text:
The railway system is broken. The previous Government did not invest and co-ordinate in the way we would have hoped, but some problems that we have seen on the line are actually the result of new investment. We understand that one huge delay was the result of a new signalling
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system being installed and the circuit breaker burning out. The company is trying to improve the signalling system, which must be fully replaced in 18 months, but the amalgamation of the two systems is causing great problems. I raise that issue because the whole line is 40 years old and must be replaced completely in the next five years. One can imagine the horror felt by MPs and constituents who live along the line at the thought of what is coming down the track towards us, or possibly not coming down the track at all. There are huge concerns.
When I met Network Rail and First Capital Connect with my hon. Friends the Members for Enfield, Southgate, and for Enfield North, we asked them what the root causes of the problems were. What really depressed the three of us was the simple fact that there did not seem to be a root cause. There was a variety of problems, one after the other. As they fixed one, they moved on to another. I do not want to bore Members too much, but on the Hertford loop line, they use class 313 carriages, which are old-fashioned London Underground and Overground carriages. As a result, the Hertford loop line is turned off of an evening. One morning, when they tried to turn the electricity on the line back on, it did not work. Perhaps someone had not paid the energy bill. No service was available on the line.
I would like to move on to some of the positives regarding First Capital Connect, because I feel that it is getting a bit of a kicking from Members, even though a lot of the problems—at least two thirds—are the responsibility of Network Rail and are due to how it integrates with First Capital Connect. During the First Capital Connect franchise, more trains have been stopping at Stevenage, so we have gained thousands more seats, many of which I have secured over my past two or three years as an MP. We have had huge improvements to bicycle racks, which have almost doubled in number. That is a big issue in Stevenage. We are the only town in the country with an integrated cycle network. Tens of thousands of us cycle everywhere in town. We have had the platforms resurfaced and we now have 12-carriage trains stopping at the town; the station is secure and we have better waiting rooms; and both the signage and the customer information system have improved.
In another transport debate earlier in this Parliament, I was very pleased to secure more than £578,000 from the Minister at the time, the hon. Member for Lewes (Norman Baker), so if the current Minister is listening, there are a number of things that I would like. That money is being used to upgrade the goods lifts to fully automated passenger lifts. The station has 4.2 million passenger movements, but it was built in the '60s—we still do not have fully automated passenger lifts, and it is 2014. Thankfully, the work on that is now ongoing. First Capital Connect is doing a good job—its mobility teams help passengers with mobility difficulties up and down the stairs—but the lifts will be a lifeline for the disabled and the most vulnerable in our community. The station is also being refurbished, and bits of it will, I hope, open in the next few months.
There has been a huge range of improvements, but one of the main concerns of my constituents remains the simple fact that we pay only for our journeys. No matter how long the journey takes, the ticket does not entitle us to a seat on the train. It just entitles us to go
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from Stevenage to London, or to Hertford, Watton-at-Stone, Cuffley or Enfield. We pay for the journey only. As my hon. Friend the Member for Enfield North said, it feels like there are very few ways in which constituents and passengers can get their points heard by the train operating companies because the franchises last for so long. The debate is opportune because the franchise is due for renewal in September this year. Like my hon. Friend, I would dearly love to see a Minister introduce to the franchise a passenger satisfaction obligation to ensure that passengers' voices are heard, so that if there are problems, they can take direct action.
I am the chairman and co-founder of the Stevenage and Knebworth rail user group, which is why I know so much about class 365 and 313 carriages. I must add that that is not through choice, but because I have had to learn about what happens in our area. Only a week or so ago, First Capital Connect put 40 newly refurbished class 365 trains on our line. The trains are cleaner and have improved. There is a balance between the passenger experience and what happens going forward.
Nick de Bois: I am pleased to hear about the investment in carriages, but I feel it is worth making the point that the 313s that we use on the Hertford loop are not being replaced. It seems like we will always have to use them. We have tired rolling stock, so although I am pleased for my hon. Friend, I hope that he spares a thought for others.
Stephen McPartland: I do spare a thought for my hon. Friend's constituents. Many of my constituents travel to Hertford and use those carriages when they get to Finsbury Park and other places. The point I was trying to make is that there has been some progress. I think that First Capital Connect is doing a relatively sound job.
Mr Charles Walker: I promise that this will be my final intervention. As my hon. Friend knows, First Capital Connect is full of civilised, approachable people. That is why I am so disappointed that it has tolerated a failing train service for too long. Its people are better than that. I hope that this debate is a call to arms to our rail company to up its game and deliver to its potential.
Stephen McPartland: I completely agree with my hon. Friend. Since just before Christmas, the service has become intolerable. Although it improves on some days, on others it does not. I would like First Capital Connect to see the meetings that we have had and this debate as a means of moving forward, getting to grips with Network Rail and delivering on some of the improvements that it has told Members it will deliver. The way to move the issue forward is to insert into the franchise a passenger satisfaction obligation. That would allow us all to hold train operating companies and Network Rail to account.
3.7 pm
Mr David Burrowes (Enfield, Southgate) (Con):
It is a pleasure to follow my hon. Friend the Member for Stevenage (Stephen McPartland). He is a champion of both his constituents and commuters, as is my hon. Friend the Member for Enfield North (Nick de Bois). Enfield Chase, Winchmore Hill, Palmers Green and Bowes Park stations are all in my constituency. This debate is of particular concern to my constituents who, like me, travel along that line. As my hon. Friend the
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Member for Enfield North said, our constituents spend thousands of pounds a year for, essentially, a poor service, although there are some exceptions.
I am not sure whether any of my constituents are present—I noticed that some members of the public arrived late—but if any of them had tried to attend this debate, they would have struggled to get here on time had they taken the trains at 11.3 am and 11.31 am. They would have been greeted by the news that there were delays of between 14 and 18 minutes at Enfield. They would have heard not only about delays, but that the train was no longer going to call at Enfield Chase, Grange Park, Winchmore Hill, Palmers Green and Bowes Park, owing to an earlier broken down train. Sadly, that is typical. There are not only delays, but complete cancellations. People's travel plans are thrown into disarray by the fact that no trains will be stopping at certain times. Commuters in particular must get to work on time. When they pay out thousands of pounds, they have a basic expectation that they will reach their destination in a reasonable time. That does not happen too often.
Sadly, my constituents have had to get used to tolerating the intolerable in many ways—to the overcrowding and overheating of carriages, as well as the delays. As my hon. Friend the Member for Enfield North carefully outlined, the past three months have been totally unacceptable. Passengers have been left literally stranded. They have had to take a bike or find some way to get a bus—when it arrives—to take them to tube stations. That is not straightforward; it is not a good, easy, efficient transfer. First Capital Connect must take much more immediate action to deal with problems when there is a good reason for things going wrong—for example, for reasons of safety.
We heard on Monday, sadly, that somebody had fallen on the line. Such things happen, and then there are delays. It is important that ameliorative action takes place, not least to give people proper transfers, so that they do not have to wait and find ways themselves—through getting a bike or by doing something else—to get a better service.
First Capital Connect, as we have heard, said in a letter that it is ultimately accountable to our constituents. Is it really? It hides behind saying that it is responsible for only about a quarter, or 24%, of delays—yes, some responsibility and accountability lies with Network Rail, particularly, and others—and it hides behind its specific contractual responsibility, saying that it is not responsible for overall performance. I say to the Minister that we must be able to do better than that when we consider the franchise agreement. It cannot simply compartmentalise its responsibilities and rely on its specific contractual delays, as it were.
Stephen McPartland: The figure of 24% that I referred to covers the whole of the Great Northern line. We are not aware of the figure for the Hertford loop line; it may be much higher than that.
Mr Burrowes: That is a very good point, and it has already been said that there are particular problems on the Hertford loop line. I agree with my hon. Friend that we need to look at properly ingraining customer satisfaction in the franchise agreement.
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First Capital Connect also relies on the national passenger survey, saying, on the question of how train companies deal with delays—again, this is across the line and not only for the Hertford loop; the figure for that may well be very different—"There is a 43% satisfaction rate; you should be pleased with that." It boasts that there has been a 10% improvement on the previous year, and that the figure is 5% greater than the average for London and the south-east. I hope the Minister realises that those rates are not acceptable. Whether or not they are the average, and whether or not there has been a 10% improvement, our constituents, who pay thousands of pounds, have to put up with what the majority of passengers say is unsatisfactory. That is not acceptable.
When the franchise agreement is agreed, our expectations must be so much higher. In the private sector and elsewhere, that satisfaction rate would not be accepted. Those sectors would have to bring about serious changes to provide a better service, and we must see that happen. The Which? survey in 2013, based on historical data, found that First Capital Connect had the worst customer ratings of all operators. There is a long way to go to ensure proper customer satisfaction and confidence.
As I and others have said, statistics for the past three months show that 83% of trains did not meet their punctuality targets. First Capital Connect's core business is to get passengers—our constituents—to their destination on time, and it is failing at that great rate. It talks about issues of accountability, but it is not truly accountable for failing to deliver that core part of its contract. We need to see how we can ensure that it does better. It is not good enough, as my hon. Friend the Member for Enfield North mentioned, to say, "We have improved the Twitter service; we have 50,000 followers." I could refer to Facebook groups; some parody the name First Capital Connect, which suggests that a whole group of people on social media have different views.
There is an infrastructure issue and a recognition that Network Rail has a lot to answer for, and indeed there is now increased investment in the line. Reference has been made to the trains and tracks being 40 years old—looking at the ages of Members present today, I think we all recognise that when one gets to 40 and beyond, there are issues—and there are problems with leaves, storms and winds, and even when new circuits get burned out. The reality is that progress has been made. There has also been progress from First Capital Connect, with additional trains coming through at peak hours, and that has all been welcome. However, now is an opportune time to ensure that First Capital Connect, or whoever takes over, does a better job.
As First Capital Connect states, decisions about future rolling stock will be made as part of the franchising process. This is a really important opportunity for us to make it crystal clear to the Minister that getting future investment soon is key to delivering a better service to our long-suffering constituents. They are long-suffering, not least because a lot of maintenance has been going on. Every Sunday, ever since I can remember, Winchmore Hill and services to Moorgate have been shut down, with a replacement bus service—a big coach trundling along our roads. People have seen that there is investment, but they are impatient to see it result in actual service improvements. They are also impatient for the franchise agreement to deliver what we are all talking about, which is true and proper accountability, meaning an improved service and improved performance.
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3.15 pm
Mr Mark Prisk (Hertford and Stortford) (Con): I congratulate my hon. Friend the Member for Enfield North (Nick de Bois) not only on securing this timely debate, but on raising issues affecting hon. Members and hon. Friends from along the whole line. Clearly, the significance of the fact that every Member on the entire Hertford loop is present will be understood by the Minister.
Ever since last September, commuters using both Hertford North and Bayford stations have endured what can only be described as a third-rate service from First Capital Connect. Admittedly, during the same period, Greater Anglia has hardly covered itself in glory, but those on the Hertford loop have suffered the most. As we have heard, for more than four months, there have not simply been occasional problems, but daily delays and frequent cancellations. When customer information has been provided, as my hon. Friend accurately described, it has been inconsistent, confusing and very often wrong, leading to our constituents not getting to work, or not getting home.
We accept that last autumn the weather was appalling. I understand, as do my constituents, that the type of problems one has in a storm can be very destructive for a rail service, but we do not understand why First Capital Connect's service was hit far worse and for far longer than the service on comparable lines; nor do we understand why, three or four months later, the problems have persisted through Christmas and into the new year, and apparently will go on for weeks to come. Many of my commuters have had to file claims for compensation—three to four a week at the moment—for the lengthy delays that they are enduring on almost every journey. Three to four claims a week is an appalling indictment of what is meant to be a service.
When things go wrong, what I discover from my constituents' complaints is that, very often, however well-intentioned and genuinely motivated and hard-working the front-line staff are—which they are—the company's contingency plans singularly fail to get people where they need to be, whether that is London for work or back home at Hertford or Bayford. As somebody put it to me, "We often feel with this service that we are simply being abandoned." That demonstrates the strength of feeling on the issue.
I have to say to the Chamber and to my hon. Friends that this autumn's problems are not unusual for the line. In 2009 and 2010, passengers from my constituency went through month after month of delays and cancellations. We were told, first of all, that it was because of the lack of drivers; that seemed to persist for several months. We then had my favourite, which was "the wrong kind of snow"—a novel explanation that the communications department would clearly have been proud of. We then had signalling failure at a certain point—it was never quite clear where that was, but it was always at some stage along the line. What it meant in reality was that for almost 12 consecutive months, we had a service that was, frankly, lamentable.
Much has rightly been made of punctuality and service. I looked at where the company lies among its competitors; that would be grounds for a reasonable judgment. The official statistics showed that in the year 2012-13—after the problems I have just described, when
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apparently things were settled—it achieved just 82.8% punctuality, when the industry average was up to 88%. One might reasonably assume that it would try to improve its game the following year and get ahead of that, but not at all. In fact, the following year it fell from that point down to 76%, which was among the worst in the entire rail sector.
What I described as a third-rate service is not new on this line. My constituents have endured it for years. One only has to look at the different passenger satisfaction surveys, rightly mentioned by my hon. Friends, to see where the root of the problem is. When one looks at surveys on punctuality, value for money, or overall satisfaction, time and again, First Capital Connect is rooted at the bottom of the list.
The point about passenger power and its inclusion in the franchise process is powerful. The Minister takes these matters seriously, and I know that he will want to talk about that today, and consider it when the franchise is let in the autumn.
First Capital Connect of course relies on Network Rail and has cited it as a regular cause of its failure. It is true that the state of the 40-year-old infrastructure on the loop is—let us be polite—below par. The condition of the tracks and other infrastructure has been the cause of many delays. There are frustrating comparisons to be made, because commuters are told that their line needs repairs, but other lines to the west, east and north have been repaired and are back in service. They wait day after day for their line to be repaired. I will try to find out in the next few weeks from Network Rail why the rail lines and other infrastructure on the Hertford loop continually fail. That is a particular issue in comparison with the main line. Does Network Rail not maintain the loop to the same standard as the main line? If not, why not? That raises an interesting safety question for the Minister.
Another area of concern for my constituents has been raised by several hon. Members. I hear many complaints not just about delays and cancellations, but about the state of the rolling stock. My hon. Friend the Member for Stevenage (Stephen McPartland) pointed out that the carriages in question go back to the 1970s. I am not as expert on carriage numbers as he is; I bow to his knowledge on that. The carriages can only be described—again, I am using the sort of polite language that seems not to appear in the social media—as not fit for purpose. They are ageing and increasingly dilapidated. They boil in the summer and are unheated in the winter.
Stephen McPartland: The carriages were built in 1976, the year of my birth, 37 years ago.
Mr Prisk: Clearly, my hon. Friend has aged better than the carriages, he said carefully, tiptoeing away. The carriages seem to be in need of replacement; I shall take things no further than that, given the age comparison that has been alluded to.
In 2011 there was some hope among the passengers on the loop in my constituency that First Capital Connect could be replaced as the franchise neared its end. However, the contract was renewed, and we were told that that was necessary to allow Thameslink investment to proceed. I want to make it clear that I agree about the need for that investment, but we on the Hertford loop do not benefit from it—either from the main line improvement
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or the new rolling stock. Those to our west and to the north will benefit, certainly, but those on the loop will not.
That underscores a theme that has emerged in the debate—a wider concern about the Hertford loop and the way in which the rail sector and policy makers regard it. All too often, it seems that the service on the Hertford loop is just an afterthought for the railway sector. Thus, when there are problems on the main line, inter-city trains are redirected along the loop and our local trains are cancelled. If there is congestion, the Hertford service is told to wait. As to rolling stock, we find that it is provided for the main line but not for us.
Commuters in my constituency feel that they have been neglected by the rail service for which they pay: by First Capital Connect, certainly by Network Rail, and by a national strategy that seems routinely to put inter-city and long-distance passengers' needs ahead of theirs. We understand the need for balance, but commuters find it difficult to accept its being continually tilted against them. That is why I want to tell the Minister that we are not satisfied with First Capital Connect's service; I could not support the extension of its franchise without radical changes, and I am doubtful that those can be achieved.
We are not happy with Network Rail's performance, either. The Minister will know, because he studies such matters closely, how bad the service delays on the loop have been. I want his assurance, if he can give it today, that he will challenge Network Rail's senior management on the issue. I intend to do so, but the Minister will know how important it is for them to hear it from him. Lastly, it is very important that he should explain that passengers on the loop should not be treated as secondary to those who travel on the main line.
In particular—this is perhaps the most tangible thing from the point of view of my constituents—a vital principle in future franchise negotiations should be the sharing of new rolling stock for the benefit of all passengers on the main line and the loop. There are different ways to do that. It would not mean that everyone would get an equal share, but all passengers should feel that they benefit from the changes in part, and are not excluded simply because they are served by only part of the franchisee's overall business. That is an important principle, which can and should be knitted into the franchise arrangements for the coming period, in the autumn and afterwards. I should like the Minister's response to it, and I hope he will support it. I look forward to his response.
3.25 pm
Lilian Greenwood (Nottingham South) (Lab): It is a pleasure to serve under your chairmanship, Dr McCrea. I congratulate the hon. Member for Enfield North (Nick de Bois) on securing this important debate. Many of the concerns that he raised—overcrowded, uncomfortable trains, frequent cancellations and inadequate customer services—will be familiar to commuters throughout the country, but there are clearly particular challenges on the Hertford loop line. I listened carefully to the examples that the hon. Gentleman and other hon. Members gave of recent disruption on the line. Passengers undoubtedly expect better, and it is clear that action by Network Rail and First Capital Connect is needed.
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Network Rail is responsible for maintaining and improving the line, but train operators also have an important role in managing disruption, providing public information and passing compensation on to passengers. Today's debate has raised concerns over how well that relationship functions. Several hon. Members have highlighted the vital importance of the way in which operators deal with delays, especially when infrastructure leads to unavoidable disruption. The disruption on the line has affected passengers acutely, because by London standards people in the borough of Enfield are unusually dependent on national rail services. The unacceptable performances of recent months have thrown the quality of those services into sharp focus, and we can all understand commuters' anger at the frequent disruption, especially against a backdrop of rising fares.
Regulated fares have risen by 20% since the election, and there have been much higher rises in some unregulated fares, but commuters on the First Capital Connect franchise have had to endure some of the worst punctuality figures in the country. Perhaps unsurprisingly, passengers report some of the lowest satisfaction rates. Between 8 December and 4 January just 74% of trains on the Great Northern routes arrived on time. The hon. Member for Enfield North highlighted periods of even lower punctuality. That is not to underestimate the challenges that Network Rail and operators face in running busy London commuter services, or the pressures on the local infrastructure and the rolling stock, some of which, as has been mentioned, is decades old; but as hon. Members have made clear today, passengers have, over the past three months in particular, had to endure an unacceptable standard of service.
Given the level of investment that is due to go into the part of the commuter network in question, it is easy to understand why the Government have opted for a management-style contract for the combined Thameslink, Southern and Great Northern franchise. However, that means that Ministers must take a greater degree of responsibility. Perhaps the Minister will outline how he expects that new approach to contracting to work in practice. How will the reclassification of Network Rail affect things? Will the reclassification make it possible to get more co-ordination between the infrastructure manager and passenger operators with a management-style contract? There are opportunities to deliver more frequent or otherwise improved timetables as part of the new franchise; that will be made possible by the infrastructure improvements.
A peculiar feature of the line is the southbound destination: most services terminate at Moorgate during the week, but there are exceptions, such as evening and very early trains, which are diverted to King's Cross.
I hope that the Minister acknowledges that there are issues that will not be resolved by the franchising process, including the rolling stock used on the line. The hon. Member for Stevenage (Stephen McPartland) mentioned the class 313s, which are among the oldest trains still in regular commercial use. If they are still in use when the new contract ends in 2021, some of those units will be 45 years old. I understand that there are particular challenges, as trains on that route have to operate with both overhead and third rail electrification systems, but even in the light of that restraint we need to know what the Department is planning for the future. What assessment has the Minister made of the long-term viability of these trains?
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It would also be good to have the Minister's comments on the record about the long-term management of the lines. The West Anglia lines, including the route to Enfield Town, mentioned earlier, are due to transfer from the Greater Anglia franchise next year. I am sure that passengers hope that London Overground will deliver the same benefits it brought to other areas that were previously managed by Silverlink, namely investment in the trains, improvements to stations and increased staff presence. That approach has resulted in much improved passenger satisfaction, delivered integration with other Transport for London services and increased revenue.
The Campaign for Better Transport has said that passenger services have
"improved significantly since the previous arrangements"
"sharply improved…from the Silverlink days."
Even the most significant customer service improvement in recent years—the introduction of Oyster cards on suburban rail routes—was driven by Transport for London, although rail operators have been the main beneficiary of the additional revenue that has been generated.
Transport for London previously expressed an interest in running the Hertford loop line, which in theory could happen when the combined Thameslink, Southern and Great Northern franchise expires in 2021. Given the success of London Overground, any such proposals deserve to be taken seriously. What discussions has the Minister had with TfL on the possibility of any future devolution of the Hertford loop line, either in whole or in part? Although that is a long-term question, which will surely be revisited, the point it underlines is that there are alternative models for operating services, which we should consider.
Mr Prisk: As the Member for Hertford and Stortford, I caution the hon. Lady slightly. I wonder whether she is aware that there is a danger that services could be improved for those within the M25, with money being spent on carriages there, not for my constituents. Does she agree that, where improvements are made and provision is offered, all the passengers along that line should benefit, not just some?
Lilian Greenwood: I agree that that danger could present itself, if there is devolution of only part of the route. It is important that we understand whether the Minister is considering devolution and, if so, how protection would be put in place in respect of such issues. I understand why the hon. Gentleman expresses concerns on behalf of his constituents.
The Hertford loop is a branch of the east coast main line. Of course, hon. Members' constituents have the option of catching a direct train to Stevenage, unless they are already there, where they can change on to InterCity East Coast services. As a key transport artery, we have to look at the east coast main line's inter-city services and how they relate to First Capital Connect's commuter provision, just as we look at improvements to the Hertford loop in the context of the wider Thameslink programme. In recent years, the quality gap between inter-city and commuter services on the east coast main
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line has widened, but instead of concentrating on bringing the local trains up to standard, the Government are committed to abolishing the successful long-distance operator.
East Coast has gone from strength to strength since the last private operator failed in 2009. Record passenger satisfaction and punctuality ratings have been achieved and all profits are reinvested in the service. However, if the Government's privatisation goes ahead, that money would be split with shareholders instead. By the time the Government expect the new franchise to start, almost £1 billion will have been returned to the Treasury in premium payments.
This year, East Coast has raised fares by an average of 1.2%, a real-terms cut, at a time when commuters across the country are having to budget for fare rises of more than double the rate of inflation. This decision was a welcome relief for passengers up and down the line, including those who change on to East Coast services from north London and Hertfordshire, but it underlined the absurdity of the Government's drive towards privatisation, which seems born out of a desire to end this successful alternative to franchising before the election. It certainly does not seem to relate to the passenger power that the hon. Member for Hertford and Stortford wants.
It is nonsense that the current successful operator has been barred from bidding for ideological reasons, but Eurostar East Coast, which is ultimately owned by the French and British Governments, has been shortlisted. The refranchising budget runs to £6 million. In the light of today's discussions, it is disgraceful that Ministers are wasting Government time and taxpayers' money on this unneeded, unwanted and wasteful privatisation, instead of getting to grips with the cost of living crisis and addressing problems on routes such as the Hertford loop.
The Parliamentary Under-Secretary of State for Transport (Mr Robert Goodwill): Is the hon. Lady considering taking other services back into the public sector when the franchises run out, should her party win the next election?
Lilian Greenwood: The Minister is aware that we are committed to maintaining East Coast as a public sector comparator, if we are in a position to do that, if he has not already privatised it. Certainly, given the amount of taxpayer and fare-payer money going into our rail system, we are right to be open-minded about considering possible rail reform, in the interests of passengers and taxpayers.
Investment in the Hertford loop line must lead to improved services in the short term and long-term strategic questions need to be dealt with, including about the trains used on the line. I urge the Minister to concentrate on securing those improvements, on this line and on other commuter lines, instead of pursuing a costly and wasteful privatisation that will not benefit passengers.
3.37 pm
The Parliamentary Under-Secretary of State for Transport (Mr Robert Goodwill):
I am grateful to my hon. Friend the Member for Enfield North (Nick de Bois) and
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congratulate him on securing this debate on an important subject, not only for his constituents in north London, but for rail passengers throughout the country.
I have to say that I feel rather guilty, because although I travel down from Yorkshire as a weekly commuter I suspect that I have had fewer problems in the past year than some commuters from north London, and further afield, experienced during just one week before Christmas. Although some of that could be down to the St Jude's storm and other inclement weather, and the need to clear tracks of fallen trees before services could resume, I appreciate that the service has, on many occasions, fallen below the standard that people would expect. I am very much in the picture, having heard a number of contributions on this subject. I will ensure that the Under-Secretary of State for Transport, my hon. Friend the Member for Wimbledon (Stephen Hammond), who deals with rail franchise policy, is also in the picture, and that Network Rail and First Capital Connect are aware of what has been said during this debate.
It is clear that if we are to continue the strong growth in rail travel over recent years, passengers must be confident that the service that they receive is reliable, quick and comfortable. That is why this Government have invested billions of pounds in railway infrastructure improvements during this Parliament and have set out their plans to continue doing so in the years to come.
My hon. Friend mentioned specifically the services provided by First Capital Connect in his constituency. As one would expect, the Department monitors rail performance closely. I should like to spend a moment providing a little more detail on some of the recent performance trends. I will also explain some of the issues involved, but I stress that it is not my job to make excuses on behalf of the operator; my job is to understand why things go wrong and what can be done to alleviate problems.
The key headline indicator for rail performance is the public performance measure, which measures the percentage of services that arrive on time. Data from the start of the financial year up to 4 January, the most recent period for which data are available, show a total PPM score for the Great Northern route, of which the Hertford loop is a part, of 85.16%. That is 6.07 percentage points short of the target agreed by the operator and Network Rail. My hon. Friend has already alluded to the inconvenience that that has caused to his constituents and to other passengers on the line. Only about a fifth of the total delay minutes over the year to date are attributable to a fault of the train operator. Some three quarters of all such delays were the responsibility of Network Rail, with the remainder being attributable to the knock-on effect of actions by other operators on the network.
My officials regularly discuss performance with First Capital Connect, and I am reassured that a number of key measures are in hand to ensure that the situation improves over the coming months. The two main causes of delays within the operator's control are issues with drivers and issues with the train fleet. On the former, regular passengers will be aware that there have been some isolated cancellations due to train crew. Passengers will naturally be frustrated by those cancellations, which have occurred for a number of reasons. Passengers should, however, also note that First Capital Connect has been steadily recruiting and training new drivers
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across a number of key routes. The latest cohort of drivers will be out on the network, ready to drive trains, from this month. That rolling programme of recruitment and training will continue for the remainder of the franchise and beyond.
The level of delays on the First Capital Connect network due to fleet-related problems has also been increasing, despite expected improvements over the course of this year. We have challenged First Capital Connect on that matter, too, and we are aware that First Capital Connect has considered ways to improve its response to incidents, thereby reducing the level of delays that result from problems with the train fleet.
I have mentioned that the majority of delays on the Great Northern route over the year to date have been attributed to Network Rail. Such delays, however, include significant and, to a large extent, unavoidable delays due to the severe weather over recent months. The St Jude's day storm, for example, caused widespread disruption, as did severe weather just before Christmas and since. In such severe weather it is inevitable that some disruption will occur. On a number of occasions, Network Rail has been forced to order the suspension of rail services until full route inspections have taken place, which has caused major disruptions.
Nick de Bois: The Minister is right to point to the weather, which played a significant part, but I remind him that the incidents raised today are also related to infrastructure. There have been signal failures and power failures with Network Rail, as well as operating issues with First Capital Connect.
Mr Goodwill: I am well aware of those issues, and the weather was only one part of it. Coupled with the other problems to which my hon. Friend alludes, weather was probably in some cases the straw that broke the camel's back and caused annoyance and anger among passengers. When we have such weather situations, safety must remain the highest priority, and it is in no small part due to Network Rail's performance on safety that the UK now has one of the safest, if not the safest, railways in Europe.
Mr Burrowes: Will the Minister respond to the point made so well by my hon. Friend the Member for Hertford and Stortford (Mr Prisk)? Why did our line seem to perform so much worse as a result of the storms? Yes, storms happened across the line, but the Hertford loop seemed to come off worst.
Mr Goodwill: I was involved in conference calls following the St Jude's day storm, and the main issue was fallen trees. A decision was taken that, before services could commence, proving trains would be put through the routes so that large numbers of commuters were not stranded, possibly with trains backed up on the line behind a number of fallen trees. Where the embankments or the margins of a rail line are wooded, there are likely to be more fallen trees on the line. That was a particular problem north of London and in the south-east during the St Jude's day storm. From a safety perspective, the right decision was taken. I gave evidence to the Select Committee on Transport stating that, before trains carrying commuters could use a line, proving trains ran to ensure that the lines were clear so that the trains could reach their destination.
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Mr Burrowes: On the Hertford loop, the safety issue was not so much fallen trees as compacted leaves. The equipment necessary to unpack those leaves took a long time to get down the lines. The delays getting to us to ensure the safety of the line was a particular operational issue, and I understand that that problem has been repeated over the years. As we see continued poor weather coming down the line, as it were, we need to ensure that the problem is not repeated.
Mr Goodwill: I am aware that "leaves on the line" has become a standing joke, but it is no joke for those affected. I will ensure that Network Rail considers its strategy for ensuring that such situations can be addressed.
Mr Prisk: I realise that the Minister cannot chase every element of every line, but there is a clear differential in the standard to which the loop is administered by Network Rail. It would be helpful if he could confirm that he will take that point away, challenge Network Rail's management and come back to us in writing in due course on the standard to which the Hertford loop is kept. Is that standard directly comparable to the main line? If so, why have we found our delays to be longer? There is a clear difference either in the way Network Rail responds to the loop or in the standard of the loop in the first place.
Mr Goodwill: Network Rail's performance on the route has not been a glorious success. In fact, it has been among the worst in the country, and it is vital that Network Rail's performance improves. It has been highlighted, for example, that vegetation management has been an issue on the Great Northern route. Although "leaves on the line" has become the stuff of satire, the fact is that autumn brings significant challenges for train operators, particularly in respect of the adhesion between train and track, which in some cases results in increased journey times and knock-on delays for passengers.
Stephen McPartland: Perhaps we could move forward with the franchises. Will the Minister consider publishing delays and timetables separately for the Great Northern route so that we can see how the delays on the Hertford loop compare with delays on the main line? There is a suspicion among hon. Members that the main line gets cleared first.
Mr Goodwill: I will see whether that information is available. If my hon. Friend tables a written question, he will probably get an answer more quickly than if he writes me a letter. Written questions seem to be an effective way to get officials to work as quickly as they can.
We have already told First Capital Connect that it must continue to challenge Network Rail to improve its performance on the line, and we are seeing some positive signs, including better plans for clearing trackside vegetation and for reducing minor defects in overhead line equipment. Network Rail has also started a programme of measures to reduce fatalities at stations. I welcome the programme, and I am aware that Network Rail has looked in some depth at how those tragic incidents can be reduced. Not only are fatalities still a significant cause of delays on the network, but of course each and every incident is a tragedy for the families of those involved.
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First Capital Connect's franchise agreement, as with all franchise agreements, contains benchmark measures. It should be stressed that although passengers have seen some significant delays, particularly in the recent extreme weather, the operator's overall performance is well within its contractual requirements, which are measured as moving annual averages. We will continue to monitor the situation closely, and we will be quick to act in the event of any breach of the operator's contract.
Lilian Greenwood: What discussions has the Minister had with First Capital Connect on how it deals with delays? The hon. Member for Broxbourne (Mr Walker) said that delays are often unavoidable, such as in periods of inclement weather, but it is how the operator deals with those delays and informs passengers of the cause and of how long the delay will last that causes the most inconvenience and upset.
Mr Goodwill: The hon. Lady is right. One of the problems, as mentioned by my hon. Friend the Member for Stevenage (Stephen McPartland), is with the information provided to passengers. We have discussed inaccurate information on the live update boards with First Capital Connect, and my hon. Friends the Members for Broxbourne (Mr Walker) and for Enfield North, who also mentioned the problem, may be interested to know that First Capital Connect is already considering the implementation of a live countdown system at a number of stations. Although I cannot promise that the system will be installed at every station for the time being, it is definitely a step in the right direction.
This month Passenger Focus, the statutory representative body for rail passengers, published the autumn results of its national passenger survey, which contained some positive signals for First Capital Connect passengers, so it is not all bad news. For example, First Capital Connect showed an annual 10% increase in satisfaction with the way it deals with delays and a 5% increase in satisfaction with the helpfulness of staff. Good results were also seen in improvements to the train and station environment; passengers report that trains and stations are cleaner and better maintained.
Nick de Bois: The heart of the problem is that, notwithstanding the fact that the operator improved by 10% from a very low, appalling 33% to 43%, if the data are not available and there is no scope within the contract to drill down to key lines and commuter routes, the chances are that a franchise operator will always hit his target, but there will always be a poor relation, and in this case that is our constituents.
Mr Goodwill: I am not saying that everything in the garden is beautiful. I am saying that there are a few more blooms around this year than in the past. The pressure is now on First Capital Connect to improve performance on punctuality and reliability, in which the survey showed an annual decline.
As my hon. Friend will know, we are planning to re-let the franchise in September, and the Department is currently assessing bids from several operators and looking at their plans for the future. I am sure he will understand that I cannot say more about the details of those bids at the moment, but I assure him that the new franchise will contain a regime of financial penalties and rewards to improve passenger satisfaction.
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The extent to which bidders meet or exceed the Department's requirement to improve the quality of services and to increase customer satisfaction will form an important part of the evaluation of bids, as my hon. Friend suggested. The winning bidder will be required to publish a regular customer report, setting out how it is engaging with passengers and taking account of their views, and how it is meeting its commitments and targets. It will also have to monitor and publish its performance against a new passenger experience metric, which combines a national passenger survey of satisfaction run by Passenger Focus, an independent body, and an objective assessment of service quality. We will, of course, make further announcements in due course.
If my hon. Friend is interested, extensive information on the new TSGN franchise is available publicly on the gov.uk website and includes the draft franchise agreement and the invitation to tender. Between them, those two documents set out the Department's detailed expectations of all bidders hoping to be the next operator of train services in my hon. Friend's constituency. In particular, they provide a full explanation of how the operator will be challenged to improve services throughout the entire spectrum of passenger experience, and detail how it will be rewarded if it exceeds passenger expectations, or held to account if it falls short. They also explain how the operator will be measured against the targets, including by reference to the national passenger survey independently undertaken by Passenger Focus.
On compensation for passengers, Network Rail pays compensation under schedule 8 of its track access agreement to train operating companies for unscheduled delays. A proportion of that will find its way to passengers via delay repayment refunds, but I accept that it is sometimes a hassle to fill in the paperwork and get the refund.
I was pleased to hear my hon. Friend the Member for Enfield North praising some of First Capital Connect's front-line staff. I hope that passengers will take advantage of its facility to nominate staff who go an extra mile for passengers.
Lilian Greenwood: I want to take the Minister back to the new franchise, which is a management-style contract. How will he ensure, or what action has he taken to ensure, that there is better integration between Network Rail and the successful operator under the new contract? I am thinking of experience elsewhere, such as the alliance with South West Trains.
Mr Goodwill: There is often criticism of such franchises and questions are asked about what incentive there is for the operators to provide a decent quality of service as they do not keep the revenue. We are very mindful of that.
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The winning bidder's performance in key areas will be subject to a performance regime with financial incentives and penalties used to drive the quality of service, protect passengers' interests and, therefore, increase revenue. The winning bidder will focus on reducing delays, cancellations and short trains and improving customers' experience of the railways in the franchise area, not just on minimising costs.
Nick de Bois: The Minister is being generous in giving way and I am conscious of time. Will he tell us now or write to us later to say whether Network Rail pays compensation to operators if it has let them down, and should there be scope to pass that on to passengers?
Mr Goodwill: I will write to my hon. Friend about that. When a train breaks down, for example, it may cause delays for other services. It is not always Network Rail's fault when such a problem happens.
Questions were asked about rolling stock, some of which is 37 years old. Decisions on the rolling stock in the new TSGN franchise are for the bidders, and we do not intend to mandate them. However, the strict service standards that operators will be held to should help to drive up services for passengers. We will be interested to see the bids that come forward.
Mr Prisk: Will that mean that all passengers should benefit? Is that the expectation of Ministers, even if it will not be the same degree of benefit? And will it mean that no classification—for example, those on the Hertford loop—will be excluded from enjoying new carriages when that is happening on the main line? That is an important principle that Ministers can establish.
Mr Goodwill: The decisions on rolling stock are a matter for the bidders, but I am sure that when the Government look at the bids, the points that have been made in this debate will be at the forefront of their mind when considering the quality of service and ensuring best value for taxpayers.
In conclusion, we are aware of the issues that my hon. Friend the Member for Enfield North has raised, and I assure him that we will maintain pressure on the operator and Network Rail to improve their performance on this important commuter route. There are signs of improvement, notwithstanding the recent severe weather problems, and we will watch the situation closely to ensure that those improvements are built on in the existing franchise and the next. I am grateful to my hon. Friend for bringing this matter to the attention of the House.
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Kings Science Academy (Bradford)
3.56 pm
Mr David Ward (Bradford East) (LD): It is good to be here before you, Dr McCrea, and the Minister. I initiated this debate and I was lucky to secure it, so it is only fair that I should be able to say what its focus is. It is important to say that because it is not about free schools and academies in general. We have had such debates, so it is not for or against such schools, but about one particular school: Kings science academy. I am not interested in what has been done in the last year or so to improve things at the school or the achievement of pupils, the quality of teaching, the behaviour of pupils, or the leadership and management. I am passionately interested in all those things because I care about Bradford, but that is not what this debate is about.
I am interested in what seems to be the collusion between the so-called benefactor, Alan Lewis, the currently suspended principal, and the Department for Education. I am interested in the DFE's role in allowing a rich Tory vice-chair to become even richer to the tune of millions of pounds of public money, and how it allowed an inexperienced young man to become principal of the school and to remain in control long after the DFE knew he had admitted that fraud had occurred in his school. How could that be?
I would like the Minister to prove me wrong in what I believe has occurred and the preferential, favourable treatment received by Mr Lewis by ending the speculation and making public the options, analysis and appraisals of nine alternative sites. If they were available, we could see whether there was a rigorous process in place.
I also want to see the evidence that the near £300,000 per year rent is not far in excess of what Mr Lewis could reasonably have expected to get from the partially tenanted and largely derelict site—I have given the Minister three photographs from before it was developed, and I can give more. What evidence is there that Mr Lewis has not made excessive profits from the school that now stands on that site? The Minister has the pictures before him. I believe that the school was only ever going to be built on that particular site—neither the principal nor, certainly, Alan Lewis would have been interested had it been anywhere else. Prove me wrong, please, but the DFE failed in its duty to ensure that a fair and robust options appraisal took place, and I have evidence to suggest that it did not take place.
As for the personal involvement of Mr Lewis in the running of the school, there is this big debate about "was he or wasn't he" chair of the governors. How on earth can the DFE have mistakenly believed that a vice-chair of the Conservative party was chairman of governors at a free school for 12 months? How can the Department have been confused about that? I had a letter from Mr Lewis as recently as December 2013, signed by himself, in which he states:
"I was never chair of the governing body of the academy."
Yet I have a copy of an e-mail to the Department, which has been amended by Mr Lewis to show him as chair of the governing body and not simply as someone involved in some way in the school.
I also have evidence that Mr Lewis was involved in the financial management of the school. In the same letter from him, however, he states that
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"at no time have I ever had responsibility for the financial management of the academy."
Yet I have a letter from the DFE in which the financial arrangements of the school have Mr Lewis not only as one of many involved, but as the person who should receive financial reports. He was the key individual who was receiving the reports, even though, to repeat his own words:
"at no time have I ever had responsibility for the financial management of the academy."
The e-mail clearly shows, set out as an action point, that the monthly financial reports were to be given directly to him.
The truth is that Mr Lewis was personally and heavily involved in the school, right from the very beginning, but he now wants to distance himself from any involvement during a period in which he knows that fraud took place. Moreover, at the same time, negotiations were taking place about the rent for the property that he owned.
A second point, on the principal, involves the internal audit investigation team report endorsing the findings of the earlier Education Funding Agency report and of the report by the accountants, Crowe Clark Whitehill, in August 2012. Will the Minister please tell me whether the CCW report was seen by the DFE? I have to tell him that I think it was, but I want some evidence that it was and for when it was seen. The IAIT report states that the principal admitted that fabrication of invoices had taken place, so even if the DFE did not see the CCW report in August of 2012, at the very least it must have known about it from the audit team at the beginning of 2013. The DFE knew about the fraud, which had been admitted by the principal, but it took no action whatever to remove him from the school.
Kevin Brennan (Cardiff West) (Lab): The Secretary of State said to me during a recent exchange in the main Chamber that
"Mr Lewis is receiving for the property an appropriately guaranteed market rent—less than he was receiving for it beforehand."—[Official Report, 6 January 2014; Vol. 573, c. 16.]
One of the architects involved in preparing the free school bid has said to me that he finds that statement is a
"very difficult to believe" Statement.
Does the hon. Gentleman agree?
Mr Ward: We need clear evidence, because we are now receiving at best evasive responses to the questions that many of us have been asking. At worst, hiding behind the ongoing police inquiry, we have received no response whatever. To be honest, the evasiveness of some of the responses has been disrespectful to Members of this House. We need answers—all the speculation can then disappear.
We know how serious things were in the school, and that the audit reports identify not only the fraud, but all the nepotism and other financial irregularities that were taking place. I repeat that all of that was known by the DFE, but no action was taken at all. We are not talking about a young and inexperienced man, but about a dishonest and disreputable character, and yet, with all that information, the DFE was content to let the principal remain in place.
I hope that the Minister can prove me wrong, because I have a number of serious allegations about the DFE itself. If I am right, the independence of the civil service
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must be in doubt. Will the Minister please put to bed some of the suspicion about the DFE by helping us? The Department has failed in its public duty to expose what it knew to be malpractice and criminal activity—it held information back and covered up the situation. We cannot have the freedom extended to free schools including freedom from public accountability.
On the reporting of an admitted crime to the police, I am still not satisfied. We have asked oodles of questions, but I am still not satisfied that the DFE acted as it should have. There will always be suspicion of a cover-up until the Minister carries out a full investigation into what happened.
The first phase of the launch of the Kings school was praised by the Prime Minister and described in the press as closest to David Cameron's vision of what a free school should be. We know the background, but when the whole scandal broke, the DFE said that it was for the school itself to decide whether the issue was a disciplinary one. How on earth can an organisation highlighted in an audit report as responsible be the organisation responsible for looking at itself and dealing with its own disciplinary issues? It beggars belief. A Government audit uncovers misconduct so serious that it needs to be passed to the police for criminal investigation, and yet the DFE feels that it is for the school itself to decide whether the issue is a disciplinary one.
When at last the Department decided that matters could not be contained within the school, it finally referred it to Action Fraud. We are asked to believe that Action Fraud botched up the recording of the fraud on 25 April. Even if we believed that to be true, we know that the DFE then did nothing about ensuring that a crime was investigated until 5 September, when it sent an exploratory e-mail to ask what was going on.
On 5 September, the DFE knew that its April report had been erroneously recorded as an information report. It was told by Action Fraud:
"If more information related to your report becomes available your report will be re-assessed to determine its viability for investigation."
The Department knew that on 5 September, but did nothing. Why was the audit report not sent directly to the police at that time?
Mr Gerry Sutcliffe (Bradford South) (Lab): I am grateful to the hon. Gentleman for the work he has been doing on this case, which has affected the credibility of some of the free schools in Bradford—notwithstanding the fact that there are some good ones. We had to get the information about when the police were informed from the police themselves, not from the DFE. We were asking questions, either written questions or questions on the Floor of the House, to try to get answers, yet answers we got none—except when we contacted the police.
Mr Ward: When we asked the police in e-mails what they had received, they said that they had received nothing. Despite what the DFE said, they did not receive the reports.
As for the questions we have been asking, there are simply too many discrepancies between the answers to parliamentary questions and the other evidence available to us. The Department made its original report on 25 April 2013: that is when the matter was reported—so
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we are told—to Action Fraud. Let us not forget that that is eight months after the CCW report. If the DFE had seen that report at that point, why was it not made public?
George Galloway (Bradford West) (Respect): I congratulate the hon. Gentleman on securing this debate, but I congratulate him more on the excellent forensic speech that he is making. The more he speaks, the more I am bound to ask whether he agrees that it is already obvious that the nub of this question is that Alan Lewis is a very senior member of the Conservative party, and so for party political reasons the Secretary of State for Education simply could not come clean on this matter with the people of Bradford and with the Members of this House.
Mr Ward: That is an excellent point. We have to ask why. There must have been a justification for the cover-up. It can be one of only two things. It is either because free schools are such a flagship policy for the Conservative party that it could not afford the embarrassment or because of Alan Lewis's involvement and his association with the Tory party. If there are any other reasons, I cannot think of them.
I will make the point again about deception—I cannot use any other word, really. As I said, the Department's original report was made on 25 April 2013, a long time after it knew about the matter. We are told that Action Fraud inadvertently logged the report as an information-only report, and subsequently apologised for that error. But how did that occur? If, as the Department claimed, information on fabricated invoices was submitted to the National Fraud Investigation Bureau, how could that be? Unless there was just a passing reference in a short telephone call, it is hard to believe that the correct message could not have got through. How could it have been logged as an information-only report if the audit report had been made available? In that case, the reaction could have been nothing other than a decision that the matter required a criminal investigation and needed to be dealt with quickly.
The Minister must be interested to learn the answer to those questions himself. In answer to a parliamentary question, the Department said:
"Action Fraud notified the Department on 1 November".—[Official Report, 6 January 2014; Vol. 573, c. 98W.]
Action Fraud notified the Department of its mistake in classifying the report on 1 November, but—as we know thanks to a freedom of information request by John Roberts—on 5 September the Department had received a communication from Action Fraud saying:
"Thank you for your email to Action Fraud concerning your Information Report."
That was received seven weeks before the Department says it was notified that the report had been wrongly classified as an information-only report. In those seven weeks, it did nothing.
In a parliamentary answer, the Department said that it had contacted Action Fraud on 5 September and
"in response Action Fraud stated that the National Fraud Intelligence Bureau had assessed the case but determined that there was not enough information to progress the case further."—[Official Report, 6 November 2013; Vol. 570, c. 229W.]
End of story, it seems—the police had looked at the matter and there was nothing to do. But the truth is that
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the e-mail from Action Fraud to the Department on 5 September told the DFE not only that the report had been wrongly classified as an information-only report, but that more information would lead to the report being
"re-assessed to determine its viability for investigation."
Even if we believe that it was through some error back in April that the report was inadvertently misclassified, on 5 September the Department was told not only that it was a report that could lead to an investigation—something it claimed subsequently to have been told on 1 November—but that if it gave additional information the matter could be turned into a crime investigation.
Of the three parties to this situation I have mentioned, who do I blame most? Is it a businessman who wants to make a lot of money and sees a quick opportunity provided by a political party with which he is closely associated? Is it a young man who is, I think, idealistic but is also egotistical, and is led on by politicians and senior civil servants to believe that for him the normal rules of integrity, honesty and propriety simply do not have to apply? Or is it the Department for Education, which became a Government agent of change and forgot that the basic rules of public accountability and scrutiny in the spending of millions of pounds of public money must always take precedence over the desire to support its political masters?
The real surprise is not that, eventually and thankfully, we have been made aware of what has happened via the whistleblowers, but that there were not more whistleblowers earlier—people within the Department, who were looking at what was going on and saying, "This is just not right." That is the real problem. I have been to the Department recently and seen the whole floor that has been taken over by the academies and free school organisation within the DFE. The massive shift that has taken place has also, I believe, brought about a cultural change in the Department. The policy has become such an important driver and part of the Government's strategy that anything goes.
The big unanswered question is, if the Department could behave in this way once, with this particular school, how many other academies and free schools has it supported in a similar manner? Unfortunately, unless we get some answers we will have to wait until another whistleblower comes forward to find out.
4.17 pm
The Minister for Schools (Mr David Laws): It is a pleasure to serve under your chairmanship, Dr McCrea.
I thank my hon. Friend the Member for Bradford East (Mr Ward) for securing this debate and for his persistence in ensuring that this important issue is debated properly in the House and scrutinised properly. I say that not just out of the courtesy that is normal on these occasions; it is quite right that he should ask questions about a serious issue that deserves to be looked at seriously.
I will take my hon. Friend's hint and will not, as sometimes happens on these occasions, fill the first 75% of my speech with general comments. I will come very quickly to a lot of the matters he raised and will try to address them as far as I can. But since he mentioned
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some issues about the accountability of free schools, I will briefly say a couple of things on that matter, before going through each of the points that he made.
Most free schools are popular with parents and are delivering strong discipline and teaching across the country. As they are brand-new schools there is, quite rightly, greater contact and oversight with open free schools than with other academies—until their first successful Ofsted inspection, at least. After that, they are subject to the same monitoring arrangements as other academies.
Mr Ward: The Minister has already started to give answers in the way I expected. I am talking about Kings—I am not interested in any other free school or any other academy. I want to know about what happened in that school and what will be done about it.
Mr Laws: I am trying to address that. I am going to speak briefly, and then I will come straight to my hon. Friend's points. He mentioned free school accountability in his speech, and it is right to say something on that, briefly and without taking up precious time. I promise him that I will address the issues that he raised.
The approach I was outlining means that in term 1, visits are arranged by the education adviser and the Education Funding Agency. In year 2, the first Ofsted section 5 report becomes available. All free schools provide budget forecasts, financial management and governance self-assessments and externally audited financial statements.
I will now turn, in the time that we have, to the matters raised by my hon. Friend that are specific to the case of the Kings science academy. He said he feared that I would hide behind—I think those were his words—the fact that there is a criminal investigation. There are some things that I cannot touch on in this speech because they are subject to a criminal investigation, and we all understand the constraints that that imposes on us all. Subject to that, however, I will try to be as open as I can.
The Kings science academy opened in September 2011. The Education Funding Agency had already planned a full financial management and governance review at the academy which would look at aspects such as financial and other internal controls, when it received allegations about practices at the school in October 2012, some of which related to possible financial irregularity. Those allegations were included in the EFA's financial management and governance review, as my hon. Friend is aware. The EFA carried out its financial management and governance review in December 2012. It looked in detail at all aspects of governance, including the chair's position, financial controls and conflicts of interest. Following the usual procedures, the EFA sent the draft report, showing the inadequacy of the financial management and controls, to the academy in January 2013 so that the academy could correct any inaccuracies. Thereafter, the EFA sent the final report in February 2013, which confirmed the assessment of "inadequate" and requested the academy's response to the findings and recommendations in the report.
The findings of the EFA's review led to a further investigation, as my hon. Friend knows, by the Department's internal audit investigations team. The Department's investigators began their on-site work at Kings science
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academy on 24 January 2013. The investigation team sent its report to Kings science academy at the beginning of April to allow for the correction of any inadequacies. John Bowers became the new acting chair of the academy in March 2013, and he tightened control by, among other things, assuming the important role of accounting officer for the academy in April of that year. The EFA also received the academy's improvement plans at the beginning of April in response to the findings of the financial management and evaluation report. Both the EFA and the Department's investigation team continued contact with Mr Bowers to monitor progress in responding to both reports. We remain grateful to the new chair for the real efforts that he has made to address some of the issues that are now public.
In line with our zero tolerance of fraud in all schools—free schools, academies and maintained schools—we reported the evidence of possible fraud to Action Fraud at the earliest opportunity on 25 April 2013. I will return to cover that aspect of the case, which my hon. Friend has mentioned, in more detail in a second. Because both the financial management and governance review and the investigation found serious failings in financial management, the Secretary of State issued a warning notice in May 2013 requiring the full recovery of relevant funds and confirmation that Kings science academy would respond to the findings in both reports.
In June 2013, the EFA confirmed that Kings science academy's new finance policy provided a firm basis for establishing proper internal controls at the school, and we wrote to the academy in July 2013 recognising the progress it had made and confirming that the report of the internal audit investigation team would be published. That is in line with our policy to publish investigation reports, which is clearly set out in the "Academies Financial Handbook". We had planned to wait before publishing the investigation report until the disciplinary processes had been completed, but we decided that it was right to publish when the investigation report was leaked in the media.
Mr Ward: I understand all that. A report had been produced by the audit team in January, which was finally published a little after that, so a report was available in which the principal of the school admitted that fraud had taken place. Does the Minister think it was right that the principal was allowed to continue to go in to work each day?
Mr Laws: I will come directly to that point in a moment. The EFA's financial management and governance report and the Secretary of State's warning notice have also now been published. We insisted that Kings science academy address identified failings urgently. While its internal evidence gathering continued, we confirmed the repayment sum at £76,933. We also sought confirmation that the disciplinary process was being taken forward. It is right that the relevant funding is being recovered from the academy in full, as it always will be if an academy or free school is unable to demonstrate that funding has been used for its intended purpose.
We believe that the Kings science academy, under the leadership of Mr Bowers, is making steady progress to address the weaknesses found in financial management and governance. That increased confidence is not just a result of the monitoring visits carried out by the EFA.
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We have evidence from KSA's externally audited accounts for 2012-13, which were received on time, unqualified, and report the auditor's comments on improvements in financial control and governance.
Let me turn now to the reporting of evidence to the police. The administrative error made by Action Fraud, which wrongly categorised the Department's evidence in April as an information report rather than a crime, is deeply regrettable, as my hon. Friend made clear. Significantly, Action Fraud has apologised for the error. We do not believe that there is any fault with the way in which the report was made by the Department.
Kevin Brennan: Will the Minister briefly give way on that point?
Mr Laws: I will not give way, because I have so much to cover. I hope the hon. Gentleman will excuse me.
Before April 2013, any evidence of fraud found by the Department would have been reported to the relevant police authority. Action Fraud was established from April 2013 and since then has been the correct organisation with which to engage. The KSA situation was the first occasion on which the Department had needed to contact Action Fraud, so it made a further check with West Yorkshire police on the same day—25 April—to confirm that the report had been made in the right way. I put it to my hon. Friend the Member for Bradford East that if there had been an attempt at a cover-up, it is unlikely that that check would have taken place.
In September, we made a further check with Action Fraud, which told us that the National Fraud Intelligence Bureau had assessed the case and decided not to take it forward. At the time, it seemed clear to us that the information regarding an alleged fraud had been correctly provided; it had been assessed and the case was not going to be progressed further. We know now that the case should have been passed by Action Fraud to West Yorkshire police for investigation, but the decision to investigate lies with the police, not the Department for Education.
I am sure my hon. Friend shares my wish to ensure that such a problem does not happen again. The Department's internal audit and investigation team has now met Action Fraud and the National Fraud Intelligence Bureau to review and refine the processes for reporting fraud in future. We have tightened the procedures through which any future reports will be made. We will use Action Fraud's online system. We will retain our own copy of the report we make and follow up within five working days if we have had no response from Action Fraud or contact the police.
As my hon. Friend knows, the police made an arrest in connection with the case on 9 January this year. Kings science academy wrote to parents on 10 January to confirm that the arrested man was Mr Raza, the principal, and that he would not be returning to the school, at least until the investigation was completed and finalised. Beyond that, it is not appropriate to comment. The parameters of the investigation are, quite rightly, for West Yorkshire police to determine. Until such time as the investigations are concluded and a determination regarding the case is reached, it would not be appropriate to release further information on that matter.
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I shall now turn to the matter of Alan Lewis's role at Kings science academy. On 27 September 2011, the academy told the Department that Mr Lewis would be chair of governors from 1 October 2011. The Department was informed on 24 October 2012 that Mr Lewis was not the chair and that Dr Asim Suleman would be chair of governors from 25 October 2012. We learned in December 2012 that there had been no chair of governors in place between October 2011 and October 2012. That was clearly a completely unsatisfactory position and totally unacceptable. Not to have a properly constituted governing body is a demonstrable failure to comply with the funding agreement. It is one of the issues identified in the EFA's review, and one that the academy quickly addressed.
Alan Lewis's other connection is that his company, Hartley Investment Trust Ltd, leases the site to the school, as my hon. Friend indicated. The site was secured for Kings science academy at £295,960 per annum, after an independent valuation. Due to the related party involvement, Treasury approval was sought and provided before final decisions were taken. If any hon. Members have any points to make about the police investigation, they should make them as soon as possible to the police.
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Tyne River (Pollution)
4.30 pm
Mr Nicholas Brown (Newcastle upon Tyne East) (Lab): It is a pleasure to serve under your chairmanship, Dr McCrea. This debate is important to my constituency and to the constituencies that neighbour mine on the River Tyne. The issues that I intend to raise have far-reaching consequences for public policy, as I hope to demonstrate. Essentially, I want to raise two questions: should we continue with the long-running efforts of central and local government to clean up the River Tyne, and should the burden of paying for that be shared between central and local government? Ideally, of course, the polluter should be made to pay. However, if that is not a practical way forward, that does not relieve those of us in public life of the obligation to find a solution to the problems.
Until recently, these were not particularly controversial questions. The statutory responsibility lies with local authorities. Government recognised the exceptional nature of these issues, the financial consequences and the broader public interest in remediation, and therefore made a financial contribution towards the costs. Newcastle city council, under both Labour and Liberal Democrat administrations, deserves credit for the way the local authority has proactively worked to remediate contaminated sites within the city boundaries. Alongside that, it has developed an imaginative and very successful public-private partnership to bring new employers to the north banks of the Tyne.
So successful has the local authority been, working in partnership with the Department for Environment, Food and Rural Affairs and its predecessor Departments, that there is only one significant cause for concern remaining in the city. To have got to this position is no mean achievement. The remedial work already completed includes two significant antimony sites.
The outstanding problem is the old Thomas Ness tar works site—the subject of today's debate. The Thomas Ness tar works was a going concern from 1920 to 1981. Its function, as the name suggests, was to produce coal tar. As a young official of the General and Municipal Workers Union, I played a small part, back in 1981, in negotiating the redundancy terms for the work force when it closed. Following closure, the factory was demolished and some remedial work was carried out to the site. However, it was still contaminated, and it quickly became clear that the contaminants were leaching into the river. Underneath the site, the sand and gravel are also heavily contaminated with tars and oils. To this day, the site causes significant water pollution in the adjacent River Tyne, as well as posing a risk to human health, with reports of serious headaches being suffered by members of the public who use the nearby foreshore in the Walker country park after only 10 minutes in the area.
In 1984, the then Tyne and Wear county council sponsored an intervention aimed at dealing with part of the problem, but the Tyne and Wear scheme could not have dealt with the underlying problem of coal tar seeping underground on the site and then dispersing. It was designed to catch the tar nearer the surface and divert it through a trench into a containment tank. That was only partly effective and in any event could not have stopped the seepage into the river.
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Newcastle city council made a more thorough attempt at remediation in the late 1990s. Essentially, the city council's scheme was a pumped treatment scheme involving pumps in wells along the site's frontage facing the river. I should say at this point, for those who are not familiar with the area, that the site is on the riverbank, and therefore natural seepage from it would be downhill towards the river. The tar clogged up the pumps, wrecking the scheme.
Government Departments worked closely with Tyne and Wear county council and the city council in a constructive way to try to solve the problem. That is all I am asking for today. In a notice from the Department for Environment, Food and Rural Affairs dated December 2013, the Under-Secretary, Lord De Mauley, wrote to all local authorities in England. His opening sentence was:
"I am writing to update you on the future of DEFRA funding of the Contaminated Land Capital Grants Scheme".
The letter is not really an update, however; it is a retreat from financial responsibility for these matters.
DEFRA had issued revised guidance to local authorities in April 2012 obliging them to focus their attention on the highest-risk sites, while allowing them to dismiss lower-risk ones. Let nobody be in any doubt: the site under discussion is a high-risk site. The key issue, of course, is the Government's financial contribution to solving the problem. The DEFRA contaminated land grants budget has gone from £17.5 million in 2009-10 to £2 million in 2013-14. An increase of £500,000 is budgeted for each year after that until 2017, when the budget head will be abolished.
Depressingly, the Minister will probably say that the council should pay for the whole thing using money provided by the Government through the revenue support grant, but the revenue support grant for north-east local authorities is not adequate to meet their day-to-day statutory functions, let alone carry extra ones without any remedial action-specific grant-aid from central Government. That, of course, would lead us into a much wider debate. I hope that the Minister will engage constructively with the issue, rather than trying to hand the whole thing over, unfunded, to the local authority.
Newcastle city council has a proposed way forward for containing the contamination on site. It has presented the scheme to the Environment Agency, which assessed and approved the proposed scheme. The Environment Agency's reply to the council is blunt and honest, and the Environment Agency deserves credit for setting out the situation in clear terms. It states:
"We currently have insufficient funds within the Capital Works Programme to be able to support this project as well as other projects with higher priority scores".
You cannot get clearer than that, Dr McCrea.
The question for all of us involved in public life is whether we leave things as they are or try to find a constructive way forward that would at least contain the problem. Let there be no misunderstanding: my preferred solution would be to eradicate it altogether. If that is not realistic, however, the very least we can do is to try to protect the river from further contamination and contain the problem on site. That, as I understand it, is essentially the local authority's proposal.
So much work has been done and so much effort has been put in to improve the condition of the Tyne that it seems disproportionate to walk away from the problem
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now. We are very close to restoring the River Tyne to its pre-industrial quality. Central Government have played an important part in getting us to where we are now, and they should help us to finish the job. We need a comprehensive plan for the river as a whole, including the upper reaches of the north and south Tyne. We need a latter-day Tyne improvement commission to bring public authorities and private sector interests together, to set a clear programme of remediation for the whole river right the way to its upper reaches, to drive the work programme forward and to remain vigilant on any emerging causes of pollution. That would have to be paid for. No local authority in the north-east is in any position to make a significant financial contribution to the project, nor is it reasonable to try to pass the cost on to private sector interests, which are, after all, not responsible for the pollution. There is a necessary role here for Government.
I accept that the problem is not unique to the Tyne, and that the Minister will be faced with similar issues in other parts of the country. I would like to explore with him constructive ways of taking the issue forward and hope that he, or one of his colleagues, is open to a meeting at which we can explore the matter further.
4.40 pm
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (George Eustice): I congratulate the right hon. Member for Newcastle upon Tyne East (Mr Brown) on securing the debate. I was interested to hear about his long-standing connection with the plant, and his negotiation of the redundancy deal for former workers.
As the right hon. Gentleman explained, land contamination is a complex area. The issue of the St Anthony's former tar works and the pollution of the River Tyne shows that. The Department for Environment, Food and Rural Affairs and the Environment Agency are aware of the site and the agency has been in regular contact for several years with Newcastle city council, which owns the site and is designated the "appropriate person" under the Environmental Protection Act 1990. We continue to offer advice and guidance.
I acknowledge the council's work to deal with the site. DEFRA recognises that it initiated work in 2000 to try to prevent the flow of hydrocarbons into the river. Unfortunately, that system failed shortly after installation. Following that, further investigation was funded through the contaminated land capital grants scheme at a cost of £240,000, and that led to the site being determined under the legislation in 2007. The council was successful in securing further funding of £189,000, resulting in a detailed design for remediation of the site. DEFRA has therefore already provided more than £400,000 in capital funding to support the council in dealing with the site.
As the right hon. Gentleman pointed out, however, the budget for the grants scheme has undergone significant cuts in line with the economic downturn, and since 2010 no further funding could be made available for the site following the assessment and prioritisation of all applications for funding. Other bids, such as those to do with landfill gas entering residential properties, would be considered a higher priority, given the greater risk to public health on the measures that we use to assess such projects. Vapour monitoring at St Anthony's established that there was no health risk to users of the walkway on
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the river bank, and there is currently no evidence that the site is causing a breach of the status of the Tyne estuary for the purposes of the water framework directive.
The phasing out of the grant scheme is regrettable, but it reflects a necessary change of approach following a review of departmental priorities and expenditure. DEFRA and the Environment Agency are not immune from the necessary funding constraints that all Departments are under. Government can continue to support only those projects that are considered to be the highest priority, and absolute emergency cases, until the scheme ends in 2017.
I want to explain how contaminated land is dealt with in England, and the additional work that has been undertaken by DEFRA to support local authorities so that they can direct resources to the highest-priority sites. The contaminated land regime, as set out in part IIA of the 1990 Act, provides a risk-based approach to the identification and remediation of land where contamination poses an unacceptable risk to human health or the environment.
Responsibility for identifying such contaminated land is a local authority obligation under part IIA, and, since 2000, financial support has been and will continue to be provided through the revenue support grant provided by the Department for Communities and Local Government. That is exactly the answer that the right hon. Gentleman predicted. The revenue support grant is not ring-fenced, and it is up to local authorities to decide where to allocate the money according to their individual priorities.
Changes made to the part IIA statutory guidance in April 2012 have resulted in a more stringent, risk-based approach to identifying and remediating contaminated land, meaning that more resources can be directed to those sites most in need. It is a simple fact that with far fewer resources, we must prioritise where spending goes first.
We are now in the final stages of DEFRA-funded research to develop new screening levels that will screen out low-risk land from the need for further investigation, thus saving money for local authorities. Once published, the screening values will sit alongside DEFRA research published in 2012 on the normal background concentrations of contaminants to help inform decisions. Case studies are also being published from the work of the contaminated land national experts panel, which is a free resource available to support local authorities that face the more difficult, borderline decisions so that they can understand what would or would not be required. It is important to note that the environmental permitting regime for current activities, particularly on redeveloping sites where there is potential to cause contamination, ensures that no new part IIA contaminated sites should be being created.
There has been a broader analysis of the health impacts. DEFRA-funded research on the current state of scientific knowledge on the health effects of contaminated land found little direct evidence of serious health effects from the types and levels of land contamination found in England today. We are not complacent, however. Such effects cannot be ruled out in all cases because it is sometimes difficult to prove causality, and there are reasons to be concerned that some sites might pose significant risks from longer-term exposure. We therefore
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take a precautionary approach to the identification and remediation of contaminated land, which is reflected in the development of the new screening levels for contaminants in soil.
The right hon. Gentleman stated that, in this era of lower public spending, we have to consider how to put right historical contamination. An estimated 90% of contaminated land in England and Wales is cleaned up through the planning system under the national planning policy framework, which has played an important part in making the planning system less complex and easier to understand, thereby encouraging sustainable development and the effective use of brownfield land where appropriate. The key for many sites is to redevelop them and, as part of that redevelopment, to have an agreement with the developer that they will put right the contamination, as they have the proceeds of the redevelopment to invest.
Mr Nicholas Brown: I am open to exploring with the Minister any practical way forward that will address the problem, and I know that he proposes that idea constructively, but I cannot see it working with the site in question. The difficulty would be in finding some way either to prevent the tar from leaching into the river, or to clear the tar off the site altogether. The capital cost of a protective measure, let alone a complete clearance, is likely to be several million pounds, which must be far more than any possible planning gain that could be made on the site.
George Eustice: I am not sure. One estimate I heard is that it would cost somewhere between £1.2 million and £1.5 million to put the site right. I take the right hon. Gentleman's point, and he understands the site better than I do, as he is the constituency MP. There are possibilities in many instances. Local authorities across the country hold toxic assets that are something of a liability. We have many such sites in Cornwall. I grew up in a mining area, and we have our share of arsenic and contaminated land. Deals can often be reached in which the local authority effectively gives the land to a developer in return for the developer putting right the contamination. I have seen that work in my part of the country—the opposite end of the country from his constituency—where we also have contamination caused by tin mining. We need to explore such things, otherwise we go full circle and come back to the question of whether using public money is justified. We have introduced a new screening process for prioritising sites that are a direct threat to health in residential areas, and we have been frank and honest that we cannot justify the expenditure at this stage. I hope it will be possible to explore the approach I have outlined.
Also, land remediation relief will support developers. The Government are encouraging a market-based approach to dealing with contaminated land, as much as possible. One financial incentive that the Government have provided to encourage the redevelopment of contaminated land is land remediation relief, which allows companies to claim back corporation tax on 150% of the costs of dealing with contaminated land, and which is intended to influence developers' decisions positively by increasing the profitability of redevelopment projects. The Treasury estimates that the value of land remediation relief is around £30 million per annum, suggesting that the
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private sector is spending approximately £100 million on land remediation relief-compliant voluntary remediation each year.
The Government are also trying to encourage local authorities, LEPs and enterprise zones to find solutions to toxic sites that have not so far been suitable for redevelopment. Furthermore, DEFRA is working with the Environment Agency and the Coal Authority to address water pollution from abandoned metal mines. DEFRA has agreed to a modest and targeted approach, initiating one to two new remediation schemes each year, subject to funding. I appreciate that that particular fund is of little use in relation to the former tar works at St Anthony's, but it is nevertheless indicative of the fact that we continue to do what we can on the issue with the resources we have.
I mentioned earlier that emergency cases will still be funded. As part of the announcement on the future of the grants scheme, my noble Friend Lord de Mauley made it clear that, subject to capital funding allocations, a contingency fund of £500,000 each year will continue to be available until the scheme ends in 2017. DEFRA is working with the Environment Agency to agree how the contingency fund will be administered; that will enable the fulfilment of ongoing projects as far as possible, and provide funding in case of emergencies. An announcement on that will be made soon, and will include details of the qualifying criteria for such cases.
To conclude, DEFRA will review the impact of the changes to the grants scheme for local authorities 12 months after the changes are introduced in April 2014. In addition, it has commissioned a new state of contaminated land survey, which will collect information on part IIA regulatory activity, the apportioning of liability, and the funding mechanisms used for dealing with contaminated land. The report will be produced by the Environment Agency before the end of 2014 and will provide information that can be used when reviewing the impact of the changes to the grants scheme.
I thank the right hon. Gentleman again for bringing this debate before the House. I am sorry that I have not been able to give him any more reassurance than the Environment Agency has, but I hope that he will appreciate the difficult constraints that we face and the need for us to prioritise our spending.
Mr Nicholas Brown: Dr McCrea, like me, you represent a constituency with a rich industrial heritage that no doubt has similar problems, albeit perhaps not exactly of the nature we have been discussing. I am very disappointed by what the Minister has said. He has, however, offered one constructive suggestion, which I note would not cost the Government any money. Nevertheless, it is a constructive suggestion and I will take it up with the local authority and others locally.
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I agree with the Minister that the possibility of a commercial way forward for the site is worth exploring. The figures he cited are the same as my own—a cost of roughly £1.2 million to £2 million for the council's preferred scheme to try to contain the tars and prevent them from leaching into the river, but it would contain them on site. I do not know how commercially attractive that would be to a developer. My preferred option would be a one-off capital clearance of the whole site to clear it up completely and bring it back to a more pristine standard, certainly than it has known since 1920. However, my suspicion is that that would cost more money.
I rather thought that the Minister would turn me down on the money, and that he would refer to the Department for Communities and Local Government grant arrangements—
Dr William McCrea (in the Chair): Order. May I say to the right hon. Gentleman that the Minister might like to say a few words in response, but it is an intervention; there can be no further speeches. Does the Minister want to respond?
Mr Brown: May I have a final sentence?
Dr William McCrea (in the Chair): One final sentence.
Mr Brown: My final sentence—there may be a few commas and semicolons—is this: will the Minister, or another Minister from the Department, agree to meet me to have a continuing dialogue on a way forward for the site, with a view to finding a conclusion?
George Eustice: I omitted to deal with that point, which the right hon. Gentleman raised. I am more than happy to go back and raise that point with Lord De Mauley. He is responsible for the matter because it is in his portfolio, even though I handle it in the Commons, and I am sure that he will be willing to meet and discuss it further. I have been as honest and frank as I can with the right hon. Gentleman about the constraints that we have. As I have said, a large sum of money is required to put the site right. We have made it clear that we have only about £500,000 a year for the whole country, so he can appreciate that it would overwhelm us. I will nevertheless take that point back and ask Lord De Mauley if he will have a meeting.
Dr William McCrea (in the Chair): I thank the Minister and the right hon. Gentleman for the debate. It was less contentious than some of the debates that we have had today, but it was no less important.

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