The ‘devolution agenda’ sits at the heart of Labour’s vision for transport, Maria Eagle tells Robert Philpot and Adam Harrison
THE government should halt its plans to return the East Coast main line – one of the country’s major intercity train routes – to the private sector, the shadow transport secretary, Maria Eagle, has suggested.
In a wide-ranging interview with Progress, Eagle also warns that Labour has ‘got to be very clear that we spend money wisely’ and argues that ‘there isn’t anything radical about continuing to spend money in a way that is not at the top of your list of priorities, especially with the situation we’re going to inherit.’
By calling for train services on the East Coast main line to remain in government hands, Eagle makes her biggest challenge yet to the country’s private train operators.
The previous franchise for the line, the principal rail artery between London and Edinburgh, was terminated by former transport secretary Andrew Adonis in 2009. He handed the running of train services to a new publicly owned company, Directly Operated Railways, which operates under the name East Coast. At the time, the government suggested that this was a temporary move and that the franchise would be returned to the private sector.
Now, however, Eagle calls for a rethink. ‘I think having a public sector comparator is actually tremendously important,’ she argues. ‘I don’t really think that East Coast as it currently runs has had enough of a chance to be that. Obviously, Andrew Adonis set it up to deal with the unacceptable fallout of the franchise when it was in the private sector. It’s forever being told that it is all about to be refranchised, [and] cannot plan for the future.’
Referring to the government’s decision in June to launch the franchise consultation which will see train services on the main line returned to a private operator in December 2013, Eagle suggests: ‘There is a very strong argument for not doing that and just letting East Coast see what it can do and supporting it in doing that.’
Eagle’s call to scrap the East Coast franchising process follows the news in June that her transport policy review is considering whether the not-for-dividend model under which Network Rail, the company which owns and runs rail infrastructure, operates could be extended to rail services. At that time, she also attacked the fact that franchises have been awarded to subsidiaries of the French, German and Dutch state railway companies, arguing that the profits they make are helping to keep fares in those countries a third lower than in Britain.
Eagle now envisages maintaining East Coast as a public sector rail company as a way to challenge such behaviour: ‘Our industry is the only one that can’t bid for these franchises, and nor can anybody bid for any franchises that might be going in Europe. And I just think that’s a nonsensical situation to be in and we have got to look at how to tackle that. I think having Directly Operated Railways or a public sector comparator is a way in which we can start to address that issue.’
The shadow transport secretary was speaking after the government’s controversial decision to strip Virgin of the franchise for the West Coast main line, handing the right to run services to First Group. It has been accused of putting in an unrealistic bid which could lead to the kind of problems which occurred on the East Coast main line three years ago. ‘Whether or not First Group have bid too much, we don’t know. We’ll see, won’t we? We know there have been instances of that in the past,’ says Eagle.
While sharply critical of the train companies, the shadow transport secretary denies that her ambition is return the entire rail network to public ownership. Instead, she pledges ‘the biggest devolution of power and responsibility out of the Department for Transport down to a more appropriate level, closer to communities, that we’ve ever seen’.
Eagle dismisses Tory suggestions that she wants to renationalise the railways as ‘diversionary tactics’: ‘I’m not interested in setting up some monolithic, centrally-run-from-my-desk nationalised body to run everything,’ she argues. Instead, she says, ‘there is a chance for us, as we go into office next time, to let go and to actually empower local communities.’
Outlining her ‘devolution agenda’, Eagle ties her thinking firmly to that of Labour modernisers: ‘Actually, I think this ties in quite well with what Progress has been doing. The Purple Book was really all about how we can empower local communities to take more of a hand in improving things locally. Let’s not just have this big, monolithic, old-style nationalised, sort-it-all-out from the centre, let’s devolve power and responsibility, let’s look at other models, and you could do that in rail. I think the localisation agenda, the devolution agenda for rail, is the big, exciting, radical thing we are looking at and that we will be able to get on with quite quickly.’
She proposes that local authorities come together in new regional ‘transport partnerships’ which would ‘take real power and control, with funding, with authority, over sorting out their local transport. That might include looking at different models, it might include taking over franchises, it might include not-for-dividend services, and not just extending that out of just Network Rail, which is where it currently is, in a quite exciting way, but which is driven from communities themselves rather than from my desk in Whitehall.’
The shadow transport secretary views her ‘devolution agenda’ as key to tackling the consequences of rail privatisation, about which she is scathing: ‘Fares have gone up enormously and so have subsidy levels, the payments the taxpayer is making as well. Yet the new trains, the upgrades – all paid for by the public purse.’ Eagle now detects ‘an appetite out there for looking at how you could reform the system in a way that makes more sense, in a way that is more accountable for people who use it but also in a way that has protection.’
Eagle accuses the government of being ‘completely on the side’ of the train companies to the detriment of passengers and taxpayers, allowing fare rises which have enabled the train companies ‘to squeeze every last drop out of people who do not have any alternative, usually commuters’. Eagle charges transport secretary Justine Greening with failing to ‘have a grip’ on her department’s budget after it handed £0.5bn in ‘underspends’ back to the Treasury. The government’s own figures, she says, show that this sum would have allowed it to hold fares down to inflation plus one per cent for just under five years.
But Eagle also recognises that the tight fiscal situation that an incoming Labour government would inherit will mean tough challenges both for some in the party and for what she calls the ‘vested interests’ in the transport industry. She backs shadow minister Stella Creasy’s suggestion of a ‘zero-budget’ spending review after the election: ‘I think it’s something that as a minister I always did. Why wait till day one? I’ve spent my time in opposition looking line by line at the government’s budget. I have to know where money’s going to come from, what’s available in order to have priorities. Government is about choosing priorities.’
Eagle was one of the first ministers in the shadow cabinet to identify which of the government’s spending reductions she believed Labour should support – she has been able to back £6bn out of its £9bn cuts – a move which, she says, ‘gives us more credibility when we talk about what we want to do and what we focus on, like keeping rail fares down. Instead of having to answer the question of “well, you’re throwing money at it and you can’t afford it”, we can say very carefully “look, this is a priority we have chosen and here’s how we do it”.’
The shadow transport secretary is keenly aware that if Labour wins in 2015 ‘I’m not going to be able to go to Ed Balls and say: “give me a load of money to do this good thing we want to do”.’ She cautions the bus companies that there will be no repeat of Labour’s previous willingness to fund the entire cost of initiatives such as the free bus passes for pensioners that it introduced: ‘In the next parliament we’re going to be looking much more at vested interests like the bus companies being more responsible, being partners in this.’ Top of Eagle’s priority list is to introduce concessionary fares for 16-19-year-olds.
To crack down on the bus companies, Eagle plans to give regional transport partnerships ‘Transport for London-type powers’, allowing them to introduce fully tendered bus services. ‘At the moment,’ she argues, ‘you’ve got a big subsidy going in to running bus services with absolutely no say or accountability for the people who are paying.’
Having shown her willingness to take on both the rail and bus companies, Eagle is also attempting to navigate the controversial debate over aviation policy and airport expansion. She has offered the government talks to build a cross-party consensus on the issue, but Labour is clear, Eagle says, that there is ‘a capacity issue’. ‘Any expansion, wherever it happens’ must not affect Britain’s ability to meet its climate change targets, she argues. The shadow transport secretary rules out the Thames Estuary airport advocated by London mayor Boris Johnson – ‘it’s mad, it doesn’t work’ – and says she is ‘not seeking to put the third runway [at Heathrow] back on the agenda – the government cancelled it.’ But with those caveats in mind, does Eagle have an open mind about airport expansion in the south-east? ‘I haven’t ruled it out – within those caveats.’
Photo: Isaac Strang/www.isaacstrang.com
Andrew Adonis, Boris Johnson, cuts, Ed Balls, Labour, Maria Eagle, Purple Book, rail, Stella Creasy, transport