Johnson and the railways. Is he ready for pay as you go – and the end of the season ticket? And are passengers?

21 Apr

Boris Johnson loves infrastructure, and is impatient about the unconscionable delays and exorbitant costs which improvements to it generally entail.

In his speech last summer at Dudley, delivered at a lectern bearing the upward-slanting words “BUILD, BUILD, BUILD”, the Prime Minister declared that as the pandemic recedes, we must “move with levels of energy and speed that we have not needed for generations” in order to bring about an “infrastructure revolution”.

An early test of this boosterism will come on the railways. In November, ConservativeHome revealed that, as soon as the pandemic took hold, Grant Shapps set up a committee on rail reform to work out how to seize the once-in-a-lifetime opportunity presented by the emergency.

One member of that committee, Keith Williams, a former Chief Executive of British Airways, has since September 2018 chaired the Williams Rail Review, set up to make recommendations for reforming the entire structure of the industry, with the interests of passengers and taxpayers put first.

The original announcement said:

“The review’s findings and recommendations will be published in a government White Paper in autumn 2019. Reform will begin in 2020.”

Johnson, who became Prime Minister in July 2019, was that autumn contending to get Brexit done, and has for most of the last year had his attention monopolised by the pandemic.

But he is reported recently to have spent time mastering and approving the Government’s response to the Williams Review, which is likely to be published in May, after the local elections.

The whole situation has changed, and has become more favourable to sweeping reform. The pandemic hastened the end of the franchising system, under which companies bid against each other to run particular lines.

He who pays the piper calls the tune. Since March last year, as Tony Lodge reminded us on this site yesterday, the railways have only been kept running with public money.

The rail unions can no longer hope, in their defence of outmoded working practices, to divide and rule among the different rail companies.

They instead face a single opponent, the Treasury, which is not inclined to regard the preservation of inefficiencies as a justifiable use of public funds.

Before the pandemic, the unions could threaten to bring trains full of commuters to a halt, with immediate loss of revenue to the operating company.

Now that what little fare revenue there is goes to the Treasury, which in turn pays the operating companies to keep a reduced service running, the balance of advantage has changed.

To stop almost empty trains is an empty threat. The Rail, Maritime and Transport Union has this week been sabre-rattling, but the more important argument is within the Government itself.

Rishi Sunak, as Chancellor, is known to have fretted at spending billions over the last year to ship “fresh air” round the country.

The Williams Review is likely to propose the creation of an arm’s-length body to run the railways: in layman’s language, a Fat Controller.

The Treasury will require assurances that the Fat Controller, and the Fat Controller’s dependents, do not gorge themselves on endless taxpayer-funded subsidies.

The most delicate task for the Department for Transport is to keep the Treasury on side. For there can be no denying that under the new system, where the train companies are paid to provide services and the fare revenue goes to the Government, it is the latter that takes the risk.

Nobody knows how passenger numbers will recover after the pandemic. How many of us will continue to work from home, at least for part of the week?

A big determining factor will be the cost of getting to the office. The present fare structure, as anyone who uses the railway knows, is a complete mess, incorporating many ludicrous but long-standing anomalies, so that, for example, when setting out to travel from A to D, it can be cheaper to book three different tickets, from A to B, B to C, and C to D.

Will the Government seize the chance to sweep these anomalies away? A future beckons in which, when we want to go somewhere, we just swipe a card and step on the next train, in the justified belief that we have obtained the cheapest fare we could have got under any more cumbersome system.

This already happens in London. In time it will probably happen throughout the network. But the cost of introducing it will be considerable, losers from the reform will be angry they can no longer get the cheap fares currently available to passengers who book in advance on non-peak services, and from the Treasury’s point of view there will be an acute danger of missing out on the season-ticket revenue from commuters, which before the pandemic was such a significant element in the financing of the railway.

Those commuters had nowhere else to go: they simply had to get to the office, and the train was the only way. The pandemic has revealed to them and their employers that they could instead remain at home.

Yet it has recently been reported that these long-suffering commuters will soon be offered carnets of tickets, which if used will mean that to go to the office for only three days a week will end up costing them more than if they went there for five days a week with a season ticket.

That sounds like a pretty effective way to deter people from travelling by train at all if they can possibly avoid it.

The other side of the equation is costs. The pay of train drivers is very high, approaching that of airline pilots, and far above what bus or lorry drivers get.

And the training of train drivers is extraordinarily expensive. It has not been transferred to computer simulators, as much of it could be. Why should the Treasury, and indeed the taxpayer, fund these outmoded methods?

I would like, in passing, to express my admiration for the job ASLEF, the train drivers’ union, has done on  behalf of its members. But conservatism has its limits.

British Rail, which ran the system until privatisation in 1994-97, had a certain charm. It was dedicated, like the other nationalised industries, to the preservation of the past, and especially to the preservation of jobs.

As a young passenger of conservative disposition in the 1970s, I could not help hoping that BR would succeed.

But BR failed. It possessed none of the freedoms of the railway companies which had preceded it, so it could not modernise itself.

Extensive modernisation is just now required. The last thing the DftT, or the Treasury, wants to do is to reinvent BR.

The Government wants to preserve the vitality of the private sector, while also taking charge, and running the railways in the public interest.

Here, one may say, is the paradox of Johnsonism. During his short prime ministership, the railways have thanks to the pandemic been nationalised, but he aspires also to preserve for them the rude freedom of the private sector.

What an awkward circle for Williams to square.

“We need a Kate Bingham,” as one railwayperson exclaimed during the preparation of this article.

New event: ‘Back to Business – reopening international travel’, with Grant Shapps

15 Apr

We are very pleased to invite you to ConservativeHome’s next live online event, in which our special guest Grant Shapps, Secretary of State for Transport, will be joined by a distinguished panel for this timely discussion.

Following the recent publication of the Global Travel Taskforce report, there are a host of crucial questions to explore, from the return of tourism and business travel, to the reunification of families separated by the pandemic.

When and how can international travel reopen? What approach offers the best route to do so safely, promptly, and to the greatest benefit for passengers and the wider economy? After a year of unprecedented disruption, how soon will things return to normal, and what will normal look like?

In this event, hosted in partnership with Airlines UK, the Secretary of State will be joined by:

Keith Glatz, Vice-President of Airlines for America and
David Evans, Group CEO of Collinson Group, the UK’s leading provider of Covid-19 travel testing.

The event will be broadcast live via Zoom at 7pm on Tuesday 20th April.

As ever, there will be the chance for the audience to put your questions to the panel.

Click here to register for your free ticket.

Andy Street: The BBC’s Birmingham plans represent a cultural “levelling up” this country needs

23 Mar

Andy Street is Mayor of the West Midlands, and is a former Managing Director of John Lewis.

This weekend Line of Duty, one of the BBC’s most successful shows, returned to our screens for its highly anticipated fifth series. The hit crime drama is one of a number of major TV productions made in Northern Ireland, making a significant contribution the local economy there.

However, few people know that the first series of this hit show – the one that established it as a fans’ favourite – was made in Birmingham, with filming taking place across the West Midlands.

In fact, Line of Duty was created by West Midlands-born Jed Mercurio, who lived for several years in Birmingham where he worked as a doctor in local hospitals.

I don’t know why production of the show moved away from Birmingham, but its move was certainly emblematic of a shortfall in investment by the BBC here, resulting not only in an economic imbalance but also in a lack of representation of West Midlands life on national TV schedules.

Now, all this is changing – with a landmark announcement this week from the BBC and significant plans for independent production studios in Birmingham, following years of lobbying by myself, and huge combined efforts by our talented creative industry. In TV parlance, we are “ready for our close up”.

I believe the announcement by the Beeb represents a kind of cultural “levelling up” – and follows the announcement that the Department for Transport is to move to Brum and the Ministry of Housing, Communities, and Local Government to Wolverhampton. All of these moves are crucial to the ongoing success of devolution, as they ensure opinion formers and decision makers, whether in the media or the Government, understand and engage with life outside the capital. But this has been a long time in the making.

For decades, Birmingham boasted one of the biggest BBC centres in the country – Pebble Mill – which was home to the Archers, Top Gear, The Clothes Show, Countryfile, Gardeners’ World and the daily magazine show Pebble Mill at One. Its studios were used to film All Creatures Great and Small, Boys from the Blackstuff, Doctors, Dangerfield, Howards’ Way, Juliet Bravo, Dalziel and Pascoe and more.

After the BBC closed the famous studios in 2004, its presence in the region shrank to a shadow of its former self. By 2011, the Corporation had opened its huge base at Salford’s MediaCity, in Greater Manchester – where it employs more than 3,000 people.

This, for me, was another symbol of how our region was being left behind other parts of the country. It wasn’t just about the loss of jobs and investment, critical though that was, it also meant that talent from our region would be forced to move elsewhere.

It also showed a major national institution turning away from us, and not just any institution – the BBC isn’t like any other business. It is one we all pay for through our licence fee and it was clear that West Midlands people were getting a poor return on the money they were contributing to BBC coffers.

Four years ago, the BBC’s annual report revealed the Corporation spent just 1.5 per cent of its programming budget in the Midlands, down from 1.8 per cent the year previously. It meant that while licence fee payers in the wider Midlands region were paying £961 million a year, the broadcaster was spending just £135 million a year here, while pumping money into London and the North. Quite simply, the BBC was investing less in the Midlands than any other part of the country.

And it’s not just about money – it’s about representation. Think about this: how many TV shows can you name that are set in the Midlands? TV schedules are full of gritty northern dramas, London cop shows or programmes that use famous regional landmarks as their backdrops. Happy Valley is set in Yorkshire, Unforgotten, Luther and Marcella in London, Broadchurch in Dorset. The biggest soaps are in the capital, Manchester and the Yorkshire Dales. Doctor Who may travel anywhere in time and space, but the Tardis chose to move its regular base from Wales to Sheffield.

Yes, we have the sublime Peaky Blinders, created by proud Brummie Steven Knight, and Line of Duty subtly hints at an anonymous Midlands setting, but there are very, very few shows where you can see life here on your screens, or hear our accents. As one of the UK’s most densely populated places, this underrepresentation is simply wrong.

Last week, the BBC announced ambitious plans for its biggest transformation in decades, including moving more programme making and investment to the West Midlands, finally delivering the kind of investment that our region has been crying out for.

This followed months of negotiations with Tim Davie, new BBC Director General, and means that over the next six years the corporation will increase activity across the region, with at least one new primetime drama series and one new primetime entertainment series commissioned here.

This will not only bring new jobs and opportunities, it will also give us the chance to tell our own stories, express our creativity, make our voices heard and ensure a fairer representation for the region on the cultural landscape. However, it will also mean that the BBC will benefit hugely from the incredible pool of talent here.

This is an industrious, innovative place. In the last four years our creative sector has really begun to regain momentum. Creative and digital was the fastest growing sector in the West Midlands between 2016 and 2018. There are nearly 1000 creative businesses in the region, contributing £4.7 billion per year to the economy – that’s why I have always championed it as a sector.

Now, this new BBC investment will feed that momentum, creating more jobs and giving us the opportunity to be a leading light in the sector again, just as we were in the heyday of Pebble Mill.

There have been setbacks. There is no doubt that years of BBC under-investment impacted on independent production here, which was cited as one of the possible reasons Channel 4 chose in 2018 to overlook Birmingham’s bid to be its new base outside of London, in favour of Leeds.

I was personally hugely disappointed by the Channel 4 decision, because I thought we were the best choice, but I don’t regret the fact that we tried. In fact, going through the process with Channel 4 helped us to galvanise our creative sector, work out where our strengths lay, and it has laid the foundations for the successes we are now seeing.

Under my leadership, the West Midlands Combined Authority helped set up Create Central to bring together the local screen industry to lead the development of plans to grow the sector. This included £2 million for Create Central to fund a programme of activities to boost the film, TV and games sector in the region, with £500,000 to run bootcamps to teach young people the skills they need to work in the TV production sector.

All this activity means the arrival of more BBC activity coincides with a creative explosion here, centred around Birmingham’s Digbeth. Two major new production facilities are already planned in this creative quarter of the Brum – Mercian Studios, an international film studios and media village, led by Peaky Blinders’ Steven Knight, and a new Creative Content Hub for independent TV and content production.

Over the next few weeks, the UK will be gripped by Line of Duty, a TV phenomenon that began here in the West Midlands. Soon, the Peaky Blinders will return to our screens too. The news that the BBC is to finally take full advantage of the immense talent to be found here will mean viewers can look forward to many more West Midlands-made TV classics, while local people will get a fairer share of the nation’s cultural currency.

George Freeman: The industrial strategy reforms I led helped to deliver Britain’s vaccine success. Now for the next phase.

1 Feb

George Freeman is a former Minister for Life Science and Chair of the Prime Minister’s Policy Board (2016-18). He is co-author and editor of the 2020 Conservatives book Britain Beyond Brexit.

The combination of Covid-19 and the Crash of 2008 have left this country facing the most serious crisis in our public finances since 1776. Unless we make the post-Brexit, post-Covid recovery a transformational renaissance of enterprise & innovation on a par with that unlocked by Thatcher Governments of the 1980s, we risk a decade of high debts, rising interest rates and slow growth.

We have a truly unique opportunity before us. As a science and innovation superpower, with the City of London now outside the EU’s rules for the first time in nearly fifty years, we can unlock a New Elizabethan era of growth – with Britain a world-leader in global commercialisation of science, technology and innovation. It is what our entrepreneurs have been crying out for. Now is the moment to make it happen.

That’s why I’m delighted to have been asked by the Prime Minister to help set up the new Taskforce for Innovation and Growth through Regulatory Reform (TIGRR) with Iain Duncan Smith and Theresa Villiers.

Reporting directly to the Prime Minister & the Chancellor’s Cabinet Committee on deregulation, and supported by a secretariat in the Cabinet Office, the Taskforce will consider and recommend “quick wins” to use our new regulatory sovereignty to unlock high growth sectors of the economy to drive post-Brexit post-Covid recovery.

Rest assured: there will also be no big report or a thousand pages of footnotes to wade through. We will be crowd-sourcing the best ideas from the business community and the entrepreneurs and innovators who are the engine of our economy.

The Prime Minister has asked me to bring my career experience in business starting & financing high growth bioscience technology companies as well as my experience as Minister in Health, BEIS and Transport leading our groundbreaking Industrial Strategy for Life Science which has paid such dividends this year.

The reforms I led in our Industrial Strategy – launching Genomics England, the Early Access to Medicines Scheme, MHRA and NICE reform, Accelerated Access procurement have been fundamental to our ability to lead the world in developing a Covid vaccine.

We now need to make Brexit & Covid the catalyst for bold reforms to unlock big UK opportunities for recovery & GlobalBritain across a range of high-growth sectors such as those I have worked on extensively as both entrepreneur and Minister:?

  • LifeScience: harnessing the potential of the NHS as a research engine for new medicines, unlocking digital health & innovative approaches to Accelerated Access, clinical trials & value-based pricing.
  • Nutraceuticals: health-promoting “superfoods”, cannabis medicines.
  • AgriTech: smart clean green twenty-first farming technology like the blight resistant potato banned by the EU.
  • CleanTech: new biofuels, Carbon Capture & Storage & digital “smart grids” to reward households & businesses for generating more and using less.
  • BioSecurity: harnessing the potential of Porton Down and UK vaccine science for plant, animal & human biosecurity.
  • Digital: removing barriers to UK digital leadership outside the EU GDPR framework.
  • Hydrogen: using the full power of Gov to lead in this key sector as we did in genomics.
  • Mobility: making the UK a global test-bed for new mobility technologies,

Before being elected to Parliament, I spent 15 years working in life sciences around the Cambridge cluster, financing innovation. I saw time and time again how the best British entrepreneurs and their companies struggled to build business to scale here in the UK.

So often we have invented the technologies of the future and failed to commercialise them effectively.

After several years working as the Government Life Science Adviser, I published my report for the Fresh Start Group on The EU impact on Life Sciences: Avoiding the Global Slow Lane.

Three years before Brexit, the report was the first to highlight the growing hostility of the EU to ‘biotech’ and the increasing tide of ‘anti- biotech’ legislation – driven by a combination of the German Green Party, Catholic anti-science and lowest commons denominator regulation by the “precautionary principle” which was having a damaging effect on the Bioscience Economy and risked condemning the EU – and by extension the UK – to the global slow lane in biotechnology.

The report set out how the genomic revolution was beginning to offer untold opportunities across medicine and agriculture to help generate huge economic, social and political dividends for mankind. Billions of people were being liberated from the scourge of insufficient food, medicine and energy. The main threat to that? The EU’s hostile regulatory framework.

This was seen clearly in numerous case studies. At the time, the EU’s hostility to GM led German-based BASF and major U.S firm Monsanto to announce their withdrawal from Europe in agricultural research and development. My report argued that unless something was done soon, other companies would follow suit, with dire consequences for the UK Life Science sector.

The report recommended a shift away from the increasingly widely used risk-based ‘precautionary Principle’ and greater freedoms around data protection, using public healthcare systems to help accelerate early access to medical innovations, and for the UK to be able to ‘go it alone’ in designing appropriate regulatory frameworks for GM crops.

The UK’s departure from the laws and requirements of the EU provides us with a once-in-a-generation chance to redesign and improve our approach.

This new Taskforce, therefore, is emphatically not another long-term Whitehall de-regulation ‘initiative’. Neither is this is about cutting workers’ or environmental rights that we rightly guaranteed in the 2019 election manifesto.

It is of vital importance that the UK maintains the high regulatory standards that we have consistently championed. In some of the fastest growing new sectors like Digital Health, Nutraceuticals and Autonomous Vehicle Tech, clear global regulatory standards are key to investment confidence. By setting the new global standards here in the UK we can play a key role in leading whole new sectors.

But we must think innovatively about supporting businesses to start and grow, and make the most of the cutting-edge technologies and sectors we nurture in our universities for global impact. For example, why don’t we use our freedom to pioneer new disease and drought- resistant crops, and use our aid budget and variable tariffs to help create new global markets for UK Technology Transfer?

We won’t unlock a new era of the UK as an Innovation Nation generating the technologies and companies of tomorrow with technocratic tinkering. We need bold leadership, clear commercial vision and reforms to support innovation and enterprise. The two go hand in hand. We won’t unlock an innovation economy without an enterprise society. So we will need to look at tax and regulatory incentives for high risk start/ups like the “New Deal for New Businesses” I proposed back in 2010 to drive recovery after the Crash.

This is a once-in-a-generation moment. Together we must seize it.

Shapps has spotted a once-in-a-lifetime chance to give Britain world-class railways

28 Nov

What a wonderful time to be in charge of Britain’s railways. The pandemic both demands and enables a programme of improvements which would otherwise have taken many years to achieve.

Since March, about £10 billion of public money has been spent to keep the trains running. At first sight, that looks like an unmitigated disaster. It is certainly unsustainable.

But it also means the strike weapon has lost its edge. To threaten to bring empty trains to a halt is no threat at all.

Nor can the rail unions divide and rule, as they did when services were divided between different train operating companies, a system which had already collapsed before the pandemic.

This is a moment of central control, when the Government is paying the bills and can insist that the interests of passengers and taxpayers take precedence over the desire of the unions to prevent change.

Ministers recognise this is a once-in-a-lifetime chance to sweep away the accumulated absurdities, ranging from outdated working practices to the ludicrously convoluted fare structure, which are holding the railways back, and to press ahead with such innovations as the introduction of driverless trains, first seen on the Victoria Line in 1968 and the Docklands Light Railway in 1987.

In March this year, ConHome can reveal, a committee on rail reform was set up within the Department for Transport and began meeting weekly.

It is chaired by Grant Shapps, the Transport Secretary, and attended by the Rail Minister, Chris Heaton-Harris, but nobody supposed the DfT could provide the specialised knowledge of how to run a railway.

So the expertise is provided by members of the committee including Sir Peter Hendy, Keith Williams, Andrew Haines and some of the Non-Executive Directors of the DfT, notably Tony Poulter.

Hendy, appointed by Ken Livingstone to run Transport for London, was kept on by the winner of the 2008 mayoral election, Boris Johnson, received a knighthood after the London Olympics of 2012 in recognition of the excellent transport arrangements during the games, and since 2015 has chaired Network Rail.

Williams, a former Chief Executive of British Airways, has since September 2018 chaired the Williams Rail Review, set up to make recommendations for reforming the entire structure of the industry, with the interests of passengers and taxpayers put first. Its work has not been published, but is being drawn on now.

Haines is Chief Executive of Network Rail, a former Chief Executive of the Civil Aviation Authority, and before that was Managing Director of South-West Trains.

The Daily Telegraph reported earlier this week that Shapps has asked Haines to produce a 30-year strategy for the railway called the “The Whole Industry Strategic Plan”.

And earlier this month, The Sunday Telegraph revealed that Haines has been asked by Ruth Hannant and Polly Payne, joint DfT directors general for rail, to report on the future of the East Coast Main Line, and to do so “from the perspective of a neutral single guiding mind”, rather than in his capacity as Chief Executive of Network Rail.

Hannant and Payne have for many years operated a job-share, and before arriving at the DfT in December 2017 were joint Directors of Higher Education Reform at the Department for Education.

One does not have to be Dominic Cummings to reckon this is perhaps not the best way to run a railway. Many in the industry think so too.

But the paucity of deep expertise within the DfT, and its propensity to meddle counter-productively with such matters as the timetable, demonstrate the need for another body, or “neutral single guiding mind”, to be in overall charge.

We require what the press likes to call a Fat Controller, though one cannot help reflecting that the original Fat Controller’s safety record was poor.

The safety record of Britain’s railways has in recent years been good. Some of the credit for that belongs to Mark Carne, Chief Executive of Network Rail from 2014-18, whose previous career at Shell was coloured by the Piper Alpha disaster in 1988.

Nothing, evidently, must be done to put safety at risk. But just as it is no longer necessary to check the oil in a car by opening the bonnet and inspecting the dipstick, for there is a light on the dashboard which will tell you if more oil is needed, so it is no longer necessary for each train to be checked every 24 hours by a driver who walks all round it at ground level, on a path wide enough to keep out of the way of other trains, and well lit enough to be used at night.

The unions insist on this ritual, which has become a ridiculous waste of the highly paid driver’s time, and of taxpayers’ money. Like modern cars, modern trains tell you when something goes wrong.

In the era of nationalisation (1948-93) the railways appeared to be in inexorable decline, and the most famous figure associated with them was Dr Beeching, who proposed to close a third of the network, which is pretty much what happened.

Since privatisation, passenger numbers have doubled, the network has undergone many improvements, there is a lot of new rolling stock and some of the lines closed by Beeching are being reopened.

Lord Adonis has argued with his usual brio the case for doing this, while Larry Elliott has pointed out that without Beeching, which left so many towns cut off, Brexit might never have happened.

One of the great attractions of creating improved railway services is that this cause appeals far beyond the ranks of Conservatives.

Good railways, railways of which everyone can feel proud, are a quintessentially One Nation policy, levelling up in action, and the 2019 Conservative manifesto rightly promised that

“we will restore many of the Beeching lines, reconnecting smaller towns such as Fleetwood and Willenhall that have suffered permanent disadvantage since they were removed from the rail network in the 1960s.”

There is now every prospect that passenger services between Ashington and Newcastle, lost in the 1960s, will soon be restored. The line runs through Blyth, long a Labour stronghold but captured by the Conservatives last December.

Ashington itself is in the constituency of Wansbeck, held last December by Ian Lavery for Labour with a majority of 814, compared to a majority of 10,435 in 2017. Perhaps the new line will help tip Lavery into oblivion.

Beeching was a blunder of Harold Macmillan’s later and less happy years as Prime Minister. It ought now to be undone, along with the destruction of the Euston Arch.

This cannot, however, become an excuse for wasting taxpayers’ money on “fantastically overpaid and inefficient” train drivers, as one source close to the reform committee describes them.

Nor does anyone know how quickly or fully the demand for rail travel will revive. The likelihood is that some commuters will decide they would rather work from home.

And there are many demands on the Treasury’s funds. Rishi Sunak will heed the calls of the NHS, social care and other good causes before he listens to the railways, especially if he thinks the latter are squandering taxpayers’ cash.

So a realistic deal has got to be made with the rail unions. The powers that be are disposed to allow existing drivers, who are mostly quite old, to retain their perks, but not to show the same indulgence to new recruits.