The House will recall that, on 21st July, in answer to Questions by my hon. Friend the Member for Enfield (Mr. Ernest Davies), I stated that the pooled net revenues of the controlled railways were estimated to fall short of the fixed annual sums payable to the railways under the Control Agreement by £37 million in 1947 and by £28 million in 1948. I also stated that the estimated cost of implementing the recommendations of the court of inquiry into wages and hours of railway-men, which have since been accepted, would be £22 million in 1947, and £37 million in 1948. These estimates indicate total shortfalls of about £59 million in 1947, and £65 million in 1948 respectively. In the light of these figures, the Government have decided that the charges made by the railway companies must be increased to such an extent as will produce additional revenue of about £65 million in 1948, while making some contribution to reduce the liability falling on the Exchequer this year.

During the war, and the immediate postwar period, when passenger travel was at a high level, it was decided that ordinary passenger fares should bear a higher rate of increase, namely 33⅓ per cent., than other railway charges, increased by 25 per cent. We have come to the conclusion that this differentiation should now cease, and accordingly all railway charges will be raised to 55 per cent. above prewar with effect from 1st October next. This will represent an increase over present charges, of 16¼ per cent. in the case of ordinary passenger fares and rates for merchandise by passenger train, and of 24 per cent. in the case of other rail charges.

The question whether the relationship between the various types of charge should be varied, will be one for the Transport Tribunal who will settle the charges schemes of the British Transport Commission after considering the views of the Commission, and of bodies representative of all classes of users.

At the railway-owned docks, where the increase on certain charges upon coastwise liners and their cargoes is 15 per cent. over prewar, this low rate of increase will be raised to 25 per cent., but extended to all coastwise vessels and their cargoes. Other dock charges will be raised from 40 per cent. to 75 per cent. above prewar.

The yield of the increase in all charges is estimated at about £15½ million in 1947 (thus leaving the Exchequer to meet a balance of £43½ million) and about £65 million in 1948.

Can the Minister give us the figures of what the Government had from the railways during the war years? How many millions of pounds?

It varies between £190 million and £200 million during the war years, when there was a surplus over the controlled amount.

Per year?

No, over the whole period.

Mr. Braddock:

Will these increases apply to London Passenger Transport services?

No, these increases apply to the four mainline railway companies. The fares of the London Passenger Transport Board were dealt with some time ago, but I would point out to my hon. Friend that some increases in wages and improvements in working conditions have still to find their expression in the expenses of the London Passenger Transport Board.

Is there any connection between increasing charges and deteriorating service, and the approaching date of nationalisation?

I would point out to the noble Lord that this adjustment of the rates and charges of the railway companies to the present level of prices arises now because they were not dealt with by the Government during the war.

In view of the increase in passenger fares, will my right hon. Friend see to it that now the age limit for children's fares shall coincide with the school leaving age, which has been raised by one year?

I think it was the knowledge that I had to meet that position that caused me to adopt the position that the railways cannot continue to subsidise, many of these fares—in this case, to meet the raising of the age as far as children are concerned.

Has the right hon. Gentleman in mind any figure as to how much of this additional cost will be borne by exports, or was the decision arrived at without taking that into account?

All relevant considerations were taken fully into account. I take it the hon. Member for Oxford (Mr. Hogg) is not suggesting that we should run the railways at a loss?

I was asking the right hon. Gentleman for a figure.

I am just stating that that was taken into consideration. I could not give a figure covering the whole field of exports.

In view of the statement that the relationship between the various types of charge will be one for the Transport Tribunal, and in view of the fact that under the Bill the Transport Tribunal may not deal with this for two years or such longer period as the Minister may direct, will the Minister inform us what steps he is to take to relate the relationship between the various prices charged, and the needs of industry during the intervening period?

As this deficiency arises, as I indicated, because railway rates and charges were not adjusted during the war to the upward movement of price levels and wage rates, the Government considered that it was necessary to adjust these immediately. I do not necessarily accept the view of the right hon. and learned Member for West Derby (Sir D. Maxwell Fyfe) that the Transport Commission will not deal with such a problem within a period of two years.

In view of the fact that the present serious position is due basically to the inefficient capitalist transport system, is it fair that the Minister of Transport should place upon the British public the burden which is due to the present position? Would not a better way of getting over the present difficulty be to reduce the amount of compensation to be given to railway owners, and meet the burden in that way?

I would point out to the hon. Member for Mile End (Mr. Piratin) that the question of reducing the interest charges on the capital invested in railways is adequately dealt with under the Transport Bill. If he will examine the figures I have given in this statement, he will see that roughly half the increase arises from the level of prices, which has so far not been met, and the other half of the increase is due to the direct upward movement of wages and working conditions, as those of railwaymen have moved in conformity with the general wage rates of the community.

Several Hon. Members:

rose——

I think we had better get on to the next Business.