Clause 33 - Arbitration by Secretary of State

Railways and Transport Safety Bill – in a Public Bill Committee at 9:45 am on 13th February 2003.

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Question proposed, That the clause stand part of the Bill.

Photo of Anne McIntosh Anne McIntosh Shadow Minister (Transport)

I want to tease a little more out of the Under-Secretary. He is wriggling in his seat, and I hope that that is not a sign of discomfort. We established, under clause 32, the potential for an offence. The explanatory notes from the Library state

that not all providers of rail services will be obliged to enter into such an agreement. However, providers such as London underground, Croydon tramlink, the docklands light railway and Eurostar will be obliged to enter an agreement. Presumably, a dispute for the purposes of clause 33 does not relate to the fact that a company has failed to enter into an agreement because, since that is a civil offence, it cannot be classified as a dispute.

Will the Under-Secretary clarify the nature of a dispute? How will the remit of the Secretary of State compare with his present remit? Clearly, he or a nominated person will have the power to give the party in dispute the opportunity to make representations? To what extent does Parliament have the power to oversee the work of the Secretary of State? Must we wait for the annual report to alert us to the fact that there has been a dispute? Is that the traditional way in which such disputes are dealt with? Will there be an independent body to which the parties could turn? We are told that if there were a dispute on a point of law, recourse would be made to the relevant court in England or Scotland. Will the Minister set out the current arrangements? What will be the exact remit of the Secretary of State? What power will we, as elected parliamentarians who have an interest in railways, have to oversee the Secretary of State to keep him on the right track?

Photo of Don Foster Don Foster Shadow Secretary of State for Transport

Clause 33 refers to a dispute between the British Transport police authority and the person who has entered into a police service agreement. We are discussing an agreement that has already been reached, but over which there is a dispute about the way in which it operates. The problem is that I do not understand why the clause does not cover the problem of parties unable to reach agreement on the introduction of a police services agreement. If there is disagreement, how will such matters be handled? Do we simply rely on clause 32, which states that people must enter into an agreement anyway, and that if they do not like it, there is no opportunity to do anything about it?

Clause 32 suggests that people are required to enter the agreement whether or not they like the

''terms construction or operation of the agreement''.

Do they enter into it under clause 32 and then, under clause 33, immediately have a dispute about it? That would be bizarre.

Photo of Mr David Jamieson Mr David Jamieson Parliamentary Under-Secretary, Department for Transport 10:00 am, 13th February 2003

Clause 33 provides for the Secretary of State to determine disputes relating to a police services agreement between the authority and the operator. The clause also provides a means of appeal to the courts on the Secretary of State's determination, but only on a point of law. That places in legislation the current informal arrangements for dealing with disputes involving the Strategic Rail Authority, as the employer of British Transport police.

The hon. Member for Vale of York asked whether operators were required to enter into the police services agreement. Some operators might argue that

it is not essential to enter into the agreement—a freight depot employing its own security staff, for example. The Government would consult the operators before requiring them to enter into an agreement, but most are likely to be required to do so. The hon. Lady asked how disputes will be dealt with. They will be handled in exactly the same way as they are now. I emphasise that clause 33(1) is about

''the terms, construction or operation of the agreement''

and not about whether a person should enter into the agreement.

On the point made by the hon. Member for Bath, there is no question that operators should have to enter into the agreement. When a dispute about the terms has not been resolved after the police services agreement has been established, the Secretary of State, or someone appointed by him, would resolve the dispute.

Photo of Don Foster Don Foster Shadow Secretary of State for Transport

I can see that the Minister is fed up with my pressing the point, and I apologise if I am offending him because I have no desire to do that. I merely seek clarification. It is clear that clause 32 may impose on a railway industry body the requirement to enter into a PSA. The

''terms, construction or operation of the agreement''

are subject to discussion between the various parties.

At the end of the day, however, the railway industry body has no choice and must accept whatever is put before it. Clauses 31 and 32 include no opportunity for arbitration if there is disagreement at the stage of trying to agree the details of the PSA. Am I right in thinking that, in those circumstances, people have a gun pointed at their heads and have no choice but to sign? They have met the requirement of having entered into the agreement and must then go through the arbitration procedure. Is there no mechanism for arbitration in reaching the agreement in the first place?

Photo of Mr David Jamieson Mr David Jamieson Parliamentary Under-Secretary, Department for Transport

No. There is no choice about entering into the agreement, but it must be approved by the Secretary of State under clause 31(2), which ensures that the agreement is not one-sided. If the parties have still not made an agreement, it is up to the Secretary of State to arbitrate formally, which is exactly what happens now.

Photo of Anne McIntosh Anne McIntosh Shadow Minister (Transport)

The clause goes much further than we might think. Subsection (6) states:

''The Secretary of State or his nominated person''

may vary the terms of the police services agreement. That seems expensive. I listened carefully to the Minister and did not hear him say that we parliamentarians would be involved in the process at all. I do not seek to usurp the role of the Secretary of State—that would be beyond me. However, this is no small cheese that we are talking about. We are told that the policing costs will be split between Network Rail, train operating companies, independent train operators, open-access operators and London Underground. The British Transport police's annual budget was £125.8 million in 2001–02, which was the last full financial year for which we have figures. The train operating companies funded the lion's share,

paying £61.1 million. Railtrack provided £35 million and London Underground £30.9 million.

The clause is powerful and it has to be included for the reasons that the Minister set out, but I seek clarification on subsection (6)(b), which would vary the terms of the police services agreement. The worst-case scenario is that a train operating company would be put into a difficult position. It could be committing a civil offence under clause 32. It might enter into an agreement and find that under the clause the terms of the agreement are varied through the arbitration process. I seek further clarification from the Minister.

Photo of Mr David Jamieson Mr David Jamieson Parliamentary Under-Secretary, Department for Transport

There is not much more that I can add, although I say to the hon. Member for Bath that I am certainly not annoyed or even mildly offended by anything that he said. He was quite properly asking questions as he always does, and I am sure that he will continue to do so during our debates. In the event—albeit an unlikely event—of an agreement not being struck, there must be a final arbiter, which is the Secretary of State or a person whom he appoints to do that job.

On the point raised by the hon. Member for Vale of York, the Secretary of State is accountable for all his actions through Parliament and he must account for them through all the means and methods that we have of bringing a Secretary of State to account. The clause provides the ability for any decision made by the Secretary of State to be judicially reviewed if it were thought to be unreasonable. If a party felt aggrieved, that further avenue is open for them to take the matter forward, should that be necessary.

Question put and agreed to.

Clause 33 ordered to stand part of the Bill.