Clause 20

Local Transport Bill [ Lords ] – in a Public Bill Committee at 4:15 pm on 29th April 2008.

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Notice and consultation requirements

Photo of David Taylor David Taylor Labour, North West Leicestershire

I call Mr. Stringer to move amendment No. 106.

Photo of Graham Stringer Graham Stringer Labour, Manchester, Blackley

I do not propose to move this amendment, Mr. Taylor.

Photo of Stephen Hammond Stephen Hammond Shadow Minister (Transport)

I beg to move amendment No. 53, in clause 20, page 18, line 28, leave out from ‘publish’to ‘a’.

Photo of David Taylor David Taylor Labour, North West Leicestershire

With this it will be convenient to discuss the following amendments: No. 54, in clause 20, page 18, line 31, leave out ‘and’ and at end insert—

‘( ) supply a copy of that document to—

(i) the chief fire officer for each fire area covering the whole or part of that area,

(ii) the head of the local ambulance service for each area covering the whole or part of that area,

(iii) all persons living within 150 metres of any part of the route as specified in the proposed scheme,

(iv) representatives of local groups representing disabled people,’.

No. 146, in clause 20, page 19, line 21, at end insert—

‘(4A) In subsection (3) after paragraph (f) insert—

“(g) either operators of rail services which are provided within the authority’s area or organisations appearing to the authority to be representative of such operators,

(h) any relevant rail infrastructure manager, and”.’.

No. 209, in clause 30, page 27, line 9, leave out from ‘publish’ to ‘a’.

No. 210, in clause 30, page 27, line 12, leave out ‘and’ and insert—

‘(ba) supply a copy of that document to—

(i) the chief fire officer for each fire area covering the whole or part of that area,

(ii) the head of the local ambulance service for each area covering the whole or part of the area,

(iii) all persons living within 150 metres of any part of the route as specified in the proposed continuation of the scheme,

(iv) representatives of local groups representing disabled people, and’.

Photo of Stephen Hammond Stephen Hammond Shadow Minister (Transport)

I want to discuss amendments Nos. 53 and 54. The clause deals with the consultation document to be issued by the local authority that wants to implement a quality contracts scheme. Previously, as governed by the Transport Act 2000, such local authorities were required to issue a notice of the proposed scheme in at least one newspaper in the relevant area. The notice would describe the proposed scheme, state where a copy of it may be inspected and the reasons for wishing to make it. The authorities were then required to consult various people.

The Local Transport Bill slightly amends such requirements inasmuch as it states that the authority must now supply a consultation document to the same list of people as mentioned in the relevant section of the 2000 Act. That will have the effect of making the process in some ways more formal and defined, and certain things must therefore be included in the consultation document. My amendments would address those small, yet important, points in relation to the consultation process.

The local authority is required to publish the consultation document

“in such a matter as they think fit”.

Amendment No. 53 would remove those words, which I believe are unnecessary. The word “publish” is hardly open to misinterpretation, and surely it must mean to produce such information in either printed or electronic form. Given that the following subsections under the clause prescribe quite tightly what must be included in the consultation document, it is unlikely that an authority would be in a position to get it wrong or, indeed, to do anything other than in the manner that is prescribed, not

“in such a manner as they think fit”.

The amendment is really a tidying up proposal, and is saying that, given the high level of prescription and that we know the meaning of “publish”, the phrase to which I have referred is unnecessary.

Amendment No. 54 is important and says that the 2000 Act already sets out a list of those who need to be consulted as a result of the documentation being produced, which includes operators, other local authorities that might be affected, the traffic commissioner, the chief of police and, of course, includes the ubiquitous phrase “think fit”, which relates to other persons. The amendment is simple. Given that those people are prescribed, it would be important to prescribe in the Bill several others who must have the document. The chief fire officer, the head of the local ambulance service and people who live within 150 m of the relevant route as well as representatives of local groups for the disabled are all people who, for the sake of completeness, should be included in the consultation procedure. We have gone through the argument several times about such persons as an authority sees fit, but it is always more helpful to describe such people in the Bill. I hope that the Minister will accept amendments Nos. 53 and 54, which are minor proposals.

Photo of Norman Baker Norman Baker Shadow Secretary of State for Transport

I am sympathetic to the amendments. If we are to have a list that specifies several individuals, including the chief of police, it seems odd that others are not included. I appreciate the Minister’s argument that it is up to local authorities or others to judge who they think fit, but once we have started devising a list, it is difficult to argue that some people should be on it, while others should not. I see no reason why the chief of police should be on the list, but not others.

Amendment No. 146 draws attention to the failure to mention those responsible for rail services in the area. We are creating integrated transport authorities and it seems bizarre to have an integrated transport authority without a requirement to consider the railways as part of the quality contracts process. The amendment would tidy up such matters. Consulting rail operators would ensure that rail capacity development, delivery of timetables and so on, would be taken into account when designing a quality contracts scheme. That is important because if, for example, Network Rail or a train operating company has plans to significantly enhance a service, that is a relevant factor when deciding whether a quality contracts scheme should be pursued in the way that it was originally designed. Similarly, if there are plans to withdraw services, that may drive up the need for a quality contracts scheme. What the rail industry does is important and significant when deciding what should be in the quality contracts scheme.

There are other benefits. Discussions may take place as to how buses and trains should integrate, and that should be part of a quality contracts scheme. Once discussions in the rail industry have taken place, a quality contracts scheme may have a different content from what would otherwise have been the case. It is not efficient to say that a good ITA will automatically talk to the rail industry, because it may not.

There are only 15 council areas in England and Wales without a railway station, so it is virtually certain that we will need to ensure integration between rail and bus. It is sensible to send a clear message to those responsible for consultation requirements to ensure that the rail industry is properly consulted. The Minister may say that it would be odd if they were not consulted, but it is not in the Bill. It would be odd if the chief of police were not consulted—although not quite so odd as the rail industry—but the chief of police is in the Bill, so why should not the rail industry be there?

Photo of Greg Knight Greg Knight Chair, Procedure Committee 4:30 pm, 29th April 2008

If I may say so, I think that my hon. Friend the Member for Wimbledon did his argument a disservice by saying that this is a minor matter. I do not think that it is necessarily so. My remarks relate to amendment No. 53 because I am concerned with the wording that the Minister invites the Committee to embrace that says,

“(a) publish, in such a manner as they see fit, a consultation document.”

That could lead to publishing occurring only on the internet, thereby disfranchising all those who do not, or cannot, use IT equipment. I am concerned about that.

The other week I had a case in one of my advice surgeries where a person who has been transporting animals for over 20 years has been told that he must take a test to continue doing so. He was told that he must take that test on a computer. He does not own a computer, he is not computer-literate and he does not want to buy a computer for the purpose of taking the test. There is a movement, not only in private companies, but also in some arms of the Government, to try to force people to use the internet when, on some occasions, they do not wish to do so.

The duty to publish in the traditional way ought to remain, as this measure could disfranchise those members of a community at the poorer end of the scale who cannot afford to purchase a computer, or those who are elderly and feel that they cannot get to grips with the new technology. I realise that the clause goes on to say that notice must be given in at least one local newspaper, but that does not necessarily guarantee that details of the scheme will get across to those who might need to know. Last week in my constituency, I went into my local newsagent to buy a local newspaper and it had sold out. I represent a tourist area, where the population doubles when the weather is fine. No newsagent can budget for the demand produced by an influx of tourists.

There is a case for requiring publishing to take place in the traditional way of being printed on to paper and made available, so that people can see the full scope of what is proposed. I hope that the Minister will take the matter seriously. I am concerned that, if this wording  remains, some persons may deem it appropriate to put it only on the website and leave it up to the public to go to the site to look at it. That is not good enough.

Photo of Rosie Winterton Rosie Winterton Minister of State (Regional Affairs) (Yorkshire and the Humber), Minister of State (Department for Transport)

As has been said, the amendments would expand the range of statutory stakeholders to be consulted on proposed new quality contracts schemes or proposals to continue existing ones. The Government recognise the importance of consulting a wide range of stakeholders. Provisions in the Transport Act 2000 already set out who must be consulted on proposals to make or continue a quality contracts scheme and those provisions are not changed by the Bill.

The existing provisions require local authorities to consult a wide range of interested parties, including all operators of local bus services in the affected area, other public service vehicle licence holders or holders of community transport permits who might be affected by the scheme; representatives of passengers, the local traffic commissioner and the chief police officer. The hon. Member for Lewes asked why the chief police officer is consulted, and not the chief fire or ambulance officer. The police have a direct responsibility for traffic management and enforcement, and that is why they have been named as a statutory consultee. However, we would expect the police service to take into account the requirements of other emergency services in their role as statutory consultee.

I take the point made by the right hon. Member for East Yorkshire. It is right that people who do not have access to the internet, for one reason or another, are not disempowered by any of the consultation processes. To come back to consulting rail bodies, it may well be that in areas where there is a quality contracts scheme that does not have any rail connections, such consultation might not be appropriate. I undertake to look into the issue that where rail is an integral part of the area there should be consultation with relevant rail operators and that when consulting, it is important for local authorities to remember and take account of the fact that not everybody has access to the internet.

I stress that there is an obligation on the local authority to consult such other persons as the authority or authorities think fit. As I said, in terms of particular schemes and depending on local circumstances, that may well include some or all of those listed in the amendment, but dealing with that issue through guidance is a better approach than the ever-expanding shopping list that we might otherwise get on the face of the Bill. Local authorities are best placed to determine who has a legitimate interest in their areas.

Photo of Greg Knight Greg Knight Chair, Procedure Committee

The Minister has largely reassured me and I am pleased that she has responded so positively to the debate. Will the guidance be published, and therefore available for everyone to see in due course?

Photo of Rosie Winterton Rosie Winterton Minister of State (Regional Affairs) (Yorkshire and the Humber), Minister of State (Department for Transport)

The guidance will be published and consulted upon. We have already put out some draft guidance; we shall reissue that and undertake a proper consultation on it. There is also a consultation for making regulations.

The amendments also include local groups representing disabled persons among the list of those to be consulted. Again, I completely understand the spirit of the proposal,  but I draw the Committee’s attention to the fact that an amendment made to the Bill in another place that we have already discussed will broaden the obligations on local authorities to have regard to the needs of disabled persons when developing and implementing local transport policies. I would expect representative groups to be consulted about proposed schemes. Again, we can cover the matter more fully in guidance.

Photo of Ian Stewart Ian Stewart Labour, Eccles

It is good to see you in the Chair, Mr. Taylor. My hon. Friend heard me pass comment on the circumstances of consultation of disabled people and people with disabled interests in Salford. I am happy that it can be dealt with in guidance, as there is good practice out there that goes some way further than what is intended in the Bill. In Salford, Mr. Jim Wheelton of Salford Disabled Motorists and other community members with an interest in organisations for the disabled do not just scrutinise what the planning committee is doing; they take part in site visits with councillors. They can be seen regularly around Eccles constituency in the city of Salford. The Bill can build on good practice such as that.

Photo of Rosie Winterton Rosie Winterton Minister of State (Regional Affairs) (Yorkshire and the Humber), Minister of State (Department for Transport)

Once again, my hon. Friend is quite right. He is right to draw attention to best practice in his constituency, and I am sure that such examples will be helpful in drawing up guidance. On the basis of my reassurances, I hope that hon. Members will feel able to withdraw their amendments.

Photo of Stephen Hammond Stephen Hammond Shadow Minister (Transport)

When we discussed the Channel Tunnel Rail Link (Supplementary Provisions) Bill, I had a pleasant experience. The Minister heard my comments, came forward with reassurances, took my amendments away and went one stage further to bring them back as amendments on Report. I had intended to press amendments Nos. 53 and 54 to a vote, but I am happy to hear her reassurances. I hope that she will think again, particularly about amendment No. 53. Although I shall seek the Committee’s leave to withdraw it, I shall look carefully at the guidance and, if necessary, bring it back on Report. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Photo of Stephen Hammond Stephen Hammond Shadow Minister (Transport)

I beg to move amendment No. 55, in clause 20, page 18, line 39, leave out ‘reasons’ and insert ‘evidence indicating’.

Photo of David Taylor David Taylor Labour, North West Leicestershire

With this it will be convenient to discuss the following amendments: No. 57, in clause 20, page 19, line 16, at end insert—

‘(c) an outline of the evidence of why the proposed scheme will provide a substantial improvement to the relevant service or services in comparison to the current service or services or the service or services that could be provided under a quality partnership scheme.’.

No. 211, in clause 30, page 27, line 28, at end insert—

‘(ca) a statement of the evidence demonstrating how continuing the scheme by means of a quality contracts scheme will provide a substantial improvement to the relevant service or services in comparison to the service or services that could be provided under a quality partnership scheme;’.

Photo of Stephen Hammond Stephen Hammond Shadow Minister (Transport)

Amendment No. 55 would ensure that the consultation document is a real document that can be responded to. The Bill says that authorities must state their reasons. I contend that the wording of that measure is open to manipulation and misinterpretation. The current criteria and the word “reasons” are subjective and difficult to quantify.

It is fair that people asked to respond to the consultation document should have the chance to assess all the relevant information put in front of them. Rather than having local authorities state subjective positions, consultation procedures should be open, fair and evidence-based. I therefore propose that the word “reasons” be replaced by the word “evidence”. The effect would be that the consultation document issued by the local authority would give a clear basis for how the decision was reached rather than simply stating what that decision was. Consultation can be effective only if it is based on facts and if people read those facts to make their decision. My amendment would therefore require local authorities—

Photo of Graham Stringer Graham Stringer Labour, Manchester, Blackley

Not for the first time in this or any other Committee, an hon. Member is reinventing the wheel. Why is it not good enough to get a commitment from the Minister, or even in the Bill, that the Cabinet Office guidelines on consultation must be followed? They are thorough and well understood.

Photo of Stephen Hammond Stephen Hammond Shadow Minister (Transport) 4:45 pm, 29th April 2008

I will wait to hear what the Minister has to say in response, but as I was saying, this would put a requirement on local authorities to justify decisions by publishing the facts and evidence on which those decisions had been made. That is a reasonable and fair amendment.

Photo of Norman Baker Norman Baker Shadow Secretary of State for Transport

Does the hon. Gentleman accept that under the system proposed in the Bill, with the approvals board and the Transport Tribunal and so on, it will be in the interest of any transport authority to produce as much evidence as possible anyway, otherwise it will risk having its quality contracts overturned? Therefore, there is a self-fulfilling element to what local authorities will do here.

Photo of Stephen Hammond Stephen Hammond Shadow Minister (Transport)

The logic of the hon. Gentleman’s argument is therefore that he should support my amendment, because he would be happy with the word “evidence”. I assume that that is what he is prepared to do. This is a reasonable and fair amendment, and I hope the Minister agrees to it.

Photo of Rosie Winterton Rosie Winterton Minister of State (Regional Affairs) (Yorkshire and the Humber), Minister of State (Department for Transport)

Once again, these amendments illustrate the basic hostility of Conservative Front Benchers to the quality contracts schemes. The aim of these amendments is substantially to raise the burden of proof placed on local authorities to justify the reasons for proposing a quality contracts scheme in their consultation document. Government policy is to ensure that quality contracts schemes are a realistic option, and we agree that it is important to ensure that local authorities can justify the proposals to those directly affected by them and to their local communities. That is why the Bill requires an authority that proposes to make a quality contracts scheme to publish a consultation document.

The consultation document must describe the proposed scheme and the local authority must justify the proposals. In particular, the authority must explain why it is satisfied that the public interest criteria will be satisfied by the scheme. These amendments would raise that hurdle to an unacceptable level.

The intention of the Bill is to increase the range of options available to authorities to improve bus services in their area, but these amendments would increase the burden of proof in such a way as to make quality contracts an unattractive option for an authority to pursue. That would completely negate the improvements that we believe the Bill will make to the quality contracts scheme system.

The amendments show that Conservative Front-Bench Members do not believe that quality contracts should be introduced. They have said already that they would abolish them if ever there was another Conservative Government, and this is an illustration of that. We cannot accept the amendments, because they would undermine the system we are trying to introduce.

Photo of Stephen Hammond Stephen Hammond Shadow Minister (Transport)

The Minister tells us that she wants the consultation procedure to be fair and accurate and open, but she does not want to put any objectivity into that. That strikes me as a pretty odd way to behave. I am not at all reassured by her comments, so I shall press the amendment and test the will of the Committee.

Question put, That the amendment be made:—

The Committee divided: Ayes 4, Noes 11.

Division number 12 Nimrod Review — Statement — Clause 20

Aye: 4 MPs

No: 11 MPs

Ayes: A-Z by last name

Nos: A-Z by last name

Question accordingly negatived.

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

Photo of Stephen Hammond Stephen Hammond Shadow Minister (Transport)

I rise to speak on clause stand part because I want to question the Minister on a number of issues that we were not able to tackle in our extensive discussions on the amendments.

Included in the consultation document will be a declaration by the local authority finance officer on the financing of the quality contracts. The Government say that the chief finance officer must declare the costs of the scheme and say that those costs can be covered under the authority’s budget. That is a sensible and important provision, particularly as the likelihood is that the costs will not be insignificant. I think everyone accepts that, in a number of areas, budgets will be tight.

Paragraph (e) of proposed new subsection 1A says that the chief finance officer, in making a declaration on funding, must take account of estimated fare income and of grants to be received. I understand the point about future income, but I want to tease out some of the Minister’s thoughts on future expenditure, because such schemes have the potential to incur expenditure.

In addition to the costs of implementing the scheme, as we heard this morning, many people believe that there is a threat of legal action by operators that find themselves losing out in the process. This morning, I cited an article on the subject by a leading lawyer. Local authorities are already aware of the risk that operators may launch legal challenges. Indeed, Metro, West Yorkshire’s passenger transport authority, is already planning to test its powers under the Bill. Under the draft guidance on the quality contracts, it believes that if it were to try an incremental approach it would be less likely to prompt the introduction of a challenge to quality contracts under human rights legislation.

The Government’s thinking is unclear. Comments in various articles say that under human rights legislation there is the potential for court challenges to be made to quality contracts. The courts will need to examine the substance of the schemes and any legal advice given on them. The documentation says that the chief finance officer must take account of finances. Does the Minister expect the chief financial officer to take account of other specified matters, such as associated potential liabilities?

I say that because this morning a number of hon. Members said that they would want such cases to be subject to judicial review. We have to accept that possibility. It will be a lengthy process, and the costs and awards could be large. I do not advocate any one side; I genuinely want to find out whether the Minister will say in guidance that when finance officers talk about future income and future costs they must have regard to potential litigation. If so, do those future costs have to include the costs of litigation and the sums that might be awarded to operators?

This morning, an hon. Member—I forget who—pointed out that they believe some bus companies are greedy and will consider challenging the legislation on the basis of the restriction of trade, as well as considering the possibility of challenge under the Human Rights Act 1998. That is a real possibility. Sir David Rowlands said to the Public Accounts Committee:

“Under the Human Rights Act any legal entity is entitled to the quiet enjoyment of their own property and you may only override that in the public interest”.

We discussed the public interest this morning. He went on to say that

“therefore to move to quality contracts requires a strong public interest reason; it cannot be done simply because somebody would like to have quality contracts.”

In relation to clause stand part, I want the Minister to say what the Government’s position is. They appear to be saying that there is no liability in relation to compensation because, as a result of quality contracts, the bus operators will retain their assets. Is that genuinely the Government line? If it is, it seems to  ignore two things that may be relevant: the issue of economic rent, which is the difference between the value of an asset being used for the purpose for which it was started and the value for the second best use of that asset, and the fact that there is good will associated with the operation of that asset, which the Government must recognise is also an asset that could be rendered valueless.

I am asking the Minister to tell us these things. First, as she knows, the Bill states that the chief financial officer will have to make a statement of future income. Will he also have to make comments about future expenditure, and will he have to qualify or at least attempt to qualify what liability there is? Is it the Government’s position that compensation is not an issue for operators and that it is unlikely to be given? I hope that the Minister can give the Committee some guidance on that practice.

Photo of Rosie Winterton Rosie Winterton Minister of State (Regional Affairs) (Yorkshire and the Humber), Minister of State (Department for Transport)

The hon. Gentleman makes the point that there is the risk of judicial review in certain circumstances. As he said, he read some legal advice that set out instances in which that might happen. That goes back to this morning’s discussion. We want an approvals board procedure and the ability to appeal to a transport tribunal, because that minimises the risk of judicial review. Therefore, the measures in the Bill mean that if a transport authority has properly followed the process of either making or continuing a scheme and the necessary criteria have been satisfied, we will not get into a situation in which there will be further litigation.

However, on the specific issue raised by the hon. Gentleman—whether the financial assessment of the scheme will include funding for litigation—it is probably true to say that a prudent authority will set aside some contingency funding for litigation, which might arise for a number of reasons. However, it is not reasonable to expect them deliberately to budget on the basis that they will be taken to court. It would be quite difficult to calculate the costs, and if the authority won a case it might recover all the costs.

In the circumstances, I am not sure that it would be helpful to pluck a figure out of the air and wave it in front of the public. Authorities have to take such risks in relation to litigation in many areas in which they work, but it is not necessarily appropriate for that to be put in the financial assessment of a scheme such as this.

Photo of Stephen Hammond Stephen Hammond Shadow Minister (Transport)

I am not suggesting that the chief financial officer of any particular area should stand up and say what he expects the cost of litigation to be, but in a number of areas there is a general health warning attached to a statement. I want to understand whether there will be in the statement a general warning that there is the potential for litigation and compensation. That is what I am trying to find out from the Minister.

Photo of Rosie Winterton Rosie Winterton Minister of State (Regional Affairs) (Yorkshire and the Humber), Minister of State (Department for Transport) 5:00 pm, 29th April 2008

I think that authorities are aware of where there is potential for litigation. One of the difficulties with the current situation is that local authorities are worried about litigation and, as a result, feel that it is difficult for them to bring in quality  contracts schemes. That is why we are trying to change the system to give greater protection to authorities in how they can make schemes, so that the risk is minimised.

As I said, I am sure that prudent authorities, when considering undertaking projects where there is any risk of litigation, will take that into account. That, frankly, is up to them. Part of how local authorities decide whether to press ahead with a scheme will be weighing up all the risks that they are likely to incur when doing so. I know that that is the process that many—or some—local authorities have gone through when looking at the issues around making quality contracts at the moment.

The hon. Gentleman asked about compensation for bus operators. We do not think that the issue is one where there should be compensation for bus operators. They will not be deprived of their assets. They will be free to deploy them elsewhere if, for example, they do not wish to tender for quality contracts or fail to win any tenders. Again, the public interest criteria that the local authority must satisfy include a proportionality test, so they will want to look at any adverse effects—for example, on local authorities—and satisfy themselves that that is proportionate to the improvements for people living and working in the area and to the achievement of the scheme objectives.

I can assure the hon. Gentleman that we will issue guidance to local authorities on applying that test. All the measures, taken together, will ensure that all operators have a fair opportunity to compete for the right to operate services in an area where a quality contracts scheme is set up. I hope that that explains the situation.

Photo of Norman Baker Norman Baker Shadow Secretary of State for Transport

I want to pursue a couple of points. That aspect of the Bill is important if local authorities are to have confidence—which many of us want them to have—in the Act that finally emerges.

On the compensation point raised by the Minister, the hon. Member for Wimbledon rightly referred to good will, which is an important issue to take into account. Historically, the Government have approached it in different ways. For example, under the Hunting Bill—if I dare mention it—no compensation was provided, because people still had their horses, stables and so on. On the other hand, when fur farming was made illegal, compensation was provided because the fur farmers lost their livelihood. Two different approaches have been adopted by the Government in recent times.

Photo of Norman Baker Norman Baker Shadow Secretary of State for Transport

That is the answer.

It will be perfectly possible for bus operators to feel aggrieved if they have built up a route through their own marketing and efforts—attracted passengers whom they did not have before—only for it to be taken away from them because of how the quality contracts work out. That is unlikely, however, because any sensible local authority will want to build it into any system. Nevertheless, the hypothetical possibility exists of someone losing what they have built up, and they will not get compensation. Still having their buses and garage will  be of little consequence to them if they have lost their route and, perhaps, their livelihood. That might be the only route they operate, for example, which is an issue.

We must first address the natural justice aspect—I would like to hear the Minister’s comments on that—but we must also address the local authorities’ point of view and give them confidence that if action is taken, a robust legal defence will be available to them that they can be confident will work in the courts.

Pursuant to that, I am interested to know—not expressly today, but in broad terms—what guidance the Department for Transport intends to provide to local authorities on dealing with potential legal issues. I am not entirely happy with the Minister’s statement that it is up to them. If local authorities or ITAs pursue quality contracts in a way that is consistent with the Government’s intentions in the Bill, it will be wrong and unfair if they end up considerably out of pocket as a consequence of legal action. In such circumstances, will the Department for Transport feel obliged to support local authorities financially? That is an important point of principle—not just in terms of natural justice, but in giving local authorities some confidence and clarity on how the legislation will unfold.

Photo of Rosie Winterton Rosie Winterton Minister of State (Regional Affairs) (Yorkshire and the Humber), Minister of State (Department for Transport)

The point of this morning’s discussion on the approvals board and transport tribunals was that we want to set up a system that provides local authorities with greater certainty without huge cost. We want local authorities to be able to go through a process that will effectively agree that the public interest criteria and proportionality have been met.

The hon. Gentleman chose a particular instance involving an operator running down a perfectly well-running route that makes a profit and has lots of passengers. I believe that local authorities will take a sensible approach in such scenarios. That is why we have public interest criteria to ensure that schemes bring benefits to passengers and offer good value for money. If a local authority simply removes a well-running route, depriving passengers of buses and the scheme of that income, that, in a sense, would not satisfy the public interest criteria. It is about getting the balance right between the two.

To return to the hon. Gentleman’s point about the Department stumping up all the money for judicial review challenges, it is the role of the Government and the Department to set up a system that works well for local authorities, but it is then for the authorities to decide whether they wish to go down that route. As I said, it is quite difficult for local authorities. We know that judicial review can be expensive. That is part of the risk that they must take into account. I am sure that it is an incentive to ensure that schemes are robust.

No local authority will want to introduce a challengeable scheme that might cost it a lot of money. It will also not be appropriate for the Department to stand back and say, “Don’t worry, if it all goes wrong we’ll pay all the costs.” That would be ridiculous, so I cannot give the hon. Gentleman any comfort there. However, the aim of the Bill is to minimise the possibility of judicial review and to ensure that schemes are good value for money and fair to all concerned.

Question put and agreed to.

Clause 20 ordered to stand part of the Bill.