Clause 57

Local Transport Bill [Lords] – in a Public Bill Committee at 5:45 pm on 6 May 2008.

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Attachment of conditions to related licences

Photo of Stephen Hammond Stephen Hammond Shadow Minister (Transport)

I beg to move amendment No. 244, in clause 57, page 49, line 14, leave out from ‘to’ to end of line 20 and insert

‘the licence mentioned in subsection (1) above’.

Photo of David Taylor David Taylor Labour, North West Leicestershire

With this it will be convenient to discuss the following amendments: No. 245, in clause 57, page 49, line 21, leave out ‘conditions are’ and insert ‘condition is’.

No. 246, in clause 57, page 49, line 25, leave out paragraph (b).

No. 253, in clause 57, page 50, line 8, leave out from ‘to’ to ‘a’ in line 9 and insert

‘the licence mentioned in subsection (5) above’.

No. 254, in clause 57, page 50, leave out lines 11 to 17.

Photo of Stephen Hammond Stephen Hammond Shadow Minister (Transport)

This string of amendments relates to the power of the traffic commissioner to attach conditions to operator licences. These conditions can be attached if the operator in question has failed to comply with the requirements and specifications of his licence. Such conditions can relate to the specific vehicles that can or cannot be used by the offending operator. Broadly, that is something that everybody will support, but the detail of clause 57 contains a much wider extension to the power of the traffic commissioner and I am not sure whether the Government meant that intentionally.

I am looking for some reassurance from the Minister regarding the Government’s intention, for the clause will enable the traffic commissioner to attach conditions not only to the licence of which the requirements have been breached, but to other licences held by that operator, and even to licences held by other operators connected with the offending operator. I am worried that those powers are excessive in the extreme, and that the punishment would be worse than the crime.

It seems wholly inappropriate that if an operator breaches the rules of its licence, another operator, even a related or subsidiary company, can be punished for the same offence, unless the traffic commissioner were going to attach conditions to all those licences as well. I cannot think of similar circumstances where such wide and varied penalties have been proposed.

Furthermore, if an operator holds several licences and one of them is breached, is it fair that every other licence could have conditions attached to it? The licences could relate to different types of service, for instance.

Obviously, the traffic commissioner needs the function to attach conditions to a licence if the licence is breached by the operator, but the powers that clause 57 gives him are much wider than that. Was that the Government’s intention, and, if so, in what circumstances does the Minister envisage those wide and excessive powers being used?

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

As the hon. Gentleman said, the amendments would, in effect, negate the purpose of clause 57, which is to extend the powers of traffic commissioners to take enforcement action against operators who fail to provide services of a satisfactory standard. It is the first of three clauses that will give traffic commissioners new or enhanced powers.

At present, traffic commissioners have at their disposal several powers that they can use to take action against operators who are not delivering a reliable service, who are not delivering the services that they said they would deliver, or who are using vehicles that do not meet the necessary safety standards. One of  those powers is that the traffic commissioner can attach conditions to an operator’s licence. The conditions can be used to prevent the operator from providing certain services, and can even go so far as to prohibit an operator from operating any bus services at all in a particular area.

That is an effective tool, but there are several difficulties with it. When we debated part 1 of the Bill, I referred to the fact that Great Britain is divided into eight traffic areas. When an operator applies for a public service vehicle operator’s licence, he must apply to the traffic commissioner for the traffic area in which the vehicles are based. Those vehicles may then be used anywhere in Great Britain. But a large operator with vehicles based in more than one traffic area will have separate licences for different traffic areas.

Under the current legislation, it is generally accepted that there is no power for a traffic commissioner to attach conditions to a licence held by an operator in another traffic area. This means that even if conditions are imposed, an operator can continue to provide services under a licence held in a different traffic area unless and until the appropriate traffic commissioner takes action against him.

There is also no power for a traffic commissioner to prevent operators from circumventing the effect of licence conditions by transferring the operation of services to a subsidiary of the same holding group of companies. Such potential loopholes weaken the powers of the traffic commissioner to take action if operators are failing.

The clause will give traffic commissioners the option, where conditions have been attached to an operator’s licence, to direct a traffic commissioner in a different traffic area to attach conditions to other licences held by the company. The other traffic commissioner could refuse only if there were good reason to do so.

The clause will also give traffic commissioners powers to attach conditions to licences held by operators connected with the original, defaulting operator, such as subsidiaries of the same holding company. I hope that the Committee will agree that it is only right that a bus operator should not be able to use the current limitations on the imposition of conditions on licences to circumvent enforcement action and, by doing so, to continue to operate bad services. That is exactly why clause 57 is in the Bill.

The hon. Gentleman’s amendments would undo those important changes, leaving operators the opportunity to continue to circumvent enforcement action. Moreover, amendments Nos. 245 and 246 would go even further, watering down existing powers so that traffic commissioners would no longer be able to impose a licence condition preventing a licence holder from operating any services in a particular area. Because the group of amendments would undermine the whole purpose of clause 57 and leave traffic commissioners with even weaker enforcement powers than they have at the moment, I cannot accept them, and I urge the Committee to reject them. With that explanation, I hope that the hon. Gentleman will withdraw them.

Photo of Stephen Hammond Stephen Hammond Shadow Minister (Transport) 6:00, 6 May 2008

I am not sure whether I agree with the Minister’s contention that the amendments would weaken the existing powers. I accept the possible need for an arrangement for holding companies or subsidiary companies, so that licences could not be switched from one company to another, as that would clearly not be right. I am still not convinced that she has addressed the point about the traffic commissioner’s greatly increased powers under the clause. The powers could give the traffic commissioner the ability to impose conditions on the licences of operators that are related, although not through a holding company arrangement. I may wish to consider the matter again on Report, and I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 57 ordered to stand part of the Bill.