19 September 2023
West Coast Main Line Franchise

Jesse Norman, Minister of State for Decarbonisation and Technology, responds to an Urgent Question on the contractual and operational situation of the west coast main line franchise.

The Minister of State, Department for Transport (Jesse Norman)

I am grateful to the hon. Gentleman for his congratulations. The Minister of State, the hon. Member for Bexhill and Battle (Huw Merriman), continues to represent His Majesty’s Government today in Poland to support UK train companies, among others, at a major international trade fair, and I am therefore replying on his behalf.

The Department has awarded a new national rail contract to First Trenitalia to continue to operate the west coast partnership, providing west coast train services as Avanti West Coast. The national rail contract will have a core term of three years and a maximum possible term of nine years. After three years the Department can terminate the contract at any point with three months’ notice.

In October 2022 and March 2023 the Department approved the award of short-term contracts to First Trenitalia operating as AWC to continue to operate services on the west coast main line. Awarding short-term contracts allowed the Department to monitor progress by AWC in improving performance following the withdrawal of rest day working before considering whether it would be appropriate to award a long-term contract. Avanti’s performance has improved significantly during this time, and taking into account other relevant considerations, the Secretary of State has decided to award a longer-term contract, as announced in today’s written statement.

Over recent months Avanti has made significant progress in recovering from the poor reliability and punctuality delivered in the latter half of last year. In line with its recovery plan and since the introduction of its recovery timetable in December 2022, performance has steadily improved, with cancellations attributed to AWC falling from 13% in early January 2023 to as low as 1.1% in July 2023. Over 90% of trains now arrive within 15 minutes of their scheduled time, an improvement from 75% in December 2022.

Gavin Newlands 

Another day, another blow for passengers who use the west coast main line. Fresh from the negative cross-party reaction yesterday to news that High Speed 2 phase 2 is on the chopping block, we have the Department for Transport on the last day before recess—shock, horror—sneaking out the extraordinary award of up to nine years for Avanti West Coast and up to eight years for CrossCountry.

Despite improvements in Avanti’s service, it is still not running a full timetable, and the Minister cannot ask us and passengers up and down the west coast main line to simply forget the last few years of horrendous performance. The Avanti service was on the brink, run into the ground by mismanagement and poor labour relations. In his letter to MPs the Secretary of State says that “Avanti is the most improved operator where performance is compared to the previous year.” Well, that would not be particularly hard—talk about setting yourself a low bar. This award will be seen by most people as rewarding failure.

My criticism of Avanti is in no way reflective of the staff, who have been first class when I have used the service. I was not overwhelmed with confidence, however, when it took me several attempts at last week’s Select Committee to get Mr Mellors to tell me just how many jobs he proposed to cut by closing the Glasgow ticket office.

Given the variable standards delivered by Avanti, we need full transparency. So can the Minister tell me the exact criteria Avanti will have to consistently meet if the extension at the end of the core contract is to be granted? What engagement has the Department for Transport had with trade unions and the Scottish Government in making this decision? What alternatives did the Department consider? Was the operator of last resort considered?

Does the Minister not understand that this award will be seen as Tory “private best” dogma? We have piles of evidence through the operator of last resort and Scotrail that publicly owned and operated railways work. Moreover, with its stake in Avanti, First Trenitalia might well be able to reinvest in Italian rail infrastructure. Is it not time to follow Scotland’s lead and put our railway back into the public sector, where it belongs?

Jesse Norman 

I thank the hon. Gentleman for his flurry of questions, and I shall address what he said. He asked for the release of the criteria of the contract awarded; that is a commercial matter and we are not going to discuss that, but I can reassure the hon. Gentleman that the Minister of State my hon. Friend the Member for Bexhill and Battle has met very regularly with the entire industry and has been working on a weekly basis with officials and with Avanti, and therefore has had the matter very much in hand.

On the performance the hon. Gentleman describes, I am astounded that he is not agreeing with the Secretary of State and celebrating the improvement over the last nine months, and six months in particular: cancellations were as low as 1.1% in July; 90% of trains arrive within 15 minutes; over 100 additional drivers have been trained and brought on since April 2022. Each of those is a significant achievement.

It is all very well for the hon. Gentleman to talk about engagement, but the hon. Gentleman has not exactly been shy in writing to the Department, so I asked my officials to scan the letters we have received and I do not think there was a single one from him in the last year mentioning Avanti. If that is an indication of how content he is with the service, I am delighted to hear it.

Mr Deputy Speaker (Mr Nigel Evans)

I call the Select Committee Chair.

Iain Stewart (Milton Keynes South) (Con)

As a regular user of Avanti services, I agree that the performance has improved markedly and I pay tribute to the new managing director, Andy Mellors, and his team for turning around what was an abysmal service. I appreciate that the Minister will not be able to talk in detail about the contract, but will he say a bit about the extent to which this new contract moves away from the micromanaged national rail contracts that have been in place since covid? They were right at the time, but are now stifling innovation in the sector and I hope that this is just the first of the revisions of these national rail contracts.

Jesse Norman 

I am grateful to my hon. Friend for his question; he brings not just personal experience of this service as an MP for Milton Keynes but also his considerable expertise as Chairman of the Transport Committee. He is right to pick up on the point of micromanagement, and that is one reason why, having been in a period of relatively short contracts—a number of two-month and three-month contracts—in order to monitor progress, the Government have now seen fit to move to a much longer framework: a three-year contract but with the potential capacity to terminate thereafter if performance is not sustained. That strikes the right balance between giving the certainty Avanti needs to continue to invest in improving the service and the accountability that the Government rightly demand.

I would add that there is some awareness that in relation to services to Milton Keynes, west midlands and north Wales there is progress to be made, and I think I am right in saying that the new chief executive is very much focused on that issue as well.

Mr Deputy Speaker (Mr Nigel Evans)

I call the shadow Minister.

Stephen Morgan (Portsmouth South) (Lab)

For the second time in two days, the Government have been dragged to the House to explain the state of our crumbling rail network, and for the second time in two days, the rail Minister has failed to turn up. Surely things cannot get any worse for passengers in the north, we thought, but today, the Minister has proved us all wrong by confirming that passengers could have to suffer up to nine more years of Avanti West Coast and up to eight more years of CrossCountry.

The Minister claims that there has been enough improvement to justify up to a decade more of the utter chaos that is consuming our railways thanks to those two failing operators, yet the latest statistics show that Avanti was the second worst operator in the country for punctuality last month, with only 46% of its trains running on time. CrossCountry was the fourth worst, with only 49% of its trains on time. What is the Government’s response to that? More lucrative contracts and millions of pounds paid out in performance bonuses. These decisions have left glaring questions for the Minister to answer. What performance metrics were considered when the Government made these decisions? Have performance payments been restructured in the new contracts, or will they continue to reward failure? Did the Government consider the operator of last resort, which has driven improvements on other lines?

The country is tired of this cycle of failure, with cancellations and delays, and any prospect of reform kicked into the long grass. It is clear that this Government are determined to run our rail network into the ground. Is their plan really to allow for rail services to have another decade of failure under the Tories, with hundreds of millions handed over to shareholders in performance bonuses and fees? If so, it is clear that they are out of ideas and out of time. If they cannot put passengers first, is it not time for them to step aside and let us deliver the change our passengers so desperately need?

Jesse Norman 

I thank the hon. Member for that brave shot. Let me just remind him that, far from being dragged to the House, the Government published a written ministerial statement and a press release this morning. Not only that, but to the extent that the Government were dragged to the House, it was by the Scottish National party. This is the second time in two days that the Labour party has been caught napping by another party in this House. As to the availability of the rail Minister, we try to pay total football in the Department for Transport. While Cruyff is haring down one wing, we expect Neeskens to be playing through the centre, and that is how we think about these things.

The hon. Gentleman is right to highlight the previous underperformance, but he is entirely wrong to predict that that will continue, because we see the evidence in front of us. As I have already said, cancellations have been as low as 1.1% in July, and over 90% of trains are now arriving within 15 minutes of their scheduled time. That is part of the basis on which the Secretary of State has decided to award this new contract. If the alternative that the Labour party is proposing is the nationalisation of our railways, I look forward to seeing the budgetary implications of that, let alone any justification that civil servants directed by Labour Ministers would do a better job than this new professional team at Avanti.

Greg Smith (Buckingham) (Con)

While I appreciate the points that the rail replacement Minister makes about recent improvements in Avanti, does my right hon. Friend accept that the failures of Avanti in recent years have led to consumers voting with their feet and refusing to use Avanti services where they can? In the case of passengers traveling from Birmingham to London, they have been coming on to the Chiltern line instead, which is adding to the overcrowding on that line. What reassurance can he give that there are incentives in the new contract for Avanti to win back that trust, so that we are not maintaining overcrowding on other railways such as Chiltern?

Jesse Norman 

With my hon. Friend’s minutiose attention to detail, he will recognise that yesterday we had the rail replacement bus Minister, but today we have another rail replacement Minister. That is thoroughly in order.

As regards the effect on customers, again, my hon. Friend is spot on. It is very noticeable how much the new team at Avanti recognise the commercial challenge of wooing back customers they have lost following the disastrous underperformance of last year, which they recognise, understand and accept. That is a vital commercial challenge. We judge that they are beginning to meet that and doing more than beginning to meet that as a matter of service. There is much further to go as regards the extension of the quality of the service. They recognise that, and that is all in the interest of customers and better customer experience.

Mike Amesbury (Weaver Vale) (Lab)

It seems that this contract has been awarded on the basis that it is a little less crap than it used to be. Is that really the way to make a decision in Government? The Office of Rail and Road statistics in August showed that Avanti was the second worst performing operator, with only 48% of trains running on time. That is not good enough. I speak as someone who is a customer, and I speak on behalf of my constituents in the north. It is appalling. This is ideologically, dogmatically driven. It is a nonsense.

Jesse Norman 

The hon. Member’s use of choice parliamentary or possibly unparliamentary language is not something I would want to repeat, even if I thought it was accurate. It is important for him to recognise the progress that has been made. If he does not recognise that, that is a pity, because there is a very considerable improvement. The question now for the House and for Government is how to sustain and enhance that improvement in the longer term. The judgment has been made that a longer-term contract will give the stability in which the company can invest for the betterment of travellers, and that is to everyone’s advantage.

Mr David Jones (Clwyd West) (Con)

It pains me to say it, but I have to tell my right hon. Friend that the decision his Department has made today will be very badly received in north Wales. North Wales passengers have had to endure a substandard service from Avanti for far too long. The prime example of that was this summer—at the height of the holiday season, which is so important to north Wales—when Avanti decided to cut four services and provided virtually no through services from London to the region. Can my right hon. Friend assure the House that his Department will be keeping a very close eye on Avanti’s performance in north Wales over the coming months and years and that, if necessary, it will terminate the franchise that has been confirmed today?

Jesse Norman 

I completely understand the concern that my right hon. Friend describes. As he will be aware, in many of these individual cases, problems lie at the network level, or are a result of driver shortages or other reasons, as well as underperformance by the company, but I absolutely recognise—and Avanti recognises—the point he raises. The answer is that, of course, the Department will remain very firmly focused on continuing to hold this company to account for the delivery of services and the continued improvement of those services.

Tony Lloyd (Rochdale) (Lab)

Once again, we find that Transport Ministers cannot even find friends on their own Benches for these decisions. People in my constituency and in the north of England will be astonished at the decision to reimpose Avanti because of its systematic failure. The Minister did not answer the question he was just asked. Will the Government guarantee that they will cancel Avanti’s contract if, once again, it is the poster boy for failure?

Jesse Norman 

That was not the question I was asked; I did answer the question that was asked. It is built into the new contract structure that, after the initial period, which allows for the investment that is required to continue to make sustained improvement, there is a recurring three-month capacity to call in the contract as required, precisely in order to exercise the kind of scrutiny and accountability that the hon. Gentleman is seeking.

Scott Benton (Blackpool South) (Ind)

I am a regular user of the west coast main line, and the improvements in both punctuality and reliability over recent months have been welcome. The Minister will be aware of the ongoing capacity issues at Preston station that are compromising potential improvements across Lancashire, such as the creation of a passing loop on the South Fylde line, which would double the number of trains coming into Blackpool South every single hour. Can the Minister raise that issue with departmental colleagues, so that we can hopefully break the logjam and create the conditions for improvements in localised services in Lancashire?

Jesse Norman 

I thank my hon. Friend for his positive remarks, which give the lie to the previous comments made directly. I can assure him that the Government are focused and will remain available to discuss and consider that point.

Can I also reiterate and double down on a point that I made earlier? One of the functions of being able to provide a longer contract is to allow the introduction of more fleet and, in particular, a brand-new fleet of electric and bi-mode Hitachi trains to replace the current diesel fleet. We expect that there will be sustained improvement at the level of rolling stock as well as at the level of service provision.

Christian Wakeford (Bury South) (Lab)

Judging by their appearances in the Chamber, I guess that the ministerial team are just like Avanti: delayed or cancelled. Yes, the service has improved, but from such a low level, and it is still a woeful service. Does the Minister truly believe that this is a good outcome for passengers?

Jesse Norman 

I am not sure what the hon. Gentleman is referring to, since the Minister was on time. I will not say that it was an improved service over the normal one, but it was hopefully an adequate replacement.

Of course, the Government stand behind this decision. A process of care and attention has been given weekly to the performance of the company, and separately to the contract grant. It has been done with great attention to detail, as the hon. Gentleman would expect.

Virginia Crosbie (Ynys Môn) (Con)

Holyhead is the second busiest roll-on roll-off port in the UK and, with Anglesey’s new freeport status, we are at the beginning of our economic renaissance. As such, it is vital that we have connectivity, particularly now that the Labour Government in Cardiff will not agree to a third Menai crossing. How are Ministers going to ensure that Avanti delivers a reliable service with direct trains from Holyhead to Euston for my Ynys Môn constituents, many of whom shared their frustrations with the rail Minister when he visited Anglesey in the summer?

Jesse Norman 

It speaks very well of the rail Minister that he did visit, and engaged with my hon. Friend and her constituents—I think that is absolutely right. She asks how it will be done: it will be done by providing a contractual framework in which there can be more investment; by bringing on 100 more drivers; by recognising that there is considerable scope for further improvement in the service, to north Wales in particular; and by improvements in rolling stock. All of that will make for a better service.

Charlotte Nichols (Warrington North) (Lab)

Data shows that the number of trains cancelled across the rail network continues to rise and is at the highest level since records began in 2014. The Minister keeps referring to July’s figures, knowing full well just how bad August’s are—in fact, statistics show that trains in Ukraine are running more reliably than our services here, despite that country’s network clearly being under considerably greater pressure. These problems do not stop with Avanti: persistent issues on the west coast main line have a knock-on impact on any east-west services crossing that line. When will the Minister accept that the current system is simply not working?

Jesse Norman 

The hon. Lady is absolutely right that there are knock-on effects and that some of those effects bear on east-west services. That is one of the reasons that the Department has separately announced and negotiated a national rail contract for CrossCountry as a rail operator, in order to provide a framework for stable further investment in those knock-on services.

Preet Kaur Gill (Birmingham, Edgbaston) (Lab/Co-op)

I declare an interest as a long-suffering user of the Avanti service on the west coast main line. In 2021-22, Avanti had the most customer complaints of any operator and it is consistently rated one of the worst-performing operators on the rail network. Despite that, Ministers spent an eye-watering £4 million of taxpayers’ money in bonuses to company executives for customer experience and acting as a good operator. Can the Minister explain when it became Government policy to reward failure?

Jesse Norman 

The hon. Lady is deliberately drawing on statistics from before the recent improvements that the Government are recognising in this contract award. However, there is a further point: it is of course right to raise individual items, but we ought to get away from a situation in which politicians feel that they can micromanage and second-guess decisions made by people at the operating level. The key thing is to make sure that the quality of management is in place to drive continued, sustained improvement, as we expect it now is with the new chief executive, Mr Mellors.

Jeff Smith (Manchester, Withington) (Lab)

As a regular user, I recognise that the Avanti service has improved in recent months—although frankly, it would have been hard for it to get much worse—but given the sustained poor performance in the past and the August performance figures we have just heard about, this contract award feels very premature. Would it not have been better to wait and ensure that we see proven, sustained improvement from Avanti before awarding such a long contract?

Jesse Norman 

Of course, a variety of considerations sit around any contract award. The attraction of this one is that it allows the most rapid possible progress on fleet improvements and support for the new management team that might be expected. As the hon. Gentleman would imagine, the Secretary of State has spent a considerable amount of time talking to the new management to make sure that they really are focused on improvement, and to hear in detail what their plan for that improvement is. The award was made in part on that basis.

Justin Madders (Ellesmere Port and Neston) (Lab)

This decision is as embarrassing as it is baffling. The Minister talks about improvements, but my constituents have not seen those improvements. He talks about reducing the number of cancellations: with Avanti having cancelled half of the services from Chester directly to London, that will obviously reduce the number of cancellations. Yesterday, for example, Avanti started a train from Crewe rather than from Chester. That presumably does not count as a cancellation, but that is absolutely no consolation to someone in Chester. It seems to me that the Government know that the companies are playing with the figures and are prepared to accept a second-class service for the people of the north.

Jesse Norman 

I understand the hon. Gentleman’s concern. It is fair to say that, from day to day, there are different issues that interrupt a good service. As I have already said, those relate not just to the availability of drivers and other key staff, but to underperformance from time to time and disruption to Network Rail infrastructure. All of those things can play their role in a highly integrated network.

Samantha Dixon (City of Chester) (Lab)

The right hon. Member for Clwyd West (Mr Jones) and I have worked for many years on the issues surrounding rail connectivity covering Chester and north Wales and, since I arrived in this House in December, I have not seen any improvement. The Minister talked about micromanaging situations, but the reality is that the Government do not seem to have understood what happened to Chester and north Wales during the summer. As the right hon. Member said, the decision was taken to cancel through trains, which fundamentally affected tourism and the visitor economy, not just for Chester but across north Wales. To be honest, that smacks of gaming the figures, and my constituents and residents across north Wales are absolutely staggered that this contract has been re-awarded to Avanti West Coast. I simply do not understand that. This is so business-critical and important to local residents and there has been a failure to take into account the realities of travelling across Cheshire and north Wales.

Jesse Norman 

The hon. Lady did not ask a question, but I understood every word of her speech. Since she is new to the House, she might want to have a conversation directly with the rail Minister about this: he is highly engaged on these issues, as colleagues across the Chamber will know. If she has not seen any improvement in relation to her constituency, at least she has the satisfaction of knowing that improvements have been recognised around the House.

Wera Hobhouse (Bath) (LD)

The Government have ensured the immediate future of Avanti West Coast, but the same cannot be said for Great British Railways, which has an office but no powers. We urgently need a body to provide oversight and accountability to fix Britain’s broken railways. The Government are in favour of that, so can the Minister confirm that legislation to create Great British Railways will be announced in the King’s Speech?

Jesse Norman 

I thank the hon. Lady for her tempting invitation, but I am not going to second-guess His Majesty on what he will announce in the King’s Speech. What I can say is that this is a topic of great interest to the Government and, as she will know, the Department is making considerable progress in the non-legislative mode that we are in at the moment to achieve many of the goals we all share.

Alison Thewliss (Glasgow Central) (SNP)

Avanti manufacturing director, Andy Mellors, told the Transport Committee that Avanti would be cutting staff at Glasgow Central station by more than a third and closing its ticket office. Why does a company that delivers such a poor and expensive service, and that holds its customers in such contempt, deserve to have its contract renewed, potentially for almost a decade?

Jesse Norman 

What I recall from that hearing is that Mr Mellors said 1% of the tickets at Glasgow were sold through the ticket office, that there would be a full staff in front of the ticket office, that those staff would work from the first train in the morning until the last train at the end of the day and that they would continue to accept cash. That sounds like quite a good service offer to me.