Chamber and committees

If I may, I would like to address Graham Simpson’s point. I look forward to Graham Simpson agreeing with the Scottish Government—and, I assume, voting with the Scottish Government if we bring this to Parliament—that rail services should be fully devolved, which would enable Scottish Governments of any colour to decide what policy on rail they want. I am looking forward to that support.

That assessment helped us to make sure that we have our finances in position and are capable of dealing with the potential procurement. That exercise has been done. Our job now is to let ScotRail get on with the procurement, which is what I am announcing to Parliament will happen.

The clear model, which I will continue to set out, is for rail services to be fully devolved to Scotland. I have already stated that in my meeting with the UK Secretary of State for Transport. The right way forward for Labour would be for it to recognise devolution and that Scotland has been leading in much of the policy direction that it wants to go in. If, following the understanding that we can have devolved operation of transport services, Labour wanted to copy our model for the rest of the UK, it would be a shame and, I think, a retrograde step if it centralised rail. That would be problematic, and I would like to see the full devolution of rail services.

It is early doors and, to be fair to the new incoming UK Government, it is focusing on the immediate legislation that we are discussing. I hope that the atmosphere is favourable and there can be an understanding. I would hope, with Alex Hynes having been seconded into the UK Department for Transport, that there will be an understanding in the centre of the UK Government of Scotland’s position and the opportunities that exist.

I am not sure whether there have been discussions at official level on the likely timescales for the next phase of the establishment of GB rail.

Well, you might say that the UK Conservative Government eroded the option of future UK Governments to have public ownership. That is what it did when it privatised the railways. It is open to any UK Government to overturn that in the future, and that is exactly what the incoming UK Government could do.

As for the sections, I make the important point that I am interpreting the UK legislation; it is not our preference or our policy. We believe that public ownership is the right way forward, which is why we took the steps that we did. We were the first to do so, and I think that, in recognition, the UK Government is now catching up to the position that we have been in.

If it helps, I have found the provision that might reassure you on whether the options would be there if, at some unlikely point, a Government came into Scotland that wanted to do something different. Our understanding—remember that this is what the UK Government has put in—is that the bill amends section 23 of the 1993 act so that the Scottish ministers will have a duty, from time to time,

“to designate services”

that

“ought to be provided under section 30”,

rather than under a franchise agreement. The bill will also amend section 24, which I referred to, so that the Scottish ministers could exempt services from such designation and allow for them to be provided otherwise than under section 30. That is very technical, but we understand that that is what the UK Government is doing.

If services were exempted from designation by order, the duty under section 30 would not apply and the Scottish ministers could make alternative arrangements to secure the provision, which could include a contract award to a private operator. That is our understanding of what the UK Government is doing—as I said, it is leaving the window open. That is not our preference, but the provision is in the legislation.

I am happy to do that, if we can find a technical way of doing so. I am sure that my office is watching this session and that we can find a way of doing that.

The Scottish Government’s policy decision is that our preference is for public ownership—and, similarly, that is the new UK Government’s preference. I think that there were also continuing concerns during the previous UK Government as to whether public ownership was the right way forward.

Different Governments can make decisions at different times about what their policy priority is. The bill aligns with the Scottish Government’s approach, which is why we are saying that we want Parliament to give consent to it.

The decision would be up to a future UK Government. This is a reserved area, so we must ensure that our powers, which we have used to our best ability under devolution, can be protected, and that is what we are doing. As I said in my opening remarks, the current rail service operation is on a more temporary basis; the bill will put it on a more permanent one.

I think that your point is about what would happen if a future Scottish Government took a different decision. I will give my understanding of how the UK Government has framed its position; I might bring in Bill Reeve on the technicalities. There is currently a presumption in favour of franchising, with an exemption for an operator of last resort, which we have used. The bill will flip that, so that the presumption is that there will be public ownership. That does not preclude a private company from operating in the future—there would be a period of designation that would allow the UK Government to decide on that at some point, if it chose to. That is my interpretation of how the UK Government has framed the legislation.

I understand that the legislation would operate with an interplay between sections 24 and 30 of the 1993 act, but the UK Government is doing that in quite a technical way. I would interpret that in layman’s terms as leaving a window open and not closing it completely. Bill Reeve can explain the technicality of what the UK Government is doing and can correct me if I have misrepresented it.

Convener, I also want to say that, as you know, I have the utmost respect for the Parliament, and it has always been open for ministers to make announcements in chamber or in committee.

Excellent.

Obviously, any rail disruption causes issues and problems for commuters, as we all know. We have not had the same degree of industrial action as has taken place over the past number of years in England, which I think has caused the majority of the cross-border problems.

There might be interaction between cross-border problems as a result of industrial action or, indeed, as a result of problems like the one that I experienced with LNER on Sunday. It seemed that everybody travelling from Waverley station who was going south to London had to turn up at Haymarket instead, which made it rather congested. My understanding is that that was as a result of a breakdown—and breakdowns happen.

Some of the issues will occur on an operational level. However, I hope that there will be a degree of stability in the system. I think that pay negotiations are being finalised, and I am very pleased that the rail unions are recommending that the Scottish pay offer is accepted. I understand that something similar is being attempted in the rest of the UK, which is welcome.

There is a combination of things. Public ownership in and of itself has, I think, stabilised our relations with the trade unions. They have said that relations have been in a much better place since public ownership. Will it be the same with the UK Government? I would hope so, but we obviously have not seen evidence of that yet.

Another benefit of public ownership is that we are focusing on passenger service delivery as opposed to companies seeking profit. That allows reinvestment in the service. It is quite telling that 400 additional staff members have been employed since public ownership. A lot of those are front-facing and public safety roles. The figure includes 260 new drivers, and another 160 drivers are being recruited currently. Replacing drivers is always a challenge. People retire, they can work for other companies and so on. Ensuring that we are not dependent on overtime and rest-day working is a common interest, and trying to achieve that is the right thing to do. Trade union members are perfectly entitled not to work on a rest day or to do overtime.

If there could be more stability in the system, that would really help everybody. It would mean that we would not have to have the temporary timetables that we have seen. The major disruption that is caused by strike action in the rest of the UK has had knock-on effects.

It is all quite complex. I am not going to assume that public ownership will suddenly resolve everything and that everything will be okay. Some of the issues will be at the operational level, and what happens will depend on the attitude of the employers and their behaviour towards their workforce. There are many challenges ahead. There always are, as I have realised since taking on the transport brief.

Thank you, convener. Good morning, members, and thank you for inviting me to discuss the legislative consent memorandum for the UK Government’s Passenger Railway Services (Public Ownership) Bill. I welcome the objectives of the bill as introduced and I recommend that the Scottish Parliament should give it legislative consent.

The bill represents an important development for which the Scottish Government has long advocated—the shifting of rail services back into public ownership across the UK. The bill aligns with the Scottish Government’s policy aims and objectives of a fully publicly owned railway to deliver for the people of Scotland and to achieve our vision of a reliable, resilient, affordable and accessible railway.

As members might be aware, the Scottish Government has already sought to achieve that for ScotRail and the Caledonian sleeper services as far as is possible within the current legislative framework, which is reserved. In 2022, operator of last resort deployment brought ScotRail and the Caledonian sleeper services into public ownership and control. Our duty to provide or secure the provision of services under section 30 of the Railways Act 1993 was engaged, and those services are now delivered through arrangements with our wholly owned company, Scottish Rail Holdings Ltd, and its subsidiaries.

The Scottish arrangements already align with the UK bill, and amendments to section 30 of the 1993 act will mean that those arrangements can continue on an on-going basis; indeed, achieving that aim as well as protecting Scottish devolved policy interests has been my key priority with the bill. Officials’ extensive engagement with the UK Government Department for Transport and with Scottish Rail Holdings has allowed us to consider and take an informed view of the bill’s policy intent since July, and I thank them for that. I also welcome the willingness of the UK Government secretary of state to engage with me and transport ministers from the other devolved Governments on the bill and, in particular, the close working among our officials.

The bill allows services to be delivered by a public sector company as the first-choice option rather than as the last resort. It allows current public sector delivery arrangements to be permanent, which will provide a stable network on which we can continue to provide reliable, affordable and attractive services.

The bill amends the Railways Act 1993 to replace the presumption that rail passenger services should be delivered by franchises with a presumption that they will be brought into public ownership when current franchise agreements end. It expects franchising authorities, including the Scottish ministers, to provide or secure the provision of designated services according to their duty under section 30 of the 1993 act, which is currently known as the operator of last resort duty.

The Scottish Government considers that the bill engages the legislative consent process, as modifications to the 1993 act alter the executive competence. The bill removes the power to award franchise agreements and the requirement to publish a statement on how that power will be exercised, and it proposes a new duty to designate services that ought to be provided under section 30. It prohibits extending existing franchise agreements or agreeing new ones, although the UK secretary of state, as the only franchising authority still to have franchise agreements in place, will have a temporary power to make further short-term awards or extensions to incumbent franchisees in certain circumstances.

The bill amends section 30 to ensure that the duty exists on an on-going basis, and not only in circumstances when no franchise agreement is in place in respect of the services. Franchising authorities may secure the provision of services to fulfil that duty only by directly awarding a contract to a public sector company, which can be a wholly owned company.

Finally, I have another important rail-related announcement on which I would like to update the committee directly. As the announcement will be made via the answer to a Government-initiated question this morning, it would be remiss of me not to use the opportunity provided by this morning’s meeting to give an update.

I am announcing today that the Scottish Government has agreed to ScotRail moving to replace the intercity high-speed train fleet that operates between Glasgow, Edinburgh, Aberdeen and Inverness. More than 4 million passenger journeys were made on intercity trains in the past year, and I want to maintain and, where possible, increase that number. This planned investment will ensure the reliability of our intercity routes for the long term, reduce emissions from intercity services and support our efforts to decarbonise Scotland’s railways. The contract notice will be published in a few weeks, and I will update the committee on progress.

In the meantime, I thank you for inviting me to discuss the legislative consent memorandum for the UK Government’s Passenger Railway Services (Public Ownership) Bill, which I am happy to answer questions on.