As our report states, for the Welsh Government to be letting a franchise for the first time represents a big challenge, and as the Welsh Government response states,

‘Passengers expect a high quality and efficient service that is affordable and accessible to all.’

In this response, the Cabinet Secretary states that if the Welsh Government secured the repeal of section 25 of the Railway Act 1993, they would take steps to ensure that future franchises are developed on a not-for-profit model. I proudly spent my previous career working in the mutual, not-for-profit sector, and they must be allowed to compete on a level playing field. However, because of my experience, I also know that they’re just as capable of inefficiency, poor service and financial failure as any other model. How then can the Cabinet Secretary justify putting such a monopolistic approach before his responsibility to passengers and taxpayers?

As UK Department for Transport officials told committee,

‘concession models can work in urban environments…but…on wider franchises such as Wales and borders, giving bidders the flexibility to innovate, develop new services, develop new ticket products, being incentivised to do so by the profit motive, is preferable.’

We also heard that—and I’m quoting—even the Chinese Communist Party recognised the need to incentivise risk.

In accepting recommendations 12 and 13 in principle, the Cabinet Secretary states that, as part of the procurement process, he expects to see higher quality rolling stock introduced, and that this will help to reduce the impact on the environment. In April, I hosted the Senedd launch of Furrer and Frey’s white paper for developing sustainable, agile, multimodal transport solutions for Wales. Speaking afterwards with Vivarail, the company rebuilding former London Underground metro cars for mainline use, they told me that they have sufficient stock to produce just over 70 three-car trains and that they could give us a fuller picture of the next steps for their business, including new battery-powered and hybrid trains. They also said that they were in discussions with Wales and borders rail franchise bidders. I shared this with the committee, and I think I raised this with the Cabinet Secretary in committee, and hope that he can update us on this today.

In accepting our recommendation 14 in principle only, the Cabinet Secretary stated that he was reviewing freight policy for the core Valleys lines and would update committee once the policy position had been confirmed. After discussions with the chair of the Rail Freight Forum and the Chartered Institute of Logistics and Transport at the Furrer and Frey event, I shared with committee his statement that rail freight is an important component of the Welsh economy, keeping 4,000 maximum-rate heavy goods vehicles off the roads each day and reducing carbon emissions by 76 per cent, but he said this must, of course, be protected in any enhancements to passenger services under the franchise. There is potential for increasing further the use of the Welsh rail network for freight, notably for slate waste and timber in the north and intermodal traffic along both the A55 to Holyhead and the M4 from the Thames to south Wales. I therefore hope that the Cabinet Secretary can say more about this today as well.

It is concerning that he only accepted in principle recommendation 15 that the Welsh Government should establish robust passenger and stakeholder engagement structures, including strong representation from the English regions. In July, I hosted an Assembly event organised by the ESP Group, highlighting the importance of inclusion and well-being in the design and delivery of transport services in Wales. They work in the area of inclusion and well-being in transport, including dementia and transport, older people and car cessation, rural transport and younger people accessing jobs and training. What engagement, therefore, has the Cabinet Secretary had or will be having with organisations such as the ESP Group and the Community Transport Association on this critical agenda?

It’s also concerning that the Cabinet Secretary only accepts recommendation 16 in principle, where the chair of the body set up by the Welsh Government to deliver the new franchise, Transport for Wales, a senior civil servant in the Welsh Government, should not be line managed by his own deputy. As the committee report stated, these arrangements are highly unusual and not sustainable.

Finally, given the Cabinet Secretary’s identification of risks and consequences arising because the UK Department for Transport was not in a position to support his intended tender issue date for the Wales and borders rail service, the UK transport Secretary’s response on 8 August, detailing what still needed to be done by the Cabinet Secretary to underpin this, raises serious questions.