'Very bad' councils to lose extra funds

Local authorities failing to make proper use of taxpayers' money earmarked for transport will be penalised financially, Alistair Darling warned yesterday.

The Secretary of State for Transport told the Labour conference that some councils were performing "extremely badly'' and would stop receiving the grants from central government. His remarks came after the Prime Minister referred to transport as the "worst public service", and complaints from delegates that some local authorities had done little towards the Government's aim of promoting integrated transport.

Speaking at a question and answer session, Mr Darling said: "Some councils do very well, some councils do extremely badly. In the next round of government spending we will be rewarding those that do well. The councils performing very badly simply won't get the money because they are not using it to improve public transport."

Mr Darling said he would not let councils off the hook and that it was their responsibility to provide, for instance, "decent, clean and safe" bus services, not just that of central government. He is known to favour schemes which involve congestion charges, where necessary to be levied against private vehicles to encourage the use of public transport.

Referring to a High Court hearing yesterday which set in motion the process whereby Railtrack will be stripped of responsibility for the rail infrastructure, Mr Darling said the company was part of a "discredited, chaotic and botched privatisation".

He said Network Rail, which will take over the infrastructure tomorrow, would be publicly owned. Hitherto, ministers had emphasised the financial independence of the not-for-profit company.

He admitted he had been "profoundly depressed" by the transport system when he succeeded Stephen Byers, but had since become optimistic. By the next election there would be a "much safer, much more reliable" rail network.