Infrastructure Bill (HC Bill 154)

Part 1 Strategic highways companies

Appointment as highway authorities

1 Appointment of strategic highways companies

(1) 5The Secretary of State may by order in accordance with this Part appoint one
or more companies as a highway authority.

(2) A company may only be appointed under this section if it is—

(a) limited by shares, and

(b) wholly owned by the Secretary of State.

(3) The appointment of a company terminates (in addition to termination by
revocation of the order making the appointment) if the company ceases to be
5wholly owned by the Secretary of State.

(4) A company appointed under this section is called a “strategic highways
company”.

(5) In this section, “company” means a company registered under the Companies
Act 2006.

(6) 10Schedule 1 (which contains consequential and supplemental amendments) has
effect.

2 Areas and highways in an appointment

(1) The appointment of a strategic highways company must specify—

(a) an area, consisting of the whole or any part of England, in respect of
15which the company is appointed;

(b) highways in that area for which the company is to be the highway
authority.

(2) Highways may be specified under subsection (1)(b) by name or description.

(3) Highways specified under subsection (1)(b) must be highways for which the
20Secretary of State or another strategic highways company is the highway
authority immediately before the appointment has effect.

(4) In the case of a strategic highways company appointed for an area adjacent to
Wales, the highways specified under subsection (1)(b) may (subject to
subsection (3)) include highways in Wales.

(5) 25Where—

(a) the appointment of a strategic highways company is varied, and

(b) by virtue of that variation the company ceases to be the highway
authority for one or more highways,

the Secretary of State becomes the highway authority for those highways (to
30the extent that he or she would not otherwise be so).

(6) Where the appointment of a strategic highways company terminates, the
Secretary of State becomes the highway authority for any highway for which
the strategic highways company is highway authority (whether by virtue of
the appointment or otherwise) immediately before the termination.

(7) 35Subsections (5) and (6) are subject to the appointment of another strategic
highways company.

Functions

3 Road Investment Strategy

(1) The Secretary of State may at any time—

(a) 40set a Road Investment Strategy for a strategic highways company, or

(b) vary a Strategy which has already been set.

(2) A Road Investment Strategy is to relate to such period as the Secretary of State
considers appropriate.

(3) A Road Investment Strategy must specify—

(a) the objectives to be achieved by the company during the period to
5which it relates, and

(b) the financial resources to be provided by the Secretary of State for the
purpose of achieving those objectives.

(4) The objectives to be achieved may include—

(a) activities to be performed;

(b) 10results to be achieved;

(c) standards to be met.

(5) In setting or varying a Road Investment Strategy, the Secretary of State must
have regard, in particular, to the effect of the Strategy on—

(a) the environment, and

(b) 15the safety of users of highways.

(6) The Secretary of State and the company must comply with the Road
Investment Strategy.

(7) If a strategic highways company does not have a Road Investment Strategy
currently in place, the Secretary of State must—

(a) 20lay before Parliament a report explaining why a Strategy has not been
set, and

(b) set a Road Investment Strategy as soon as may be reasonably
practicable.

(8) Schedule 2 (which contains provision about the procedure for setting or
25varying a Road Investment Strategy) has effect.

4 General duties of a strategic highways company

(1) A strategic highways company must, in exercising its functions, co-operate in
so far as reasonably practicable with other persons exercising functions which
relate to—

(a) 30highways, or

(b) planning.

(2) A strategic highways company must also, in exercising its functions, have
regard to the effect of the exercise of those functions on—

(a) the environment, and

(b) 35the safety of users of highways.

5 Directions and guidance

(1) The Secretary of State may from time to time give a strategic highways
company directions or guidance as to the manner in which it is to exercise its
functions.

(2) 40Directions under subsection (1) may provide, in particular, that a function is
only to be exercised—

(a) after consultation with the Secretary of State, or

(b) with the consent of the Secretary of State.

(3) In exercising its functions, a strategic highways company must—

(a) comply with a direction, and

(b) have regard to guidance,

given to it under subsection (1).

(4) 5Directions and guidance under subsection (1) must be published by the
Secretary of State in such manner as he or she considers appropriate.

6 Delegation of functions

(1) A strategic highways company may authorise another person to exercise a
function it has under any enactment, if the function is prescribed by
10regulations made by the Secretary of State.

(2) An authorisation may authorise the exercise of a function—

(a) wholly or to any other extent;

(b) generally or only in some cases or areas;

(c) unconditionally or subject to conditions.

(3) 15An authorisation—

(a) does not prevent the company or any other person from exercising the
function to which the authorisation relates,

(b) may be for a period not exceeding ten years, and

(c) may be revoked at any time.

(4) 20The strategic highways company may—

(a) enter into a contract with an authorised person in connection with the
exercise by that person of a function;

(b) make payments to an authorised person in that connection.

(5) Where an authorisation is revoked at a time when a contract in connection with
25the exercise of a function is subsisting, the authorised person is entitled to treat
the contract as repudiated by the company (and not as frustrated by reason of
the revocation).

(6) Regulations under this section may not prescribe a function if it is—

(a) a power of entry, or

(b) 30a power or duty to make subordinate legislation.

(7) Where a function of the Secretary of State is transferred to a strategic highways
company under this Part and is, immediately before the transfer, authorised to
be exercised by another person by an order under section 69 of the
Deregulation and Contracting Out Act 1994—

(a) 35the authorisation is to have effect as if it had been given by the
transferee company under this section, and

(b) if the function is not prescribed under subsection (1), it is to be regarded
as having been so prescribed.

(8) Where a function of a strategic highways company is transferred to another
40such company under this Part and is, immediately before the transfer,
authorised to be exercised by another person under this section, the
authorisation is to have effect as if it had been given by the transferee company
under this section.

7 Exercise of delegated functions

(1) A function to which an authorisation under section 6 relates may be exercised
by—

(a) the authorised person, or

(b) 5an employee of that person.

(2) Anything done by, or in relation to, the authorised person or that person’s
employee in connection with the exercise of a function is to be treated as done
by, or in relation to, the company.

(3) Subsection (2)—

(a) 10does not affect the rights and liabilities of the strategic highways
company and the authorised person as between one another,

(b) does not make the strategic highways company liable under section 6
of the Human Rights Act 1998 in respect of any act (within the meaning
of that section) of the authorised person or an employee of the
15authorised person if the act is of a private nature,

(c) does not prevent any civil proceedings which could otherwise be
brought by or against the authorised person from being brought, and

(d) does not apply for the purposes of any criminal proceedings brought in
respect of anything done by the authorised person or that person’s
20employee.

(4) Schedule 15 to the Deregulation and Contracting Out Act 1994 (restrictions on
disclosure of information) applies to an authorisation under section 6 as it
applies to an authorisation of the Secretary of State under Part 2 of that Act
(contracting out).

(5) 25In this section—

(a) “employee”, in relation to a body corporate, includes a director or other
officer of the body;

(b) references to anything done include anything omitted to be done;

(c) references to the exercise of a function include the purported exercise
30of a function.

Oversight

8 Watchdog

(1) The Passengers’ Council must carry out activities to protect and promote the
interests of users of highways for which a strategic highways company is the
35highway authority.

(2) Those activities may include investigating, publishing reports or giving advice
to the Secretary of State on—

(a) how a strategic highways company’s exercise of its functions or
achievement of its objectives under a Road Investment Strategy affects
40users of highways for which it is the highway authority, and

(b) any other matters—

(i) relating to highways for which a strategic highways company is
the highway authority, and

(ii) which the Council considers to be of interest to users of such
45highways.

(3) The Secretary of State may by regulations provide that those activities may not
relate to a matter—

(a) to the extent specified;

(b) subject to compliance with specified conditions.

(4) 5The Secretary of State must consult the Council before making regulations
under subsection (3).

(5) The Secretary of State must, in exercising functions under this Part, have
regard to any advice given to him or her by the Council under this section.

(6) The Council may by agreement with a local highway authority carry out
10activities to protect and promote the interests of users of highways for which
the authority is the highway authority.

(7) Those activities may include investigating, publishing reports or giving advice
to the local highway authority on any matters—

(a) relating to highways for which the authority is the highway authority,
15and

(b) which the authority and the Council consider to be of interest to users
of such highways.

(8) In Part 6 of Schedule 1 to the Freedom of Information Act 2000 (other public
bodies and offices: general), at the appropriate place insert—

• 20“The Passengers’ Council.”

9 Monitor

(1) The Office of Rail Regulation must carry out activities to monitor how a
strategic highways company exercises its functions.

(2) Those activities may include investigating, publishing reports or giving advice
25to the Secretary of State on—

(a) whether, how and at what cost a strategic highways company has
achieved its objectives under a Road Investment Strategy, and

(b) objectives for a future Road Investment Strategy.

(3) The Office may direct a strategic highways company to provide such
30information as the Office considers necessary for the purpose of carrying out
activities under subsection (1).

(4) A direction under subsection (3) may specify the form and manner in which
the information is to be provided.

(5) A direction under subsection (3) may not require—

(a) 35production of a document which the strategic highways company
could not be compelled to produce in civil proceedings, or

(b) provision of information which the company could not be compelled to
give in evidence in such proceedings.

(6) The strategic highways company must comply with a direction under
40subsection (3).

(7) The Secretary of State must, in exercising functions under this Part, have
regard to any advice given to him or her by the Office under this section.

10 Monitor: compliance and fines

(1) If the Office of Rail Regulation is satisfied that a strategic highways company
has contravened or is contravening—

(a) section 3(6) (compliance with the Road Investment Strategy), or

(b) 5section 5(3) (compliance with directions and regard to guidance),

the Office may take one or more of the steps mentioned in subsection (2).

(2) The Office may—

(a) give notice to the company as to the contravention and the steps the
company must take in order to remedy it;

(b) 10require the company to pay a fine to the Secretary of State.

11 Monitor: general duties

(1) The Office of Rail Regulation must exercise its functions under sections 9 and
10 in the way that it considers most likely to promote—

(a) the performance, and

(b) 15the efficiency,

of the strategic highways company.

(2) The Office must also, in exercising those functions, have regard to—

(a) the interests of users of highways,

(b) the safety of users of highways,

(c) 20the economic impact of the way in which the strategic highways
company achieves its objectives,

(d) the environmental impact of the way in which the strategic highways
company achieves its objectives,

(e) the long-term maintenance and management of highways, and

(f) 25the principles in subsection (3).

(3) The principles are that—

(a) regulatory activities should be carried out in a way which is
transparent, accountable, proportionate and consistent, and

(b) regulatory activities should be targeted only at cases in which action is
30needed.

12 Monitor: guidance

(1) The Secretary of State may from time to time give the Office of Rail Regulation
guidance as to the manner in which it is to carry out its activities under section
9.

(2) 35The Secretary of State and the Treasury, acting jointly, must give the Office
guidance as to the circumstances in which the payment of a fine under section
10 should be required.

(3) The Office must have regard to guidance given to it under this section.

(4) Guidance under this section must be published by the Secretary of State in such
40manner as he or she considers appropriate.

Transfers of property etc

13 Transfer schemes

(1) The Secretary of State may make one or more schemes for the transfer of
property, rights and liabilities—

(a) 5from the Secretary of State to one or more of the following—

(i) a strategic highways company, or

(ii) a proposed strategic highways company;

(b) from a strategic highways company or a former strategic highways
company to one or more of the following—

(i) 10the Secretary of State,

(ii) a strategic highways company, or

(iii) a proposed strategic highways company.

(2) In making a transfer scheme the Secretary of State must have regard to—

(a) the functions, or the proposed functions, of the transferee under any
15enactment, and

(b) the terms of appointment, or proposed terms of appointment, of a
strategic highways company, or a proposed strategic highways
company, to which the scheme relates.

(3) Schedule 3 (which contains more provision about transfer schemes) has effect.

(4) 20In this section and Schedule 3—

• “proposed strategic highways company” means a company which the
  Secretary of State proposes to appoint as a strategic highways
  company;

• “former strategic highways company” means a company in respect of
  25which such an appointment has terminated.

14 Tax consequences of transfers

(1) The Treasury may by regulations make provision for varying the way in which
a relevant tax has effect from time to time in relation to—

(a) any property, rights or liabilities which are transferred by virtue of a
30transfer to which this section applies, or

(b) anything done for the purposes of, or in relation to, or in consequence
of, a transfer to which this section applies.

(2) This section applies to—

(a) a transfer of property, rights and liabilities in accordance with a scheme
35under section 13, or

(b) a transfer occurring under section 263 of the Highways Act 1980
(vesting of highway in highways authority) by virtue of the
appointment of a strategic highway company under section 1 or the
variation or termination of such an appointment.

(3) 40The provision that may be made under subsection (1)(a) includes, in particular,
provision for—

(a) a tax provision not to apply, or to apply with modifications, in relation
to any property, rights or liabilities transferred;

(b) any property, rights or liabilities transferred to be treated in a specified
45way for the purposes of a tax provision;

(c) the Secretary of State to be required or permitted, with the consent of
the Treasury, to determine, or to specify the method for determining,
anything which needs to be determined for the purposes of any tax
provision so far as relating to any property, rights or liabilities
5transferred.

(4) The provision that may be made under subsection (1)(b) includes, in particular,
provision for—

(a) a tax provision not to apply, or to apply with modifications, in relation
to anything done for the purposes of, or in relation to, or in
10consequence of, the transfer;

(b) anything done for the purposes of, or in relation to, or in consequence
of, the transfer to have or not to have a specified consequence or to be
treated in a specified way;

(c) the Secretary of State to be required or permitted, with the consent of
15the Treasury, to determine, or to specify the method for determining,
anything which needs to be determined for the purposes of any tax
provision so far as relating to anything done for the purposes of, or in
relation to, or in consequence of, the transfer.

(5) In this section—

(a) 20“relevant tax” means income tax, corporation tax, capital gains tax or
stamp duty;

(b) “tax provision” means a provision of an enactment about a relevant tax.

(6) References in this section to the transfer of property, rights or liabilities in
accordance with a scheme under section 13 include references to—

(a) 25the creation of interests, rights or liabilities under the scheme, and

(b) the modification of interests, rights or liabilities under the scheme,

(and “transferred”, in relation to property, rights or liabilities, is to be read
accordingly).

Finance

15 30Financial assistance

(1) The Secretary of State may provide financial assistance—

(a) to a strategic highways company, for the purpose of any of its
functions, or

(b) to any other person, for the promotion or improvement of transport
35services by land in England.

(2) Financial assistance may be provided in such form and on such terms as the
Secretary of State considers appropriate.

(3) The form in which financial assistance may be provided include in particular—

(a) grants,

(b) 40loans, or

(c) guarantees.

(4) The terms on which financial assistance may be provided include in
particular—

(a) in the case of a grant or a loan, terms as to repayment;

(b) 45in the case of a guarantee, terms as to reimbursement.