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5.45 pm

Mr. Gordon Prentice: I support new clause 7. I welcome the rail link, which is long overdue. If people knew the extent of the subsidy involved, they would choke on it. Public assets are being given away. It amounts to grand larceny. If it were not being done by the Government, the person responsible would be behind bars in Pentonville. Public assets are being gifted.

The story is full of ironies. One of the four bidders is Lord Parkinson, in his latest metamorphosis as chairman of Eurorail. In 1990, he vetoed a proposal by British Rail to construct the rail link. As my hon. Friend the Member for Nottingham, North (Mr. Allen) said, it is a matter of public record that the subsidy required then was£1.9 billion: a low-interest loan of £1 billion, capital grant of £500 million and an additional £400 million investment required by Network SouthEast. Now the Government are shovelling public money into the pockets of London and Continental as if there were no tomorrow. It will not be the people of Britain who own this magnificent new railway but the shareholders in London and Continental.

Lord Parkinson said at the time that it was not the Government's policy to subsidise the rail link and came out with this fantasy on 11 June 1990, when he said that it was

"illegal for the Government to subsidise any fast tunnel link, on the ground that it would create unfair competition for ships, road freight and airlines."--[Official Report, 11 June 1990; Vol. 174, c. 4.]

We have the same Government but a different situation. The most enormous subsidy is going to London and Continental. As my hon. Friend the Member for Nottingham, North said, the outrage that people should feel is not being felt because of the diet of privatisation outrages. The Guardian on 4 March 1996 said:

"It is only because we have been nurtured so long on the drip-feed of privatisation sleaze that people haven't been more outraged."

How true that is.

I shall deal with the specific figures. The straight cash subsidy, the so-called financial contribution, for a 68-mile long line is £1.4 billion. Railtrack is currently being floated, and all the pundits and commentators who know about such things tell us that that will raise about£1.7 billion. It was originally valued at about £6 billion, then the figure went down to £3 billion; now we are told that it is worth £1.7 billion.

What assets are we, the British people, losing in exchange for that £1.7 billion? First we shall lose 10,000 route-miles of permanent way, compared with an important rail link 68 miles long. Then 2,500 stations will go, plus 90 light maintenance depots, 40,000 bridges, viaducts and tunnels and, Railtrack tells us, 9,000 level crossings, with other bits and pieces. All that is to raise £1.7 billion. Even then, as my hon. Friend the Member for Nottingham, North said, £1.4 billion of that will be transferred seamlessly to the private sector company, London and Continental, to build 68 miles of fast link.

The fast link should have been built years ago, in 1989-90. It is a national disgrace that it still has not been built. When I was on the Select Committee we went to

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France to see the TGV. It was a blur of light; we could not see the thing as it flashed across the plain in northern France. But over here in Kent there is a puffing Billy: it is a Eurostar train, but it wends its way to the channel portal at 40 or 50 mph. And that will continue until the fast link is built. It is a tragedy that the Government were so short-sighted--or rather, ideologically blinkered--that the line has not already been constructed.

Now for the great railway sell-off. The Opposition have calculated a total of £5.7 billion, and I think that that figure is right, but for the purposes of argument I shall concentrate on what the Government say the assets are worth. There is a big difference. All the commentators and journalists and economists without exception, including the Financial Times and all the business broadsheets, say that although the Opposition may have pitched the figure a bit high at £5.7 billion, no one believes the Government's subsidy figure, which I shall deal with in a moment, because it is too low.

Apart from the £1.4 billion, there are the King's Cross railway lands, with an existing use value of £5.8 million. When I asked the Minister a question, he said that the development value of those lands was £10.6 million. I am not a surveyor, but the King's Cross railway lands are within spitting distance of central London.

The Minister told me that the existing use value for the Stratford rail lands--they were valued as railway marshalling yards, although they would not really be worth anything for their existing use--was £15.2 million. He then told me that

"the development value of the Lands excluding those parts required for the CTRL"--[Official Report, 14 March 1996; Vol. 273, c. 721.]

was £12.5 million. Pull the other leg.

Mr. Watts: Like the hon. Gentleman, I am not a surveyor, but the estimates of the development value of the land were made for British Rail for the purposes of its accounts. They are not my estimates, but professional valuations.

Mr. Prentice: Yes, those may have been the valuations prior to development, but it takes nothing more than common sense to see what will happen. There will be a new international station at Stratford, all the traffic coming in from East Anglia and the rest of eastern England will funnel into Stratford, and the adjacent railway lands are ripe for development. The British Rail surveyors should be out of a job if they value them at £12.5 million. We are not talking about one or two acres, but 240 acres, with the King's Cross and Stratford lands combined.

There are more depots too--for instance, Manchester Longsight. I do not know it personally. I have not visited it, as I have visited Stratford and King's Cross, but I have been told that the historic cost valuation was £5.9 million. No other valuation was given, just a historic cost valuation. So we do not know what that might be worth.

Then there is the Eurostar maintenance depot at North Pole in north London. The Government say that that is worth £77.5 million. Again, that is a historic cost value. I do not know when British Rail acquired that depot. It may have been a long time ago, or relatively recently. No other valuation was given. Again, the Government relied on a historic cost valuation.

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My hon. Friend the Member for Nottingham, North mentioned the Eurostar fleet of trains. The loss of that is something that people should gag on. The fleet of 11 trains, each one weighing about 800 tonnes--a marvellous triumph of engineering--is being gifted to London and Continental. The Government say that it is worth£380 million. Yet the debt write-off alone for Eurostar trains was £1.3 billion.

Mr. Jacques Arnold: The hon. Gentleman is presenting a politician's judgment on the value of development land, as against the judgment of highly professional experts. He is also telling us that a politician's judgment of the value of carriages should be based not on their value but on the money spent on them. No business man would do that. The hon. Gentleman is making the fatal mistake that Labour politicians always make, especially when they are in government: they believe that politicians can carry out business better than business men. There is a very good example that he could look up--the Labour Government's attempt to set up the groundnut scheme.

Mr. Prentice: I should not have given way and allowed the hon. Gentleman to make that nonsensical intervention. We are talking about the valuation of public assets. As I told the Minister, every commentator who--unlike the hon. Member for Gravesham (Mr. Arnold)--knows anything about the subject, says that those public assets are being given away at a bargain basement price. [Interruption.] If the hon. Gentleman could contain himself for a second, I want to mention a few more public assets and tell the House the Government's valuation of them.

The new Waterloo international station has just been built. It is a marvellous beautiful station--the gateway to London. Apparently its value is £136 million. Then there is Ashford international station. All the work that has been done in Ashford in preparation for the new link--

Mr. Stevenson: That was all public money.

Mr. Prentice: Of course it was all public money;£41 million was spent.

Back in London, the Government tell us that the valuation of St. Pancras station, on existing use, is£3.7 million. Then there are some little dribs and drabs with which I shall not weary the House--the land at Kensington Olympia, the marshalling yards and the 650 properties along the line, all of which will be given to London and Continental.

If we add all those together, using the Government's own figures, the valuation amounts to £621 million-worth of assets, which are all to be gifted to London and Continental. If we add the £1.4 billion contribution,that makes more than £2 billion. Yet all those years ago, the entire line could have been constructed and kept in public ownership for less.

The whole affair has been an absolute disgrace. The Government say that it is a triumph, but people out there are not so stupid. They realise that valuable public assets such as Railtrack and the assets associated with the channel tunnel rail link are being handed over. If any

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other organisation were doing that, its managers would be behind bars, not sitting on the Front Bench. The sooner the Government are out of office, the better.

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