Select Committee on Environment, Transport and Regional Affairs Minutes of Evidence

Explanatory Memorandum from the Department of the Environment, Transport and the Regions (EST 98A)



  More details can be found in the Annual Report 1998: Chapter 9, 12, 13, 14, 15 and 16 and Tables A6, A10, A11, A14 and A15.

Vote total

Final net provision 1996-971,1745,539
Provision sought 1998-991,198,372
Change (Per cent)-31 Per cent
Final net provision 1997-981,253,533
Provision sought 1998-991,198,372
Change(Per cent)-4 Per cent

  This Vote replaces the former Class V, Vote 3 (Transport Industries) and parts of Class V, Vote 2, (Department of Transport: administration and transport services).

  The provision in this Vote covers the Department of the Environment, Transport and the Regions' support to transport nationalised industries; grants to Railtrack; British Rail; DoA Ltd; MRPS grant; payments in respect of expenditure relating to international railways and the Channel Tunnel Rail Link; expenditure connected with the privatisation of British Rail businesses and Railtrack; other consultancies; capital expenditure by transport industries funded by EC grants; railway industry and National Freight Company pension funds; National Freight Company travel concessions; rebate of fuel duty to bus operators; ports and shipping services; Royal Travel; civil aviation services; international aviation services; transport security; freight grants; and expenditure associated with the non rail privatisation programme.

  In 1998-99 this Vote took over some provision for some transport services such as ports and shipping services; civil aviation services; international aviation services; transport security; freight grants; and royal travel from the former Class V, Vote 2.

Section E—Other rail consultancies


Final net provision 1996-977,036
Provision sought 1998-995,650
Change (Per cent)-20 Per cent
Final net provision 1997-981,109
Provision sought 1998-995,650
Change (Per cent)+409 Per cent

Annual Report 1998—Figure 2a

  The reduction in provision between 1996-97 and 1998-99 and the increase in provision between 1997-98 and 1998-99 result from two causes. First the bulk of expenditure on the Channel Tunnel Rail Link (CTRL) related consultancies was transferred to a new Section P during 1997-98. Second, there was an increase in provision in 1998-99 in anticipation of consultancies required in connection with the London Transport Public Private Partnerships (PPP).

Section F—CTRL competition


Final net provision 1996-9712,900
Provision sought 1998-9933,487
Change (Per cent)+160 Per cent
Final net provision 1997-983,500
Provision sought 1998-9933,487
Change (Per cent)+857 Per cent

Annual Report 1998—Chapter 12, paragraphs 12.23-12.26; figure 12a

  Channel Tunnel Rail Link expenditure is forecast to increase in 1998-99 when the main construction is due to begin. The expenditure is limited to works and undertakings which the Government is contractually obliged to provide, including work by London Underground at St Pancras.

Section L—Privatisation of rolling stock leasing companies (ROSCOs)


Final net provision 1996-970
Provision sought 1998-99-26,000
Change (Per cent)n/a
Final net provision 1997-98-43,000
Provision sought 1998-99-26,000
Change (Per cent)40 Per cent

Annual Report 1998—Chapter 12, paragraph 12.11

  The main proceeds (£1,822 million spread over the two years 1995-96 and 1996-97) from the sale of rolling stock leasing companies (ROSCOs) as Government-owned companies were categorised as excess receipts and are shown as a nil figure for 1996-97. Deferred proceeds were from 1997-98 treated as appropriations in aid, with Treasury's consent. The timing of deferred receipts from the sales of ROSCOs is such that receipts are lower in 1998-99 than in 1997-98, and would have been lower still had payment of a tranche not slipped from 1997-98.
Section K—Ports and Shipping services


Final net provision 1996-97-18
Provision sought 1998-991,052
Change (Per cent)
Final net provision 1997-983,815
Provision sought 1998-991,052
Change (Per cent)-72 Per cent

Annual Report 1998—Chapter 15, paragraphs 15.23-15.26; figure 15a

  The receipts were increased during 1997-98 by £4.9 million to reflect higher than expected receipts from the sale of Port of London Properties; the latter receipts are usually surrendered to the Consolidated Fund in full. The Port of London Properties receipts in excess of CFER provision were scored as ports and shipping appropriations-in-aid with Treasury's agreement. The provision in 1998-99 is higher than in 1997-98 to cover the International Maritime Organisation's major maintenance projects, and the costs of the MV Derbyshire and Sea Empress Formal Inquiries.
Section L—Civil Aviation services


Final net provision 1996-97-3,880
Provision sought 1998-99789
Change (Per cent)
Final net provision 1997-98-3,757
Provision sought 1998-99789
Change (Per cent)

Annual Report 1998—Chapter 14, paragraphs 14.13-14.15 and 14.20-14.32; figure 14a

  Changes in the required provision from one year to another are mainly due to changes in the net contribution from expenditure and receipts on EUROCONTROL. The estimated reduction in 1998-99 com pared with both 1996-97 and 1997-98 is caused by the increase in the value of sterling relative to the ECU and an increase of members.
Section N—Transport security


Final net provision 1996-971,950
Provision sought 1998-992,205
Change (Per cent)+13 Per cent
Final net provision 1997-981,855
Provision sought 1998-992,205
Change (Per cent)+19 Per cent

Annual Report 1998—Chapter 16, paragraphs 16.8-16.9; figure 16a

  The increase from 1996-97 and 1997-98 to 1998-99 results from the move of Royal train security funding to this Section of the Vote.

Section O—Freight grants


Final net provision 1996-9712,421
Provision sought 1998-9939,652
Change (Per cent)+219 Per cent
Final net provision 1997-9831,161
Provision sought 1998-9939,652
Change (Per cent)+27 Per cent

Annual Report 1998—Chapter 12, paragraph 12.19-12.20; figure 12a

  The increases have been made to encourage more freight onto rail. Action has been taken to boost the take-up of freight grants.
Section Q—Metropolitan Railways Passenger Services (MRPS) grant


Final net provision 1996-970
Provision sought 1998-99234,498
Change (Per cent)n/a

Annual Report 1998—Chapter 9, paragraphs 9.38-9.39; figure 9a

  Before 1997-98 the grant to support PTE rail passenger services was funded from within the local authority Revenue Support Grant.
Section R—Deeds of Assumption (DoA) Ltd


Final net provision 1996-9718,007
Provision sought 1998-9924,258
Change (Per cent)35 Per cent

Annual Report 1998—Chapter 12, paragraph 12,13; figure 12a

  This consists of four quarterly payments in repayment of PTE capital debt. Responsibility for making the payments transferred from Railtrack to DoA Ltd when Railtrack was privatised in May 1996. In 1996-97 there were only three quarterly payments made by DoA Ltd instead of four (since one payment was paid by Railtrack before privatisation). In 1998-99 the provision is for four payments.
Section S—London Transport


Final net provision 1996-97966,000
Provision sought 1998-99592,000
Change (Per cent)-39 Per cent
Final provision 1997-98652,000
Provision sought 1998-99592,000
Change (Per cent)-9 Per cent

Annual Report 1998—Chapter 13

  The large reduction in provision between 1996-97 and 1998-99 reflects the previous Government's plans. The figure for 1998-99 includes additional grant of £120 million which is being provided to LT as part of the Government's package for a PPP for the Underground.
Section T—British Rail grant


Final net provision 1997-9840,000
Provision sought 1998-9960,000
Change (Per cent)+50 Per cent

Annual Report 1998—Chapter 12, paragraphs 12.7-12.10; figure 12a

  This is a new grant to fund the residual activities of BR. It was introduced in 1997-98 following the cessation of BR's responsibilities for railways operations. The provision is higher in 1998-99 due to expected low income from its diminishing programme of property disposal.
Section U—Non rail privatisation programme


Final net provision 1996-971,295
Provision sought 1998-99160
Change (Per cent)-88 Per cent
Final net provision 1997-98400
Provision sought 1998-99160
Change (Per cent)-60 Per cent

  Falling provision on this Section over the years 1996-97, 1997-98 and 1998-99 mainly reflects the declining activity and requirement for consultancies on the privatisation of the Trust Ports.

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