Examination of witnesses (Questions 216
-239)
WEDNESDAY 16 DECEMBER 1998
MR ROY
GRIFFINS and MR
MIKE FUHR
Chairman
216. Gentlemen,
thank you very much. I am sorry we are a little late in starting.
Would you like to tell us who you are and if you have any preliminary
remarks we would be delighted to hear them.
(Mr Griffins) Thank you, Madam Chairman. My name
is Roy Griffins, I am Head of the Railways Directorate at the
Department of the Environment, Transport and the Regions. Next
to me is Mike Fuhr, a member of my Directorate, he is Project
Director of the Channel Tunnel Rail Link which encompasses the
Eurostar business.
217. You look astonishingly cheerful. Is
that a sign that you have something to say to us, Mr Griffins?
(Mr Griffins) Just a few opening remarks, if you
will permit. The Government welcomes this inquiry. The Integrated
Transport Policy White Paper of July, "A New Deal for Transport",
made it clear that the country relies on good transport links
for its vitality and prosperity. On the same day the Government
published its policy document on the railways in the form of a
response to this Committee and reiterated its commitment to improving
the quantity and quality of rail services, that is freight and
passenger; we are talking passenger here. In fact, what I use
as a litany is the goal which the Government stated when it came
to power: "the overriding aim must be to win more passengers
and freight on to rail". On the subject of the Committee's
present inquiry you will already know that the Deputy Prime Minister
has received a report from the consortium with whom you have just
been talking. He sent the report to the Committee, put it in the
Library of the House and he has commissioned an independent review
of the issues raised by the consortium's report and by the alternative
proposals put forward by the Virgin Group. Here I think I am returning
to the theme that came up in the last hour. It would be helpful
to have more information from Virgin for the purposes of that
independent review and we shall be requesting it.
218. Have you already done so?
(Mr Griffins) Only in the context of requesting
Virgin's full disclosure for the purposes of the review conducted
by the consortium, we have not done so in connection with the——
219. The second review?
(Mr Griffins) The review announced by the Deputy
Prime Minister. We have not commissioned that yet.
220. Were you aware that Virgin had not
replied fully to the initial inquiry?
(Mr Griffins) Yes, we were.
221. Please continue. I am sorry.
(Mr Griffins) The Government's overall policy
then is that Scotland, Wales and the English regions should share
fully in the benefits of the Channel Tunnel and the Channel Tunnel
Rail Link when it happens. The Government wants the regions and
nations of the United Kingdom to have convenient, effective and
efficient access to international rail services.
222. And that includes Northern Ireland
as well in the United Kingdom?
(Mr Griffins) Yes, in so far as the international
rail services connect.
223. Ah! We were talking about aims, were
we not, Mr Griffins? It must be the Government's aim to extend
high quality rail systems throughout the United Kingdom, must
it not?
(Mr Griffins) Yes, it must.
224. Good. We got that on the record.
(Mr Griffins) Can I give you that one?
225. Thank you, Mr Griffins. I am always
pleased when I get one up on a railwayman I can tell you that.
(Mr Griffins) Before closing the general remarks
could I mention one tiny issue which we could deal with now or
later if you wish. It goes to the relationship between the review
which the Deputy Prime Minister has just announced and the work
of your own Committee.
226. Please. Any enlightenment is always
welcome in this Committee, we are very broad minded.
(Mr Griffins) It is mechanics rather than substance.
Ideally the Government would like its review to be informed by
the conclusions of this Committee. There is an excellent precedent
for this. About a year ago I sat in this Committee room, I sat
there, saying a lot less than I am saying now, in fact saying
nothing at all, I was sitting next to the Deputy Prime Minister.
He outlined the Government's policy on rail regulation and the
Strategic Rail Authority. The Committee deliberated and produced
a report. The Government took it in, digested it, considered it,
adopted part of it, stole some of its ideas and produced not only
the railways part of the Integrated Transport White Paper but
the daughter document on the same day. That was an example of
what seems to me to be a very constructive dialogue. It would
be galling if we could not do that kind of thing now. I just signal
it now and I will discuss it with your clerk later.
Chairman: That is
helpful. We know you are all very intelligent and we are very
happy to know that you learn from the work that we do in this
Committee.
Mr Stringer
227. You say it is the Government's objective
that all the regions and countries of Great Britain should benefit
from the Channel Tunnel. Is not the real fact that the regions
are disbenefiting and you are getting a concentration of investment
and transport in the South East?
(Mr Griffins) As a result of the Channel Tunnel?
228. As a consequence, yes. We have had
evidence before this Committee of a great deal of investment in
the South East between London and the Channel Tunnel, around Heathrow,
extra services to Paris and Brussels, but no benefit to the North
West, the North East, Scotland, Wales. If investment goes in it
is likely to increase the regional disparities, is it not?
(Mr Griffins) Accepting your premise that if that
was the only place in which investment was put, yes, the answer
must be what you say is true. That is not necessarily the case.
Narrowing it down to this particular context, direct regional
services through the Channel Tunnel international rail services
I think you are giving one of the planks of the rationale for
the independent review which the DPM is commissioning which will
take into account disparities and social and economic benefits.
229. So you agree with me that at the moment
there are no benefits to the regions?
(Mr Griffins) No. If there was only investment
down here—— The benefits to the regions do not come
solely from direct international rail services.
230. Just looking in the context of the
Channel Tunnel, what other benefits are there?
(Mr Griffins) I do not know the exact breakdown
of passengers through the Channel Tunnel.
231. We are not splitting hairs here, we
are talking about billions of pounds worth of investment in the
South East and what the benefits are for those of us who do not
happen to live in the South East.
(Mr Griffins) People living outside the South
East travel through the Channel Tunnel, goods originating outside
the South East go through the Channel Tunnel. It is not necessarily
because the Channel Tunnel coincidentally happens to be between
the South East of England and the continent that that is something
which is engineered to disadvantage the regions.
232. You have quantified this, have you?
(Mr Griffins) I have not.
233. Do you believe that the regional Eurostar
services will ever run without public subsidy?
(Mr Griffins) No, I do not know, but I would hope
to have an idea of that as a result of the outcome of a thorough
and independent review.
234. If the independent review of the review
shows that there is public subsidy, is it the Department and the
Government's position that that public subsidy should be agreed
to in order that the regions will benefit?
(Mr Griffins) I take your question to mean if
the review showed that there was a need for public subsidy.
235. Yes, that they would not be commercially
viable.
(Mr Griffins) You are forcing me down a hypothesis.
Can I say that there is no public subsidy to international maritime
services, there is no public subsidy to international air services,
so prima facie it does not seem right that there should
be a public subsidy to international rail services. I am sure
the Government would want to take a view following the outcome
of this independent review.
236. What estimate have you made of any
benefits to British Airways from transferring their passengers
from Heathrow to Charles de Gaulle services on to a rail link?
(Mr Griffins) The Government has not.
237. So we have a consortium in which one
of the partners may benefit by tens or hundreds of millions of
pounds by non-direct commercial activity on the railway and you
have not assessed that?
(Mr Griffins) I think you are making a number
of assumptions.
238. I am making the assumption that there
is value in slots, that British Airways can make more money on
its inter-continental services by giving up those slots and I
am asking what estimate you have made of the fact that when a
contract has gone to a partnership which includes somebody who
can benefit by making decisions that will free those slots up?
(Mr Griffins) I would not argue with you about
the slots. You will know more about the slots than I do. I think
the assumption you are making is that the consortium will mount
a Heathrow service which I do not know.
Mr Stringer: I am
asking what estimates you have made of the benefit to British
Airways if that happens? I would have thought that was a sensible
thing to have done.
Chairman
239. It would help us, Mr Griffins, if you
told us what the parameters were. Who is going to conduct this
review? What have you asked them to do and have you taken account
of the questions like the ones you have just been asked?
(Mr Griffins) Can I take us back to the deliberations
for the Channel Tunnel Bill in the mid-eighties which led to section
40 of the Channel Tunnel Act 1987.
| 
