Examination of witnesses (Questions 240
-259)
WEDNESDAY 16 DECEMBER 1998
MR ROY
GRIFFINS and MR
MIKE FUHR
240. If you insist!
(Mr Griffins) It is a point and it was referred
to. There have been a number of reviews on the need for, the rights
and wrongs of, international rail services since then. So far
as I know, so far as this Government knows, there has never been
a wholly disinterested review as everybody has had some kind of
axe to grind. I think that was obvious from your questioning of
the previous witness. There are conflicts there, there are contradictions
and as a minimum there is a lack of clarity.
241. That is why we want to know who you
have asked and what you have done.
(Mr Griffins) We have not asked anybody yet and
nor have Ministers finalised the terms of reference.
242. Mr Griffins, that is terribly important,
is it not, because it is fair enough that you have not offered
the job to anybody if you have not decided what you want to know,
that would make it a bit difficult, but I think the Committee
would like to have just a broad-brush approach to what you are
asking.
(Mr Griffins) I am in a position to give you a
broad-brush approach. We would expect the review to consider the
commercial viability of regional services, the socio-economic
benefits that would be derived in the regions from such services,
the nature of the services, i.e. the points that would be served,
the likely level of demand, certain technical considerations,
the capacity of certain stations on the routes and we would also
want it to consider the impact on the Inter-Capital services which
underpin the Eurostar business, which in turn underpins the Channel
Tunnel Rail Link, which the Government is trying to keep alive
and believes it has succeeded in doing and that would have an
important effect of the Channel Tunnel Rail Link project. We have
not finalised them. We would like to get this commission under
way early in the New Year.
243. So someone is going to have a busy
Christmas!
(Mr Griffins) Putting them together, yes. But
ideally we would like the Committee to be able to influence the
process.
Chairman: Mr Griffins,
now we get to it, you want us to write the terms of reference.
I am very glad you made that clear at the beginning of your evidence.
Mr Stevenson: Just
give us a piece of paper and we will do that now.
Chairman
244. Just hang around after you have given
evidence.
(Mr Griffins) I am not being facetious. The Committee's
views would clearly be helpful.
245. Heaven forbid that the Chairman should
ever be facetious!
(Mr Griffins) The question is how we can get the
Committee's input. Can we get the Committee's input in time to
influence the terms of reference or can we ensure that before
the process gets set in any firm way we can take your conclusions
in?
Chairman: Mr Griffins,
I like people who reply to questions with questions. That always
cheers me up. The reality is that you are saying to us you have
not got the terms of reference fixed and you want to get this
off at the beginning of the New Year, but you also want us to
have some say in this. I think that is a very clear steer. We
are very grateful to you. We shall take the rest of the evidence
today and then the Committee will want to consider how they can
immediately respond because an immediate response will obviously
be called for and I am sure you will enjoy what you get.
Mr Donohoe
246. A point that has already been raised
and we did not have an answer to is just where the traffic is
generated that goes through the tunnel as is the present arrangement.
Would it surprise you to learn that 80 per cent of it was north
of Watford, that the business that is going through the tunnel
is around that figure? You do not happen to know that? Is it possible
for you to do an exercise that would give us some indication as
to the regional spread of traffic going through the tunnel both
in terms of freight and in terms of passengers?
(Mr Griffins) Personally I could not, but it is
certainly possible to get it done.
247. Who would do that then? Would it be
you that would do that, would it be the Department or would it
be the operating companies?
(Mr Griffins) The Department could commission
it.
248. And is that not something that you
would see as having some sense about it?
(Mr Griffins) It would certainly have some relevance
to this review.
Mr Donohoe: Is it
not possible that in actual fact Parliament was deceived by virtue
of the fact that we would never have had that Act on the statute
book had it been the case that all of the information that is
now coming to hand was there and that the possibility of there
ever being any regional services being put into service is zero?
Indeed, in terms of trains, they will be diminishing even further
by virtue of the fact that we have now got more and more low cost
carriers in the air than there have ever been and there is the
development of that as an industry and yet the whole concept of
Eurostar as far as the regions is concerned, in particular as
far as the northern regions is concerned, is just hogwash, is
it not?
Chairman
249. Answer yes or no.
(Mr Griffins) I am not in a position to answer
yes or no. I cannot answer for the passage of legislation in 1987,
neither on behalf of the Government nor indeed personally. I do
have a copy of the Channel Tunnel Act 1987 with me and I have
got the terms of section 40 with me.
250. If you read all the debates at that
time, and you will have done so like all good civil servants,
you will know that of course nowadays it is possible to take into
account consideration of any legislation which is set at the time
and you will also remember what was said at the time was very
clearly this would go ahead on the assumption that there would
be a Eurostar regional service. All you are being asked is, is
it true that Parliament agreed that at that time and this clearly
was not the case.
(Mr Griffins) I think that is an interpretation.
Chairman: I will take
that as a yes. I am a very forward woman.
Mr Stevenson
251. Mr Griffins, we have heard from previous
witnesses, Inter-Capital and Regional Rail and it is the regional
bit that interests me because everything at the moment is capital
and not regional. Given that the evidence that we heard earlier
this afternoon indicated that the possible option of that organisation
centring their future activities on Heathrow emerged about May
or June, which at the same time was the ten per cent share taken
by BA, and the Deputy Prime Minister appointed the same consortium
to do this review in July, does it surprise you that this review
operated by the consortium that indicated that one of their possible
attractive options was Heathrow came out with a report that said
"we do not think regional services using these sets is going
to be viable"? Has that surprised you?
(Mr Griffins) No, it did not surprise me. The
fact that you are asking the question I think is yet another part
of the rationale for going for an independent review.
252. You have been very kind by answering
the question, I am so grateful, but could I just follow that on.
You very helpfully said that you were going to give us a broad
brush view on the terms of reference that the Deputy Prime Minister
may be considering in terms of his disappointment in the report
assessment done by Inter-Capital and Regional Rail. One of the
broad brush criteria that you said may be in there was social
and economic benefits for the regions. I hope I have quoted you
correctly. If that is the case, given your comment that you detect
a conflict in the present system and a lack of clarity in the
present situation, and given that Inter-Capital and Regional Rail
have clearly given the way that they are thinking in terms of
the developments that they may want which would benefit the South
and South East and not the regions, why were they appointed the
management agent yesterday? The point I am getting at is they
have told us that they did not take the social and economic benefits
of the regions into account at all. Given all of this lack of
clarity and the conflict, the Deputy Prime Minister's disappointment,
why were they appointed yesterday?
(Mr Griffins) There are a number of points I need
to respond to on there. First, the lack of clarity and the contradiction——
253. Conflict.
(Mr Griffins) ——conflict that I referred
to were in the context of different organisations' views for the
prospects for regional services and their proposals for such.
There are conflicts between them. As to the question of why this
consortium was chosen, this consortium was chosen by London &
Continental Railways as part of the revised proposals which were
worked on between 28 January when the Deputy Prime Minister came
immediately to the House of Commons to announce the imminent prospect
of the collapse of the Channel Tunnel Rail Link and the return
of the Eurostar business to the Government, and 3 June when he
was able to announce a rescue.
254. Why were they appointed yesterday by
someone? Was it Government that appointed them? Was it with Government's
approval? Did you know they were appointed yesterday?
(Mr Griffins) Yes, I did. The deal was done on
3 June. The formalities were concluded in this respect yesterday.
255. Did that require Government approval
at all or was Government not involved in that?
(Mr Griffins) The Government were involved in
the deal, indeed the Deputy Prime Minister came to the House and
outlined it.
256. When was the deal done?
(Mr Griffins) 3 June.
257. Hang on. The deal was done on 3 June,
which the Government knew about. I do not want to be unfair so
I will try to choose my words carefully. This was a consortium
that in May or June had given clear indications that one of their
options for the future would be using the regional Eurostar stock
at Heathrow. A report came out from them saying really that the
regional Eurostar services are not viable and yet the deal was
done in June and the Government went all through this and actually
appointed them knowing full well that they were going to be management
agents a month before the announcement. Is that correct?
(Mr Griffins) No. The deal in June was a hard
fought—hard wrought rather than fought, I suppose fought
as well—deal to rescue a project of a considerable number
of billions of pounds which was underpinned supposedly by the
Eurostar business, a Eurostar business which was when the project
was originally conceived over-estimated in terms of its return.
258. I understand that, Mr Griffins.
(Mr Griffins) Therefore, when it was rescued in
June what the Government attempted to rescue was the deal as it
was rather than impose additional obligations.
259. I understand that. Forgive me, I really
do not want to appear rude and interrupt you but if I do not I
shall not understand and that means I will go out of the room
more confused than when I came in. What I do not quite understand,
if the Chairman will allow me, is this: the deal was done that
included the appointment as the management agent of the consortium
we now know as Inter-Capital and Regional Rail. That was done
on 3 June. The Government knew about that. They did not say anything
about it but they knew about it. In July the Deputy Prime Minister
appointed that same
consortium—— You see the point I am getting
at. I do not want to waste the time of the Committee but it is
quite important that I understand.
(Mr Griffins) London & Continental Railways,
the contracting party with the Government for producing the Channel
Tunnel Rail Link, needed, amongst other things—
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