House of Commons - Environment, Transport and Regional Affairs

Select Committee on Environment, Transport and Regional Affairs Seventeenth Report

SEVENTEENTH REPORT

The Environment, Transport and Regional Affairs Committee has agreed to the following Report:—

DEPARTMENTAL ANNUAL REPORT 2000
AND EXPENDITURE PLANS 2000-2001

1. The Environment, Transport and Regional Affairs Committee is appointed to examine the expenditure, administration and policy of the Department of the Environment, Transport and Regional Affairs and its associated public bodies. Each year we and our predecessor committees have inquired into the Department's Annual Report and published expenditure plans. This is our third such Report since the merged department was established following the 1997 general election.

2. We took oral evidence on the Departmental Annual Report 2000[9] over three sessions before the Environment Sub-committee, the Transport Sub-committee, and the full Committee respectively. Our witnesses were Lord Macdonald of Tradeston, Minister for Transport; Sir Richard Mottram, Permanent Secretary; Mr John Ballard, Principal Finance Officer; and other senior officials from the Department of the Environment, Transport and Regional Affairs. Questioning covered a wide range of issues, from Resource Accounting and Budgeting and the Department's web site to exemption from capital taxes for heritage properties. In this Report we highlight a number of the matters raised in the three evidence sessions.

OBJECTIVES AND PUBLIC SERVICE AGREEMENTS

3. The Annual Report is based upon the DETR's 10 main objectives, listed in Chapter 1 of the Report. Each main chapter of the Report contains a summary of key achievements over the past year; an explanation of how those achievements relate to the Department's objectives and public service agreement (PSA) targets; and a description of how the Department is striving to deliver those targets. Chapter 13 of the Report lists in detail the Department's PSA targets and the progress made to date on each.

Transport priorities

4. Since Lord Macdonald was appointed Minister for Transport there have been persistent reports that the objectives of Departmental policy have changed, with more emphasis being placed on building new roads and less on developing a fully integrated transport policy. This is in stark contrast to the 1998 Integrated Transport White Paper, which said that "the priority will be maintaining existing roads rather than building new ones ... Simply building more roads is not the answer to traffic growth ... This White Paper sets a new course for roads policy".[10]

5. The Minister denied that there had been any change in policy since he took office. Claiming that priorities were unchanged, he acknowledged that "there are other areas of road works both at trunk level, motorway level and at local level we want to invest in", but asserted that "that in no way undercuts our commitment to try and improve investment in public transport, in rail, rail freight, in bus services and local transport."[11] Later, the Permanent Secretary argued that the Department was simply trying to implement the framework set out in the Integrated Transport White Paper, which included a road investment programme.[12]

6. Since our questioning of the Minister, the Government's 10-year plan for transport has been published.[13] In it the Government says that £21 billion will be invested in strategic roads,[14] on projects including 30 trunk road bypasses, the widening of 5 per cent of the strategic road network, and eighty more major schemes to tackle 'bottlenecks' at junctions.[15] This commitment to a major programme to build new roads, and to upgrade other roads, is at odds with the claim of the Integrated Transport White Paper that "the priority will be maintaining existing roads rather than building new ones ... Simply building more roads is not the answer to traffic growth ... This White Paper sets a new course for roads policy".[16] We note that the Department appears to have given increased importance to roads from the position in the White Paper on Integrated Transport.

Urban Renaissance

7. Achievement of an urban renaissance should, in our opinion, be a key objective for Government. We have expressed in many recent Reports, most notably that on the Urban White Paper,[17] the importance of ensuring the regeneration of our cities. The Urban Task Force, chaired by Lord Rogers, recommended that the Government should "include the objective of an urban renaissance in the terms of reference for the 2001 Comprehensive Spending Review which will determine public expenditure priorities for the following three years ... A single 'Urban Renaissance Public Service Agreement' should be developed to operate across Whitehall following the 2001 Spending Review".[18]

8. However, at present none of the Department's 10 main objectives relates specifically to urban regeneration. Furthermore, where the Department's individual Public Service Agreement targets relate to the urban renaissance (such as "establishing targets for the proportion of regeneration projects meeting their output goals"[19]), they are incidental to the core objective of the regeneration of our cities. Questioned on Lord Rogers's recommendation that there should be a specific Public Service Agreement target for the urban renaissance, the Permanent Secretary indicated that he would be "very happy" to have such a target, but complained "framing a target to capture the urban renaissance is quite a difficult thing to do."[20] However, we do not believe that it is an impossible task. Given the importance of the urban renaissance, and the danger that, in the absence of a specific objective, it will not be given the priority it deserves, the Department should add an urban policy objective to its 10 main objectives. It should also frame appropriate targets related to this objective, including an increase in the population of inner city areas.

TARGETS

9. In our Report last year on the Departmental Annual Report 1999, we expressed concern about the Department's use of targets. We observed that "too often they are invented without sufficient thought and rejected if they appear too difficult to meet."[21] We questioned our witnesses about a number of the Department's targets, in particular those which were dropped this year.

Rail freight

10. In 1997, English Welsh and Scottish Railway set itself an 'aspirational' target of doubling the volume of freight carried in five years, and trebling it in ten years. These targets were endorsed in the Integrated Transport White Paper.[22] However the Government now admits that these targets will not be met,[23] and "may have been a touch ambitious."[24] We were told that the company is now expecting growth to increase by eight per cent per annum, which would see rail freight doubling in around nine years.[25] The Government's ten-year plan foresees rail freight increasing by 80 per cent by 2010.[26]

11. We are surprised that the White Paper should have endorsed English Welsh and Scottish Railway's targets for the growth of rail freight so readily, if they were considered over-ambitious. If rail is to play its full part in the movement of freight, the Government and the shadow Strategic Rail Authority must review and revitalise the policies designed to increase use of this mode. This review should include firmer guidance and extra funding for rail freight projects in local transport plans.

44-tonne lorries

12. The prospects for greater use of rail freight have further suffered from the Government's decision to allow 44-tonne lorries on certain roads. This decision was made despite the recommendation of the Commission for Integrated Transport that the Government should await an analysis of the impact on rail freight, currently being prepared by the Shadow Strategic Rail Authority.[27] The Government is now awaiting this review before confirming its decision.[28]

13. The Government admitted that "it would be foolish to say that the introduction of 44-tonne lorries would not have an effect on the amount of rail freight", although it was claimed that the measures contained in the ten-year plan for transport would more than counterbalance the impact of heavier lorries.[29] The Government's ten-year plan sets out the amount to be spent on the railways, and argues that "it ought to be possible" to increase the share of freight carried by rail to 10 per cent by 2010.[30] It gives general examples of means by which the rail freight industry might be supported, such as the development of freight priority routes, the elimination of bottlenecks, changes to gauges, and funding for new and improved freight terminals, but it sets out no specific programme of measures by which rail freight will be strengthened. It is most important that the prospects for rail freight are not damaged by the introduction of 44-tonne lorries. We therefore recommend that 44-tonne lorries be permitted for general use only after specific recommendations relating to the protection and strengthening of rail freight have been developed by of the shadow Strategic Rail Authority, and have been implemented.[31]

Cycling

14. The National Cycling Strategy, published in 1996, established a national target of doubling the amount of cycling by 2002, and of doubling the amount again by 2012. The Integrated Transport White Paper endorsed the target.[32] Last year's Annual Report listed it as a target to be met as part of the local transport programme.[33] Accordingly we were surprised when Lord Macdonald told us that the target for 2002 had not been "put ... inside our formal targets":[34] it has in fact apparently been abandoned.[35] Instead, Lord Macdonald said, the Government's target was "quadrupling cycling by 2012".[36] The ten-year plan for transport set a target of trebling the number of cycling trips by comparison with 2000,[37] which it said represented a re-basing of the target of quadrupling cycling by 2012 compared to 1996, and could be used alongside the target of quadrupling cycle use by 2012. The targets will be achieved, it is claimed, through the development of the National Cycle Network,[38] and through "very firm encouragement" for cycling in local transport plans.[39]

15. We are surprised that the Government, having endorsed the target for doubling cycle use between 1996 and 2002 in the White Paper and in last year's Annual Report, should now argue that the target had not been formally adopted. Its failure to take the measures necessary to achieve the target shows the Government's fundamental lack of commitment to cycling. We trust that the Government's remaining targets, of trebling cycle use by 2010, and quadrupling cycle use by 2012, will prove to be more durable. However, unless it takes the necessary steps to make cycling much safer, we fully expect that these targets will also be abandoned.

Walking

16. The last Annual Report announced that "in 1999 the Department will set a target for walking.....".[40] In order to encourage better conditions for pedestrians, the Government has provided advice to local authorities in its guidance on local transport plans and in its recently published Encouraging Walking: Advice to Local Authorities. However, this document did not set a national target to encourage walking, as had been promised. A possible target of increasing the proportion of all journeys made on foot to one-third within ten years was thought to have been rejected as being impracticable. Local targets were favoured instead.[41]

17. The DETR states that walking can be "a healthy, enjoyable way of getting about, but only if the pedestrian environment is pleasant and safe".[42]We agree, and would like to see an increase in the number of journeys made on foot. However, more attention must be paid to the needs of pedestrians if people are to be persuaded to undertake more journeys on foot. The Department has not provided a satisfactory explanation for reversing its plan to adopt a national target for encouraging walking. We recommend that the Government reconsider the case for setting one.

Travel safety

18. The Annual Report states: "We want to achieve a 40 per cent reduction in the number of people killed or seriously injured in road accidents, a 50 per cent reduction in the number of children killed or seriously injured, and a 10 per cent reduction in the slight casualty rate..".[43] Ambitious road safety targets will require possible additional funding particularly in the pursuance of a detrunking programme.

Climate change

19. Perhaps the most high-profile of the DETR's targets is that of preparing a programme to ensure delivery of the commitment, first made in the Labour Party manifesto in advance of the last General Election, of a 20% reduction in carbon dioxide emissions by 2010. The Government has published a draft Climate Change Programme, setting out the policies and measures which they hope will result in the achievement of this target, on which we reported earlier this year.[44] It is intended that the final version be published later this year.[45] We were told by the Government that "what we are trying to do at the moment is get reactions from people as to whether they think that the sums we have done and the expectations which have been put on the table are believable."[46] Officials seemed confident that, on the basis of the policies set out in the draft programme, the 20% target would be met.

20. However, that confidence does not appear to be shared by the Royal Commission on Environmental Pollution. Its recent report Energy - the Changing Climate expressed scepticism about whether some of the measures outlined in the draft programme, particularly those affecting the transport sector, would deliver sufficient reductions in emissions to ensure achievement of the 20% target.[47] Subsequent to our evidence sessions with officials from the Department, the Chairman and two Members of the Commission appeared before us to give evidence on their Report: they reiterated their concerns about the "hole" in the Government's climate change programme.[48] In the light of the Royal Commission on Environmental Pollution's evidence to us, officials' confidence that the 20% target will be met appears complacent.

ACHIEVEMENTS

21. As mentioned above, the Annual Report is based upon the DETR's 10 main objectives, listed in Chapter 1 of the Report. Each main chapter of the Report contains a summary of key achievements, related to each particular objective. Both Lord Macdonald and the Permanent Secretary spoke to us about the Department's achievements over the past year.[49] Lord Macdonald told us that the main achievement was to get Government agreement to the 10 year transport plan. The Department has a raft of objectives which command widespread support. There has been progress this year, but we remain impatient with the pace of implementation.

IMPLEMENTATION

22. During the three evidence sessions relating to this inquiry, we took the opportunity to ask about a number of matters on which this Committee has in previous Reports made recommendations. Below, following our questioning on these matters, we make further recommendations on two particularly important issues which have been the subject of previous inquiries by the Transport Sub-committee, namely tendered bus services and air traffic control.[50]

Tendered bus services

23. In our Report on Tendered Bus Services, we expressed concern about the rising prices of local bus service contracts.[51] According to the Association of Transport Co-ordinating Officers, the price of local bus service contracts is continuing to rise. During 1999, the price of re-tendered contracts rose by 17 per cent (compared with 12 per cent in 1998) and it is estimated that tendering authorities would need to increase their budgets by 8.7 per cent to maintain existing service levels. The combination of this rise in prices and a shortage of funds led to local authorities withdrawing bus services that provide 364,000 journeys per annum in the year to October 1999.[52] In its reply to the Committee's Report on Tendered Bus Services, the Government said that it did not presently consider that a case had been made for additional financial support for local authorities over and above that provided through the 1998 Comprehensive Spending Review. Nevertheless, London Transport has been provided with additional funding in response to higher tender costs.[53] We were told that this was mostly because of the difficulty of recruiting drivers in London.[54]

24. The Minister told us that the Government would look closely at the resources available for tendered bus services when full local transport plans are submitted later in the year, although he also noted that funding for these plans had already increased by 23 per cent. this year, with further rises planned for next year.[55] We are pleased that the Government has acknowledged the need for increased resources to off-set higher tender prices in London. We recommend that tendering authorities outside the capital also be given extra money to maintain socially necessary bus services which are in danger of being withdrawn because of rising costs.

Air traffic control

25. The problems which have been experienced with the new Air Traffic Control Centre at Swanwick are well-documented, not least in Reports from this Committee.[56] The proposed sell-off of a 46 per cent. share in National Air Traffic Services (NATS) makes those problems all the more significant.

26. According to officials, the Swanwick centre will be working by the end of 2000, when there will be a "technical handover": this will be followed by 12 months of training for operators, and the system will become fully operational in the winter of 2001-2.[57] However, the sale of a 46 per cent. share in NATS is due to take place in 2001, ie. before the system is fully operational. Bidders for this 46 per cent. share may not therefore be able to be confident that they would be buying a system that works, and we are concerned that the price obtained will be reduced as a result. We are not satisfied that the Government will get the best value for money by selling part of National Air Traffic Services before the new Air Traffic Control Centre is fully operational.

CONSULTANTS

27. The issue of purchasing consultancy advice is one about which we have expressed concern in previous Reports on Departmental annual reports and expenditure plans. In last year's report we recommended that the Annual Report provide more information about the work consultancy firms perform, the reason the work could not have been performed in-house, and the cost of each contract.[58] The Government did not respond to this recommendation. When, this year, we questioned officials on why this information was still not published in the Annual Report, there seemed to be some confusion as to whether it was a question of commercial confidentiality or simply a matter of keeping the amount of information provided in the Annual Report down to an acceptable level.[59] We remain convinced that commercial confidentiality need be no bar to the publication of more information to allow judgements to be made as to whether the Department is using consultants properly and obtaining value for money from the contracts it enters into. We therefore repeat our recommendation that the Department give details of the work each firm performs, and the reason the work could not have been performed in-house, and indicate the cost range within which each contract falls. We would prefer that this information be provided in the Annual Report, but if this proves not to be possible, the Department should propose another way of putting it into the public domain.[60]

9 Cm 4604 Back

10 Integrated Transport White Paper, Cm 3950, p.3, para.1.4 Back

11 Q193 Back

12 Q417 Back

13 Transport 2010:The 10 year plan, Department of the Environment, Transport and the Regions, July 2000. Back

14 The trunk roads currently operated by the Highways Agency: Transport 2010, p.50. Back

15 Transport 2010, p.55. Back

16 Integrated Transport White Paper, Cm 3950, p.3, para.1.4. Back

17 Eleventh Report, Session 1999-2000, Proposed Urban White Paper, HC 185-I Back

18 Towards an Urban Renaissance, p.281 Back

19 Annual Report, op cit, p.198 Back

20 QQ434, 431 Back