Select Committee on Environmental Audit Minutes of Evidence

Examination of Witnesses (Questions 160-179)



  160. It might be said that the incentive was set up the wrong way in retrospect?
  (Mr Byers) My own view on Railtrack is I think the way Railtrack was floated—and there is a very good Public Accounts Committee report when the Chairman of the Public Accounts Committee was the present Chairman of the Conservative Party, and I urge Members to read it because it is very critical of the way that Railtrack was floated and the poor deal the taxpayer got from that. There are inherent flaws in the way Railtrack was privatised.

Mr Gerrard

  161. I think some of the discussion has slipped a little bit away from what we ought to be concentrating on because if we are interested in developing public transport is not the question what levels of investment are going in. Perhaps the Secretary of State could give particular regard to the Underground and some comparison of what is going to happen over the next 15 years compared with the previous 15 years.
  (Mr Byers) I would be more than happy to provide the Committee with that information. The plan is there will be some £13 billion over the next 15 years. I have not got to hand the comparison with the previous 15 years but I think he will be aware that it is a significant increase on the amounts that have been invested in the previous 15 years.

  162. Do you have figures on the actual investment which took place by Railtrack over the past few years?
  (Mr Byers) I can provide those to the Committee as well.

  Chairman: Perhaps you would let us have a paper both on the Underground figures and the Railtrack figure.

Mr Barker

  163. Could you give a rough split between the investment you expect to be direct from government and that which you expect to come from the private sector?
  (Mr Byers) As far as rail is concerned we expect some £30 billion to come from the public sector and £34 billion from the private sector.

  164. You mention that you do not anticipate that the Railtrack situation will have impacted on your ability to raise finance or indeed the cost of finance, despite what one reads about US investors' attitudes towards further participation. Could you say what your target cost of capital will be and whether you will be measured against that when you go into the market?
  (Mr Byers) It will obviously vary situation to situation. If I can give you one example of where we feel capital will be available probably at a level which is going to be better than it may have been under Railtrack. We are confident that the successor body to Railtrack (because it will have its risks reduced and because it will not be involved in the major enhancement projects, and will simply be concentrating on operations, renewals and maintenance) will be a less risky investment and therefore they are likely to find that finance will be available at a better rate than would have been the case as far as Railtrack was concerned. It will vary from case to case and obviously on the return on investment.

  165. Of that £34 billion, what sort of proportion is that element you have just alluded to?
  (Mr Byers) The Railtrack proportion or the successor?

  166. Yes.
  (Mr Byers) I am not sure we can go into that sort of detail here. That will be something for the successor to Railtrack to discuss with the private sector. It is going to be a private sector company and it would be wrong for me as Secretary of State to try and say exactly what level of debt the new company might want to be engaged in.

  Chairman: Let us go on to the area of planning. Mr Gerrard?

Mr Gerrard

  167. Planning is a DTLR responsibility now and you have announced that there is going to be a review of planning process and a Green Paper published. Can you tell us how you will involve other government departments in that review, particularly DEFRA?
  (Mr Byers) I think, Chairman, there are two separate issues here. One is a Government Green Paper on planning which we hope to publish in the next month or two. That will look at planning in the round, as it were, and it will be the first time that a comprehensive look has been taken at planning probably since 1947. It will be an opportunity to look at the role that planning can play in achieving two principal objectives; planning as a lever to achieve social renewal and also as a means of economic regeneration. That was the way in fact it was looked at by the Attlee Government in 1945 when they did their big review in 1947. We need to do something similar because we are not using planning as effectively as we could, in my view. The Green Paper will be a very extensive look at all aspects of planning and because it is a Government Green Paper all government departments are involved in the process so DEFRA are closely involved and they are commenting on the various drafts we have had. Quite separately and in addition to the Green Paper, there is there specific issue about the major infrastructure projects. I guess Terminal Five at Heathrow —

  168. I would like to come on to that.
  (Mr Byers) We are looking at that almost as a separate aspect. There is the Green Paper on planning and running alongside it to a certain extent is the document about the more consultation we will need to have on the major infrastructure projects.

  169. I would like to come onto the major infrastructure projects in a moment but can we stay on the land use planning issues. You said you are going to issue a Green Paper. You also said in the memorandum that you gave to us that the consultation period will last until Easter. You are also going to issue consultation papers on Section 106 agreements and compulsory purchase compensation. Can you give us any idea of the timescale of all this, we have got a consultation until Easter, and when we might expect to see the outcome. When we do see the outcome, are we going to have a review of the whole planning system in the round so that we do not get the Section 106 and compulsory purchase being treated as separate side issues.
  (Mr Byers) They are clearly not separate side issues, they are a key part of the whole process.

  170. I was interested that you were issuing separate consultation papers.
  (Mr Byers) The way I look at it is the Green Paper is going to be the vision for planning, if I can put it that way, it is big picture stuff and there will some individual proposals, but we have got compulsory purchase and we have got Section 106 already there and they are quite discrete areas which do not necessarily impact on the purpose of why you need planning and what planning can achieve. People will be able to look at them together and see the links between them but compulsory purchase in particular is a quite a discrete area where there will probably be a different constituency that will be looking at CPOs compared to the broader planning issues and that is the reason why we pulled it out. Also on Section 106 you are looking at an obligation being imposed on people. There are issues there. If we look at affordable housing, there is probably a different constituency as far as that is concerned there as well. That is the reason why.

Mr Francois

  171. We were told at a previous hearing that a planning Green Paper was likely to pop out sometime before Christmas. Is that broadly correct or is there the possibility of some slippage? As we have you here it is a good time to ask.
  (Mr Byers) It depends on whether we feel it is ready to go. There is a lot of work going on at the moment and I shall be looking forward this weekend to reading what I hope might be the final draft. If it is the final draft then it will be out before Christmas. If as I read it there are improvements that I would want to make which I then need to consult on with my colleagues at DEFRA and elsewhere it may slip, but I am keen to get it out before Christmas.

  172. It is probably but not definitely?
  (Mr Byers) Whatever we do there will be at least a three-month consultation period. That is the important thing

Mr Simmonds

  173. One of the areas in planning at the moment that seems to be at fault is there does not seem to be sufficient ability for the public to be consulted bar through the traditional inspectorate route which is a very expensive exercise involving barristers. One of the criticisms that has been made so far of the proposals in the Green Paper that have slipped out in the public domain is that there will be even less opportunity for the public to have their say. Would you like to comment on that?
  (Mr Byers) When people have the opportunity of seeing the Green Paper they will recognise that that is not going to be the case. To me what is very important about the planning process is you have basically got to take people and communities with you. We all know as constituency members that the most difficult planning issues that one has to deal with are when people feel that they have been ignored and they have not been able to voice their concerns. You have to find a system which allows people in their own way to articulate their concerns. What worries me, and I say this as a lawyer, is that people at inquiries feel a bit intimidated by the procedure and the process and do not feel they can voice their concern as a local person affected by the major planning decisions. We have got to a find a better way of allowing people to have access to the process. I would like to think that in the Green Paper we begin to flesh out some ideas as to how that might be achieved. One of the reasons why it is a Green Paper is that we do want to consult on this and we do want people to suggest their own ideas about how we can involve local people and communities more effectively than they are at the moment. And it is a good opportunity to do it because the thing that strikes me is that the point about planning is that it is all to do with change, that is a truism, but people have got to feel that they are partners in the changes that are going an affecting their local neighbourhood and if they do not then they will object, they will take action and it will be very difficult. We have got to manage that process and I think by allowing people to be involved is the best way of doing so.

  174. One of the other criticisms of the planning process as it exists at the moment is that it is very slow and if you are going to involve the public more in the decision-making process presumably it will slow it down even further.
  (Mr Byers) I do not think it needs to. If there is a clear timetable and people know the timetable and know certain things have to happen by a certain date then it gives it a degree of certainty, a degree of focus and local people will know exactly what is going on. To go back to your first question, what you have to do is make sure that local people are properly informed and have all the relevant information available to them, and that does not always happen at the present time.

Mr Gerrard

  175. In the memorandum you sent to us you said that the Green Paper would be about process rather than about policy. Your first answer seemed to indicate that this would be a very broad Green Paper in its scope. How far will you be able in that Green Paper to take account of sustainable development and how that relates to planning policies?
  (Mr Byers) I hope when you see the Green Paper that you will recognise that sustainable development has been taken into account. It is something of which I am very mindful and in a sense it is very helpful we have had this evidence session just a couple of days before I read the next draft of the Green Paper because it will certainly be at the forefront of my mind when I start reading it on Saturday.

Mr Barker

  176. Can I just echo the point Mr Gerrard has made. On Monday I had an opportunity to visit the Duchy of the Cornwall's project at Poundbury which I thought was excellent and best practice in promoting both better town planning as well as better built homes. I think there is too little in the current planning process that promotes the environmental agenda. Can you comment on how the new planning process will promote best practice and produce environmentally more efficient homes and also in the wider context of planning. One of the things that struck me at Poundbury is the way that the streets are constructed in order to mitigate the use of cars to allow people to walk to work, walk to services. There seems to be a need for a much bigger picture and a higher quality of design in local planning procedure which I do not see evident at the moment.
  (Mr Byers) I do not disagree with that. There are two ways in which it might be addressed. One is to look at how we develop the skills of planners. There is a real issue and I know the Prince himself is concerned about how planners are trained. That is an issue we will almost certainly want to address in the Green Paper. And, secondly, is how you can promote best practice and where things have been tried and have worked well, to make sure that planners are aware of them. What always amazes me, Chairman, if we look at the mistakes that were high-rise developments in the 1960s, which very quickly we know, from experience in the North East, within two or three years fell into disrepair, but we were still building high-rise flats into the mid-1970s. We have got to make sure that people learn from things that work well and also mistakes that are made, and one of the things I will certainly want to address in the Green Paper is how we can learn from experience and build on best practice.

Mr Gerrard

  177. Can I turn now to the question of the large infrastructure projects. I realise again you are going to issue a consultation paper on some aspects of this. Can you give us an outline view of what you propose?
  (Mr Byers) The objective that we have set ourselves, and we are in the major infrastructure projects only talking about two or three projects a year that will fall into this category—and Heathrow Terminal Five I guess would be a good example of an application that would fall into this particular heading—on the one hand there has to be a better way of conducting a planning inquiry than was Heathrow Terminal Five just in terms of the time. The public inquiry itself took four years. There were a number of issues that were raised there, some of which were of direct concern to local residents. We have got to make sure that whatever we put in its place local people can still express their own concerns and reservations. But the issue is whether or not matters of major policy should also be determined at public inquiry or whether we in Parliament should have an involvement in a particular policy that might be there. For example, there was lots of discussion in Terminal Five about the policy of developing airports in the South East of England. And the issue is whether that could have been determined by an elected body, Parliament in this particular case, so we would determine the policy and then the issue would be where that is to be located in the South East of England and whether Heathrow would be a suitable location and then the details of the actual application itself could still be a matter that the inquiry could look at. We are still working on the precise details which is why the consultation paper has not come out yet. Part of it is looking at the Parliamentary procedures that could be used because those who have been here for a while, although there is not an obvious model, would think that is a good way of dealing with it. Obviously I am talking to the Leader of the House about what those Parliamentary procedures might be. The consultation document, hopefully, will come out early in the New Year when people can see the detail.

  178. Would you expect that because these are major projects that there would be an environmental assessment as an integral part of any of those new procedures?
  (Mr Byers) I would have thought, although it depends on the nature of the application and the project, that would be a matter that would certainly need to be considered.

  179. At what stage? Is that the sort of thing you would expect that to be available to Parliament who are being asked to make decisions?
  (Mr Byers) I would have thought Parliament would have been reluctant to agree to something if they did not have that sort of information available to them.

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