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John McDonnell (Hayes and Harlington) (Lab): May I reinforce the view of my hon. Friend the Member for Bethnal Green and Bow (Mr. Galloway) that it would be useful—in fact, invaluable—to have the Bindmans papers before us? It is the duty of the House to have them circulated this evening.
I support the Bill because I take the view that the London transport system is in urgent need of expansion. I speak as chair of the National Union of Rail, Maritime and Transport Workers parliamentary group and I shall also talk about constituency matters.
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Last year, almost 1 billion journeys were made on the London underground and, in the 10 years since 1994–95, there has been a 40 per cent. increase in mainline rail travel between London and the south-east and a 22 per cent. increase in mainline rail journeys in London itself. Our population as a city is predicted to grow by 700,000 by 2016, which will increase the demands on our rail infrastructure. During the gestation of Crossrail from the first Bill to this, my constituency has seen the development of Heathrow airport, with a fourth and now a fifth terminal. As a result of lack of investment in public transport, journeys by car, lorry and other vehicles to that airport are making my constituency the most air polluted in the country.
Concerns about the timing of the construction of Crossrail have been mentioned. It is disappointing that we cannot plan major projects such as the London Olympics and Crossrail to coincide. However, I wholeheartedly welcome some parts of the Bill. Clause 34, for example, disapplies the prohibition in section 25 of the Railways Act 1993 on public sector operators providing passenger services. That is a major commitment to public service operation. One might even describe it as an advance for democratic socialism, but I do not want to go too far.
There are a number of concerns about the Bill, such as network control. When we debated the Railways Bill earlier this year, we identified unnecessary fragmentation and lack of clear lines of accountability and control as the worst features of the privatisation of rail. The Railways Act 2005 therefore gave Network Rail additional responsibilities for railway infrastructure. That was reinforced in the Warwick agreement between the Labour party and the trade unions, which clearly stated that Network Rail was to oversee all rail engineering work. I would welcome ministerial confirmation that Network Rail will have responsibility for the oversight of maintenance and renewals on Crossrail.
Concern has been expressed about freight and it is important that we ensure that Crossrail will bring environmental benefits. We are therefore looking for assurances that freight currently moved by rail on the great eastern and great western main lines is not put in jeopardy. Crossrail could temporarily cut off a number of freight terminals on both those lines and lead to the closure of the rail-connected concrete plant in Royal Oak. It would be useful to have a ministerial assurance that freight currently moved by rail will not lose out because of the Crossrail project.
Mention has been made of the costs of the project. I agree with my hon. Friend the Member for Bethnal Green and Bow that, given that the legislation will make such a hefty requirement of the public sector should costs fall on it, it is extraordinary that the Bill does not identify where funding will come from. I suggest that the rail proposal will significantly benefit London's business community and that the project therefore provides the Government with an excellent opportunity to explore some innovative ways of meeting the Crossrail costs from the private sector. The very principle that those who benefit should contribute to the cost of the scheme should be in the legislation.
Asking businesses to pay their fair share towards transport projects is already the norm in countries from France to the United States of America. Research
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published in June 2004 on behalf of the passenger transport executive showed, for example, that the city of Lyons can raise more than £100 million a year from a dedicated payroll tax that can be levied on all firms, both public and private, at up to 1.75 per cent. of the company payroll. Lyons has a population of about 1.4 million; by comparison, London's population is in excess of 7 million. A payroll tax levied at, say, 1.63 per cent. would raise more than £500 million a year. Over five years that would amount to £2.5 billion towards the cost of the Crossrail project in the capital.
As the railway will greatly assist the airport, I suggest that we look to BAA for a contribution. At its annual general meeting on Friday, BAA announced profits of more than £500 million. Surely it can pay something towards a project of major benefit to the airport. In Paris, there is also a levy on employers and half the revenue raised from traffic and parking fines goes to transport investment. The RMT-commissioned "Funding London Underground" report last year looked at the state and the city of New York, which fund grants and subsidies accounting for 46 per cent. of the metropolitan transportation authority funding. A large proportion of subsidy comes from hypothecated taxation, which in principle at least is targeted at non-fare paying beneficiaries of the scheme in the private sector.
Mention has been made by my hon. Friends of the increase in land values. Now is the ideal time to explore the concept of land value taxation on those who will benefit directly from the development of Crossrail. Experience of the Jubilee line demonstrates just how land values and property prices can soar in an area and provide an adequate source of financing.
In London, we have long complained about lack of investment in the manufacturing of rolling stock. In the past few years, there have been significant job losses in the rail manufacturing and maintenance sector at sites including Birmingham Washwood Heath, Eastleigh and Derby, as well as in the capital. It is regrettable that the new high-speed trains for the proposed integrated Kent franchise will be built in Japan and not in Britain. Crossrail gives us the opportunity to kick-start a recovery in the manufacturing of railway stock in the UK as a railway workshop. I therefore encourage the Government to bring all their influence to bear to ensure that new rolling stock for Crossrail is manufactured and maintained in Britain.
Having objected to the original Crossrail scheme, largely because of the implications of the development of the Heathrow express for my constituents, I should say that such objections no longer exist in my constituency, except in companies that want some certainty about the development of the project. Companies and homes have been blighted for a long time as a result of the proposals. We desperately need a decision in principle and on the time scale. We want clarification of precisely which areas of land will be affected and for what period. That will allow companies such as Leemark Engineering and H. G. Timber in Hayes and Lafarge Aggregates to plan in the short term for the length of their operation on their present site and, if necessary, in the long term, for relocation.
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Mr. Ken Purchase (Wolverhampton, North-East) (Lab/Co-op): My hon. Friend rightly talks of the need for a decision in principle because uncertainty is a problem, but does he agree that, before that can be taken, people who might support the Bill need to know about the ongoing revenue consequences of the capital programme? Until that is known, how can we expect people to support the programme with hard cash?
John McDonnell: That is a good point—the issue needs to be addressed in the ongoing debate. The benefits to a number of constituencies, to the environment and to the economy of London and the south-east and of the country as a whole, warrant some public sector commitment to the ongoing revenue funding, and that should come from public taxation. I accept that there might be growth in the subsidy that will be required, but that burden can be borne by business and through public taxation in the long term. That is why I urge the Government to look now at both the capital and revenue costs and establish a system such as those across Europe and the United States that enable projects to be adequately funded from hypothecated taxation.
The issue of certainty leads me to that of compensation. There is reference in the Bill to the usual compensation for compulsory purchase. I hope that we have a debate on the Floor of the House about the compensation that will be awarded to people for protection of their homes following any environmental impact and for any relocation. I am concerned that the levels that were discussed when the issue was first considered 15 years ago will not be adequate to meet the demands of relocation, or even the costs of short-term operation, as affected by transportation issues and other environmental impacts of the construction of the rail.
Overall, I welcome the Bill and look forward to the opportunity for my constituents and me to make representations to the Committee. I hope that the Government will address the significant issue of funding that I have raised and that we can achieve a consensus across London, even if we do have to bypass Bethnal Green and Bow—and I would fully understand why.
6.40 pm
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