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UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 737-i House of COMMONS MINUTES OF EVIDENCE TAKEN BEFORE TRANSPORT COMMITTEE
SIR ROD EDDINGTON, GOVERNMENT SPECIALIST TRANSPORT ADVISER
Wednesday 30 November 2005 SIR ROD EDDINGTON Evidence heard in Public Questions 1 - 59
USE OF THE TRANSCRIPT
Oral Evidence Taken before the Transport Committee on Wednesday 30 November 2005 Members present Mrs Gwyneth Dunwoody, in the Chair Mr David Clelland Clive Efford Mr Robert Goodwill Mr John Leetch Mr Lee Scott Graham Stringer ________________ Memorandum submitted by Sir Rod Eddington
Examination of Witness
Witness: Sir Rod Eddington, Government Specialist Transport Adviser, gave evidence. Q1 Chairman: Good afternoon to you kind sir. It is always a delight to see your cheerful face. Can I ask you to identify yourself for the record? Sir Rod Eddington: Thank you, Chairman. I am Rod Eddington from the Department for Transport at the moment. Q2 Chairman: Sir Rod, do you have something you want to say to us before we start? Sir Rod Eddington: Perhaps just a few brief comments, Chairman, and then I will turn to the important part of the session which is the questions. I have been in this role now for just under two months and I have spent that time trying to gather as much evidence as I can on this key issue of the links between transport, transport infrastructure and the economy. I recognise that when Government take decisions around transport and transport infrastructure they do so with a mind to other things as well, environmental issues and social inclusion issues. We are looking at transport through an economic lens. I am trying to make this process as evidence based as possible, so through the last two months I have met with 50 key stakeholders across a whole range of different modes and we have spent quite a bit of time in the regions. That journey is not finished yet. We are probably about two-thirds of the way through our regional visits. We were in Newcastle and Teesside yesterday for instance. I am working with a small team made up of some people from Transport and some from the Treasury. We have also looked to gain as much as we can from the work that was done before. One of the key groups who are working with us is a group that we call the academic friends which comprises some of the key transport economists and geographic economists in the country. Through them we are trying to draw on the information that is out there so that we can include it in the work that we do. Q3 Chairman: Thank you for that. I am rather taken with a group called "The friends of Sir Rod"! Could you give us a little bit more information about the remit, just the detail of the remit and whether you were consulted about it and what you finished up with? Sir Rod Eddington: The remit is to look at transport infrastructure through an economic lens and to look at transport and transport infrastructure from an economic, economic productivity, economic stability and economic growth viewpoint. That was the remit I was given and I was happy to accept it having spent most of my life in transport in one form or another and recognising that transport infrastructure is essential to the way in which our transport system is run. I was asked to put my thoughts forward by the middle of 2006. Q4 Chairman: How did this originate? Sir Rod Eddington: I expect because the Secretary of State for Transport in particular had heard me say on a number of occasions that I felt that unless we took a long hard look at transport infrastructure in this country and understood its importance to both the economy and to people's way of life we were in danger of allowing that critical infrastructure to run down. Having heard me say that on a number of occasions, he asked me what I thought we should do about it and as I was contemplating an answer he said, "Not now. I would like you to spend some serious time doing this and come back in the middle of next year." It was on that basis that I think I was asked. Q5 Chairman: Why do you think it is important that you should do this and not civil servants? Sir Rod Eddington: I am working with a small team of civil servants, but for me the key piece of this work is to work with as many of the key stakeholders as possible. As to why I was asked, I think you would have to ask them, not me, but I have been very keen to try and make this remit as broad as possible in the context of talking to as many key stakeholders as possible. Q6 Chairman: Who are you going to report to? Sir Rod Eddington: I will submit my report to the Secretary of State for Transport and the Chancellor. I will submit my thoughts in the middle of 2006. Q7 Chairman: So both of them at the same time. Sir Rod Eddington: Yes. Q8 Chairman: Can you tell us how your work is connected with the Government's short and medium term transport plans? Sir Rod Eddington: I have been asked to look at transport policy and in that sense it has no connection to decisions that are being made today, tomorrow or the day after. The specific brief was to look at transport policy in 2015 and beyond. Q9 Chairman: You must have to get to 2015 from somewhere, do you not? Sir Rod Eddington: I agree entirely. If I work to my remit, it will be for the Government to decide whether or not what we find has any relevance earlier to that timescale. There are some real challenges today, tomorrow and yesterday and clearly they need to be addressed. Q10 Chairman: It is a very wide-ranging brief. Do you think you can do it in nine months even though you are Australian? Forgive me! Sir Rod Eddington: It is a fair question. I have asked myself that same question. I am confident that we can do a serious and significant piece of work in that time. Will we get to the detail of all the issues that will be raised? No, we will not because many of these issues are substantial issues that will require careful thought. The implications are likely to involve things that only governments at the end of the day can decide. I think it is an opportunity for me to put my thoughts forward in the hope that they might find some resonance. Q11 Chairman: The Chancellor did say that you would look at the "priorities". That is rather specific, is it not? Sir Rod Eddington: Indeed it is. Q12 Chairman: You do not think that is a code for cutting back the amount of money that is spent on transport? Sir Rod Eddington: I hope not because I think one of the challenges we have is that if we are going to make the right transport decisions then we need to think quite carefully about what the investment requirements are and where those funds come from. Q13 Chairman: At one point Lord Birt was supposed to be involved in blue sky thinking in transport. Do you have access to what he did? Are you building on what he did? Are you ignoring what he did? Sir Rod Eddington: I have not had access to his conclusions. Q14 Chairman: He did come to some conclusions, did he? This Committee was unable to discover them. You can assure me that he came to some conclusions, can you? Sir Rod Eddington: I have had no more luck than you in that regard. However, I have had access to the data he produced. I have looked hard at all the evidence that we can find that relates to this issue. I think some of the work he did on demand management was interesting and some of the European comparisons he did were interesting. I have seen the data but I have not seen the conclusions. Q15 Mr Clelland: You said you had recently visited the north-east of England. Did you have the opportunity when you were there to discuss the effects of congestion on the A1 and the A19 on economic development in the area? Sir Rod Eddington: Yes. We were there yesterday. We went down to Teesside as well, but we spent most of the day in the North East. I think the issue of congestion generally, although in this instance it is road congestion, is something that is raised wherever we go and it very quickly comes to a number of issues, ie the issue of what role does demand management have in resolving congestion problems, what are the alternatives and what are the causes of congestion. One of the things I am very keen that we do is to start by understanding what the journeys are, whether they are intercity journeys, whether they are people coming to work in the morning, whether they are freight journeys and if they are freight journeys, where are they coming from and to, and then from that to reflect on what the economic issues are. Road congestion is a problem around the country. Mind you, if you talk to people on the rail network, they will talk about the competition for space on the railway as well. Q16 Mr Clelland: I was more interested in the current effects of congestion in that area on economic development. Are you aware that the Highways Agency has effectively blocked economic development around the A1 and the A19 because they say it is too congested? Sir Rod Eddington: That issue was raised with us. I know these issues are important and they are significant locally and clearly they are issues that need to be addressed. As the Chairman suggested, we cannot wait until 2015 to address some of the challenges we face. Nevertheless, my brief is very clear, which is to step back and take a look at the bigger issues - and that is why the issue of congestion is important to us, because it clearly is a significant issue - and not to get enmeshed in the day-to-day challenges. Q17 Mr Clelland: That is fair enough, but, as a general principle, if the Highways Agency were to adopt that policy across the country we would find that economic development in huge swathes of the country where we are trying to develop new businesses would be effectively blocked. Is that reasonable? Is it not economic development that is going to pay for the new infrastructure anyway? Sir Rod Eddington: I have not spoken yet to the senior leadership of the Highways Agency, I have to do that in the next week and I have an appointment in my diary. It is one of the issues that I will raise. Q18 Clive Efford: You are quoted in the Transport Times article as saying that those countries that have got transport right are those with transport systems that are integrated. Which countries did you have in mind when you said that? Sir Rod Eddington: I have spent much of my life in Hong Kong and anyone who goes to the new airport at Hong Kong would look at the rail link to the downtown and the rail infrastructure that goes with that airport, would look at the underground system in Hong Kong - the same is true in Singapore, incidentally - and recognise that there is a system where transport is thought about as an entity rather than through modal links. There are other examples, but they are the two that are the best and are very much in my mind. Q19 Clive Efford: Do you think that with such a fragmented system in terms of ownership in the UK it is possible to get it right in the same way as those countries? Sir Rod Eddington: The question of ownership and funding is a very important one in this debate. As I say, remember I am only two months into this journey and it is a nine month journey. I am looking in the first instance at the link between those journeys and the economy. I am very mindful that there are other issues that are important in this context: environmental issues and social inclusion issues but my focus is very much the economy. I am yet to look at the issue of what ownership structure delivers the best outcomes. Going back to my Hong Kong days, there is in the broad a role for both private and public ownership in transport and at the end of the day it is for the Government to decide where that balance is to be struck. Most of my time has been spent working for private companies, airlines, that exist in an environment where some elements of the infrastructure are government owned and some elements are privately owned. As long as one is clear about what the key governance issues are, it is possible to live and operate in a world where both the private and the public sector are involved. Q20 Clive Efford: You say that some of the major strategic decisions have to be taken by the Government ---- Sir Rod Eddington: Agreed. Q21 Clive Efford: ---- but in some areas of transport, the private sector is the people who make the decisions. Airports and ports are examples of that. Is that not a problem in terms of planning and developing an integrated transport infrastructure? Sir Rod Eddington: If you turn to airports specifically and airlines, and the way in which they work together, I have not found that a problem. Again, government is not without some influence in this matter. At the end of the day, for instance, airport charges are regulated by the Civil Aviation Authority and government has a real role to play in aviation in areas like safety and security. It is about identifying the areas where government naturally should take a leadership role and the areas where the private sector could meaningfully take a leadership role. If you look at the infrastructure demands particularly in any country and the question of can they all be met by government funds, it is difficult to believe the answer to that question is yes, simply because there are so many different calls on government funds: education, health and the like. It is a question of government deciding where it intends to strike the balance. Q22 Clive Efford: I accept that, but if we take some examples, like the United States for instance, I understand none of their airports are private. Sir Rod Eddington: Most of their airports are owned by the local authority, and that is true in our country in some cases as well. For instance, Manchester Airport is owned by the local boroughs that are around Manchester. That is perfectly workable in my experience. We were at Manchester Airport earlier, we have been to Birmingham Airport and we were at Tees Airport yesterday, and that is owned by the Peel Group, it is privately owned. It is not necessarily true that one is always right and one is always wrong, my point is there is a place for both private and public capital and funding in these schemes and it is for government to decide where the balance is to be struck. Q23 Clive Efford: You have also said that planning procedures are a problem. How do you think we can improve the planning process? Sir Rod Eddington: This goes back to the earlier question. Wherever we go, the issue of demand management and is there a role for road pricing in our road transport is raised. The other issue that is always raised is the planning regime. The feedback I get, which is pretty crisp on this, is that the current planning regime is too complicated, too long, too expensive, contains too much uncertainty and that it hinders the running of our transport nodes, it hinders intelligent upgrading of those facilities and the building of new facilities, where appropriate, and we need to do much better. Q24 Clive Efford: Are the ODPM represented in your review? Are they commenting on the issues around planning? Sir Rod Eddington: As I say, I am still very much in the data gathering mode. Clearly, given my brief, I am particularly interested in the planning process as it relates to major transport infrastructure projects, and that is what I have been talking about as I go round the country. My findings will reflect the sorts of things I am hearing. Clearly, planning is a matter for the Office of the Deputy Prime Minister, as you rightly say, but, given that my brief is to look at transport infrastructure, and given that planning is an issue that is raised by all the stakeholders, I think we have to take it very seriously. Q25 Mr Scott: Can I just ask on that very subject, are you suggesting that planning issues should have no local input and should be decided nationally, and local interests should not be taken into account? Sir Rod Eddington: Not at all. I think the question of how we decide the right balance of local versus national input is an important part of the process, and I think it is very important that the planning process is thorough, but there are plenty of examples in the last decade, Dibden Bay is probably the most recent one, where the planning process took several years, costs tens of millions of pounds and the answer was no. The key stakeholders in those circumstances say, "Well, we accept that sometimes the answer will be no, but it should not take four years and cost us £45 million to get a no". I think the planning process by its nature must be thorough and must involve local as well as national considerations. This is not a plea for reduction in the thoroughness of the planning process, I just think it is overly complicated, too long and too expensive. I think the uncertainty issue is important, it is important at both the local level and the national level. Q26 Mr Scott: But you would not want to see local authorities taken out of this loop? Sir Rod Eddington: Not at all. Q27 Mr Scott: Or, indeed, if they think something is inappropriate for it to be overruled nationally? Sir Rod Eddington: No. I think clearly the local entity has a key role to play in the process. Q28 Graham Stringer: Possibly you can help me, Sir Rod. I cannot decide whether you have got the easiest job that Government has ever given anybody or an impossible job. Let me put the question like this: you said earlier that there is a capacity problem, will your report not say that and say, "We need more runways, more tramways, more railway, more roads, more deepwater ports", end of story, you can finish and go home, not in seven months but by Christmas? Will your report say that or will it be a deeply complicated report that looks at academic studies that try to decouple road traffic from the economy? I am not quite sure at what level you will be operating, perhaps you can help me. Sir Rod Eddington: It is a good question. As to whether I have got the easiest or the most difficult job, perhaps we can discuss that in the middle of 2006. Q29 Chairman: Doubtless that can be arranged. Sir Rod Eddington: I look forward to it, Chairman. It is clear that we have capacity issues in all the modes that you have discussed. What is equally clear is that we cannot build our way out of trouble. If we could, it would be an expensive solution but it would be one which we could consider. If we take the issue of roads, what is clear is that in the time frames that I have been charged to look at, 2015 and beyond, demand management will be an important part of I hope - I suspect, I think - the operating regime. Again, I like to keep a foot on the beach because I still have not been to a number of places. In fact, I have been very disciplined about the fact that we should not reach any conclusions until we have given all the key stakeholders a chance to have their say. The devil is in the detail in something like demand management on the roads. You know that, I read the report produced by this Committee in March this year and I went through the work that was presented to you by some of the leading figures on these issues here, and Professor Peter Mackie from Leeds University is on the Academic Friends group that Professor Sir Nick Stern chairs for us. There is broad agreement, sometimes reluctantly reached, as I go round the country and talk to the key stakeholders that demand management is a part of the story: "How do we make best use of existing infrastructure?" and that is not just true of roads but of rail, ports and airports as well, "Where can we build? What should we build? What is the case? What are the environmental implications?" By its nature, I think it is a complex tangle of issues. The challenge for us all is to sort out the things that matter most, the priorities, as the Chairman has said, and to speak to how we might address those priorities in a sensible and meaningful way. A piece of work that is overly complicated is generally of not much use. Q30 Graham Stringer: You have a distinguished career in aviation. Certainly in the view of this Committee, the ownership structure of BAA is a problem in terms of increasing capacity in the airport system in the South East and the best use of that capacity in the South East. Would you in any way feel constrained about recommending the break up of BAA? Sir Rod Eddington: At this point in my journey, Mr Stringer, I would not feel constrained in any way on any issue, that included, because I am absolutely focused on what the economic implications are for transport and making sure that we absolutely understand the links between the economy and transport and transport infrastructure so that when you take a decision, and by its nature it is a balanced decision across a number of issues, you understand the economic implications as well. If there is a strong economic case for a particular course of action, I would not resile from that. Q31 Graham Stringer: At the very start you said that you were working with civil servants. When I go round and speak to groups interested in transport, both commercial groups and greener, more environmentally concerned groups, they might not agree precisely on the analysis but they often come to the same conclusion that part of the problem in transport in this country is the Department for Transport itself. Will you feel constrained by the use of civil servants who follow departmental policy? Will you be able to access resources elsewhere? Sir Rod Eddington: I think the answer to that is no, I do not feel constrained. If I wish to, I can access resources elsewhere. My major external resource at this point in the journey, and a very useful one, has been the Academic Friends group because it includes people like Professor Sir Peter Mackie. Q32 Chairman: They are not a secret, are they? Could you write and tell us the names in due course? Sir Rod Eddington: I asked my team to put it in the memorandum I sent to you. Q33 Chairman: It is in there, sorry. Sir Rod Eddington: I have given you the list of names. Professor Nick Crafts, Professor Stephen Machin and others, it is an excellent group who challenge, push and probe, who pull information and evidence to us. For instance, Nick Crafts has done an excellent piece of work on the history of transport infrastructure and economic development in this country going back to the middle of the 19th Century and the importance of the textile industry on the basis that sometimes we have lessons to learn from the past. We have looked at labour markets. We have looked at agglomeration. I anticipate using that group as a significant sounding board. Also, when we go out we generally have long days and speak to many different groups, key stakeholders, local and regional authorities, business community operators, users of transport infrastructure, so our exposure is very wide and the inputs to this process are varied and many. Q34 Graham Stringer: A last question, if I may. This country is almost unique in the world, certainly in Europe, in having a deregulated bus system. This Committee has been concerned that is the cause of the drop in passengers using buses in every region in this country, except the one region which has a regulated bus system. Will you be looking at the regulation of buses? It is at a lower level than road capacity or airport capacity but it is a vital part of the transport infrastructure of this country. Sir Rod Eddington: I think that is right. It is clear that in an integrated transport world, particularly for commuter populations, and in all our big cities now commuting is a very big issue, striking the right balance between public transport and the motorcar is key. In the context of public transport there are significant parts of the rail network that are already heavily congested, so what role does light rail and the buses play in that world? It is a key piece and I do not think you can examine those issues without ultimately examining what I would describe as the governance issues that surround them. By the way, that issue is regularly raised with us as we go round the country. Q35 Mr Leech: Have you been given any steer from the Department in terms of looking at the idea of road pricing, not looking at re-regulation of buses and not really considering light rail, or have you been given a blank sheet of paper for you to come back with your ideas rather than coming up with what the Department wants you to come up with? Sir Rod Eddington: I have been given a blank sheet of paper. In fact, there has been no attempt to influence me on any of those issues; in fact, on any issue. Q36 Mr Leech: So no parameters have been set at all? Sir Rod Eddington: No. Q37 Mr Leech: In terms of concentrating on the economic regeneration, do you feel that concentrating on that as opposed to maybe social and environmental benefits of transport might tie your hands at all? Sir Rod Eddington: No, I think it is a key issue. We were in Birmingham and we spent some time in the Black Country with the entities there that are trying to regenerate, and we were in Newcastle earlier talking about some of the issues there and some of the areas that are challenging for them. The issue of economic regeneration is a critical part of a stronger economy. One of the issues that are always raised in those conversations is the role that transport has to play. There are other issues raised as well: skills, access to jobs, and in particular the ability of people who are in deprived areas to get to work where it is available is an issue which is regularly raised. As I say, when we go to places like the Black Country specifically they will spell out the realities, the unemployment rates and the challenges that include the challenges of transport. Q38 Mr Goodwill: My colleague from Milton Keynes often repeats the old spelling rule "i before e", infrastructure before expansion. All too often in this country it seems that the infrastructure is playing catch-up with the planning process. Do you intend to look at countries like Spain where European Structural Funding has put in infrastructure, and how successful that has been in being followed up by expansion and economic development? Sir Rod Eddington: Your question raises a number of issues. If I might take the second part of your question first. One of the things we are doing is not just looking in the UK, we are looking outside the UK. You take good ideas wherever you can find them. I think the Spanish example is a good one. The Spanish have been major beneficiaries of entry into the EU. They have made major investments in airports, in places like Madrid and Barcelona they have put in high speed rail links and they have had a substantial investment in new infrastructure. Q39 Mr Goodwill: I am told there are a lot of empty motorways. Sir Rod Eddington: Clearly one of the challenges is how you strike the balance between investment in new infrastructure and making sure that we reinvest in existing infrastructure. Again, as I go round the country, and I repeat I have not finished that journey yet, the two issues that are probably raised most regularly with us - issues like planning and congestion are raised with us - are congestion infrastructure is less reliable and what impact does unreliability have on the economy? Trucking companies will say, "If a journey from our logistics hub in Birmingham to the stores that we serve, that circuit normally takes two hours but one in four takes three hours, we must plan on three hours and that has implications for the number of trucks we need on the roads, the number of drivers we use." Congestion equals a lack in reliability and that is a tax on the economy, and a substantial tax as well. I think there is an issue about how we make sure we get the best out of existing infrastructure. That is the second issue. Reliability is usually the first, "Are we getting the best out of infrastructure we have at the moment". Demand management is part of that discussion, but it is only part of it. The bottom line is we have a lot of transport infrastructure in this country and I think one of the reasons why the Spanish experience is interesting but different is that, in a sense, they are building infrastructure that in some cases was built in this country 50 years ago and that places a substantial repair and maintenance burden on us. I think one of the challenges to this country, particularly when we look at rail and road - we have not spoken about ports much but I think ports are the forgotten piece of transport infrastructure in this country - there is a substantial requirement to make sure that infrastructure is in tiptop working order, because if it is not the congestion problem exacerbates and that is a tax on the economy. Q40 Chairman: Of course, a lot of that money that went into Spain was not government money directly or private money, it came from European institution funds. Sir Rod Eddington: Indeed. Chairman: If you could get us perhaps reclassified as a second Ireland, perhaps we could follow that. Mr Goodwill: The Government has commissioned a number of reports in recent weeks, this week's Pension Report being a case in point which has cost £1.6 million, and it appears that they are going to ignore many of the conclusions of that report. Can I ask what the budget is for your report, including civil servants' time, and whether you are confident that your conclusions will be acted upon by the Government? Q41 Chairman: Are you good value for money, Sir Rod? Sir Rod Eddington: On the basis that I am not being paid a penny, Chairman, I will leave you to be the judge of that. Our budget is very small, it will be less than that, but it does include the time of the civil servants who work on this process. Q42 Mr Goodwill: Will they act on your conclusions? Sir Rod Eddington: I absolutely believe they will; I would not be doing the work if I did not. I think the Secretary of State for Transport - I have worked with a number - is very serious about the issues and is very serious about trying to come to terms with them. Chairman: Mind you, if they do not you might finish up as a Viscount! Q43 Clive Efford: A big question facing you in the next nine months is there is only so much public money going into the transport system, what do we run it for and who do we run it for and who benefits. Will issues around environmental impact and social inclusion, which are very high up the Government's agenda in terms of its policies, be any constraint on the recommendations that you might make? Sir Rod Eddington: As I said, I have been asked to look at it through an economic lens; however, I recognise governments when they take decisions on these issues do reflect on other issues. It is important to me, for instance, that I understand how the environmental piece fits into this, not because I am charged with doing any substantial piece of work on that but I have already met with the Transport 2000 team to understand the issues that they believe are appropriate and relevant in this discussion. Similarly, as we go round the country issues of social inclusion and economic regeneration are raised with us, so I am mindful of that. Nevertheless, I am particularly keen that we understand the links between transport and the economy and the implications of taking decisions around our transport infrastructure. Q44 Chairman: In which case I want to ask you one or two specific questions. Are you doing any work on the north-south high speed rail link? Sir Rod Eddington: I have already spoken to the people who are championing the Maglev. I am very interested in the north-south high speed link and, of course, the most interesting piece of that jigsaw puzzle that is new is whether or not it would make sense to go for technology like that. Q45 Chairman: But you are not just looking at it in terms of one scheme, you are looking at the theory of a north-south high speed link? Sir Rod Eddington: Yes, absolutely. Q46 Chairman: What about ports? Are you going to connect your work with the strategic review of ports which the Secretary of State said would begin next year? Sir Rod Eddington: If I could just say a few words about ports, Chairman, because, as I said earlier on, I believe they are the forgotten piece of our transport infrastructure, primarily because those of us who sit in this room regularly use the road, the rail and the airports, but very rarely go to visit the ports, and with security arrangements as they are today that is not going to change. It is absolutely clear that Britain will continue to be a major importer of raw materials, agricultural products and finished goods and 95 per cent by weight of that, 75 per cent by value of that, will come through our port network. The ports are absolutely fundamental to the smooth running of our economy and the quality of people's lives. People do not think about ports but when they walk into supermarkets much of what they buy on the shelves comes through our ports. We have already spoken to a wide range of port operators and we have had significant visits to two substantial ports in this country. We were in Tees Port yesterday and we will visit others as part of the rest of our study. I am particularly interested in the issues they raise with us. They include the planning issue and, although I have no role in current planning applications, clearly I am very interested in the role the planning process plays in this important issue of transport. They raise with us surface access to the ports and the degree to which the road and rail networks are or are not connected. They raise other issues as well. I think we have some very efficient ports in this country and we neglect them at our peril. Q47 Chairman: I think that is interesting. You are assuming that part of your report will have a major implication for the ports industry and the links to other forms of transport? Sir Rod Eddington: Yes, indeed. To answer the second part of your question, I would be very happy if the work we are doing on ports fed into the ports review which DfT will begin early next year. Q48 Chairman: You have mentioned several times the question of management, particularly in relation to things like congestion and roads. Sir Rod Eddington: Yes. Q49 Chairman: Are you assuming that road charging will, in fact, be a basic platform for that kind of management? After all, you have made it very plain to us that you are not looking at what is happening tomorrow. Sir Rod Eddington: The short answer is yes, I am assuming that demand management will be a part of the picture in the timescales I am talking about, if not before. It is an issue that I have discussed at significant length with the different stakeholders as I go round. I think there is a broad view that it is inevitable. There is a view that the devil is in the detail and we have to think very carefully about what we do, about what technology we use, about how we use it. There are concerns in some places that unless there is at least a national thought process which runs through demand management, some city centres in some regions might miss out because if there are congestion charges levied in some areas and not in others business might migrate from one to another. There are some concerns about it but I think there is a general view, and I am assuming that demand management will be part of what we do, and unless I hear something radically in the next month ---- Q50 Chairman: That brings me rather neatly to the whole question of funding. Is your main brief to develop schemes through partnerships with the private sector? Sir Rod Eddington: No. Q51 Chairman: It is quite interesting that you quoted Hong Kong, which you and I both know well, and we also know that many of those schemes only came into being because it was government money, government direction, government commitment to specific schemes which are still being carried out, even if some of them are being offered for privatisation. Sir Rod Eddington: Indeed. Q52 Chairman: Is that the way you envisage our future transport system being organised? Sir Rod Eddington: It would be too early for me to give you a definitive answer to that because I am not clear in my own mind what the answer is. It is clear that there has to be the right balance between public and private involvement of funding and at the end of the day it is for government to decide what that balance is. In talking about Hong Kong in response to your earlier question, Hong Kong has a reputation, rightly I think, for being a true global entrepôt where the infrastructure is first class, hard and soft, not just physical infrastructure but the rule of law and education and other key issues. There is an example, as you rightly say, where government has taken an important role in many major infrastructure projects. Q53 Chairman: To be fair, Hong Kong Government, at the moment anyway, does operate on a slightly more controlled plan than the British one, although I suppose we are always open to change. Sir Rod Eddington: The democratic model is different there. Chairman: I think that is a nice way of putting it. I assume that you are thinking about that because you may have to go back to Hong Kong at some point! Q54 Graham Stringer: Not to live again. Sir Rod Eddington: A place to visit, yes. Q55 Chairman: Yes, there have been some very interesting conversations with Senior Citizen Lee. I think it is interesting to know whether you think that the lack of investment in our infrastructure, particularly transport infrastructure, has been because of the Government's involvement in the private sector. The things that you mentioned were quite interesting when you said "I have just come back", and you quoted the four major schemes. Quite a lot of those were specifically held up because of the change from, in effect, a nationally controlled scheme to a privately financed scheme. Sir Rod Eddington: One of the things I am very keen to understand is what the impediments to action are. What is clear when I speak to people about why we have been unable to do more is a number of issues are raised. One is the Government's model, the one you have described, and another is the planning issue. The ports people, for instance, would say, "The capital is available, we are prepared to invest but the planning process is too long, too complicated, too expensive and too uncertain". If I can come back to the Hong Kong analogy: most of the infrastructure of Hong Kong, which is world class, was built when it was part of Britain, effectively, it was a British colony. Q56 Chairman: But not directly with British finance. Sir Rod Eddington: No, it was not. Why is it that we have been unable to do the sorts of things in this country that have happened in other places? That is why one of the issues that I think is really important is what is the decision making process, what is the Government's model, who decides what, how do we get the right balance, but also how do we make sure that we make decisions in a timely way and move them along. Q57 Chairman: Sir John Bourn in this House last week said that there are over 700 PPPs and PFIs and large numbers of those are in transport. Have you been asked to look at the overall effect of that sort of development on the amounts of capital that would be available for new schemes? It would be interesting to know whether the Government is, in effect, doing a running total of what future governments are going to have to cough up under these private arrangements. Sir Rod Eddington: I have not been asked that specifically but it is clearly an issue, as I said. The issues of what is it that is required, what is deliverable and how is it funded, are all critical pieces at this stage for me. Q58 Chairman: Sir Rod, as I said at the beginning, it is always a delight to see you. I do note that you agreed very foolishly to come back again, and I will remind you of that. Sir Rod Eddington: Indeed, Chairman. As you will appreciate I will need to present my thoughts to the ministers first but ---- Q59 Chairman: We do not mind you doing obeisance to the Chancellor first. Sir Rod Eddington: I look forward to coming back when I have some clear thoughts and findings for your Committee. Chairman: We are very grateful to you, thank you very much indeed. |