Select Committee on Crossrail Bill Minutes of Evidence


Examination of Witnesses (Questions 14920 - 14939)

  14920. If we go to pages on to clause 19, it needs to be read with clause 17 above and that is the provision which enables Railtrack and the relevant train operators to obtain payment of their relevant costs which we have seen previously defined. Is that correct?[65]

  (Mr Oatway) That is correct.

  14921. It is simply a provision either as in CTRL or as in the East London line to protect you in the circumstances you have identified?

   (Mr Oatway) That is right.

  14922. Turning to EWS 40, explain to the Committee the three undertakings which you are seeking on page five.[66] 21 is an undertaking by the Promoter to the Committee or to EWS that network code condition G5 will not be invoked in consequence of the Crossrail Act. That is the legislative change point, is it not, which you have already explained?

  (Mr Oatway) That is correct.

  14923. It seems that is what the department intends so you are merely asking them to commit themselves to it?

   (Mr Oatway) That is right.

  14924. Could you explain 22? The first thing is that there are some words that need to be added. After "is entitled" in the penultimate line, we need to add the words "or the method by which it is calculated."

   (Mr Oatway) That is correct.

  14925. Could you explain that undertaking to the Committee?

   (Mr Oatway) This goes back to what I touched on earlier. Currently, when network changes are drawn up and formally proposed in detail, there are many different ways of implementing something. We want an undertaking—we are looking for the Committee's help here—in trying to ensure that Crossrail will not be able to override or remove the ability for EWS as a train operator to be able to object to the detail of the scheme rather than the principle; or to object if there was any dispute over the amount of compensation which is another right we have at the moment; or the method by which that compensation is calculated. We currently enjoy that right and we would like an undertaking from the Promoter that they would not seek to overturn that right, as we believe they have implied so far.

  14926. So far as independent adjudication, would that also be part of the matter?

   (Mr Oatway) Absolutely, yes. As Graham Smith mentioned earlier, it is crucial to confidence within the industry that any disputes can be resolved by an independent arbitrator rather than somebody who has an interest in one party or the other.

  14927. That is the position under the ordinary code and you are simply asking that it be maintained for Crossrail?

   (Mr Oatway) That is correct.

  14928. Undertaking 23 goes to the CTRL and the East London line point, an undertaking by the Promoter to the Committee or to EWS that the Promoter will develop and operate a bespoke compensation regime covering all other losses freight train operators may suffer in line with the precedent given in EWS 28—ie, those losses not covered by network change or the other existing mechanisms—such that the freight train operators receive compensation for all other costs, direct costs and expenses including loss of revenue reasonably incurred by them as a consequence of any restriction of the use of Network Rail railway network as a result of construction of the Crossrail works.
  (Mr Oatway) That is right. We believe that undertaking is essential to enable EWS to be compensated on a no net cost/no net gain basis as was intended by Crossrail's H2 paper.[67]


  14929. You are not seeking any sort of double compensation, are you?

   (Mr Oatway) No, absolutely not. I can categorically say that we are just looking for compensation on a no net cost/no net gain basis—ie, we are looking to be held harmless for the effects of Crossrail on our services.

  14930. Undertaking 21 was about G5. What is the possibility that Network Rail might invoke condition G5?

   (Mr Oatway) This is the other concern we have because obviously when network changes are proposed they are normally proposed by Network Rail in most cases. If the department gives us an undertaking or the Promoter give us an undertaking that they will not implement G5, we would hope that Network Rail would give the same undertaking because without that we would still not have the same confidence that it will not be invoked when the time comes.

  14931. What is G5 aimed at? When it refers to legislative change, is that a change like a health and safety change under the Act or something like that?

   (Mr Oatway) That is correct, if there is a proposal, for example, which affects the whole industry network so it includes changes to trains and track and operators. Network Rail are instructed by the Health and Safety Executive—now the ORR as they have taken on that role—to implement safety procedures. We would expect that each operator or Network Rail would cover the costs of that in their own respect.

   Cross-examined by Ms Lieven

  14932. So far as your first point is concerned that the compensation provisions for enhancements do not include temporary changes for less than six months, as I understand it, what you are seeking compensation for is over and above that which you would get under normal industry processes.

   (Mr Oatway) Yes. We want compensation on a no net cost/no net gain basis.

  14933. It is compensation that you would not get if works were carried out by Network Rail under normal powers.

   (Mr Oatway) If they came under the definition of an operational change of less than six months, that is correct.

  14934. For instance, works on the West Coast Main Line which your own witness, Mr Smith, was keen to say were as extensive and more expensive than Crossrail. If that project was done again by Network Rail your clients would not get any compensation for network changes that interrupted services for less than six months.

   (Mr Oatway) If it was done by Network Rail, but one important point is that under the normal industry processes any disruption that gets proposed through the industry procedures we have a right to object to and have it independently arbitrated; whereas in this particular case of Crossrail under the Bill powers it looks like those rights and concerns will be overridden.

  14935. So far as the second point is concerned, invoking G5, can I say to the Committee it is not the Promoter's intention to invoke G5. I hope that gives some comfort on that point because there seemed to be some confusion.

   (Mr Oatway) If that is as good as an undertaking—

  14936. Ms Lieven: It is a statement to the Committee which the Secretary of State can be held to so I suspect it is as good as an undertaking.

  14937. Mr Liddell-Grainger: I think the point is taken on board.

  14938. Ms Lieven: So far as the third point is concerned, do you have a copy of our information paper on railway compensation, H2?[68]

  (Mr Oatway) I believe I have.

  14939. In the appendix at page five we deal with standard industry compensation arrangements. I assume you have read this?

   (Mr Oatway) Absolutely.


65   Committee Ref: A168, Schedule 11, Protection for Railtrack, The London Underground (East London Line Extension) (No. 2) Order 2001 (S.I., 2001, No. 3682), www.opsi.gov.uk (SCN-20060711-07) Back

66   Committee Ref: A168, Requests for Decision, Compensation for temporary disruption (LINEWD-19605-100). Back

67   Crossrail Information Paper H2-Railway Compensation, billdocuments.crossrail.co.uk Back

68   Crossrail Information Paper H2-Railway Compensation, billdocuments.crossrail.co.uk Back


 
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