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20 Nov 2007 : Column 1121

The National Audit Office concluded that the restructuring was well thought out and helped to maintain private sector discipline over cost. The arrangements that were put in place have now proved their effectiveness, as the project was completed on time and within budget. As planned, the new railway is fully open and the Eurostar services moved successfully from Waterloo to St. Pancras International overnight last week. I take this opportunity to thank everyone who played a part in that.

Government support will always be needed to fund major rail projects, but given the investment made by taxpayers, we now need to get the best possible return. In 2006, after speculation about the ownership of LCR, its shareholders decided that at that point they did not want to sell their interest in the company. However, as was announced to Parliament in March last year, the LCR board and the Secretary of State agreed to undertake a joint programme of work to evaluate potential restructuring options. The objective of that work was to identify and implement a future structure for the company that was affordable and maximised value for taxpayers. The work is not yet complete, but we have made significant progress.

A separation of LCR’s three different businesses is planned—the infrastructure, including the track and stations, the land interests and the UK stake in Eurostar. Ultimately, as the Secretary of State said last year, we anticipate that there will be an open, competitive process for any sale, to secure best value for the taxpayer. The Bill is the first step towards that. Outside the Bill, a number of regulatory approvals must be granted.

Damian Green (Ashford) (Con): The Minister makes the important point that when the sale happens he will seek to gain the best value for the taxpayer. Can he cast some light on whether the Department will also have some regard for the travelling public who use the line, particularly in Kent, because one can imagine circumstances in which there would be a genuine tension between those two demands?

Mr. Harris: I can assure the hon. Gentleman that any restructuring process—indeed, any wider policy of the Department—will make the interests of the travelling public an absolute priority. I understand that he has concerns about the service pattern of Eurostar as it affects Kent, and he may want to say something about that later.

Dr. Stephen Ladyman (South Thanet) (Lab): While my hon. Friend is on the subject of the travelling public, he will know that my constituents are very much looking forward to using the domestic high-speed service. Many of them will want to go to Stratford international station and then get on to the docklands light railway to go into the City, as will be possible from 2010. Others will want to transfer from Stratford international station to Stratford domestic station to get on to the Jubilee line. Those two stations were supposed to be linked by a travolator, but I understand that there are now some second thoughts about whether that will be constructed or whether the link will be delivered in some other way. Will the arrangement that he is proposing make it more or less likely that we will get that essential link between the two Stratford stations?

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Mr. Harris: That was an ingenious intervention by my hon. Friend. The short answer is that I am afraid that the Bill will make absolutely no difference to whether the travolator—an inelegant word if ever there was one—will be constructed. He is right that the requirement to build a mechanical link between the international and regional stations at Stratford was part of the original planning consent. He will perhaps already know that plans are now in place to build an access route from the eastern side of the station that will require passengers to walk about 200 m, and the procurement process to identify a suitable contractor is under way.

Outside the Bill, there are a number of regulatory approvals that must be granted, but if the timetable proceeds as we anticipate, the most significant sale—of the rail infrastructure—is likely to take place in 2009.

Mr. Eric Martlew (Carlisle) (Lab): We have had all sorts of problems with Railtrack in the past; now we have a unified railway system under Network Rail, with the exception of this line. Will Network Rail be able to bid to bring the line into the national network?

Mr. Harris: The answer is yes. However, I will not speculate about who might ultimately win that particular bidding process.

The Bill, though short, is the first visible step in the restructuring work package. Our work with LCR identified that High Speed 1 might be subject to two existing pieces of legislation—the Channel Tunnel Rail Link Act 1996 and the Railways Act 2005. As a result, there is a risk that legal or regulatory uncertainty about how the legislation interacts could jeopardise the Government’s ability to get the best price. The first clause confirms that the Secretary of State’s powers under the 2005 Act to provide financial assistance can be applied in relation to High Speed 1 and the train services that run on it.

The second and third clauses change existing provisions in relation to the regulation of the line, which is exempt from economic regulation by the Office of Rail Regulation. However, the Secretary of State has certain regulatory duties in relation to HS1, such as setting an access-changing framework and ensuring fair and non-discriminatory terms of access to the railway. There are some areas where the duties of the Secretary of State and the ORR overlap, or could overlap, and the Bill clarifies who is responsible for what and allows the ORR to recover the costs that it reasonably incurs when exercising its function and duties in relation to CTRL or HS1.

Sir Peter Soulsby (Leicester, South) (Lab): Does the Minister accept that while there has been an understandable focus on the enormous success of the passenger facilities that will be available with the reopening of St. Pancras, there needs to be an equal focus on the potential use of the rail link for freight? That has been a much less successful development, with, at times, as few as one train a day using the line for that purpose, and that needs as much attention in future as the successful passenger-related developments that have already taken place.

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Mr. Harris: My hon. Friend makes a valid point. I know that he takes a close interest in rail freight matters. High Speed 1 might be appropriate for freight usage. The Government’s hope is that decisions about access to High Speed 1 will be taken on a completely commercial basis. He is right to point out that the recent history of through-tunnel rail freight has been a difficult one, certainly in relation to the charging regime for travel through the tunnel. The Government have been trying to work that problem through with the owners and the rail freight companies. My hon. Friend is absolutely right that there is no reason why domestic freight should not use High Speed 1 in the future.

The Bill amends the statutory definition of “development agreement” in the Channel Tunnel Rail Link Act 1996 to include the word “operation”. We are now starting to see the full extent of this project’s value to the UK taxpayer. The financial receipts from any sales are likely to be significant, but the benefits of the rail link are wider than any simple financial transaction. LCR estimates that the new line is facilitating £10 billion in private investment in some of the most deprived areas of the south-east. King’s Cross Central is a 27 hectare former goods yard that will accommodate new-build homes and reused warehouses, shops, offices and leisure facilities. Taxpayers will receive an agreed proportion of the proceeds from that development.

In Stratford, a 30 million sq ft development, including a new station, shopping centre and accommodation for athletes, will support the successful staging of the Olympic games in 2012. Journey times to the continent have been cut by at least 40 minutes, compared with before HS1 was built, and through tickets are now available from regional stations across the UK.

Rob Marris (Wolverhampton, South-West) (Lab): My hon. Friend talks about through tickets from regional stations and the regeneration effects of HS1. Bearing in mind that his constituency is on the west coast main line, as is mine and that of Madam Deputy Speaker and several other hon. Members present, can he say when we might see HS3 serving that line so that people outside the south-east can quickly get to the continent if they wish to do so?

Mr. Harris: I am grateful to my hon. Friend for that very helpful intervention. [ Laughter. ] We have plenty of time, Madam Deputy Speaker, but I am not sure that you would want me to digress to that extent. However, since the question has been asked, the channel tunnel, which was first suggested as a genuine capital project that would actually go ahead in the 1980s, gained support in the House because there was a commitment to link it via high-speed lines to points throughout Great Britain. My hon. Friend is absolutely correct about that. Subsequently, in the late 1980s and early 1990s, the then Conservative Government decided that direct high-speed links to the channel tunnel would not be provided—I am not making a political point here; this party supported their decision.

To bring the House completely up to date, it is a matter of record that our party’s 2005 manifesto committed the Government to considering the case for high-speed links from north to south, and we have done that as part of the process leading up to the publication of our White Paper, “Delivering a sustainable railway”, in July.
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The Government concluded correctly that although there may be a case in the medium to long term for high-speed lines as a way of meeting additional capacity demands, there was not as strong a case for them with regard to connectivity and journey times, given that Great Britain is a relatively small island. That discussion is still ongoing in the Government. We will make further consideration of the case. I hope that whoever is in this job in 2012 will make a relevant announcement at that time, in the run-up to the high-level output specification planned for publication in that year that will cover the control period from 2014 to 2019.

Mr. Gordon Prentice (Pendle) (Lab): My Friend or his ministerial colleague told me that the Government would not consider extending HS1 north until 2012. That is a tragedy because its extension would make a transformational impact. I have just come back from Taiwan, where a high-speed railway was opened in April. All domestic flying has stopped in Taiwan because it makes sense for people to travel on that railway.

Mr. Harris: I am grateful for my hon. Friend’s brief travelogue, but I must emphasise that, in the context of connectivity in the United Kingdom, the case for high-speed lines is not as strong as it might be in other parts of the world. I do not accept that the high-speed line is, of itself, necessarily a good thing. There must be other economic and environmental reasons for such a line. It is a vast financial commitment over a long time, with certain consequences such as blight. Ultimately, travel times in Great Britain are comparable with some of the times that are achieved for similar distances between cities and other locations on the continent. I have not ruled out the prospect of more high-speed lines in Great Britain, but they must be considered on the basis of whether they benefit the economy and meet the demands of increasing capacity in the next 10 to 15 years.

Adam Price (Carmarthen, East and Dinefwr) (PC): Given the Under-Secretary’s comments and the fact that people in the north of Scotland and in my constituency in the west of Wales currently and for the foreseeable future derive no direct benefit from the channel tunnel rail link, why is it still regarded as a UK-wide project? Why is Government funding under clause 1 excluded from the operation of the Barnett formula? Why that exclusion when we do not receive any direct benefit from the line in Wales or Scotland?

Mr. Harris: We are considering the first high-speed line to be implemented and inaugurated in our country and our capital city. I do not perceive any benefit in following the nationalist, narrow-minded dead end that the hon. Gentleman’s comments suggest. To describe a high-speed line from St. Pancras to the channel tunnel as some sort of parochial benefit for the south-east is the worst form of nationalism. Nationalism takes many bad forms but that is one of the most small-minded attacks that I have heard since I gave an interview to BBC Radio Scotland two weeks ago.

Dr. Ladyman: The discussion is becoming terribly negative. I have worked out that my constituents in Ramsgate will be able to get to Leeds in four hours, including the time it takes them to change trains at St. Pancras, on the new service. We should celebrate that, not criticise it.

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Mr. Harris: I am grateful to my hon. Friend for again bringing the debate back on track. We should celebrate High Speed 1. More than £8 billion has been spent on upgrading the west coast main line, slashing journey times between London and Glasgow, which will have a knock-on effect on people in Glasgow, including in my constituency, who want to use the west coast main line to travel to King’s Cross and Euston, then go to St. Pancras for their onward journey to the continent. That is unalloyed good news for the whole of Britain, especially the British rail industry.

Sir Peter Soulsby: I want to revert to the pressure that has been put on my hon. Friend to consider other high-speed links in the UK. He has talked about the excitement that opening High Speed 1 has generated. Given the genuine excitement, the continuing and growing concern about climate change—and the effect of other modes of transport on that—and the ever-increasing congestion on existing lines, is not now, rather than 2012, or who knows when, the time to consider other high-speed links? We would thus capture the excitement of the moment.

Mr. Harris: I add a note of caution to my hon. Friend’s comments. The environmental case for a high-speed line is often overstated and painted in black and white terms. Pushing any train up to significantly higher speeds takes great increases in energy, which has to come from somewhere. I return to the point that I made earlier. Connectivity cannot always be addressed by high-speed rail in a country the size of Britain. Given that the journey times between most of the major cities in Britain are already fairly modest, we are left with the conclusion that the main argument for new high-speed lines lies in the need to meet the increased expectation of higher capacity in the medium and long term. The Government are committed to considering that option. I hope that my hon. Friends and hon. Members in all parts of the House will accept that as a reasonable and mature strategy to pursue.

Sir Peter Soulsby: I thank my hon. Friend for giving way again. Does he not accept that the energy necessary to get those high-speed trains up to speed is worth expending if they get people off domestic airlines and make rail a realistic alternative for them?

Mr. Harris: Take, for example, the journey from London to Manchester as it stands currently. Even without high-speed lines, rail already has the majority share in that market. Once the west coast main line is finally upgraded, I expect that advantage to increase.

The Government are not in the business of telling airline passengers that they should not use airlines. We want to ensure that realistic alternatives are available when people make a judgment about which form of travel to use. Thanks to our investment in the wider rail industry over the past 10 years, and in the west coast main line in particular, people in this country have a realistic choice of whether to travel by train, rail or car. That was not always the case. Before 1997, and certainly 20 years ago, most people did not have a choice between rail travel and air travel. They now have a realistic alternative to travelling by air, and more are choosing railways even without the high-speed lines.

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Rob Marris: My hon. Friend is being very generous in giving way. Given his background, can he tell me of a single Member of the House representing a constituency in Glasgow who takes the train more than once a month to get from his or her constituency to the House and/or back?

Mr. Harris: I would not want to speak for any of my colleagues representing the first city of Scotland, but I can tell my hon. Friend that I certainly use the railway to get from Glasgow to London every Monday morning—although that is a hostage to fortune. I use the train whenever possible, which works out at three times every month at least.

Local people in Kent will experience reductions in journey times to London from the end of 2009, with travel to Folkestone and Canterbury estimated to take about an hour. The brand new fleet of class 395 Hitachi trains will also be used to deliver the high-speed Javelin service during the 2012 Olympics, travelling from St. Pancras to Stratford in just seven minutes. The Bill sets in motion a restructuring package that will optimise value for money for taxpayers and put the railway on a firm financial footing for the future. I commend it to the House.

4.58 pm

Stephen Hammond (Wimbledon) (Con): Today we have the Second Reading of the Channel Tunnel Rail Link (Supplementary Provisions) Bill. It is a small Bill of only six clauses; none the less it is a difficult Bill and to some people almost impenetrable. However, behind it lies a unique British achievement: the channel tunnel rail link or High Speed 1, as we are now to call it. The first service left St. Pancras last week to universal acclaim, achieving recognition from all the national newspapers; indeed, even the Evening Standard put it on its front page. Those of us who attended the opening ceremony the previous week will remember for a long time the excitement and sense of achievement that we experienced that night. The crowning achievement is surely the reinstatement of the single span roof.

As the Minister rightly said, the contributions of Lord Heseltine and the right hon. Member for Kingston upon Hull, East (Mr. Prescott) are to be saluted. We on the Conservative Benches should also like to offer our congratulations to Mr. Rob Holden of London and Continental Railways and his team at the channel tunnel rail link on completing the project on time and on budget. We would also want to salute, as did the Minister, the efforts of all those who moved operations seamlessly overnight from Waterloo to St. Pancras. That was a major success and when the first train rolled out last week, it was a huge achievement.

High Speed 1 now stretches from the mouth of the channel right the way through the Kent countryside into east London via Stratford, terminating at St. Pancras—a total of 109 km or 67.7 miles. Although the London St. Pancras to Paris Gare du Nord service will be the main focus at the moment, we should not forget that about 40 per cent. of the capacity is being reserved for high-speed domestic services. Clearly, that will be a huge advantage for the commuters of Kent.

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