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Dr. Ladyman: I am glad that the hon. Gentleman has recognised the benefits of the domestic services to my constituents in Kent, but may I gently remind him that
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when the Conservative Government left office, they had no plans for a domestic high-speed service? In fact, they had ruled them out. It was my right hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott) who insisted that there must be a domestic service on the CTRL.

Stephen Hammond: I thank the hon. Gentleman for that, but let me remind the hon. Gentleman that on 20 February 1996, it was the Conservative Government who had the vision and awarded the contract to put that in place. They awarded the contract to London and Continental Railways to build and operate the channel tunnel rail link. Who would have dreamed that we would see 186 mph travel from the UK to France and beyond, as well as on domestic services? Certainly anyone using domestic services at the moment could hardly have dreamed of that.

Rob Marris: Given the vision of the Conservative Government—I absolutely salute that vision for the channel tunnel—what are the hon. Gentleman’s views on the possibility of High Speed 3? If his party were in government, would they support it and, if so, would they put any public money into it?

Stephen Hammond: I am delighted to respond to that intervention. I know that the hon. Gentleman is a keen student of our policies, not to mention explanatory notes, so I am somewhat surprised that he does not seem to have noticed that we have already said and confirmed—it is in Conservative party policy—that an incoming Conservative Government will conduct a feasibility study for HS3.

As I understand it, the Bill is intended to make minor amendments to current arrangements. There is a belief that the structure of London and Continental Railways, which has contributed to success in construction and delivering the project, may not be the best on an ongoing basis and for its operational purposes. As the Minister said, the Government and LCR have thus undertaken an evaluation of available restructuring options. The Bill is being enacted so that that process can happen.

As the Minister stated earlier, the Government believe that splitting LCR into its component businesses is the best way forward, so the Bill introduces a small number of measures to clarify the legislative and regulatory status of High Speed 1. The Government believe that, without their intervention and the Bill, there would be risk of legal and regulatory uncertainty. In Committee, we will look to the Government to clarify, quantify and justify that position.

Mr. Martlew rose—

Stephen Hammond: I am delighted to give way.

Mr. Martlew: I am very pleased that the hon. Gentleman is delighted. I just asked the Minister whether he would be happy for Network Rail to bid for this particular line. I put the same question to Her Majesty’s Opposition.

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Stephen Hammond: Network Rail will be able to bid for it. As the Minister said, it would be wrong for anyone in the House to prejudice the outcome of the bidding process.

The Government assume that if the assets of LCR were sold, their value—without this legislation—might be sub-optimal due to the lack of clarity about the funding arrangements for capital construction and the future. One of the things that we will be keen to learn from the Minister is what guarantees the Secretary of State has given with regard to the construction phase. Will the Bill allow the assets to be sold with those guarantees? Does it imply that if London and Continental Railways assets were sold, the debt would remain guaranteed by the Government and the original funders?

The Minister was right to say that clause 1 implied the existence of a sufficient level of uncertainty over whether the powers that the Secretary of State had to fund the project during the construction phase would continue into the operational phase. We shall want the Minister to clarify at some point whether he means that those powers apply to the whole channel tunnel rail link, or just to the channel tunnel rail link and LCR after the construction phase. Does the uncertainty stem from some ambiguity in the original Act, and why did that Act not cover the post-construction phase? That is an important point because, as the Minister well knows, later this week a Bill analogous to this will be considered in Committee, and we need to be sure that the provisions in this Bill cannot be applied to the construction phase of another major project.

I assume that the import and intent of the Bill will not affect a net change in the overall cost to the public exchequer, but merely confirm what is already the case. However, questions arise from the Secretary of State’s power to continue to fund the channel tunnel rail link and the trains that run on its infrastructure. Does that imply that the subsidy applies to both infrastructure managers and train operating companies? Will the Minister confirm that there will be no overall change in public cost, but merely a restatement of the guarantee? Why is it envisaged that the Government will subsidise the operating cost, and for how long is that envisaged to last? If Eurostar train operations succeed or at least break even, why should the public purse continue to operate a public subsidy? All that arises in clause 1. Although the Bill itself is small, we shall have a fair amount of work to do in Committee.

Clause 2 appears to repeal some of the provisions in the Channel Tunnel Rail Link Act 1996 relating to the Office of Rail Regulation which it is claimed are no longer necessary. Again, we shall seek clarification of the exact extent of what the Government are doing. Under section 16(1) of the 1996 Act, any operator of CTRL is not required to hold a licence under the Railways Act 1993, and therefore access arrangements relating to the channel tunnel rail link do not generally require the prior approval of the ORR. We shall seek elucidation of why the operator is not required to hold a licence. Will that continue into the operational phase, and, if so, does the Minister expect the position to change? Do the access arrangements that currently do not need prior approval not need it because they have been agreed, or because they will be regulated by some different method?

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I understand that all access contracts in relation to the channel tunnel rail link are outside the regulation of the ORR under the terms of the 1993 Act. How long does the Minister intend that to continue, and is it really desirable? What impact will it have on the ORR’s normal powers in relation to safety and performance? All that is covered by clause 2, which is short but gives rise to a number of issues.

Clause 3 makes some changes to the ORR’s duties in relation to the channel tunnel rail link. It gives specific powers to ensure that functions in connection with the national rail network which the ORR formerly exercised to prevent the construction project from being adversely affected are now changed. It is a small repealing measure. As the Minister said earlier, clause 4 allows the ORR to charge a fee to the operators of the channel tunnel rail link in proportion to the cost that is incurred.

Although this is a relatively small Bill, clauses 1,2 and 3 will require scrutiny in Committee. As I said earlier, however, behind the Bill stands a unique British achievement, and the Minister was right to praise it. Conservative Members also salute that unique achievement.

I am grateful to the Minister for his offer of a briefing prior to the Committee stage. I hope it will be enlightening, and that it might raise the scales from my eyes with regard to some of the Bill’s more technical points. We intend to aid the Bill’s parliamentary progress and I ask my colleagues to support it.

5.10 pm

Mr. Charles Clarke (Norwich, South) (Lab): As the hon. Member for Wimbledon (Stephen Hammond) has said, this is a short Bill which is uncontroversial in the House. It does have some significance, however, certainly for people such as my constituents in Norwich who are trying to use Stratford station in the way suggested by my hon. Friend the Member for South Thanet (Dr. Ladyman)—to get better access to Eurostar and services to north Kent. I want to probe a little the remark made in response to his intervention by my hon. Friend the Minister, who said that the Bill will make no difference to the development of that.

I strongly support the Bill, particularly the part that confirms section 6(1) of the Railways Act 2005 giving the Secretary of State the power to

As I understand it, clause 1 of the Bill confirms for the avoidance of doubt that the Secretary of State can following completion of the construction project continue to provide financial assistance to CTRL—the channel tunnel rail link—under the powers of the 2005 Act. That is one of the clarifications that the Bill seeks to make.

In particular, the Bill confirms the Secretary of State’s power to provide capital funds through a range of different mechanisms for the CTRL project. I understand why my hon. Friend the Minister therefore said that the Bill was not associated with a high-speed link such as High Speed 3 or HS4—or, in the case of Norwich,
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probably HS15, when it comes around. He might be interested to know that the leader of the Liberal Democrats on Norwich city council is arguing for us to get a full high-speed link—that HS15 project—right away, but I understand the public expenditure constraints my hon. Friend the Minister described.

The Eddington report’s statement that we should be trying to get far more efficiency out of our existing network is of relevance to the Bill and this issue, and in particular the question of the interchange between the main line service between Norwich and London—and other services coming into Stratford—and Eurostar and the Kent system. It seems to me—perhaps this will be clarified in the wind-up—that the power that the Bill confirms allowing the Secretary of State to require that money be spent on improving this network and the assets related to it could in principle, if the Secretary of State so desires, apply to creating out of Stratford station an effective high-quality interchange. I want to elaborate on that point.

The Secretary of State should use that power to invest capital in the vital interchange station at Stratford, and in particular either to construct a travolator—it would have been far better had that been established earlier—or another convenient walkway, such as the eastern egress walkway which is currently being talked about, from the main line and other services at Stratford to the new international station on the Eurostar route. As other interventions have suggested, that will also be the connection to the new service to north Kent. Therefore, this is not simply to do with a high-speed service from the constituency of my hon. Friend the Member for South Thanet or from Ashford; it is also to do with an interlink for people travelling from East Anglia to Kent. If they have that interchange at Stratford, the services will be improved.

There is discussion and argument about what the exact distance of the interchange will be. I understood that it might be 400 m to 600 m, but I heard the Minister say he thought it might be 200 m. It will in any case be a relatively short distance, but it does not seem to me to be an unreasonable demand that people travelling internationally—going on holiday, perhaps—should not have to lug their bags about and should instead have the kind of automatic transit that we see in every airport in the country. My hon. Friend the Minister might confirm whether I am right, but that does not seem to me to fall outside the Secretary of State’s remit in terms of the capital investment they could require.

Of course, the case for investing in the interchange station is very powerful. There are three central arguments. First, as I said a moment ago, it would increase use from East Anglia and some parts of London, including the Canary Wharf area—that is not entirely insignificant when looking at business on the Eurostar service—of both Eurostar and the service to north and east Kent. As the hon. Member for Wimbledon said, that represents about 40 per cent. of the capacity of that line. That increased use would be a real benefit to millions of people, certainly including my constituents but also many others throughout the whole east and south of the country.

The second case for investing in the interchange station is that it would increase revenue to Eurostar and put the Government in a stronger position to gain a
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proper return on their investment, which I understand is one of the Bill’s purposes. For example, a survey commissioned by Newham council from Buchanans suggested that such a change would increase Eurostar’s revenue by no less than 10 per cent. That is a big increase. There have been counter-suggestions that the figure could be as low as 2 per cent.; however, even 2 per cent. should not be sniffed at if one is trying to get better use of the network as a whole. That would be a matter of real interest to those involved in the restructuring of London and Continental Railways. In the context of the restructuring that the Minister described in his opening remarks, the potential travel and transit on the route is very important.

Mr. Martlew: I am listening very carefully to my right hon. Friend, who is talking about changing at Stratford to get on the Eurostar. Does he share my concern that very few of the trains stopping at Stratford will be going on to the continent?

Mr. Clarke: I am glad that my hon. Friend has raised that issue, because I am very concerned about it. I had a series of meetings over the summer with the people running Network Rail, Eurostar and various other services, such as National Express, which runs a service through that station. I was not going to say this but perhaps I will—despite the assurances that I received from Eurostar, I want it to be spelled out in terms that the service will stop at Stratford with the frequency required.

I note some of the things that have happened to the Ashford service—the hon. Member for Ashford (Damian Green) is in his place—and I am slightly concerned that the Eurostar management would really like people to travel from St. Pancras to Ebbsfleet and on through the tunnel, without bothering about Stratford and Ashford. I might be wrong in saying that and I am not making that charge directly, but it is a concern. That is precisely the reason why I draw attention to the Secretary of State’s powers in these matters, which is what this Bill is about. The Secretary of State can use such powers, and I shall deal in a moment with the effort by the former Deputy Prime Minister to use such powers precisely because some of the companies concerned were not prepared to go along with what the Government were seeking to achieve.

Dr. Ladyman: I agree with everything that my right hon. Friend is saying about the importance of the interchange between the regional and the international station. However, I should point out in the light of what has happened to Ashford that Eurostar management never gave any hint that they were intending to cease the stopping of the Brussels train at Ashford while the station was being built, and while their support for Ashford was necessary to build Ashford International. I, like him, have my doubts about whether they will be committed in the long term to the Eurostar’s stopping at Stratford, for the same reason.

Mr. Clarke: I am grateful for that intervention and I think that my hon. Friend will agree that the strongest way to convince the management of Eurostar—or, indeed, of any train service—of the utility of stopping at a particular station is the impact on passenger numbers
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and, therefore, on revenue. That is why I cited just before he intervened studies suggesting that revenue would increase if the kind of investment in Stratford station were made that would make a difference to the motivation of the management. I do not blame Eurostar management for wanting to run a service in a way—in the right way—that makes them money, but I question whether they are making the right judgments from the point of view of revenue development.

I was arguing, first, that investment in the station would increase the use of services, and secondly, that that would therefore increase revenue to Eurostar, which is in the interests of Eurostar and of the Government of the day when looking at the restructuring described in the Bill. Thirdly, that change would increase incentives to travel by rail, rather than by car. For example, it would reduce the amount of car journeys from East Anglia to Ebbsfleet to pick up the Eurostar. Some in the train business believe that it is okay if people drive to Ebbsfleet, but it is getting on for a 100-mile drive from parts of my constituency to there. It would be far better if people got on the train and made the change at Stratford if they were going to do that.

The regulatory impact assessment suggests that

That refers to carbon emissions. I am certain that the indirect benefits for the environment are significant.

I am arguing about utilisation and the benefit to constituents; about revenue to Eurostar and, therefore, ultimately to Government in the restructuring that is talked about; and about sustainability and environmental improvement. For all those reasons, I maintain that capital investment at Stratford is important. I am delighted that my hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody) is in her place, because she chairs the Select Committee on Transport. [Interruption.] She moves so elegantly that it is a miracle to behold. I hope that I shall not misrepresent the Committee’s central conclusions. I read them to say that the Committee had come to the view that the interchange at Stratford would enhance the rail network as a whole and would take the situation forward positively.

Martin Linton (Battersea) (Lab): Does my right hon. Friend accept that it is difficult to reach St. Pancras station from some parts of London? The development of an orbital service in London whereby it is possible to go around the centre of London rather than through it, and increasing congestion in the centre, may mean that his campaign for all trains to stop at Stratford and for better facilities there will get support from many people in London for whom the move from Waterloo to St. Pancras, although welcome in some ways, creates a longer journey to get on the Eurostar in the first place.

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