Clause
65
Financial
provisions
Question
proposed, That the clause stand part of the
Bill.
The
Chairman:
With this it will be convenient to
discuss the following: New clause
2— Financial provisions (disclosure of
information)—
‘(1) The
Secretary of State shall publish all relevant details as to the moneys
used to fund the construction and maintenance of Crossrail, beyond
those monies as already provided by Parliament and set out in section
65(1).
(2) The Mayor of London
shall, not less than 12 months after the granting of Royal Assent to
this Act, publish and make available to all who are eligible and
registered to vote in the London Mayoral or Greater London Authority
elections, a statement
indicating—
(a) the
agreement he has undertaken and agreed with the Secretary of State for
the proposals of building Crossrail,
and
(b) the potential financial
consequences of this agreement for
London.
(3) The Secretary of
State, after consultation with the Mayor of London and the Transport
Commissioner for London, shall publish an annual statement setting out
which bodies shall bear responsibility and liability for any costs
associated with the building of Crossrail separately indicating
the—
(a) costs to date,
and
(b) projected costs to
date.’.
New clause
3—Disposal of surplus
property—
‘(1) Any land
and or property acquired or used for the purposes of this Act, if
deemed thereafter surplus to the needs of this Act, shall be disposed
thereof.
(2) The proceeds of
any disposals under subsection (1) shall be made available only for
either—
(a) the purpose
of paying compensation as required under this Act,
or
(b) the purpose of paying
for the construction of Crossrail or any such related
purpose.’.
Mr.
Harris:
The clause is the standard clause that appears in
Bills that provide for the expenditure of public money. It simply
provides that any expenditure by the Secretary of State under the
Bill
“shall be paid out
of money provided by
Parliament”.
The
content of the clause itself is entirely
uncontentious.
With
regard to the new clauses, the hon. Member for Wimbledon seeks to
achieve transparency in the way that Crossrail will be funded. I am
happy to say that the Government agree that
transparency about Crossrail is desirable, as evidenced by the
documentation that we have already made available, to which I referred
in an earlier sitting. I can give comfort to the Committee that we
intend to more information public in future. Yesterday, a copy of the
heads of terms agreed by the Secretary of State for Transport and
Transport for London were placed in the Library of the House. Some
details have been redacted to protect commercial confidentiality, but
the key terms of the deal between the co-sponsors of the project are
now in the public domain. We and TfL need to produce the detailed
arrangements that will support the heads of terms. That will involve
the production of a large number of documents, which we expect to take
several months to finalise. Our presumption is that those documents
will be made public, again subject to the need protecting commercial
interests.
Turning to
new clause 2, the publication yesterday of the heads of terms means
that the Government have in practice already published the
information that proposed subsection (1) would require. May I make it
clear that we intend to make public the relevant detailed agreements
that will be negotiated over the coming months to implement the heads
of terms? I believe that that will deal in large part with what
proposed subsection (2) seeks to achieve. The issue of the wider
financial consequences of Crossrail for London mentioned in proposed
subsection (2) (b) is a matter for the Mayor. I expect that he would
want to be very clear with Londoners about that, and he is subject to
ongoing scrutiny by the London
assembly.
Proposed
subsection (3) refers to the desire for ongoing information about
progress during construction. Our intention in that respect is captured
by paragraph 3.11.2 of the heads of terms, which makes it clear that
Cross London Rail Links Ltd will be required to publish
information,
“to ensure a
high level of transparency as to the progress and cost of the Crossrail
Project.”
To
conclude, while I sympathise with the sentiment underlying new clause
2, I think that it is unnecessary. I hope that I have made it clear
that the Government and the Mayor recognise the importance of keeping
the public well informed about the way in which Crossrail is taken
forward, and that we are already taking steps to do that. On that
basis, I hope that the hon. Member for Wimbledon will not press the new
clauses to a vote.
Stephen
Hammond:
Certainly, we have already had one attempt this
morning to introduce finance into our discussions, and the Minister
congratulated the hon. Member for Richmond Park on the elegant manner
in which she tried to inject the issue into this morning’s
debate. I was tempted to speak in the debate on her amendment, but I
resisted the temptation to do so, because I expected to have the
opportunity to discuss my two new clauses and to speak on clause stand
part.
As the Minister
said, clause 65 provides for the expenditure incurred by the Secretary
of State as a consequence of the Act to be paid for out of money
provided by Parliament. It is a standard clause and we have no problems
with it; we do not object to it. I have no doubt that, subject to
commercial confidentiality, the Government are keen, or certainly have
proved be keen, to provide details of the Crossrail package. In that
spirit, I want to offer my thanks to the Minister both the briefing
that he gave to the hon. Member for Carshalton and Wallington, who is a
Liberal Democrat spokesman, and me. I thank him, too, for the package
that he provided last night for Committee members—that package
is now is in the Library. His spirit of transparency
and generosity is appreciated. However—as the Minister would
expect, there is always a “however”—the Bill gives
explanations of the moneys provided by Parliament but not by other
bodies. It does not provide, either, for updates to be delivered to
Parliament on the subject of funding and costing. That was what I might
have said about with the hon. Lady’s amendment this morning:
although I thought it an excellent and elegant amendment, it was a
one-off, and did not require an annual statement to be made to
Parliament.
My new
clauses go further than the hon. Lady’s amendment. We appreciate
and accept the Minister’s generosity of spirit in making those
disclosures, but it would be wrong of us as the Opposition not to
ensure that adequate and appropriate protection is available. New
clause 2 would provide such protection by making
three provisions. First, it would ensure that the
Secretary of State makes available to Parliament details of funding
arrangements. Secondly, the Mayor of London, whoever that is at the
time, will commit Londoners to extra expenditure and potential
liability, and it is only right that he should provide them with a
statement of the financial consequences. I am not sure that I share the
Minister’s confidence that every person elected Mayor would be
keen to provide such a statement. Thirdly, the new clause states that
the Secretary of State shall, after consultation, provide an annual
statement of costs and
liability.
The
justification for proposed subsection (1) is clear. The provision would
allow us to scrutinise the elements of the package, to undertake proper
risk analysis, and form a view on the financial probity of the
providers, before considering the provisions behind the finance package
and the financial model so that we could take taking a view on the
associated risk. The Conservatives have said throughout the
parliamentary process—I am sure that the Liberal Democrats have
done so, too—that we support the principle of Crossrail, but
that we would need to see the funding. The Minister has acted in a
spirit of generosity and transparency, and it is appropriate that we
enshrine that transparency in the Bill.
Proposed subsection (2) is
simple. All councils have to provide an annual statement on how they
deliver services and how those services are paid for. The subsection
would not place any greater requirement on the Mayor of London.
He is happy to commit Londoners to potential liability as a co-sponsor,
so he should be happy to tell Londoners exactly what the financial
consequences of his actions will be. I see no problem with that, and I
am sure that Londoners would appreciate it.
Proposed subsection (3) would
provide for an annual statement or update. As we embark on the
building, maintenance and operation of Crossrail, we do need more than
a snapshot in the House; we need dynamics. If there were a problem of
overspend or—less likely, I suspect—underspend, or if was
a delay, the new clause makes provision for Parliament to be notified
of such things, which would be subject to
parliamentary scrutiny. I have listened carefully to the Minister. We
are grateful that he has deposited information with us, and we thank
him sincerely for doing so. At the same time, I hope that he recognises
that it is the Opposition’s duty to make sure that his spirit of
generosity is not transitory and that it is enshrined in one of the
most important parts of the Bill so that it will be available for
future scrutiny. I shall therefore seek to divide the Committee on new
clause
2.
5.45
pm
New clause 3 is
a simple but important housekeeping measure. This is an exceptional
project, and it requires exceptional powers and exceptional discretion.
We have recognised that spirit throughout. The
Secretary of State has been granted powers of compulsory acquisition
both within and without the scope of the Compulsory Purchase Act 1965;
she has been granted rights of easement and licences; and she has been
granted powers of purchase along the deemed route within and without
the limits of deviation. We all accept that that is necessary and
desirable.
After
Crossrail is built, however, there will undoubtedly be land excess to
the needs of the Crossrail operation. I am sure that any member of this
Committee, particularly those who served on the Select Committee, can
think of petitions they have heard where the land that is going to be
used for the building of Crossrail will not be necessary for its
operation. The Government and the operators of Crossrail will not
necessarily want to be a landlord so that excess land should be
disposed of. The proceeds from the disposal of the surplus lands should
be directed to reducing the overall costs and funding the compensation
payments. This is a sensible housekeeping measure and I commend it to
the
Committee.
Susan
Kramer:
I will be very brief. Obviously I was sad that
those on the Conservative Front Bench could not see their way to
supporting my amendment because it gave the advantage to the House of
being able to give its assent to the final package on Crossrail. I,
too, am very impressed by the generous amount of information that has
been provided by the Minister. However, there is an issue of underlying
principle that is worth establishing. We have noticed that every time
there is an issue here, reference goes back to the channel tunnel
rail link and no doubt future Bills will all talk about what was in this
Bill. Establishing the ongoing principle on the face of the Bill that
information should be disclosed on a regular basis is probably no bad
item to have.
Again,
although we all have a great deal of confidence in this Minister, the
project runs way out into the future. It would be sad to give leeway to
others to provide less disclosure than the current Government are
willing and able to do. Although I shall support the new clause tabled
by Conservative Members, if for some reason it should fail, will the
Minister consider these matters and reflect his own attitude towards
transparency in a clause that he might bring forward at a future date
to ensure that providing information is an ongoing
principle?
Mr.
Binley:
I apologise to the Committee for detaining hon.
Members for perhaps longer than they might have hoped, but financial
accountability and especially annual reporting are vital matters. I
want to talk briefly about why I believe them to be so important. Most
people know that my background is in a business environment. Annual
reporting creates a discipline that simply is not created in any other
way. It creates an accountability that gives credibility to a
project.
The second
thing that annual reporting provides is the ability
to put things right if they are not going right. We have seen too many
projects from Governments of all political persuasions that have gone
wrong because they have not been properly managed. It is all very well
seeing a problem, putting money into it, and, finally, setting targets,
but that is not the secret of management. The secret of management is
managing the process thereafter. Very often it does not mater whether
the decision made about a specific issue falls within a set of
parameters, but it clearly matters if it is managed, fine tuned,
tweaked and the subject of drastic effort in a way that changes a
process that is clearly going wrong. Financial reporting allows a
process to be looked at in a clearer way than almost any other
mechanism.
As I said,
a company would have to proceed along the lines that I have described,
but it is not clear that that applies in this case, even if we bear in
mind the constitution of the package that we are talking about with
regard to Crossrail. I want to ensure that it does apply. Putting the
new clause into the Bill offers a protection not only
for respective Governments—because it is likely that this
process will be undertaken by respective Governments as it goes on into
the future—but for the taxpayer, who will contribute sizeably to
the project. It is not only the taxpayer in London who will contribute,
but also those throughout the rest of the
country.
I
therefore urge the Minister, whom I know to be keen on transparent
government, to consider the process, even if on this occasion he does
not accept it. At the very least, will he come back on Report with a
mechanism that would accede to this request, which I am sure that he
feels in his heart is
sensible?
Mr.
Field:
Just for once, let us be wise before rather than
after the event. The Minister and I have been in Parliament for exactly
the same time, six and a half years, and there is a sense of
dÃ(c)jà vu as I consider many of the Bills on which I served
on the Committee.
For example, the first Bill
Committee that I sat on was the Proceeds of Crime Act 2002; we pointed
out, time and again, the enormous costs that would go into setting up
the associated agency. On the Enterprise Act 2002, we repeatedly talked
about the risk of allowing too many 20-somethings to become bankrupt,
but all that came to pass. On the Licensing Act 2003, I talked
endlessly about the notion of 24-hour drinking and the risible idea
that bringing in more flexible licensing laws would somehow lead to a
Parisian drinking culture on the streets of London and of the country.
Likewise, on the London Olympic Games and Paralympic Games Act 2006, we
endlessly talked about the spiralling costs, and, of course, they are
precisely what have come to
pass.
Our biggest
concern in relation to Crossrail is not the idea of it, as the project
is something that we very much support, but the notion of blight if the
proper funding is not put into place. I fear that, notwithstanding the
assurances made by the Minister and the Prime Minister over the last
six or seven weeks, the funding package for Crossrail is a good deal
less robust than we would like it to be. It is for that reason that I
totally support new clause 2, and my hon. Friends have put forward
robust reasoning for it. I fear, however, that if we do not get this
right and we do not get the proper funding in place, there will in
years to come be a sort of half-Crossrail that will not do anything
like as much as it is planned to do at this stage; there will be a
phase 1, with phase 2 or 3 deep in the future, which will never come to
pass because of the enormous, spiralling
costs.
We need to get
this right, and the worst of all worlds, as I have
said, is that countless numbers of constituents, not only in my
constituency, but in dozens across London and the south-east, will have
their lives blighted by being on the Crossrail route, with very little
prospect of the project coming to fruition, unless we get the funding
right. Therefore, I hope that the Minister will give serious
consideration to ensuring that, for once, we are genuinely wise before
rather than after the event.
Mr.
Harris:
I have already made some comments about new clause
2. Shortly, I would like to make some comments in response to the
comments by the hon. Member for Wimbledon about new clause 3.
First, I would like to respond
to what the hon. Member for Richmond Park has said. I do not feel that
a commitment in the Bill to the kind of reporting that she is looking
for would be appropriate in this case. I understand why she and other
members of the Committee have belittled the notion of always using the
precedent of the Channel Tunnel Rail Link Act 1996 to justify a
particular clause in this Bill, but let me suggest a corollary of that.
Can she, or indeed any other member of the Committee, name a piece of
legislation about a large infrastructure project where this kind of
reporting, aimed at creating the level of transparency that we all want
to see, has been included in the Bill? It is a rhetorical question; I
would be very surprised if there was an
answer.
Mr.
Harris:
We may actually have an
answer.
Mr.
Binley:
The Minister challenged us so may I ask him
whether he thinks that, although there is no precedent, it is time that
we set one? That is the point about this new clause. We want to improve
government and I am sure that he also wants to improve it. On that
basis, and in the spirit of going forward to ensure that we have more
transparent government, surely he would accept that
point.
Mr.
Harris:
There is a good reason why such commitments have
not been included in previous legislation. I must say to the hon.
Gentleman that I am not about to make political history and create a
precedent with the Crossrail
Bill.
On the comments
of the hon. Member for Cities of London and
Westminster, I am clearly far more optimistic than he is about the
robustness of the financial package that has been put together. Time
will tell, but I think that the amount of work that has been put into
creating that financial package will show in time that that package is
extremely impressive and, I must say, robust.
The purpose of the hon. Member
for Wimbledon in proposing new clause 3 is to ensure
that
“Any land or
property...if deemed thereafter surplus to the needs of this Act,
shall be disposed
thereof”
and
the proceeds will be used for Crossrail-related purposes. I can assure
him that this new clause is unnecessary. The Secretary of State has
already given a number of undertakings on the matter of the land
disposal policy. These form part of the environmental minimal
requirements and she has given undertakings to Parliament on the
enforcement of those requirements. The relevant paragraph in that
policy is as
follows:
“Where
any land which has been acquired and used for the construction of
Crossrail is:
(i) no
longer required for the satisfactory completion of the Crossrail
works;
(ii) not
required in connection with the operation of Crossrail;
it will be sold subject firstly
to the Crichel Down Rules 2004 and to the extent that this does not
apply, then in accordance with this
policy”.
As I am sure the
hon. Member for Wimbledon will recall, those rules provide for the
circumstances in which land acquired under threat of compulsion but no
longer required for public purposes will be offered back to the former
owner. The requirement under the rules to offer land back is not
unqualified.
The terms
of the Crossrail land disposal policy were
published in advance of the Select Committee’s
consideration of the Bill. Therefore, they have formed the backdrop for
many agreements reached with persons whose property would be subject to
compulsory purchase as a consequence of the Bill.
On the question of the use of
the proceeds, I assure the hon. Member for Wimbledon that it is
integral to the funding package announced by my right hon. Friend the
Prime Minister last month that the proceeds will be applied for
Crossrail purposes. As the hon. Gentleman will appreciate, however, the
timing of those receipts is unlikely to marry with the timing of
payments of compensation and therefore they will go towards the
repayment of Transport for London borrowing to finance the
project.
The heads of
terms between the Department for Transport and Transport for London,
setting out the
details of the funding arrangements, were published
yesterday, as the hon. Member for Wimbledon will know. He will find in
the table on uses and sources of funds, at paragraph 4.1.3 of those
heads of terms, that it is envisaged that £500 million will be
raised from sales of surplus land and property. With
those assurances, I hope that the hon. Gentleman will consider not
pressing the new clause to a Division.
Question put and agreed
to.
Clause 65
ordered to stand part of the
Bill.
Clause 66
ordered
to stand part of the
Bill.
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