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Lord Graham of Edmonton: My Lords, in the early part of the Statement, which I warmly welcome, the Minister referred to London Transport as part of the lifeblood of London. It is a lifeline for many people who work in London but who live outside the London Transport area. I live in Loughton which is on the Central Line. It does not comprise part of the Greater London area. Loughton, Debden and Epping had no say whatsoever on whether a Greater London Authority

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should be set up; nor on whether a mayor is appropriate. I support the establishment both of a Greater London Authority and of a mayor.

The people in my area are concerned at the following words which appear in the legislation. I refer to the words,

    "in so far as they consider it necessary". Are the Minister and his colleagues seized of the possibility that there could be many disgruntled people who work in London, but who live just outside the area we are discussing, who have not been consulted on what the mayor is able to do in this matter? We should bear in mind that these people, who pay their taxes and their rates, are entitled to a fair crack of the whip. They would not want to see services outside the main area neglected for any reason whatsoever.

Lord Whitty: My Lords, with all due respect to my noble friend Lord Graham and to the noble Lord, Lord Dixon-Smith, I have always known that there are a number of disgruntled people in Essex! The mayor will be elected by the people of the GLA area. Nevertheless, the main function of the whole authority will be strategic. It is essential that the transport planning department of that authority takes into account the needs and interests of neighbouring authorities. It is important that the planning bodies of the GLA co-operate with the planning bodies outside its area, including the counties, to deliver a transport system for the South East and, in some cases, beyond.

Baroness Ludford: My Lords, I have three questions. First, as an aid to evaluation of the PPP, will the Government now publish the Price Waterhouse study which, it is rumoured, shows that a public interest company borrowing externally is the best deal? Secondly, will there be open competition for bidding for the other lines in future and if not, why not? Thirdly, as the Statement and the proposals concern lines including the District and Circle Lines, and therefore Westminster Underground Station, when is access from the Palace of Westminster to Westminster Underground Station likely to be improved, given that anything that we can do to encourage Members of both Houses to come here by public transport would be desirable?

Lord Whitty: My Lords, I trust that Members of neither House need any additional encouragement to come here by public transport. The station at Westminster is being refurbished--that process has continued for some time--as part of the Jubilee Line extension. That will be completed by the end of the year. The station itself may be improved thereafter.

As I understand the position, it will be difficult for us to publish the whole of the Price Waterhouse study for reasons of confidentiality and so forth. We have already published a summary of the Price Waterhouse study. As regards the other two contracts for the Underground system, as I have indicated we are seeking bidders for both of those under a system of open competition.

Lord Clinton-Davis: My Lords, did my noble friend note the observation of the noble Lord,

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Lord Dixon-Smith, who said that he felt let down? However--this is much more relevant--is he aware that many Londoners feel let down by the failures and neglect of their transport system during virtually two decades of Tory government? Will my noble friend say something about the processes of integration that are to be undertaken between surface and underground transport systems, in particular with regard to the airports? Are the consultations to be dealt with on a comprehensive basis to enable the whole system to be seen as an integrated one? What form will those consultations take and when do the Government propose to embark on them?

Lord Whitty: My Lords, although I would not put it quite so bluntly, I associate myself with my noble friend's view that there was a long period when Londoners felt acutely that their public transport needs had been neglected. The previous government belatedly recognised some of the problems, but that was far too late. We have ended up with an infrastructure of the totality of London Transport which will take a long time to sort out. However, we are determined to do that.

The Government are considering this matter in a totally integrated fashion both in terms of awarding the contracts and in terms of the structure which we seek to establish in Transport for London which will cover both the Underground and the buses. It will cover the strategic road network, the river service and many other aspects of the London Transport infrastructure. For the first time, those services will be considered together in a strategic assessment. That will, of course, need to have an interface with the airport authorities and the authorities outside London in terms of strategic planning. That process will begin as soon as the new institutions are in place. In the meantime, plans and options are being developed within the department in consultation with the operators.

The Lord Bishop of Hereford: My Lords, I have two questions for the Minister. The first concerns the capacity of Railtrack to take on additional work. I think we are conscious that Railtrack has done some excellent work on track and stations. There are many good things to be said about what Railtrack has achieved. However, there is also a sense that Railtrack is struggling to fulfil its existing obligations. It is rightly under pressure to speed up the process of dealing with bottlenecks and pinch points and to provide additional capacity for freight traffic in particular. Is it reasonable or wise to add this additional burden? I think simply in terms of engineering capacity and managerial competence. Should a large amount of extra work be put on Railtrack at this stage? Is the Minister satisfied that it has the capacity to deal with it?

My second question concerns regulation. Can the Minister tell us whether the sub-surface track which is linked with the existing mainline system will be subject to the same kind of regulation, and, on this work, will Railtrack be subject to the strategic rail authority in the same way as the mainline system?

Lord Whitty: My Lords, in terms of Railtrack's capacity, we are confident that it can provide, develop and expand the necessary expertise to take over. It may have to acquire and demonstrate additional skills, particularly

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in the project management and overall strategic management areas. If there are deficiencies in those areas they will become apparent during the negotiating period. However, I do not believe that to be so. By the time we have concluded a firm agreement with Railtrack I believe those doubts will have been removed. However, I cannot give an absolute assurance at this point. I believe that Railtrack is working on those matters.

As to the regulations which will apply, although Railtrack is one company it will be responsible for two different parts of the system. It will manage the part of the national rail system which comes into London on the one hand, and it will be managing on behalf of London Transport, under contract to London Underground and TFL, the part of the Underground system it takes over on the other. There will therefore be regulation under the Strategic Rail Authority, taking over the responsibilities of the franchising director and others, on the national rail side; and it will be under the GLA regulations and the power of the mayor on the other side. Of course, we are also building into the GLA Bill a co-operative structure between the mayor and the Strategic Rail Authority for rail services within, into and affecting the London area. There will be a squaring of the circle. However, it is true that the Underground will be under the mayor and the rail network will be under the Strategic Rail Authority.

Lord Harris of Haringey: My Lords, I, too, am grateful to my noble friend for the Statement. Perhaps he can clarify two points. First, if there are to be any additional costs associated with the PPP arrangements, I understand from what my noble friend said that these would not be borne by passengers, subject to the ceiling of increases in fares of RPI plus 1 per cent. Can my noble friend give an assurance that the London taxpayers will not be asked to make up any difference, given that they already subsidise the rest of the country to the tune of many billions of pounds a year?

Secondly, I understand the desire not to give specific dates as to when certain things will happen--it would be improper to rush the negotiations--but can my noble friend give an assurance that the public will begin to see the benefit of the new arrangements before the end of the first term of the first mayor of London?

Lord Whitty: My Lords, as far as concerns the burden on the London taxpayer, there is no implication in these arrangements. The whole objective of the arrangements is to ensure that there will not be an additional burden on the London taxpayer, as there would have been had we put the whole of the London Underground network under the direct control of the GLA. I can therefore give my noble friend the first assurance that he seeks.

As to the time-scale for improvements, a significant number of improvements will be visible during the first period of office of the mayor of London--that is, within the next five years. However, I must caution my noble friend that some of the benefits of this investment will take some considerable time. There will be an investment allocation of £7 billion over a period of 15 years for the Underground network. This contract will run for 25 to 30 years. We have a long backlog to make up. We inherited

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a £1.2 billion backlog and it will take some time to make it up. However, I believe that we will see some improvement in the time-scale to which my noble friend referred.

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