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Lord Whitty: My Lords, the noble Earl ends his speech with a challenge. I hope that I can make a useful suggestion. Everyone in this Chamber and more widely recognises the important breakthrough that the proposition on congestion charging and hypothecation makes to the future funding of transport infrastructure and the quality of the system within London.

When the noble Earl began, I thought that he was making a Second Reading speech, but clearly he has concerns about the proposition. His noble friend's amendment and the amendment we are considering effectively accept that we shall engage in a system of congestion charging, should the mayor so wish, and deal primarily with the issue of hypothecation.

The provision of hypothecation as such is already covered in Schedules 18 and 19 and my ministerial colleagues and I have made many commitments throughout the passage of the Bill relating to our advocacy of such approaches in London and elsewhere. Schedules 18 and 19 define relevant transport purposes as,

It is clear that a wide range of schemes across the geographical area of the GLA would be paid for by the hypothecation of this money. Therefore, the provisions of the Bill already guarantee that the revenues from the new charges will be ring-fenced for the purposes of implementing the mayor's transport strategy.

That leaves us with the question, for how long? The noble Earl dismissed it, but the agreement reached between government departments on the hypothecation of this form of revenue for transport infrastructure is a major breakthrough. It has been widely welcomed and it gives us a new way of providing decent transport for the capital. It is an important issue and it is not in the nature of the Treasury to concede such matters for all time. Indeed, it has a good reason for taking that stance and I agree with it. It is that if the revenues are sufficiently high and of a sufficiently long duration, there will come a time when there are no value-for-money transport infrastructure projects in London.

Noble Lords may believe that that is a long way off. I agree that it is probably a long way off, but there comes a point when it is appropriate. Therefore, we

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have built into the measure the provision that any scheme starting within the next 10 years can run for 10 years, but there will then be a review of the process. It seemed sensible to build in that review.

In her amendment the noble Baroness has been a little more modest than she was during earlier stages when she suggested 35 years before there was a review of the proceedings. She is now suggesting 15 years. It is to be hoped that by Third Reading we can reach some accommodation on the 10 years we propose, plus a review at the end of that period. That does not mean that the hypothecation will automatically stop. Indeed, if the scheme is working to the benefit of Londoners and there is palpable improvement in the transport system in London as a result of such funding, there is no doubt in my mind that the political imperative of continuing the scheme in some form will exist.

Nevertheless, it is sensible and prudent to review the situation after a period of 10 years. That is what we are building into the Bill. We do not want a five-year delay by having a review after 15 years. We believe that it is sensible to have it after 10 years; a view we have taken throughout the debate from which I shall not depart at this stage of the Bill.

There is not a great deal between the noble Baroness and ourselves on the desirability of providing this power for the mayor in relation to congestion charging and a workplace parking levy. However, understandably, the noble Baroness wishes to push the matter further in the future. I wish to do so, too, but it is prudent to build into the Bill a review after 10 years. I hope that on reflection the noble Baroness will agree that that is sensible financial management by national government and by the mayor and that she will not pursue the amendment tonight.

5.15 p.m.

Baroness Thomas of Walliswood: My Lords, the Minister was right to suggest that we on these Benches have sympathy with the ideas of congestion charging, workplace parking levies and hypothecation. On that we are completely at one. However, the difference between us lies in the area he next referred to; namely, the moment when such funding will no longer be necessary. Two difficulties arise. The first is that there may be problems with a 10-year period because it allows only two and a half of the four-year local authority cycles after the coming into existence of the GLA in which to commence any such schemes. The second is that if a sufficient number of schemes is undertaken to contribute to the financing of the undoubtedly enormous public transport needs--who knows, we may return to cycle lanes, which we are not allowed to talk about in the context of the Bill but which the mayor will be allowed to talk about in determining a transport strategy--there might be a wide range of transport needs to which the money can be put. Throughout, our contention has been that 10 years is not long enough to provide a stable, reliable source of funding for such projects.

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I shall read with great care the final part of the Minister's answer and compare it with what he said in Committee. I thought I understood what he said in Committee and my understanding will be enriched by comparing the two. I shall make sure that I really do know what the Government's intention is. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Dixon-Smith moved Amendment No. 495:

Page 147, line 23, at end insert--
(“(4) Any charging scheme established pursuant to this section shall cease to take effect, and may not be revived, if at any time there is not a scheme to improve transport arrangements (including schemes to assist the movement of pedestrians) within Greater London in the operation or establishment of which the net proceeds of the charging scheme (within the meaning given it in Schedule 18) can be applied, and are only applied.").

The noble Lord said: My Lords, perhaps I may say a word about Amendment No. 495. It might have been thought that Amendment No. 495 flowed from the previous group of amendments that we have been discussing, but in this particular grouping I shall be discussing Amendments Nos. 495 and 510, which are identical in wording. My noble friend Lord Attlee will discuss the other amendments in the group.

We should be very clear as to what we are talking about. Clauses 254 and 255 of the Bill create options for the mayor or his subsidiary body, Transport for London, or the London boroughs or the Common Council of the City of London to introduce schemes either for congestion parking or workplace parking.

This Bill is for and about London, and in that sense it is a geographically local Bill. It is not a national Bill to establish a national tax or a national scheme of levies. When we talk about hypothecation, which has been trumpeted as a great triumph, it is my view that we are being made to fall for what I regard as something that is intellectually dishonest. There is nothing to hypothecate. The Secretary of State has no revenue at all because any power to raise revenue is wholly and entirely in the hands of somebody else. In effect, what we are saying in this Bill is, “Mr Mayor, you may charge these levies on behalf of London on those who drive or park in London, whether or not they live in London, but after 10 years we reserve the right to take your decision away from you and to take the product of that decision and apply it elsewhere". I am sorry, but I do not regard that as a satisfactory way of going on. Schedules 18 and 19 give effect to that, and that is where the issue of hypothecation is discussed.

Amendments Nos. 495 and 510 deal with the matter in this way: they leave the power of decision to raise these revenues locally, of course, as the Bill requires. Then the Bill says that they should be applied locally for the improvement of transport arrangements, which include schemes to assist the movement of pedestrians within Greater London. Then at the point when there are no further such schemes that anybody can think of which could be of any possible benefit to London, those schemes will cease. It seems to me that that is perfectly reasonable and proper. If the decision is

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taken locally to implement these schemes, then, when there is no further use for them locally, they should cease. I think that is the way we should go about this business.

Of course in the background there is a separate issue, which is the question of whether there should be a national scheme of road-user charging--one could call it “congestion charging" or give it any other name. There could equally well be a national scheme for workplace parking charging. If both those schemes were to be introduced on a national basis, then the Secretary of State would rightly be able to claim credit, if he could persuade the Treasury to hypothecate the product of those schemes for transport purposes, because in fact there would then be some national money over which he had some control and with which he could do something. That may well be the situation we shall be looking at in a year or two. I have heard rumours floating around that indeed there may well be legislation at some point in the not too distant future, bringing just such schemes into being on a national basis.

I said when I began these remarks that we are dealing here with a geographically limited Bill: in essence, a Bill which is all about London and which is for Londoners. If schemes are produced under this Bill, they will be produced either by the mayor or his subsidiary, Transport for London, or the London boroughs or the Common Council of the City of London.

I regard that as perfectly reasonable. It is also perfectly reasonable that if those bodies choose to introduce those schemes, the schemes should be applied to London. I do not think it is reasonable that in fact, having taken the initiative, the risk and indeed possibly the political odium of introducing such schemes, they should then be subject to the intervention of a third party--that is to say, the Treasury--to take away from them what one might call their rewards for political boldness and initiative. It is for that purpose that Amendments Nos. 495 and 510 are on the Marshalled List. I commend them both to the House and beg to move Amendment No. 495.

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