Select Committee on Mersey Tunnels Bills Minutes of Evidence

Examination of Witnesses (Questions 660-679)



660. Point 17 relates to the monopoly situation in relation to the road tunnels. Obviously Merseytravel control all of the road tunnels under the river. I suppose that is what one might expect anyway, but it is fairly unique in that it is also owns the ferries and controls the under-river railway link, so it will have a fairly wide, extensive monopoly. Public utilities are generally subject to some form of regulation, as I think was agreed this morning by the expert speaking for Merseytravel, but the only control at the moment, particularly on the tunnels part of that monopoly, is the existing part of the Act which says that if the Authority wants the tolls increased, they need to justify it to the Minister and if there are sufficient objections, the Minister may decide that there needs to be an Inquiry.

661. Point 18 is the point about the fact that the tunnels are almost unique in Britain in being in the centre of an urban area. There are a few other tunnels that touch urban areas, but there are no other river crossings with a toll on which are so close to the centre of a conurbation.

662. Point 19, I think to a certain extent we have already covered, is this question of the Authority wanting the power to spend surpluses for other purposes which again appears to be in part to cover the charges that they are already making against the tolls. Going on to the bottom ----

663. CHAIRMAN: I am sorry to interrupt you there, but it was pointed out by Mr George very early on yesterday, but I think, with respect, your quote is from the Bill as it was presented to another place, not to the Bill as it appears in this House.

664. MR McGOLDRICK: That is correct.

665. CHAIRMAN: It is a very small point.

666. MR McGOLDRICK: The wording is changed slightly, but it is still there.

667.CHAIRMAN: It is germane, but it does not say anymore, "and in such manner as it thinks fit". It just says, "for other purposes".

668. MR McGOLDRICK: That is correct, my Lord.

669. CHAIRMAN: That is just for the record.

670. MR McGOLDRICK: Towards the end of point 19, there is the issue of the original Act for building the Mersey tunnels, the one that comes up in Mr Field's constituency says that the tolls should cease after 40 years at the latest. That was amended in the 1980 Act, but even under that Act the tolls would eventually reduce, not increase.

671. Point 20 is about the fact that there is a reserve power in the Bill to use the old system and what that in fact means is that an increase could be applied for which was in fact above the increase that would be allowed according to the RPI. Under the Bill, that in fact then means there is a new and higher base that the RPI would be applied to, so in effect the tolls would be permanently racked up for what might have only been some temporary situation.

672. Point 21 is the point we have already been through about the insulation works and the definition. Can I make it clear that there is almost nobody who is opposed to spending on noise insulation works. A lot of people think that it should have been done a long time ago because obviously the people who are going to benefit now are almost certainly not the persons who were there when the tunnel was built.

673. Can I then turn to the submissions.

674. CHAIRMAN: Are there any questions from my colleagues on this side, on the Petition? No. Please carry on.

675. MR McGOLDRICK: As I said earlier on, I am not intending to go through this word by word. I will go through it as quickly as possible. The first 11 pages are the statement made by Merseytravel on the Second Reading of the Bill in the Lords which, in italics, has been annotated with our comments on it, but I am not intending to go through that. Pages 12 to 14 is the historical background to the Mersey tunnel tolls, again I am not going to go through that in any detail other than that it is aimed to set out the basic position which is that the original way in which the tolls were going to be financed was that only part of the cost was supposed to come from the tolls, and a large part of the cost was supposed to come from the Corporations of Liverpool and Birkenhead.

676. If I can then turn to page 15, there has already been some mention of the fact that this is the second Bill. The first Bill was introduced in 1999 and withdrawn in 2000. It was pretty much the same as the present Bill, except, as has been pointed out by Mr Field, it contained what a lot of people would say was a privatisation measure, but, to use Merseytravel's own words, paragraph 18, there would have been a concession for a period of 25 years that somebody else would have been running them and, as you see at paragraph 18, in return for somebody else running them at that time, Merseytravel were expecting to receive a premium, a one-off initial payment of £50 million. In addition, as it says, point 19, to the £50 million they were expecting to get annual rental payments in the region of £15 million a year for a period of 25 years. If my arithmetic is correct, that is approximately £425 million that they were expecting to receive. To a certain extent, what is now happening is there is not a concession and an amount which may not be £425 million. I think the figure we went through this morning is close to about £300 million would accrue to Merseytravel and basically it is accruing to them from tunnel users.

677. Page 16 is trying to point out one of the difficulties that we have as the User Association because basically we have little or no income whereas Merseytravel are able to use the tunnel tolls although it is not actually clear, on my reading of the 1980 Act, that that is a purpose that it could be used for, but they are able to use the tunnel tolls to promote this bill and to try and convince tunnel users by letters such as this, which has gone out to all regular tunnel users using the fast tag system that it is somehow in their interests that tolls are increased.

678. If you turn to page 17, there is then a supplemented 17A and 17B which is loose. One of the points that Merseytravel have made is that the existing system for revising tolls is cumbersome and longwinded. That may or may not be true but it begs the question as to why that is the case. As I said earlier, we were initially objecting to the Toll Revision Order which Merseytravel made about a year ago. The period during which objections could be made was four weeks and those four weeks ended just over a year ago. We would have expected that it would not take all that long for there to be a decision on an inquiry but what we found is that we had to bombard the Department of Transport with questions as to whether there was going to be an inquiry and, if there was not going to be an inquiry, why not, and, if the inquiry was delayed, why it was delayed. At page 17 are the eventual answers that we received from them as to why the inquiry was delayed. They said that the delay in announcing an inquiry was caused by a number of factors including consideration of Merseytravel's application and the comments made by others etc. In our view, the inquiry was delayed because the Department of Transport were either acting inefficiently or were dragging their feet.

679. One of the points that Merseytravel also made yesterday was that if only one person objected to the toll increase, there would have to be a public inquiry. If you turn to pages 17A and 17B, as I said before, we were pressing the Department of Transport just to answer that one simple question of whether there would be a public inquiry and you can see in the second paragraph their answer which refers back to the existing Act. It says:

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