Select Committee on the Crossrail Bill Minutes of Evidence

Examination of Witnesses (Questions 8820 - 8839)

  8820. CHAIRMAN: I remember the situation well!

  8821. MR ELVIN: It is in note form in places, but I hope that it is nonetheless comprehensible, and it is easy to give you it in writing.

  8822. CHAIRMAN: I am sure it will help us follow what you say. We will come back at 20 past two. Mr Bennett, you are now released in accordance with the plan and thank you very much for coming.

The witness withdrew

The Committee adjourned from 1.02pm to 2.20pm

  8823. CHAIRMAN: Mr Elvin, I do not know what it was you were going to say—the normal neutral introduction. We have, however, heard some of the contentious points. If you wish to mention some of them that would not go entirely amiss, but I will leave it to you.

  8824. MR ELVIN: My Lord, indeed the note that I have set out sets out more submissions rather than simply setting the position; because the position can be described in probably a couple of sentences. I thought it was more useful to the Committee to know what the arguments were, rather than simply setting out a very neutral, "Well, these are the three issues we have to deal with".

  8825. My Lords, this is really a continuation of what I said last week, which is that you are dealing with the more general railways powers issues this week. I make it clear at this stage, as I did in cross-examination of the witnesses earlier, that one thing that is not in issue before your Lordships is that rail freight and protecting rail freight growth is an important matter—no-one suggests it is not. The only issues your Lordships are effectively concerned with are the mechanisms which are proposed to operate to provide proper protection for rail freight, not the question as to its protection in principle.

  8826. CHAIRMAN: At some stage, I think after we get past clause 34, you were indicating before the adjournment that it may not be all that important whether they stay in the Bill or not. I think that needs explaining—not now but at some time.

  8827. MR ELVIN: My Lord, as you know the Bill currently before you, broadly clauses 22-45, contain a series of provisions which, if they were to be enacted, would modify the duties of the Rail Regulator quite considerably in order to ensure the operation of Crossrail, and provide statutory powers to ensure the running of Crossrail absent an appropriate access agreement. Concerns were expressed about that mechanism and those series of powers before the House of Commons Select Committee by most of the rail petitioners. Those concerns were understood.

  8828. Throughout the Bill process the Promoter has made it clear that the use of the standard industry regulation mechanisms was the preferred approach. As your Lordships know, an Access Option was applied for, and that Access Option will allow access to the main rail network and, following negotiations with the infrastructure manager, Network Rail, proposals were submitted to the ORR. They were consulted upon, as the ORR is required to do under the Railways Act. The ORR then held a hearing on 1 February, having received substantial written representations and evidence from the industry and other interested bodies; issued a provisional decision on 3 March; heard further representations in written form after the provisional decision; and then issued the final decision on 14 April. Thereafter, the ORR's role, as I mentioned earlier, is to give specific directions as to the final content of the access agreement, in accordance with the decision of 14 April.

  8829. You will see from the note I have provided to the Committee that the position with regard to the use of the industry mechanisms was made very clear in Information Paper H3, and we have just put section 3 up on the screen.[13] It has always been our position that should an appropriate Access Option be obtained within the relevant timescales then Bill powers would be cut back.

  8830. Following the consultation and the processes and the two decisions of the ORR, the provisional decision and the final one, the Minister made two public statements setting out current policy from the Department, which was that the provisional decision and then the final decision was sufficient for the Minister to state an intention to delete the principal rail powers modifications in the Bill and to do so at the Public Bill stage.

  8831. As I said in my note, it is fair to say that the principal issues remaining for this Committee, on the basis that the Public Bill powers will be removed as per the Minister's statement of policy, are issues which were fully argued before the Rail Regulator in the process I have just outlined. You have already seen in the cross-examination of Mr Bennett the way in which in particular certain issues with regard to infrastructure were properly considered both at the provisional and the final stage by the ORR. The industry has had a full opportunity to raise its concerns in the more technical forum of the Rail Regulator's hearing and representations, where all the matters such as capacity, paths and timetabling (if I may say so with respect to your Lordships' committee) are most appropriately dealt with by experts who understand the modelling processes; and where the industry regulator is used to balancing the various competing interests of passenger services, new passenger services with existing rail freight interests and, of course, protecting the potential for growth beyond the current utilisation today.

  8832. Of course, the statement of the Minister on 11 April made it clear that clauses 23-34 would be deleted. I will come to clauses 40 and 41 in due course. As we said last week, as public provisions, although we are clearly more than content for Petitioners to raise matters, and no doubt your Lordships will comment on the position as your Lordships see fit, but it is proposed that those matters be dealt with at Public Bill stage. We have made available draft amendments that are proposed to be tabled in due course. I make it clear that those are draft amendments only. They are not necessarily the final form. No doubt there may be some tweaking. Those draft amendments, of course, are put forward on the basis of the policy, which is that there must be a valid Access Option in place. If there were to be a legal challenge to the decision of the Regulator matters might need to be reconsidered, but we hope that that will not be the case; and certainly there has been no sign of it to date.

  8833. There is a call from some of the Petitioners for an undertaking that the intended way forward should be made the subject of an undertaking from the Promoter. That is to say, an undertaking with regard to the Bill provisions. Rather difficult to see how one could get an improvement on the Minister's public statement of intention in the two statements of 11 and 18 April; and it is rather difficult to see how, providing nothing significantly changes with regard to the validity of the ORR's decision, the Minister would be in a position to persuade the Public Bill Committee to do anything other than his stated intention. We do not consider it is appropriate, given the Minister's public statements, to go any further than that. We ask your Lordships to support us in that.

  8834. We are grateful to Lord Berkeley for taking over the mantle of representing a number of the rail freight interests, which no doubt is very helpful in dealing with the issues in an efficient and clear manner. We understand that the issues really for your Lordships today are, firstly, the lack of commitment by the Promoter to provide specific items of infrastructure that are included as works in the Crossrail Bill, principally the issue I took up with Mr Bennett this morning; and the proposal in the proposed amendments for a new clause modelled on the London Olympics and Paralympics Act to address concerns related to blocking rights during construction. There are some additional issues, clauses 40 and 41 for example, but it seems to us those are the two main issues where most of the Petitioners are heading, at least from the freight industry.

  8835. Turning to infrastructure, the basis of almost all of the rail freight petitions before the Select Committee in the other Place was on the basis that the rail clauses were unacceptable and that Crossrail should use regular industry processes and apply for an Access Option. I have quoted in the written submissions at paragraph 18, if you will forgive me for doing so, Lord Berkeley's statement to the House of Commons Committee on 6 July, simply because it is probably the fullest and most representative statement of what was put to the Select Committee, and it represented in clear terms the concerns of the freight industry. You will see at the quotation from paragraph 14362 of Lord Berkeley's statement in Volume 4 of the Select Committee Report that the key to his submissions was independent regulation. He says, "Independent regulation is the key. One has to make the point that the private sector investors are always suspicious of the government mind or policy. If one wants private sector investment, that has to be protected, and the protection we get is from the independent ORR".

  8836. I am pleased to note, of course, as a result of representations, and indeed the constant policy of the Promoter and the position with the Access Option, that we have moved much closer together in terms of our respective positions than we were in the other Place. Indeed, the shortness of the issues before your Lordships this week is indicative of the fact that you are dealing with in the scope of a few days what took over three weeks in the House of Commons Select Committee. I am sure your Lordships will be very pleased that that is so, rather than the position facing the Commons.

  8837. CHAIRMAN: You are quite right!

  8838. MR ELVIN: The process we have used, as I have mentioned, is that under the Railways Act. That involves, and I have broken it down in paragraph 20 into the main stages: the submission of the proposed agreement between Network Rail and Crossrail to the ORR; public consultation and scrutiny by the ORR of the proposals, including consultation with the industry; and then directions from the ORR as to the form and terms of the final agreement under paragraph 5 of Schedule 4 of the 1993 Act.

  8839. I think it might be helpful if I just put up the provision, because I mentioned it to the Committee earlier, just to show you the width of the ORR's power.[14] Under paragraph 2 of paragraph 5, you will see, "If the ORR decides to give directions to the facility owner requiring him to enter into an access contract, the directions shall specify the terms of the access contract". So it is a very broad power to the ORR. Therefore the access to the network is dependent entirely upon the terms which the ORR decides to impose on the access agreement. Whatever the initial position between Network Rail and the facility owner in the draft agreement, the ORR has the final say as to what terms should go into the agreement between Network Rail and Crossrail.

13   Crossrail Information Paper H3-Crossrail Access Option, (LIEWD-IPH3-003) Back

14   Railways Act 1993 (c. 43), Schedule 4-Access agreements: applications for access contracts, The decision and the directions, (SCN-20080429-001) Back

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