Select Committee on the Crossrail Bill Minutes of Evidence

Examination of Witnesses (Questions 9960 - 9979)

  9960. And that is a matter in respect of which, as you heard, Mr Elvin is going to be able to provide us with some costs. Have you yet heard any explanation of the difference between those works and the Acton dive-under to which the Promoters were perfectly happy to commit?
  (Mr Smith) I have heard no explanation of any difference.

  9961. And if we concentrate on 2017, and aim to have Crossrail operating in 2017, how stand our proposals in relation to that objective?
  (Mr Smith) We need these pieces of infrastructure to be able to ensure that the Great Western Main Line can accommodate all the services that Crossrail want to operate other than the two off-peak services, and can accommodate the freight services, and can accommodate the complementary passenger services, and, we keep forgetting, the long distance high speed passenger services to the South West, to Bristol and to south Wales.

  9962. If the aim, as I say at present, is to achieve 2017, is that assisted by some finality now or is it irrelevant to that objective?
  (Mr Smith) Certainty now is always better than uncertainty lasting into the future. From a very parochial perspective, to be able to give our customers the assurance now that the whole Crossrail process has created comfort for all users of the railway, that there will be sufficient capacity for everybody's needs, is going to make it far easier to sell rail freight as an environmentally sustainable mode that people should be using more of in the future.

  9963. We heard about the word "de-scoping" the project earlier, and we had it defined and explained to us. Can you see any possible justification for a de-scoping of the project to exclude those works which are in EWS 26?
  (Mr Smith) I would be extremely concerned were the project to be de-scoped in that manner, because I have seen or heard of no alternatives to these works which are necessary to create the necessary capacity for all users of the network.

  9964. MR GEORGE: Thank you very much. Those are the only questions I have.

  9965. CHAIRMAN: Thank you very much, Mr Smith.

The witness withdrew


  9966. You are Nigel Oatway. Can you just explain to their Lordships the position you hold with EWS?

  (Mr Oatway) Yes. I am Nigel James Oatway; I am the access manager for EWS, a post I have held for 14 years. I have worked in the rail industry for 27 years and within the rail freight industry for 15 years. In addition to my role as access manager of EWS I also hold a number of positions on key rail industry groups and committees. These include being a committee member of the Class Representative Committee, which oversees and approves changes for the industry Network Code; a Committee member of the Access Disputes Committee, which adjudicates on access disputes between industry parties, many of which arise from the Network Code; and also I am a committee member and deputy chairman of the Delay Attribution Board, which oversees the guidelines for specifying how performance delays are allocated and attributed.

  9967. I think, Mr Oatway, if there are any questions about change control mechanism and the like it is, so to speak, your daily diet, is it not?
  (Mr Oatway) I will do my best to answer any.

  9968. And what are your particular responsibilities with the EWS, please?
  (Mr Oatway) My key responsibilities within EWS are managing our track access arrangements with Network Rail for running our services on the network. I am also heavily involved with dealing with rail regulatory compliance, particularly matters dealing with access and licensing regimes. This also includes the Network Code, as I have referred to earlier, which is the document containing a set of common rules which apply to network access, incorporated by reference into each track access agreement, apart from a very small number of exceptions.

  9969. Mr Oatway, earlier this morning Mr Smith referred to what happened on the West Coast Main Line to freight. I think you gave evidence, did you not, at the inquiry into the Transport and Works Order in respect of those works, is that right?
  (Mr Oatway) Yes, in respect of the four tracking of the Trent Valley.

  9970. Precisely because there was concern about the likely effects on freight of the works and you were seeking safeguards?
  (Mr Oatway) That is correct.

  9971. Could we now, please, just turn to the whole subject of access arrangements? Could you just very briefly explain the position so far as EWS' access arrangements?
  (Mr Oatway) Yes. EWS, along with all other rail users, have entered into long and short-term access contracts, or framework agreements, which have to be approved by the Office of Rail Regulation, and these give them the right to use the railway network and are commonly known as track access contracts. There are also station access contracts and facility access contracts, and also connection agreements which govern the connection of third party terminals to the network, but they are all access arrangements which are dealt with under the access provisions of the 1993 Act. These contracts invariably last for many years at a time and therefore allow rail companies to plan the use of the network and offer services to their customers with a high degree of certainty and assurance. For example, EWS' track access contract with Network Rail for the majority of its train paths expires in December 2015; EWS' future business plans, however, are based on the presumption that this access contract will be renewed or extended before that time, because it is absolutely essential for rail freight companies and their customers to be able to rely on the contractual rights within their track access contracts. If EWS could not use or reach its freight terminals, or lost its train paths, it would be in breach of its contracts with its customers and its business would suffer greatly. What is more, the danger of this happening will also discourage any new customers from being attracted to rail as a preferred mode of transportation for their traffic, as they would see rail freight as being unreliable, uncertain and subject to material interruption beyond the control of the rail freight operators.

  9972. If we now turn to the railway clauses themselves, I indicated in opening that EWS welcomed the removal of certain clauses from the Bill, and you have had the opportunity of looking at the new draft clauses which it is proposed to deposit elsewhere. So far as that is concerned, are there any comments you wish to make other than the matter of clause 41(3) which we will come to in just a moment?
  (Mr Oatway) No. We very much welcome the Promoter's policy decision to delete the majority of the railway clauses in the Bill, but we believe the Promoter has maybe erred in determining to bring forward the related amendments at subsequent public stages of the Bill and only prepared draft amendments for this Committee to consider. Our reasoning on those points was set out in detail to recent letters to the Clerk of the Committee and the Promoter, so I do not propose to go into those in any great detail.

  9973. You are simply hopeful, as I understand it, that when those clauses reach their final form they will be no more damaging to private interests than the present proposed clauses?
  (Mr Oatway) That is correct.

  9974. Now, can we then turn to clause 41(3) in the Bill dealing with arbitration in relation to various forms of assets?[11] I addressed the legal side of this matter yesterday and I have really only two questions for you in relation to clauses 40 and 41(3), and the first is in connection with the CTRL railway. I introduced the Committee yesterday to the provision there whereby they had an equivalent of clause 40 but they did not have a clause 41(3); they simply had a standard arbitration clause. Has that given rise to any difficulties or problems or delays to the construction of CTRL which might justify the inclusion of clause 41(3)?

  (Mr Oatway) None that I am aware of.

  9975. And can you yourself see any need for clause 41(3)?
  (Mr Oatway) None.

  9976. We will leave that matter, then, and move on to the question of compensation, and in this context I think it would be helpful if we had the Promoter's paper, H2 Railway Compensation, on the screen, paragraph 3, page 2.[12]

  9977. So far as the basic scheme of the proposals of the Promoters, I think that is set out in paragraph 3, is it not, of that particular document?
  (Mr Oatway) Yes, it is.

  9978. And they there say that they believe the "standard industry arrangements should be appropriate for compensating the railway industry for the loss of, or disruption to, services during the construction, apart from the specific instances set out in sections 4 and 5 below".

  It then says that in certain circumstances, where standard arrangements do not provide an appropriate remedy, specific non-standard arrangements will need to be developed. I think in summary your case is to say that the Promoters have failed to identify a particular category where a specific non-standard arrangement is appropriate over and above the matters referred to in H2?
  (Mr Oatway) That is right. I believe there are gaps, yes.

  9979. Now, so far as the basic principles of H2, that is the no loss/no gain principle, do you take issue with that in any way?
  (Mr Oatway) Absolutely none. I think that is perfectly fair and reasonable, that compensation should be given on a no net gain/no net loss basis, ie holding the affected parties neutral.

11   Crossrail Bill, Session 2007-08, HL Bill 14, Clause 41(3) (SCN-20080501-001) Back

12   Crossrail Information Paper H2-Railway Compensation (LINEWD-IPH2-003) Back

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