Select Committee on the Crossrail Bill Minutes of Evidence

Examination of Witnesses (Questions 10340 - 10359)

  10340. What is striking about the position before your Lordships is that the Petitioners not only welcome the ORR's decision, but welcome the details of the ORR's decision. Their representations show they not only understood what was decided but they demonstrated this through their detailed representations and you have got the letters in the exhibits and we have gone through most of them. It is all the more remarkable therefore, given the time spent on the issue of infrastructure before this Committee, that so little issue was taken with the regulator's provisional decision to reject the requirement of infrastructure works and to use an objective approach based on outputs. Indeed Freightliner positively endorsed the use of the objective test without any requirement for specific enhancement works. I quote again there from the letter that I put to Ms Durham on Tuesday. EWS not only welcomed the output to that approach in its further representations, but made a point, as I put to Mr Smith this morning in Section 15, that the ORR had gone out of its way to meet EWS's concerns in the change control mechanism and had imposed a new form of change control mechanism which met EWS's requirements.

  10341. Accordingly, therefore, you are in the position, my Lords, where the ORR has specifically considered freight growth and network capacity, has considered the question to require those works that are now put before you, but the regulator had power to require specific works to enhance capacity but decided not to require them, but instead decided to allow further work to continue to enable the appropriate infrastructure inputs to the model to be identified at a future point in time so there is a flexibility in how best to determine meeting the objective test.

  10342. The rail freight industry generally accepted and welcomed that decision.

  10343. It is now less than three weeks after the regulator's final decision and there has been no change of circumstances other than the favourable announcement by the Minister of his intention to seek the removal of the rail clauses from the Bill. Nonetheless, the same interests who did not seek to persuade the regulator to specify works and announce themselves content with the decision now appear to argue before your Lordships that such works should be specified.

  10344. We have tried to understand the reasons behind this complete change of stance. The answers have been vague. There have been inaccurate comparisons with planning applications, which I will come back to in a minute, or simply irrelevant, namely that there are two parallel processes. The justifications advanced do little to hide the real point, which is that the Petitioners seek to use the opportunity to seek from your Lordships' House what they were unable to persuade the regulator to require and did not contest with the regulator after the provisional decision.

  10345. The analogy with the planning system is a wholly bad one. It is bad because the analogy used by both EWS and the Rail Freight Group failed to include in the points that were put a situation where there is a regulator in a similar position to the ORR, in other words there is another regulator with a separate jurisdiction to the planning jurisdiction. In fact, within the planning system a local planning authority will not act so as to require by condition something that is regulated by another regulator under a parallel regime. If you looked at EWS and RFG's planning analogy correctly, which has not been done by them, then the conclusion would be that you would not seek to regulate that which the regulator had already dealt with. Indeed, what I have done is I have set out for your Lordships two extracts from current Government planning policy; paragraph 8 which is a quotation from paragraph 22 from the annex to Circular 11/95, which is on the imposition of planning conditions on planning permissions which is still current which says that in the planning regime you do not duplicate controls. If there is a separate regulator, you leave it to the separate regulator to do his or her regulating, you do not duplicate that through the planning system.

  10346. Similarly, if you look at one specific area of planning, which is pollution control, in that way you clearly have a separate regulator, which is usually the Environment Agency, this is paragraph nine and I have quoted from paragraph eight of the current planning policy note 23. It makes the point: planning and pollution control systems are separate but complementary. Pollution control is concerned with preventing pollution and then goes on to make the point that the planning authorities should work on the assumption that the relevant pollution control regime will be properly applied and enforced and should act to complement but not seek to duplicate it. Thus, if we were before a local planning authority rather than before your Lordships' House that authority would not have the power consistent with planning policy to impose a condition requiring a provision of infrastructure because the ORR has power to do it; the ORR has determined how any necessary infrastructure is to come forward through the application of the objective test; and the Committee does not need to assume that the access regime has been properly applied since it is plain that it has been to the extent that it has earned the plaudits of the freight industry in the correspondence and before your Lordships; and to impose a condition by requiring an undertaking here would duplicate the effect of the objective test mechanism and conflicts with it because the application of that mechanism may reveal in the future that a particular piece of infrastructure is not necessary to secure the 92 per cent.

  10347. My Lords, I simply say, your Lordships are being led up the garden path with the planning analogy because the proper planning analogy, which is where there is a parallel regulator, is that the planning authority—and it is suggested by my learned friends that your Lordships stand in the position of the planning authority being asked to grant planning permission—should not duplicate the duties of another regulator.

  10348. CHAIRMAN: Mr Elvin, I think this is over-simplified, is it not, because supposing that it was entirely within the hands of the local planning authority and there was a very big new development required which on highway grounds would need access roads and roundabouts and that sort of thing, they could insist on that. It is within their own jurisdiction as a county council.

  10349. MR ELVIN: Yes, but there is no parallel regulator.

  10350. CHAIRMAN: There is no parallel regulator, but it is not right to say that they never can, they sometimes can insist.

  10351. MR ELVIN: My Lord, it is contrary to Government policy if there is a separate regulator to duplicate that regulation and these statements make that clear. The highways example is a bad one because normally with highways works you would impose a Grampian condition which would prevent you from commencing development until the works were done, but that would not be a parallel regulator, that is simply waiting for the works to be done.

  10352. CHAIRMAN: I am not trying to say that your point about a parallel regulator is wrong, but it is not entirely correct to say that planning authorities cannot deal with infrastructure requirements.

  10353. MR ELVIN: Absolutely, but it depends on whether there is a parallel regulator.

  10354. CHAIRMAN: Yes.

  10355. MR ELVIN: The only point I am making is that the analogy that the Petitioners have made with the planning system is just a misleading one because unless you consider the circumstances of the parallel regulator under planning, you are putting forward a false analogy. The problem is it has been put through submission rather than through witnesses and the only witness that ventured a view, Ms Durham, then accepted she was not a planning expert and was not really able to answer the questions. It is just a bad analogy. I am not suggesting to your Lordships you should not pursue the analogy, I am just saying it is a bad one and I do not think it helps you. I think you have got to make your own decision based on, with respect, looking at the issues as they apply to the rail industry rather than to a planning authority.

  10356. Mr Bennett accepted that what was being sought was outside the normal industry process, as your Lordships will recall, and Mr Cann eventually accepted that the issue before both the regulator and the Committee was about securing capacity and that he was asking the Committee to take its own view on the infrastructure requirement. Ms Durham sought to argue that it was more the role of the Committee to specify works than the regulator, despite the fact of its consideration of that issue, though she was unable to advance any real basis for that argument.

  10357. Mr George said in opening that what he was seeking would not override the regulator's decision, but immediately went on to explain why the evidence presented at the regulator's hearing on 1 February should not have satisfied the regulator that 92 per cent was achievable. In fact, with respect to him, he confused the true position on that evidence. For example, the improvement in maintenance of 40 per cent that he referred to in opening is 40 per cent on the 2006 baseline which, as Mr Burns said on behalf of Network Rail they were starting effectively from a very poor position in 2006. As he said, it did not seem unreasonable given the things we are going to do to expect that to improve by 40 per cent. In any event, as Mr George failed to acknowledge the 40 per cent improvement and the changes to assumption about miles per casualty were just two examples of the inputs to the model that have to be investigated to determine how best to achieve the 92 per cent. Indeed, Mr Burns made this clear. If your Lordships look at what he said, he said, referring to Mr Morris, "Richard described what happened if you just move two of those variables to reasonable positions of expectation". It is clear he was not saying that they were the only issues, but if you just change two of the assumptions, then matters change considerably in terms of the capacity.

  10358. We say that whether or not particular items of infrastructure should be provided should be part of that process. Adoption of the Petitioner's current position would be to preclude this, as indeed Mr Garrett accepted when Mr Taylor cross-examined him.

  10359. Just to remind your Lordships that Mr Smith said this morning I think in re-examination that in fact passenger train companies were now meeting about 90 per cent to date and, of course, the modelling has some way to go so far as Crossrail is concerned. As your Lordships know, the regulator dealt with the matter at this stage when modelling was at the first stage.

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