Examination of Witnesses (Questions 10380
- 10399)
10380. If the parties cannot reach agreement
under Clause 40, the matter is referred to arbitration. The Secretary
of State may then, under Clause 41(3), specify the results to
be achieved by arbitration, and then the arbitrator determines
the fair terms—such as compensation—by which those
results are achieved. This is to avoid the possibility that the
result of the arbitration frustrates the ability of the Nominated
Undertaker to deliver essential Crossrail works, which have been
authorised by Parliament.
10381. The asset controllers in question include
London Underground and the Public Private Partnerships, BAA and
Network Rail. Clauses 40 and 41 are only intended to be used in
circumstances where the matter is not within the Office of Rail
Regulation's normal jurisdiction, or a solution cannot be reached
by normal agreement.
10382. It follows, therefore, that the Promoter
does not intend that clauses 40 and 41 will apply to railway operators
on the Network Rail network, as clause 40 should not supplant
or override the allocation of access rights under the Railways
Act 1993, the taking of possessions under the Network Code as
overseen by the ORR, nor, indeed, the Department's stated intention
to work within normal industry processes as far as possible in
connection with the Crossrail project. If clause 40 is not applied
in circumstances where the matter may be referred to the ORR for
determination in accordance with its statutory duties or functions,
then clause 41 does not apply in these circumstances either.
10383. Indeed, it is unclear how these clauses
could be used to supplant or override the ORR's decisions under
the Railways Act 1993 with regard to access rights, as the provisions
that would have allowed intervention in the allocation of access
rights are intended to be removed in accordance with the Minister's
recent statements (made on 11 and 18 April) and clauses 40 and
41 do not directly empower the Secretary of State in making a
direction to modify any access arrangements directed by the ORR
under the Railways Act 1993. It would therefore be an abuse of
power, and thus judicially reviewable, for the Secretary of State
to use clause 41(3) to seek to modify any decisions made by the
ORR under the access regime of the Railways Act 1993.
10384. Whilst, therefore, clause 41(3) is not
to be used to direct the ORR in discharging its statutory duties
or functions, there are other circumstances where clauses 40 and
41 might apply. For example, the Crossrail works at Farringdon
station will involve a complex interface with other works, such
as Thameslink, and non-regulated asset controllers, such as London
Underground. It is therefore recognised that this complexity requires
managing in order to ensure the successful delivery of the Crossrail
project at this location, particularly as it may be necessary
for the Secretary of State to ensure that the terms of a London
Underground or PPP contract (which is not regulated by the Railways
Act 1993 or within the ORR's jurisdiction) do not unreasonably
prevent something that is critical to the delivery of the Crossrail
project that has been defined as part of the Bill process.
10385. Nevertheless, clauses 40 and 41 remain
fallback provisions in these circumstances, as it is also recognised
that, in this example, London Underground, as a key delivery partner
to the project, will have a direct interest in integrating Crossrail
works successfully with its own existing assets.
10386. The Promoter is considering whether it
is appropriate to, during later stages of the Bill process, make
it explicit that clauses 40 or 41 should not be invoked by either
party where the matter may be referred to the ORR for determination
in accordance with its statutory duties or functions—in
effect, where a solution can be reached under the aegis of the
normal regulatory processes.
10387. Notwithstanding that, the Promoter is
clear that it does not intend that clauses 40 and 41 will apply
to railway operators on the Network Rail network. The provisions
would instead remain in reserve to deal with such complex circumstances
as outlined above, although the Promoter will specifically review
clause 41(3) following comments that the Select Committee has
made.
10388. I end with a specific response to Lord
Berkeley's submissions because the EWS submissions I have dealt
with in their entirety, and I simply respond to Lord Berkeley's
conclusions on his two slides. The commitment to specific infrastructure
I have dealt with. With regard to Conclusion 2, which we can see
on the screen, "to confirm we will accept all industry processes
as set out in the ORR decision on Option Agreement", our
point is the ORR's decision does not require specific infrastructure
but we are bound to accept the ORR; that is our means of obtaining
access to the national network. It seems to me to be an exercise
which is really without any point. [32]
10389. Given the Minister's statement of the
intention to remove the powers in the rail clauses, this is superfluous
and it really is the same point as my rejection of an undertaking
to carry through the provisions given the ministerial commitment.
10390. With regard to the second bullet, there
are industry processes to regulate possessions, as we have debated
at some length during the course of the last three days, and we
do not propose to go any further than say we have committed to
carrying out industry processes in the way we have expressed our
intentions.
10391. So far as the third bullet, Gospel Oak
to Barking is one of those projects which is already funded and,
indeed, I think you were told the other day it is already under
way, so that is one of those matters that lies outside the purview
of the Crossrail Bill in any event.
10392. On the fourth bullet point, it is not
appropriate to ask the Minister not to undertake to introduce
further amendments. The proper processes of the House will be
followed, and I certainly do not have any submissions to make
as to any further proposed amendments that are currently intended.
Your Lordships have the proposed amendments that are proposed
to be introduced at the Public Bill stage, and the Minister's
statement of intention.
10393. On the fifth bullet I have dealt with
clauses 40 and 41, and the sixth bullet is again the same point,
the Peterborough-Nuneaton works are matters which lie outside
the Crossrail Bill and they are matters being dealt with under
TIF in any event, and therefore the undertaking, as with the other,
is not justified.
10394. I am conscious that I owe Lord James
the note which we will get to your Lordships by the end of the
week, and Lady Fookes' note on safety and security is in hand.
10395. I will have typed up my handwritten notes
on costs with the corrected arithmetic which we will formally
tender as an exhibit. I will also have a note to answer your Lordship's
question before lunch to give you chapter and verse about the
infrastructure manager. I think the simplest way of dealing with
that is to submit a note which I ought to copy to Network Rail
because it is dealing with a matter that Network Rail raised yesterday.
10396. CHAIRMAN: Yes. I think we would
like that sooner rather than later.
10397. MR ELVIN: I appreciate that. I
would deal with it on the hoof but the complexities of railway
industry legislation are such that, rather than make a mistake
and have to correct it, I want to get it absolutely right and
make sure we have a note that I can hand in with a degree of assurance.
10398. CHAIRMAN: Are you going to have
to take instructions from Transport for London as well?
10399. MR ELVIN: No. My Lord, I think
I said enough about that yesterday. Your Lordship is trying to
tease me—well, your Lordship is succeeding, actually!
32 Committee Ref: A52, Conclusion 2 (SCN-20080501-024) Back
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