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Transport: Investment

Volume 721: debated on Tuesday 26 October 2010


My Lords, with the leave of the House, I would like to repeat the Statement made by my right honourable friend the Secretary of State in another place.

“With permission, Mr Speaker, I would like to make a Statement on the Government’s investment plans for our transport networks. During the course of my remarks, honourable Members may find it helpful to refer to the documents that I have placed in the Library of the House and the Vote Office this afternoon.

As my right honourable friend the Chancellor explained last week, the decisions that we have taken to cut waste, end lower-priority programmes and reform the welfare system allow us to invest in Britain’s long-term economic growth and to prioritise transport infrastructure to support economic growth. We have already announced a green light for Crossrail and Tube upgrades, as well as plans for investment in low-carbon vehicles and recharging infrastructure and to take forward work on a high-speed rail network. Work is continuing on evaluation of additional investment in major rail projects and I expect to be in a position to make an announcement to the House in the next few weeks.

Today I can confirm a programme of investment in our crucial strategic road network, managed by the Highways Agency, and in our local transport networks. We will continue to invest in capital maintenance, spending over £5.9 billion over the next four years on unglamorous but important works to maintain the integrity of the network, both strategic and local. We have also allocated over £180 million over the four-year period for high-value minor enhancements to the strategic road network.

We are taking action to reduce the cost of proposed Highways Agency schemes by respecifying, renegotiating with suppliers and improving governance and control. Thanks to these decisions, I can confirm that funds will be available for sustainable upgrades to the strategic network to tackle congestion hot spots, delivering networkwide benefits that provide very high returns on investment.

I can confirm today that the eight Highways Agency major schemes currently under way will be funded to completion and opened to the public in the next two years and I can announce funding for 14 new projects to commence on site by April 2015, including the schemes announced by my right honourable friend the Chancellor last week. These are: the A11 Fiveways dualling; the M4 and M5 junction north of Bristol; the M6 between junctions 5 and 8 in Birmingham; the M62 between junctions 25 and 30 near Leeds; three schemes on the M1 between Derbyshire and Wakefield, from junctions 28 to 31, 32 to 35a and 39 to 42; four schemes near Manchester, from junctions 8 to 12 and from 12 to 15 on the M60, junctions 18 to 20 on the M62, and from Knutsford to Bowden on the A556; improvement of the A23 between Handcross and Warninglid; and the completion of the upgrading of the M25, with a managed motorway scheme for peak-time hard-shoulder running between junctions 23 and 27 and junctions 5 and 7. These essential investments will cut congestion, improve journey times and, most importantly, support economic growth. Every pound that we spend on these schemes will generate, on average, £6 of benefits.

I can also confirm that work will continue on developing a further set of Highways Agency schemes, ready to start in the next spending review period if funds become available. A detailed list is included in the documents to which I referred earlier. There is one last group of four current Highways Agency schemes that will be reviewed to see if they still represent value for money and can be progressed for the next spending review period.

As important as strategic roads are to the national economy, many of the highest value-for-money proposals are those that address the needs of the local road and public transport infrastructure that supports the economies of our cities, towns and rural areas. That is why last week we announced our commitment to completing major local projects worth over £600 million, including measures to improve access to Weymouth in time for the Olympics and acceleration of the work on the Tees Valley bus network, as well as confirming our intention to invest up to £350 million to complete the upgrade of the Tyne and Wear Metro. We also announced our intention to proceed with PFI schemes to extend the Nottingham tram network and deliver sustained improvements in highways maintenance in Sheffield, Hounslow and the Isle of Wight. My department will work urgently with the four local authorities concerned to ensure that we can deliver these schemes within the funding available.

My right honourable friend the Chancellor also announced last week that we will invest more than £900 million over the next four years on new local authority major schemes. They will include: a new bridge over the Mersey at Runcorn, partly funded by tolls; improving access to Leeds station; and extending the Midland Metro tram line from Snow Hill to New Street through Birmingham city centre.

I can confirm today that a further seven major local authority projects have also been given the green light, subject to planning and other approvals. They are: a new bus interchange and associated transport improvements in Mansfield; a new bypass that will take traffic away from communities in Sefton; an integrated package of sustainable transport improvements in Ipswich; major improvements to the M5 at junction 29, east of Exeter, providing access to new housing and employment areas; a bypass to the north of Lancaster, improving connections between the port of Heysham and the M6; improvements on the A57 east of junction 31 on the M1 near Todwick; and a new northern distributor road in Taunton to provide additional cross-town capacity and access to areas of brownfield land. These schemes, worth about £300 million in total, have been selected from a pool of projects with proven business cases. They are listed as ‘supported’ schemes and are shaded in green in the list that I referred to earlier.

But our duty is to ensure that every pound spent is essential. Even with these priority schemes, I expect local authority promoters to work with my department to ensure that every opportunity for cost saving has been taken and every source of alternative contributions fully explored before funding is confirmed in January next year.

While the House will welcome these decisions, Members on all sides will want to know how we are proposing to handle the remaining schemes. The £600 million-plus remaining for additional new projects after the announcements already made demonstrates the importance that we attach to local authority major schemes, but it will not be enough to fund all the schemes proposed by local authorities. I have therefore placed in the Library a list of all currently submitted schemes, including three schemes which previously had conditional approval and which we will now seek to progress to full approval, showing how we propose to categorise them.

For 22 schemes where my department has completed a value-for-money assessment in the past four years, we will invite best and final funding bids from this ‘development pool’—the schemes shaded in amber in the list. Promoters will be challenged by my department to consider the scope of a scheme, its cost, lower-cost alternatives and their ability to contribute more locally. Those who can make the best case are the most likely to receive funding, which will be confirmed by the end of 2011.

Further analysis will be carried out on another 34 schemes for which the department does not currently have an up-to-date assessment to determine whether they can go forward to join the development pool and bid for a share of the £600 million-plus funds available. These schemes are shaded blue on the list; a decision will be made by January 2011. This competitive process will ensure that the greatest possible number of schemes, offering the best value for money, is able to proceed, facilitating economic growth and providing jobs across the country.

Under regional funding allocations, regional and local bodies were encouraged to identify a large number of schemes for longer-term prioritisation, many of which were in very early stages of development with no business cases submitted to the Department for Transport. In the longer term, I want decisions on local transport priorities such as these to be taken out of Whitehall and placed in the hands of local people. My department will work with the emerging local enterprise partnerships and local authorities to identify the best approach to local decision-making on future transport priorities.

I have set out today the decisions that we have made and what they mean for our strategic and local transport networks. The measures that I have described will help to deliver long-term, sustainable and affordable economic growth in this country. The difficult choices that this Government have made have allowed us to invest in the future and I commend this Statement to the House”.

My Lords, that concludes the Statement.

My Lords, I thank the noble Earl for repeating the Statement that was made in the other place earlier today and congratulate him on making the best fist of a pretty poor job. We all looked on the Secretary of State for Transport in his shadow role as some kind of Grecian figure with a huge club to wield on the public sector. Now that he has been translated to Secretary of State for Transport, we see that he is seeking to cover himself with some small fig-leaf of decency by investment in transport. But it will not do. He has not changed his visage or his perspective. This is not a Statement about significant investment in transport. It is a cover for limited investment in transport—a reduction of proposals under the previous Administration and no guarantee except in the most minimalist form of what will be delivered over the next four to five years.

If one looks at the major road schemes, apart from those that were put in place under the previous Administration, none of the new ones will begin until some time before 2015, if conditions allow. Certainly, they will not begin before 2015. There is no suggestion at all that they will be an investment of completion to the advancement of the nation, so delay is built into it. There is already an excuse for the delay because the whole document is presaged on the assumption that, if we can make the efficiency savings, if we can cut the waste at the rate at which we intend, and if we can get all the measures through in the way in which the Government intend, there may be some dimension for investment.

The Government will not get all they expect in terms of efficiency gains. They will not achieve all they expect in reducing waste. They will be disappointed in some areas and they will find difficulty in certain areas in getting their proposals through. After all, one element of the coalition might summon up some reserves of energy and resource at some stage to put a delaying tactic on certain aspects of these cuts. Therefore, we should look on these nugatory promises of investment for what they are: promises that are in the main contingent except where the scheme is already in place.

What we do know is where the cuts will fall. The Statement is about highway and local transport schemes but the noble Earl was very early on to the issue of rail and took pride in the fact that the Government are sustaining Crossrail. How could the Government do anything else with such a significant project? Crossrail, a rail issue, was introduced into this Statement about roads because it is an indication that the Government supposedly have their heart in the right place. Is their heart in the right place? The Government are prepared to contemplate increases in rail fares over the five-year period up to 2015—rises in certain rail fares of 25 per cent. Does anyone think that this will have anything but a detrimental effect on railway demand? Does anyone think that commuters and others will look at the choice between rail fares that are escalating and road costs and, having found the equation more to the advantage of road, move from rail to road to the detriment of our environment, to the detriment of our economy and to the detriment of the very objectives that the Government purport to secure through their overall railway policy?

What the Government are about is pricing certain people off rail. The Secretary of State for Transport indicated in a recent newspaper article that he expected some fares to go up by some 10 per cent, which merely indicates his economic innumeracy. It is quite clear that what is being contemplated is an increase vastly above that. For season ticket holders, we will see increases in fares of such significance as either to hold rail passengers to ransom or cause them to go on to our already crowded road system.

What is the case for rail is also the case for buses. There is a straightforward, unembellished clear cut in the subsidy to bus operators. What does that mean? It means higher fares or reduced services, or more likely both. We will see our rural areas become more and more dependent on the car because of this onslaught on the buses, and we will see the pressure reflected in the needs of those who have no access to a car but face increased bus fares.

What is also absent from this Statement is any comment about the cuts of more than 25 per cent in the resources of local authorities. What does that mean for crucial aspects of local authority operations? Certainly with regard to road maintenance it means a very great deal indeed, but it also means something to another dimension, on which the noble Earl was singularly silent in his Statement. I hope he gives some response to these questions. What does a cut to local authorities’ resources mean for road safety programmes? What does it mean to the ability to introduce and maintain road safety measures and monitor road safety? We will be watching this very closely indeed. We have real anxieties about the extent to which this Government seem to set at a very low priority the very significant improvement in road safety provision on our roads over the past decade or so. The British position is better than the rest of the industrialised world; it is the best in Europe. It is also a reflection of the significant amount of resources made available to local authorities, which have responsibility for road safety. The local authorities are to sustain a very significant cut. I say to noble Lords and particularly to the Minister that, if during the time when this Government are in office we see a reversal of the trend towards improved figures with regard to road safety, we will hold them to account, because they have set this issue as a low priority—so low that in this Statement about investment in highway and local transport schemes there is not one mention of road safety.

My Lords, I am grateful to the noble Lord for his reply to the Statement. It was a virtuoso performance, as I have come to expect from the noble Lord. He has very skilfully—and I am grateful to him—avoided the trap of asking detailed questions about the Statement, because it is accompanied by plenty of literature for noble Lords to read tonight.

The noble Lord suggested that my right honourable friend had done a pretty poor job. I think that he has done a really rather good job and that he has the ideal skill set for his current position. The Government’s top priority is deficit reduction. I wonder how much the party opposite would have had to cut the transport budget if it had won the general election.

The noble Lord talked about the difficulty of cutting waste and getting further efficiencies from organisations such as the Highways Agency. He is right; his party has plenty of experience. Why did we mention rail? My right honourable friend’s heart is in the right place. We believe in the future of rail and we are committed to Crossrail, High Speed 2 and other projects. I certainly look forward to debating how we are going to improve our country’s rail system.

The noble Lord talked about adjustments to local authorities’ road safety budgets. It is of course up to local authorities to determine their priorities and how they continue to drive down casualties. We will be monitoring the situation very carefully. During my time in your Lordships’ House, I have always paid the greatest attention to road safety, and that will not change.

The noble Lord mentioned the BSOG. I look forward to the Question for Short Debate that we will be taking shortly.

My Lords, I am not going to indulge in a lot of criticism, but I will ask a few technical questions, which I hope the Minister will address.

First, much of the paper is made up of words like “appraisal” and “value for money”, yet the system that the Government have adopted—the new approach to transport appraisal—is hopeless. I say this as an economist. The new approach puts value on a lot of valueless things, such as small time savings of a minute, half a minute or less, and it needs bringing up to date. Also, other road users such as bus users or cyclists need to be treated as valuable people. The new approach tends to assume that only car drivers are valuable people and therefore ascribes a lower value of time to those other users.

Secondly, will the Minister tell us something about hard-shoulder running, which is mentioned in the Statement? We do not yet know whether hard-shoulder running has proved to be thoroughly satisfactory from the point of view of both road safety and access by the emergency services to accidents.

Thirdly, I want to mention the PFI scheme, which is referred to in the Statement. Did the Minister see in the Sunday papers that the M6 toll road, which was built by PFI, is in considerable trouble because people will not pay to use a toll road when there is a free road beside it? The only solution, to my mind, is to introduce a system of road charging on our trunk motorways. Otherwise, there will not be many PFI investors.

Fourthly, road maintenance is in a disgraceful condition, and the Government should direct more attention to keeping the road network that we have in good and serviceable order rather than necessarily trying to expand it, because the road network does not work.

Fifthly, there are now lots of utility companies in this country, and all of them have near freedom to dig up the roads when they want and cause massive delays and damage to the road surface. There is supposed to be a system of traffic management, under which the utilities are supposed to apply to the local authority for permission to dig holes. Whenever they want to dig such holes, however, they put up a big sign saying “Emergency”, “Danger” or whatever. That does not mean that they do the job any more quickly, but it allows them to override the provisions in the Transport Act 2005 to regulate the use of the highway.

My Lords, it fills me with dread when the noble Lord says that he will ask me a few technical questions.

The noble Lord referred to some of the terms of our assessment and things like that. We need to ensure that the schemes with the best value for money, the best benefit to society and the best economic growth are the ones that go forward. The noble Lord has expressed concern many times, in both this Parliament and the previous one, about NATA. We are reviewing that process.

The noble Lord talked about hard-shoulder running. He will be aware of, I think, the M42 where the Highways Agency has trialled hard-shoulder running, which has been shown to work. I understand that the statistics have shown a safety improvement. Because it has been shown to work, there will be more hard-shoulder running schemes.

The noble Lord mentioned the M6 toll road, which is perhaps not getting all the toll income that it should. I remind the noble Lord that the M6 toll road is not PFI-funded but is a private road.

The noble Lord mentioned the condition of local roads, which is a matter of great concern. I think that the ICE’s State of the Nation: Infrastructure 2010 report states that the Highways Agency’s strategic roads are in quite good shape but local roads have serious problems.

Finally, the noble Lord also talked about the utilities. All noble Lords will be aware of the problem of utilities digging up the roads, sometimes in ways that are completely inconvenient. We are aware of that, but I will draw the noble Lord’s question to the attention of my ministerial colleagues.

My Lords, since the election the Government have made great play of being a green and low-carbon Government, particularly committed to low-carbon transport. When one reads the Statement, it is extraordinary that it emphasises so many rail projects—most of which are irrelevant because they come under the major scheme—and very few road schemes, especially in the detailed list of 600 schemes, whatever those are. I am surprised. Perhaps the Minister could explain why the Statement mentions no local rail schemes or local tram schemes—except, I think, for one.

There is mention of a few bus schemes. Presumably, those will follow on from the enormous success of the Cambridge guided busway, which I think is two years late and has doubled in cost. Why anybody wants to replicate that around the country, heaven only knows.

There is nothing at all about cycling—no cycle schemes. I understand that the Government have cancelled the cycle training programme organised by Cycling England. Where is the implementation of the Government’s green agenda in this Statement? It seems to be business as usual, going back to the previous Conservative Government.

My Lords, I am delighted to respond to the noble Lord’s points about low-carbon and sustainable transport. Rail schemes will be covered later, as we are not talking about CP5 issues.

The noble Lord referred to problems with the Cambridge scheme. I have just signed off a reply to a Written Question on that, so he will get an Answer shortly. I accept that there are a few problems there.

The noble Lord talked about cycling and the situation with Cycling England. He needs to remember that, as I said the other day, the bikeability scheme will continue.

My Lords, I thank the Minister for the A11 Fiveways to Thetford improvement scheme, which will mean that Norwich—I do not know if any of you know where Norwich is—will be joined to the motorway network by dual carriageway to the south for the first time ever.

It is quite extraordinary that the A47 Blofield to North Burlingham scheme is being abandoned, according to page 1. In case the Minister does not know this, a new port has just been built at Yarmouth, so all the roll-on roll-offs will come along on the single carriageway, which will not be nice for them.

I cannot find anything in this document to do with improving the A47 or the A17, which connect Norfolk to the north, the west and the Midlands. In the yellow pages at the back, we find reference to the Norwich northern distributor road and the phrase “if it is worth it”. I can tell noble Lords, as ex-chairman of Norfolk County Council’s highways committee, that it is not worth it. It is not worth it because it was not built 25 years ago. It will be twice as long, twice as useless and will annoy twice as many people. Dear, oh dear—but at least the Government will get Norwich on the motorway.

My Lords, I am glad that the noble Lord is pleased about the A11 Fiveways project as it connects Norwich by dual carriageway. In researching the Statement, I found place names that I had never heard of. It is a little too challenging for me to comment on specific schemes, but parliamentary tools are available to the noble Lord, should he wish to use them.

My Lords, what is the definition of a congestion hotspot, as it is difficult to envisage a hotter congestion hotspot than that which exists along the south coast, particularly in the Worthing area? The scheme for a Worthing bypass got past the public inquiry stage something like a decade and a half ago, yet there has still been absolutely no action, particularly by the previous Government. In terms of economic efficiency, for a long while it has been quicker and much easier to drive from the south coast up to the M25, round the M25 and then down the M20 or M3 if one wants to get commercial traffic through the Channel Tunnel or to the Dover ports. Will my noble friend look into this whole issue as, in economic terms, it fully deserves to be included in the programme? No doubt the schemes that have been announced are very welcome, but I should have thought that this scheme ought to be given higher priority than those on the list.

My Lords, the noble Lord presents me with a difficult problem in responding to a specific scheme about which I know little. However, I will write to him.

My Lords, the noble Earl has referred on this and other occasions to local authorities’ ability to respond to these issues, when the Government are failing adequately to fund local government to enable it to do so. He told the House that speed cameras could be funded by local authorities and that this would save money. In actual fact, it has cost the Exchequer money because the income from speed camera fines was more than the cost of the cameras. The Government have pretended that they are protecting pupils in our schools but admitted at the weekend that there is a cut in real terms in the funding per pupil. I have no doubt that the Government will say that local authorities can make up all those shortfalls, including the shortfall in road maintenance for local roads. The Government are hiding behind the shift of responsibility from themselves to local government in order to avoid the flak for policies that will gain public opprobrium.

My Lords, as I said, our number one priority is to deal with the deficit. I understand the point that the noble Baroness makes—it is a good point—but local authorities will have to deal with this matter as best they can. They will have to make tough choices, just as my right honourable friend the Secretary of State has had to make tough choices because of the situation that we have inherited.

My Lords, I wish to refer to the schemes in the development pool, particularly to the Leeds new generation transport trolleybus experiment, which I am pleased to see is within that pool. I declare an interest as the president and trustee of the British Trolleybus Society.

I point out to the noble Earl that trolleybuses are successfully operating in many countries throughout the world and are a very good, cheap, low-carbon, non-polluting, silent and safe vehicle to operate in the urban environment. Therefore, I hope that this scheme will be left in and that we can have an experiment in Leeds, which I sincerely hope will lead to a further extension of the trolleybus system—a system which unfortunately was destroyed throughout the country, probably by the actions of the oil lobby.

My Lords, I thank the noble Lord for his contribution. By definition, a trolleybus is electrically driven and therefore has zero emissions at the point of use, which makes it a very attractive project. I look forward to researching this project, just out of interest on my part.

My Lords, would the Minister agree that it is difficult to accept that dealing with the deficit is the number one priority when an announcement is made locally that the £50 million made annually by the congestion charge in west London is likely to be abandoned in December, with all the attendant loss for the capital that will go with it? That sits neither very squarely with dealing with the deficit nor indeed with fairness, when one sees the nature of the people who will be the beneficiaries from the abandonment of the west London congestion area.

I should like to ask something more positive. Nowhere in the document is there anything that gives us great hope of seeing a strategic approach to many of the problems that we face. In particular, I pick up the point made by the noble Lord, Lord Bradshaw, about the massive cut coming in the maintenance of roads. Some £200 million is to be taken out every year over the next four years, after a particularly difficult winter. If we have another hard winter, at the rate we are going we will be like a third-rate country. Will the Minister please explain the criterion used to determine how the £200 million should be saved in each of the next four years? Is that to be done by local authorities or has some criterion been set for establishing that?

Secondly, which schemes have been totally abandoned? It is very difficult when reading the documentation to identify whether any have gone. My reading of it is that some have gone all the way. Will he please place a list in the Library?

Thirdly, are the Government giving any thought to alternative means of raising funds to reinvest in the road transport system? For example, a number of parts of the country were exploring the possibility of introducing congestion charging—not solely to raise funds but to reduce congestion—and such schemes would have been helpful in providing funding for reinvestment in other parts of road transport. Has that been totally abandoned by this Government? Does the noble Earl have any views on how they might explore alternative ways in which money may be raised?

My Lords, the congestion charge is not my responsibility but the responsibility of the Mayor of London.

On the difficulty of local maintenance, I shall write to the noble Lord. On the Highways Agency, it can do a number of things to better manage the strategic road network. It can build on the investment of the previous Government in better systems, to make sure that maintenance takes place at the right point—not too early and not too late.

As for the noble Lord’s question about local authority congestion charging, I should say that we have no intention of introducing a national scheme.

The road schemes to be cancelled because there is no foreseeable future for them are: the A1 Leeming to Barton scheme; the A19 Seaton Burn interchange; the A19 Moor Farm scheme; the A21 Kippings Cross scheme; the A21 Flimwell to Robertsbridge scheme; the A21 Baldslow scheme and the A47 Blofield to North Burlingham scheme.

My Lords, before the general election, visiting Conservative spokesmen who came to the north-east spoke warmly about the prospect of dualling the A1 north of Newcastle. Will he confirm that not only is there now no prospect of that happening for the foreseeable future but even smaller improvements to that road are not likely to take place as far ahead as one can see? Will he also bear in mind, when he talks about local authorities undertaking capital works, that the capital programme of local authorities is to be cut by 45 per cent?

My Lords, there is a slight glimmer of hope for the A1 north of Newcastle. We are considering whether it should be part of the strategic road network. However, this does not mean that it will be dualled any time soon.