Clause 2 — Financial reports

Business of the House – in the House of Commons at 4:00 pm on 31st October 2013.

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Amendments made: 25, page 2, line 12, at end insert—

‘( ) the extent to which expenditure incurred under section 1 during that year represents an overspend or underspend as against the budget for such expenditure for the year;

( ) the likely effect of any such overspend or underspend on a total budget of £50.1 billion in 2011 prices (which includes construction and the price of rolling stock).’.

Amendment 26, page 2, line 15, at end insert—

‘( ) Each report must also contain an account of the vocational qualifications gained during the financial year by individuals employed by persons appointed under an enactment to carry out activities in connection with preparing for, and constructing, the network referred to in subsection (2).’.—(Stephen Hammond.)

Photo of Eleanor Laing Eleanor Laing Deputy Speaker (First Deputy Chairman of Ways and Means), First Deputy Chairman of Ways and Means

The hon. Gentleman indicates that he wishes to move an amendment that has not been spoken to, and I cannot take his amendment.

Third Reading

Photo of Patrick McLoughlin Patrick McLoughlin The Secretary of State for Transport 4:02 pm, 31st October 2013

I beg to move, That the Bill be now read the Third time.

Let me begin by thanking all Members who served on the Public Bill Committee. In particular I thank my right hon. Friend Mr Burns, not only for his work on the Bill, but also for the hard work that he put into the Department for Transport during his time there. It was a great pleasure to work with him.

For a project as important as this, everyone should have their say—indeed, it sometimes feels as if they do. At the same time, however, we need to move the debate forward, which is what the Bill does. This is the point at which the debate starts moving from “if “ to “when”. The House has already voted overwhelmingly in favour of the principle of a new high-speed, high-capacity rail network. I hope it will do so again this evening because the decisions we take today will benefit our country for decades to come.

Just this week, with the storms that hit the south and east, we have seen how crucial our railways are to national life. When trains are crowded and disrupted, life for hard-working people gets more difficult. That is why the new north-south line is not some expensive luxury.

Photo of Patrick McLoughlin Patrick McLoughlin The Secretary of State for Transport

I will, but I do so reluctantly because of the number of hon. Members who want to take part in Third Reading.

Photo of Bill Cash Bill Cash Chair, European Scrutiny Committee

I understand why the Secretary of State is reluctant to give way. Throughout the whole of this land, people are deeply disturbed by the manner in which the Bill is being rammed through. Furthermore, as he well knows, the arrangements he has described as benefits are not accepted by my constituents and many other people, nor by the many reports emanating from the Public Accounts Committee and others that demonstrate that HS2 is not a straightforward benefit, and is in fact quite the opposite.

Photo of Patrick McLoughlin Patrick McLoughlin The Secretary of State for Transport

I know my hon. Friend is not in favour of the new line—he loses no time in telling me that. I dare say that similar comments were made in debates on railways in the House over the centuries. The truth is that the line will be the first line built north of London in 120 years. I understand the concerns of hon. Members whose constituencies the line goes through. I do not dismiss them and have never done so. I want to ensure that we have a fair compensation scheme in place. I believe that the scheme is, without any doubt, right for the future of the UK.

I find it rather ridiculous that I can go from London to Paris on a high-speed train, and that my hon. Friend can go from London to Brussels on a high-speed train—I know he keeps a close eye on what goes on there—but we cannot go from London to Birmingham, Manchester or Leeds on a high-speed train. The time has come for a steep uplift in our transport system.

I should tell my hon. Friend that there is still a long way to go. We must take the hybrid Bill through the Commons. There will be plenty of opportunities to debate it in detail. As Mr Straw said, HS2 will be debated in far more detail than roads that now go through various constituencies when they probably caused greater environmental damage.

Photo of Patrick McLoughlin Patrick McLoughlin The Secretary of State for Transport

I do not want to take too long because I know many hon. Members want to speak. I will give way—for the last time—to my hon. Friend.

Photo of Andrew Bridgen Andrew Bridgen Conservative, North West Leicestershire

I thank my right hon. Friend for giving way. It is true that this is a high-speed debate. Does he agree that an hour is completely insufficient parliamentary time for a Third Reading debate on the largest infrastructure project the country has ever seen?

Photo of Patrick McLoughlin Patrick McLoughlin The Secretary of State for Transport

My hon. Friend has taken part in the Third Reading of many Bills—they have always been hour-long debates. In fact, it is only recently that we have had debates on Third Reading. Back in the days when the right hon. Member for Blackburn was Leader of the House, we sometimes did not have debates on Third Reading because we simply did not have the time. The Government are trying to help everybody we can—[Interruption.] I do not want to get any more partisan now that I have the right hon. Gentleman on side.

The Bill is about helping communities and businesses, and helping the cities of the north and the midlands to compete on equal terms with London. Nobody begrudges the money we are spending on Crossrail or Thameslink. They are huge investments in our capital city, but it is time we looked at what is happening in the rest of the country.

Three important words—room for growth—sum up why the project is so important. They are at the core of the strategic case we published on Tuesday. The responses to the report show the crucial message of growth. The British Chambers of Commerce states:

“This report bolsters the economic case for HS2…HS2 is the only scheme that can transform capacity on Britain’s overstretched railways.”

The CBI has thrown its considerable weight behind the project. It did so because the new line is part of the answer to the infrastructure deficit that faces our country. The leaders of our great cities back HS2. Sir Richard Leese, leader of Manchester city council, has said:

“It’s straightforward and simple. We need more capacity and the only way is through this new network.”

Since 2008, the country has learned some tough lessons, but we must make ourselves more resilient and competitive as an economy. That will not happen if we do not take the long-term decisions on investment and stick to them. Our society is changing, our population is growing, people are travelling more, and demand for inter-city rail travel has doubled in the past 15 years and will continue to increase.

As I have said all along, I welcome suggestions for creating more capacity, but the so-called alternative suggestions from the critics simply do not add up. We have looked at the case for building new motorways and dramatically expanding domestic aviation. Neither does the job. Some people believe we can carry on squeezing more room out of our current railways, patching up our problems. The work we published this week shows that, if we tried to create the capacity we needed by upgrading the three current main north-south lines, we would face 14 years of weekend closures. That is not an alternative to the new line, it is disruption on a nightmare scale.

We are already investing record sums in the existing railway. Network Rail will spend £38.3 billion in its next five-year control period, and the Government have a £73 billion budget for wider transport investment over the next Parliament. Despite all that, we will still need new rail capacity. If one accepts that—and that we need room to grow—there is no choice about how to provide it. As the strategic case makes clear, a new high-speed north-south line is not just the right way, it is the only way.

The new north-south line will be the backbone of Britain. It will have 18 trains an hour, each carrying up to 1,100 passengers, transforming the available space on inter-city lines. As long-distance services transfer to the new line, capacity will be released on the existing network. Of course, not every city across Britain will benefit in the same way, but Network Rail estimates that more than 100 cities and towns could benefit from released capacity. It would mean significantly more commuter services, better connectivity and more routes for rail freight, taking lorries off our most congested roads.

We know that HS2 is the best answer to our transport problems, but as with any large infrastructure scheme, we also know we will face opposition. I respect the fact that some people are concerned about the impact on the places they live, and I respect those with serious proposals for improvements. Already, the environmental impact of the new line has been vastly reduced thanks to such improvements. But I also respect what Sir John Armitt said in his recent report on infrastructure—that big schemes need “broad political consensus” as well as “resolution” from political leaders.

HS2 must be a national project with support across the parties, or in the end it will be nothing. Labour leaders in our great cities across the north and the midlands know that HS2 is right. To those who say that there is no blank cheque, I say that there never has been and there never will be. I know that hon. Members want costs controlled. Here are the facts. The target price for the first phase is £17.16 billion. That is the price for construction agreed with HS2 Ltd. For the whole Y-route, the agreed budget is £42.6 billion, including a contingency of £14.4 billion, which we are determined to bear down on. Sir David Higgins—the man who built the Olympics on time and on budget—will make sure that happens. As the new chairman of HS2, he will bring his penetrating eye and expertise to the task to get the best value for our country.

As the strategic case published this week shows, our updated benefit-cost ratio has fallen slightly from 2.5 to 2.3. We have been open about that, but it means that the business case for the new north-south line is still strong, with more than £2 returned for every £1 invested—about the same as Crossrail and Thameslink, and nobody seems to doubt those projects. In fact, the ratio for HS2 could increase to 4.5 if rail demand continues to rise until 2049.

It is still important to recognise that the benefit-cost ratio cannot take account of unpredictable factors. That was true of the Jubilee line extension in London, for instance, which did not include the 100,000 jobs it now supports at Canary Wharf. It was true for

High Speed 1, which did not include benefits from redevelopment at King’s Cross and St Pancras. When I first became a Member of Parliament, King’s Cross and St Pancras were places where people did not want to spend any time if they could possibly get away with it. They would try to turn up just before their train was due to leave. Those stations are now destinations in their own right. People go there and look with amazement at what has happened to the UK’s railway system.

Photo of Frank Dobson Frank Dobson Labour, Holborn and St Pancras

I represent not just St Pancras, but Euston and King’s Cross. Does the Secretary of State accept that virtually all the people in my constituency who are now opposed to HS2 were strongly in favour—indeed, the first advocates—of the transformation of St Pancras and the improvements at King’s Cross?

Photo of Patrick McLoughlin Patrick McLoughlin The Secretary of State for Transport

Of course I do. I am more than happy to meet the right hon. Gentleman to discuss the particular issue of Euston station, because the redevelopment will bring specific problems. But we must also ensure that we get the very best deal for his constituents in the redevelopment of Euston station. I am meeting the leader of Camden council next week, although I do not know if the right hon. Gentleman will be there. I do not discount the concerns of local residents about the work on major infrastructure projects, and we have to take them into account.

Photo of Jonathan Edwards Jonathan Edwards Shadow PC Spokesperson (Treasury), Shadow PC Spokesperson (Business, Innovation and Skills), Shadow PC Spokesperson (Transport), Shadow PC Spokesperson (Communities and Local Government), Shadow PC Spokesperson (Culture, Media and Sport), Shadow PC Spokesperson (Wales)

Last week it was disclosed that the Treasury had made a mistake and awarded Barnett consequentials to Wales in the 2015-16 spending round. Subsequently, the Treasury said it would claw the money back in the next spending review and that it did not set a precedent. Will the Secretary of State confirm that there will not be a clawback, that the precedent has now been set and that Wales will have the consequentials? Unless he does so, we will vote against him on Third Reading.

Photo of Patrick McLoughlin Patrick McLoughlin The Secretary of State for Transport

It would be a brave Secretary of State who started second-guessing the Treasury, and I will not do that now. I understand the hon. Gentleman’s representations and will bear them in mind.

I will briefly explain the next steps. We intend to submit the hybrid Bill before Christmas. In February, the growth taskforce reports. I know the challenges ahead, but also the opportunities. We are not here to patch up our railway once again, only to spend far more later when it turns out that we should have invested properly at the start. It will take determination to strengthen our country. I urge this house to support the Bill. It is our chance to get ahead and to invest in our long-term prosperity.

Photo of Mary Creagh Mary Creagh Shadow Secretary of State for Transport 4:15 pm, 31st October 2013

I welcome the Under-Secretary of State for Transport, Mr Goodwill, to his new role, and I look forward to working with him. I pay tribute to my predecessor, my hon. Friend Maria Eagle, for her work in holding no fewer than four Transport Secretaries to account, and for her tireless work to develop Labour’s transport policy. I pay tribute, too, to my hon. Friend

Lilian Greenwood for piloting the Bill through Committee in a co-operative manner. Following in her footsteps, I am proud to support High Speed 2, and I am proud to support getting good value for public money, too.

We support plans for a new north-south rail line, but we are clear that the Government must get a grip on the costs. High Speed 2 was the brainchild of Lord Adonis, the Labour Government’s last Transport Secretary. We understand that the railway is not needed just to tackle the rail capacity crunch that we face in the next ten years: managed properly, HS2 has the power to transform the economic geography of our country. It will build our great cities and bring them closer together. It will connect people to each other, to work and to leisure. It will help to rebalance the economy, creating and using our country’s manufacturing skills.

Photo of Charlie Elphicke Charlie Elphicke Conservative, Dover

This is an important project requiring national consensus. It needs all parties to support HS2 if it is to go ahead—no ifs, no buts. Will the Labour party support this project properly: yes or no?

Photo of Mary Creagh Mary Creagh Shadow Secretary of State for Transport

If the hon. Gentleman had listened, he would know that I just said we will support HS2. We shall be voting in favour of it this evening.

This is the first new north-south railway for more than 100 years, but Labour's brainchild has, sadly, been neglected by the Government. Instead of gestation, we have had stagnation. The project has been put at risk by delays, project mismanagement and, in July, by a huge increase to the budget.

First, on delays, Ministers looked at strategic alternatives to High Speed 2. That took until November 2011, which wasted 18 months and led to slippage in the project timetable, with Ministers now playing catch-up. Costs in this Parliament have risen from £700 million to £900 million. The National Audit Office has warned that this tighter time scale poses risks to the project:

“Faster preparation for the bill may increase the extent of petitions to Parliament which may make it less likely that royal assent is granted by the planned date of May 2015.”

Another delay is that the consultation on phase 2 of the route has only just been launched for the Y part of the network, despite the fact that it was being worked on when we were in power three years ago. Ministers have been trundling along; it is time for more urgency.

Secondly, on project mismanagement, the Government’s early cost-benefit reports were criticised in May this year by the National Audit Office for failing to make the strategic case for the new railway. I welcome that that has now been published in full. In September, the Public Accounts Committee warned that Ministers’ plans to present the hybrid Bill to Parliament before Christmas were “ambitious” and “unrealistic”. I would be interested to hear from the Secretary of State whether that is still his plan.

Photo of Andrew Bridgen Andrew Bridgen Conservative, North West Leicestershire

Will the hon. Lady confirm, as he has stated in the media, that the shadow Chancellor will have the final say over whether Labour supports HS2?

Photo of Mary Creagh Mary Creagh Shadow Secretary of State for Transport

The shadow Chancellor has never said that in the media. In fact, he has told the media that it will be a collective decision, so I do not know where the hon. Gentleman has got that from.

Finally, this summer the contingency budget ballooned to £14.4 billion, now one third of the railway’s cost. Our concern is that putting in such a large contingency at such an early stage of the project could be a self-fulfilling prophecy, a point made by my hon. Friend Steve McCabe. We are living in austere times. Our constituents are facing the largest cost of living crisis for a generation. Prices have risen faster than wages for 39 of the 40 months of this Government, and working people are, on average, more than £1,500 a year worse off. In these circumstances, and given the public finances, it was right for my right hon. Friend the shadow Chancellor to call the Government to account for their mismanagement of the project, which has led to this ballooning of costs. That is the right thing to do, because public consent for this great project depends on people like the shadow Chancellor having the courage to stand up against sloppy, incompetent and bureaucratic government. It is we, the Opposition, who are the true friends of HS2 and this Government who have put it at risk. We will continue our scrutiny of these costs and our discipline on the public finances.

Photo of Clive Betts Clive Betts Chair, Housing, Communities and Local Government Committee

My hon. Friend rightly draws attention to the problem of delay. Certainly in Sheffield, we are particularly concerned about the delay between completing phases 1 and 2. Now that the welcome appointment of Sir David Higgins has been announced, should not one of his jobs be to consider how we can build the second phase more quickly? Perhaps we could start building in the north as we start building in the south.

Photo of Mary Creagh Mary Creagh Shadow Secretary of State for Transport

Again, that is for Sir David Higgins to work out with Ministers, but undoubtedly that could keep costs down and allow further benefits to be realised.

Photo of Roger Godsiff Roger Godsiff Labour, Birmingham, Hall Green

Is there a figure above which the Opposition Front-Bench team would not support this project, if the incompetence to which she refers is played out by the Government? Is there a figure at which the Labour party would pull out?

Photo of Mary Creagh Mary Creagh Shadow Secretary of State for Transport

I do not know whether my hon. Friend was here when this was discussed, but we tabled an amendment on Report that was agreed by the Government and which makes it clear that any contingency spend must be reported to the House annually.

We will continue to hold up the weaknesses of the management of HS2 until every one of them has been addressed. We want to see swift progress with the hybrid Bill and we shall scrutinise the latest strategic case, published this week, to satisfy ourselves that it is based on sound assumptions. The Government must drive down those contingency costs and have a clear strategy for doing so. This fiscally disciplined scrutiny is what one would expect from any credible official Opposition seeing a Government desperately mismanaging a project. We will go ahead with the project, but the Government must bring down the costs, and the benefits to the nation must be clear. We say: get a grip on the project, get control of the budget and get it back on track.

The increase in rail usage during our time in government was a record to be proud of, but we now face serious challenges. We understand that current and future capacity constraints on the existing rail network place a brake on regional and city growth. We know that demand for rail travel continues to grow, despite the tough economic times, and our support for a north-south line rests on tackling that capacity problem and supporting 21st century transport infrastructure. This week’s strategic case shows the intense pressure our major mainline stations are under, and not just in the south. In four years, there will be 200 people for every 100 train seats arriving into Birmingham New Street at 5 o’clock. Rail freight is growing at 3% a year, and HS2 would free up space for more freight trains on the east coast, west coast and midland main lines, and take those lorries off our roads.

Photo of Kelvin Hopkins Kelvin Hopkins Labour, Luton North

As I said in my speech, if we want a serious transfer of freight on to rail, we must make it possible to transport lorries on trains, but we cannot do that on the existing network because the gauge is not big enough. We need a dedicated freight network for that to happen.

Photo of Mary Creagh Mary Creagh Shadow Secretary of State for Transport

I am not sure whether my hon. Friend is proposing that we build an entirely new freight network—

Photo of Mary Creagh Mary Creagh Shadow Secretary of State for Transport

Okay, well perhaps we will park that thought for another day, because many others want to come in. My hon. Friend is absolutely right, though, that we have to shift freight from the roads and on to the more environmentally friendly railways, and we want ensure that this line can do that. We want HS2 to give people a real choice between short-haul aeroplanes and the more environmentally friendly trains. We want to see more inter-city services for cities that currently have a poor service to London. We want HS2 to free the west coast, east coast and midland main lines for new commuter services between the midlands and the north.

These are not just transport arguments. They are social and economic arguments about the sort of country we want to be: a country in which no town or city is left behind. We want to ensure that cities such as Wakefield, which currently enjoys a twice-hourly inter-city service to London, are not downgraded. I obviously have a particular interest in Wakefield’s twice-hourly service to London, which I am happy to declare.

The public consultation on compensation arrangements is important, and the Government need to ensure that they respond fully to specific local issues such as those raised by Mrs Gillan, and that proper compensation is given to residents who are affected or blighted, such as those in the constituency of my right hon. Friend Frank Dobson. We will maintain pressure on the Government to work closely with the communities affected.

We will vote today in favour of this paving Bill to allow preparatory expenditure on the scheme. We believe that how we build something is as important as what we build. This is not just a transport project; it is also a social and economic project. I am glad that the cities are already looking at how they can invest in skills so that local people can benefit from the employment opportunities that HS2 will bring. We are pleased that the Government have agreed to our amendments on vocational training audits for the scheme. That will help us to realise our Labour vision of creating 35,000 high-quality apprenticeships over the lifetime of the project, representing a step change in vocational education for this country’s young people. HS2 is not just a transport project; it is also an employment project.

We are glad that the Government have accepted our amendments on annual reports to Parliament on contingency spending to ensure that the scheme is kept on budget, and on linking the railway with active travel such as cycling and walking. Having said that, I will not make any promises about cycling the new cycle path that will run alongside the track. After cycling from London to Brighton, I think I know my limits. We will also continue to scrutinise Ministers to ensure that they work closely with UK companies to use procurement to deliver the maximum jobs, growth and skills for UK companies, small and large.

High Speed 2 is a huge project which, if managed properly, will bring great social, economic and environmental benefits to this country. The project is about how we deliver capacity for more passengers and services, and connectivity to bring cities closer together, while ensuring that the trains run on time. We will serve our great cities by having HS2 come in with a budget that is under control and with benefits that are clear for all to see. The Secretary of State that he should do his job and I will do mine, and my job is to ensure that he does his job properly.

High Speed 2 is a project that is in the national interest. It has suffered from the fiscal and project management incompetence of this Government, and I hope that this Secretary of State will get it back on track. Britain deserves better than this. It will fall to the next Labour government, a one-nation Government, to build HS2—on time, on budget and in the national interest.

Photo of Caroline Spelman Caroline Spelman Conservative, Meriden 4:27 pm, 31st October 2013

I should like to congratulate the Under-Secretary of State for Transport, my hon. Friend Mr Goodwill, on his new appointment and thank him for taking up the baton on the Bill on Report. That was not an easy task. He was preceded by an excellent Minister, my right hon. Friend Mr Burns, who did a very good job in Committee. I really enjoyed the spirit of co-operation between both sides in Committee, and the latitude that Frank Dobson and I were given to table amendments that have genuinely improved the Bill.

Anyone who will have High Speed 2 going through their constituency is having a difficult time. Those who will have an interchange station will have what I have described as the pain and the gain. The quality of the local connectivity can tip the balance between pain and gain in those areas, and I am delighted that an amendment has been accepted on a cross-party basis to improve local connectivity. That will make a big difference to the constituencies that will have those stations. It will provide for local road, rail, cycle and pedestrian connections to the new interchange stations.

The Birmingham interchange station will offer a rare opportunity to improve the already integrated international airport and its main line station, through a connection with high-speed rail. Seeing the potential for that, the airport has proposed a second runway, even though it has plenty of spare capacity on its recently extended runway. It hopes, of course, to relieve some of the pressure on London and the south-east. With the interchange station being approximately 38 minutes from Euston, it is obviously competitive in terms of journey time with some of the London airports. This had led my local authority to see the potential of this transport hub, designating it as “UK Central”. HS2 is central to that vision.

To fulfil that vision, I hope that the Department will be able to look at the design stage of the new junctions required on the M42, as it serves Birmingham airport, the present station and the National Exhibition Centre. We need help with that. It would be worth giving consideration, too, to the development of the surface area and perhaps take another look at providing a tunnel—I would very much like to see that—where HS2 crosses over the existing west coast main line.

I believe that the extra time the Government have given for this Bill has allowed important improvements and mitigations. The draft environmental statement was indeed a draft—one on which we could consult our constituents and seek to secure improvements. I am sure that my constituents and those of many other Members appreciate the value of that.

Unfortunately, we did not reach my amendments today. They would have improved the terms of the compensation for all affected constituents and enshrined in statute a property bond. I am pleased that the Government are consulting on a property bond, and we have every hope that that will be brought to fruition.

Photo of Dame Cheryl Gillan Dame Cheryl Gillan Conservative, Chesham and Amersham

I support my right hon. Friend in her search for a property bond. As she knows, my constituent Hilary Wharf, the railway economist, has done a great deal of work on the property bond issue, and believes this will be a much fairer way of compensating all those people whose lives and properties will be damaged by this project.

Photo of Caroline Spelman Caroline Spelman Conservative, Meriden

I agree with my right hon. Friend and I urge all Members whose constituencies are affected by HS2 to make sure that their constituents respond to the consultation that is under way; the Government remain open-minded about the eligibility criteria, which is important. I indicated in an intervention that there is an important need to offset the impact on biodiversity. I know that the present Secretary of State for Environment, Food and Rural Affairs is working with HS2 to make sure that no net loss of biodiversity arises from the infrastructure.

For the west midlands, HS2 is a lifeline. We should not overlook the fact that, at a time when west midlands manufacturing is undergoing a renaissance for the first time in my generation, there is no capacity for transporting manufacturing products on our railways. Anyone driving down the M40 will see transporter load after transporter load of cars going for export. We export 82% of all the cars we produce, and 50% of them go to other EU countries. They should be able to be transported by rail. The freight aspect of HS2 is thus incredibly important.

Finally, in view of the completion date, this project is principally going to benefit our children and our children’s children. I would like us to be the generation with the foresight to provide for them.

Photo of Frank Dobson Frank Dobson Labour, Holborn and St Pancras 4:33 pm, 31st October 2013

I am going to be the original parochial MP. For many people in my constituency, this issue is not a question of “not in my back yard”, but one of “not through my front room”. A total of 220 homes will be destroyed and a further 1,000 homes will be blighted for the 10 years while the works go on at Euston. A large number of small businesses will be bankrupted because of what is going on there.

When it comes to getting compensation, both the qualifications and the quantum for compensation in Greater London, and most particularly at Euston and in Camden Town, are much worse and far inferior to what will apply in rural areas. I hope that some people in the House of Lords will see fit to help Ministers keep the promises they made about being fair to everybody in terms of compensation. There can be no justification for saying that the noise is less in Euston than in Great Missenden. Noise is noise, dirt is dirt, filth is filth. The main difference is that in Euston all that will go on for 10 years, whereas on most other parts of the line it will go on for only a short period.

HS2 Ltd, and the HS2 apologists, say “Oh, it will not be as bad as Frank Dobson says.” Well, if the trouble will not be as bad as Frank Dobson says, why cannot those at HS2 come up with full, decent compensation? The main reason is that they know that it is going to be terrible and that proper compensation would cost a lot of money, but why should people living in my area experience dreadful blight for a decade or more while a national project goes through? Why should they be sacrificed on the altar of that national project?

It has been suggested that buildings in the area will act as buffers against noise. The people who live in Mornington terrace, the people who live in Ampthill square, the people who live in Park Village East, the people who live in Eversholt street, the people who live in the Regent’s Park estate, the people who overlook the railway now and the people who will overlook the railway when the “buffer” blocks of flats have been demolished—all those people face 10 years of noise and filth and disruption, and we are proposing that they should not receive the same level of compensation as people living in Great Missenden. That cannot be fair, and it cannot be decent.

I think that nearly everyone in the House wants to support and help small businesses. Drummond street, in my constituency, is full of small businesses with very hard-working owners and staff, providing restaurants and cafés and shops. It is on the west side of Euston station. The shopkeepers and restaurateurs have conducted surveys, and have found that between 40% and 70% of their trade is passing trade—people who are going to or from Euston to catch a train, the tube or a bus.

It is currently proposed that about a third of Drummond street will be demolished—which does not include any of the shops—that a huge fence will be built around the construction site for 10 years, and that there will no longer be any access to the west side of Euston station from Drummond street. Anyone trying to get from the shops and restaurants into the station will have a quarter-of-a-mile wander around the boundaries of the site. That means bankruptcy for the small businesses there which will lose their trade. Those businesses are already being damaged and blighted. The kitchens of one of the restaurants are getting a bit past it, and the restaurant is thinking of replacing them, but there is no point in investing in that replacement. Let me say this to both Front Benches: do they seriously think it right to go ahead with this project and damage those little, ordinary citizens?

I raised this matter in the Committee, which took evidence from witnesses. When the problems in Drummond street were brought to the distinguished attention of the man who is the director general of the HS2 project at the Department for Transport, he gave his considered opinion of the Drummond street traders, saying

“Their business will develop. We hope that businesses in Drummond street will benefit from the construction workers on the HS2 site.” ––[Official Report, High Speed Rail (Preparation) Public Bill Committee, 11 July 2013; c. 154, Q292.]

Does he seriously think that some construction worker, knackered and stopping for his snack break, will walk a mile to and from Drummond street to get food? No is the answer to that, but what is worse, had this great person inquired of the traders in Drummond street, they would have confirmed to him that a major construction site nearby had supplied them with no single remembered user during their lunch breaks. This, I have to say, is someone who works for the outfit which has been promoting HS2 until now.

As I have said to the Secretary of State and his predecessors, if I was in favour of this hare-brained scheme, I would get rid of a lot of the people involved, because in my constituency alone their original estimate of the costs has proved to be £1 billion less than their revised costs. That is £800 million extra at Euston and £125 million for running the works across Camden town, where, apparently, the cost went up from £170-odd million to £300 million because they had not realised they would need to widen the track. If that reflects the quality of thought and advice, I say to those people who are in favour of this scheme, “Watch it, because it’s a mess, and even the great man who, at the Olympics, did manage to spend the contingency fund is going to have difficulty sorting it out.”

I therefore have to say that I believe it will be necessary for the House of Lords to try to look after and properly compensate the people I try to represent. At the last general election I made two promises. I promised I would try to stop HS2 happening and, failing that—this was a twin-track approach, if people will excuse the expression—I said I would try to make sure all their interests were looked after. I have great belief in the integrity of the current Secretary of State, and if he is going to discharge his promise to look after people properly and treat them fairly, he will have to deal properly with the people I have been trying to represent.

Photo of John Randall John Randall Conservative, Uxbridge and South Ruislip 4:42 pm, 31st October 2013

Madam Deputy Speaker, may I take this opportunity to welcome you to the Chair for the first time when I have been speaking?

I am very sorry that on Report time did not allow us to address all the various matters I hoped we were going to talk about, especially with regard to compensation and mitigation. I am equally sorry that I was otherwise occupied on Second Reading so I was not able to speak then. I would just say to my former captors, who held me hostage for the last 13 years, that I hope that when we come to the Second Reading of the hybrid Bill we will have plenty of time—several days—because this is a hugely important issue.

Many issues of huge concern to many of my constituents and to even more of my fellow residents in the London borough of Hillingdon have not been solved by what we have heard today. Frank Dobson mentioned the property bond not being extended outside rural areas, and that is a matter of real concern to us. However, my constituents can rest assured that I will be raising those concerns inside the Chamber, outside the Chamber, and in any way I can. I and the other two Members of Parliament for Hillingdon—we like to be regarded as the three musketeers, “one for all, and all for one”—will be raising these issues.

Voting for this Bill tonight does not mean I will be giving a green light to the whole project. There is still some way to go for me to be persuaded that the pros outweigh the cons, and I shall be looking at things very seriously. But one thing I would say is that if there is one person in this Chamber who can persuade me of that, it is the Secretary of State.

Photo of Phil Wilson Phil Wilson Opposition Assistant Whip (Commons) 4:44 pm, 31st October 2013

Sedgefield has a particular place in the history of railways, as it was in a place in Sedgefield, Heighington crossing, that Locomotion No.1 was assembled by George Stephenson in 1825, on its route to Darlington to open up the Darlington and Stockton railway. It was said at the time that such was the velocity that in some parts the speed was frequently 12 mph, but it still took 65 minutes to travel the eight and a half miles to Darlington from Heighington crossing. Obviously we have come on a long way since then, but there is still a long way to go, which is why I support the Bill.

I wish to talk a little about supply chains and how this project will have an impact on jobs. Hitachi is opening a factory in my constituency which is going to build the intercity express programme trains, and the Secretary of State is coming to the constituency tomorrow to celebrate the start of construction there. That is just one example of what impact this will have on factories in areas that, in the first instance, are not affected by high-speed rail, because the route will not be going through the north-east initially. We are talking about 730 jobs, with 3,000 to 5,000 jobs in the supply chain. We also have a new university technology college opening. Hitachi and other companies in Newton Aycliffe are in negotiations with Sunderland university to open the UTC. It will create a plethora of people who are interested in engineering, electronics and all the other kinds of apprenticeships that we require to continue the work and the factory going forward. In addition, the research and development facility for trains for Hitachi will be based in Newton Aycliffe.

We should not forget that Hitachi built the bullet train in Japan, so if Hitachi is lucky enough to win the contract, it will have the technology to build the trains in this country. These trains would not be imported; they could be built in this country. That would mean 3,200 permanent jobs, not necessarily at Newton Aycliffe, but around the country, and jobs to maintain the trains as well. The capacity for the supply chain is fantastic.

The system of high-speed rail in Japan—the Shinkansen —covers 1,500 miles. The first high-speed rail started there in 1964, and Japan is on its eighth generation of high-speed train. The average delay on these trains is 36 seconds. I want a bit of that for the UK.

J

Jim Dodds
Sheffield, North of England? Sheffield is about half way between London and Berwick. At best a gateway to the north. You remember the North, that place where ships, steel mills, coal mines wool and cotton mills thrived prior to Thatcher's economic and social vandalism? That place on which the wealth of this country was founded during the Industrial Revolution.Then came Free Market Capitalism - that which had failed so horrifyingly in South American countries - when the pound flew free as a vulture allowing city traders to drink champagne as the blood was drained from trade unions and miners were clubbed by policemen drafted from all parts of the UK. HS2 will serve only to consolidate that which is already in the south and help Scotland to opt for independence thus condemning the North to Tory rule forever.

Submitted by Jim Dodds

Photo of Dame Cheryl Gillan Dame Cheryl Gillan Conservative, Chesham and Amersham 4:47 pm, 31st October 2013

May I, too, welcome you to the Chair, Madam Deputy Speaker, as this is the first time I have spoken with you in that position, and offer many congratulations? I will be brief, because I have spoken at length before. I still think that HS2 is an expensive toy. I remember that we once had something else that went fast—it was called Concorde, and we know what happened to that. [Interruption.] It is still not flying these days, and it lost out to the jumbo jet.

The Government have introduced this Bill, but it has not really moved this House or our knowledge of HS2 much further on. The Bill writes a blank cheque for the Government to spend as much as they want on the preparation of any of our railway works throughout the country, in perpetuity. The Government really introduced the Bill because they have lost control of the public relations on this project and they have lost control of the costs. I cannot even remember how many times we have read about the Department for Transport carrying out a “fightback” on this project.

No one is very impressed that four and a half years down the line a project that is supposed to be so worthy is still in the position it is in: the business case has worsened; the capacity claims have not been backed up in this Chamber today by any facts; the speed has now dropped away and is no longer the prime reason; and the connectivity is poor, as we have seen. Of course, all of us would agree with some of the aims and objectives, including mending the north-south divide, as has been discussed. We would all like those aims to be achieved, but I do not think that HS2 will do that.

I am sorry that we did not have more time to discuss compensation, but compensation consultation is still going on and I hope that the Government will have a property bond.

Photo of Alec Shelbrooke Alec Shelbrooke Conservative, Elmet and Rothwell

I am grateful to my right hon. Friend for giving way on the point about compensation. Although it is important that the Bill be given a Third Reading tonight, because many of my constituents would otherwise be left in limbo, it must be placed on the record that the project cannot go ahead if a property bond is not put in place to defend people not just now, but in future. Even if the project is dropped, they still need that property bond.

Photo of Dame Cheryl Gillan Dame Cheryl Gillan Conservative, Chesham and Amersham

I hear that, and many people would agree with my hon. Friend.

I am sad that the Bill is coming up for Third Reading without our having had longer to debate it. I, sadly, will be going through the Lobby to vote against it. I do not think any help or support should be given to the project. Many people around the country share my view. Simon Walker, director general of the Institute of Directors, said recently:

“We agree with the need for key infrastructure spending, but . . . It is time for the Government to look at a thousand smaller projects instead of . . . one grand folly.”

Richard Wellings of the Institute of Economic Affairs said:

“This lossmaking project fails the commercial test, while standard cost-benefit analysis shows it to be extremely poor value for money.”

I could go on. Even the Adam Smith Institute says that HS2 is a disaster.

Photo of Andrew Bridgen Andrew Bridgen Conservative, North West Leicestershire

Does my right hon. Friend agree that if there were a genuine business case for HS2 the Government would not have to put £50 billion-plus of taxpayers’ money into it, and the chief executive of Legal and General, which has announced a £15 billion fund for UK infrastructure, would not say that he does not want one penny of that money spent on HS2?

Photo of Dame Cheryl Gillan Dame Cheryl Gillan Conservative, Chesham and Amersham

I am grateful for the support for the quotes that I cited.

As the Secretary of State well knows, we have an outstanding meeting on compensation. I know he has tried to fulfil that and I hope we can get together on compensation, because my constituents are so badly affected.

I hope HS2 does not go ahead. The new love-in between those on the two Front Benches does not fool me much. I am pretty sure Labour will play politics with the project right up to the wire, but if it does go ahead, we must make sure that we have the best protection for our environment and our countryside, and the best compensation for people whose lives, businesses and communities will be rent asunder by the project. Nothing less will do.

Photo of Roger Godsiff Roger Godsiff Labour, Birmingham, Hall Green 4:52 pm, 31st October 2013

I spoke and voted against the Bill on Second Reading, and I regret to say that nothing I have heard subsequently has convinced me that I should not vote against it again today. After Second Reading, the argument put forward by the Government began to unravel and people came out stating different positions from those that they had taken before.

First, the Department for Transport upped the figures to £42 billion. Then a previous Chancellor of the Exchequer said that the cost could go to £80 billion and he was withdrawing his support. Then Lord Mandelson said that he attended the Cabinet meeting—presumably the same one as my right hon. Friend Mr Straw attended—where the project was dreamed up as a big idea on the back of an envelope without proper analysis or costings. You pays your money and you takes your choice as to what you want to believe, but I do not think that is the way we should undertake such a project.

There are two points that I wish to make. First, the Government say, not unreasonably, that to go ahead with such a big infrastructure project, they need the support of the main Opposition party. That is perfectly reasonable, but I have been there before, as have many Members in the House. I remember when Michael Heseltine was making preparations for the millennium. He went to the Labour party and said, “Look, I can’t build a millennium dome unless you commit yourselves to it.” We committed ourselves to it, and what happened? Well, there was a good party for the great and the good on new year’s eve, then attendances at the dome dwindled, we could not give it away, and eventually we ended up with £600 million of taxpayers’ money being totally wasted because it had to be given away to AEG for nothing. That is what happens when we go in for a vanity project without proper costings.

Secondly, if this is a such a great bargain for the taxpayer and for this country, why is it not being financed by private capital or foreign sovereign wealth funds? The Government are no great lover of public enterprise. Indeed, they are doing their best to pass the very successful franchise on the east coast line back into private ownership. That is their position, fine, but why is private capital not coming into this project? Why are foreign sovereign wealth funds not coming in? The Government are quite happy to have a new generation of nuclear reactors built by a state-owned Chinese company that is answerable to the Chinese politburo, yet this project needs to be paid for with public money. I suspect the reason is quite simple: private capital will not touch it with a bargepole, because those involved know that it cannot be done within the figures that have been talked about. It will go massively over budget and they are not going to pick up the bill.

I asked my hon. Friend Lilian Greenwood whether there was a pull-out figure for this project. She declined to give me a figure, and I understand that, but if there is no figure to all intents and purposes we are signing a blank cheque. If we go along with the Government and costs escalate—she made a very good point about degrees of incompetence—what will the pull-out figure be? What will happen if we get half the line built and all of a sudden the figure shoots up to nearly £100 billion? What will we do then? Just continue?

I have a great deal of time for the Secretary of State and in many ways he is in a hole. As an ex-miner, however, he ought to know perfectly well that when someone is in a hole, they should stop digging. My strong advice to him is that he should stop digging. He does not want to end up with a white elephant.

Photo of Alec Shelbrooke Alec Shelbrooke Conservative, Elmet and Rothwell 4:57 pm, 31st October 2013

HS2 is a very important project for the city of Leeds. The benefits it will bring to the north of England are immense, but they cannot be built on the back of hard-working people who have invested their livelihoods in their houses and so on. It is therefore vital that, before we sign the Bill off next spring, proper compensation is in place in the form of property bonds, and that the suggestions on rerouting, which are not about “not in my back yard” but propose sensible alternatives to ensure that the route follows existing transport corridors or goes through open countryside, are dealt with. With the best will in the world, we cannot mitigate the effects of such a development just 30 metres from the back of someone’s house.

I was a supporter of this project before I came to this House, but I cannot support it if the compensation package is not right. I urge the Secretary of State to ensure that it is right before the subject returns to the House in the spring.

Photo of Louise Ellman Louise Ellman Chair, Transport Committee 4:58 pm, 31st October 2013

High Speed 2 is essential national infrastructure, and we are at a critical part of the process. The concerns raised in today’s debate are very important, and many of them were raised by the Transport Committee two years ago. Some of them have been addressed, but some need to be looked at further. It is now the responsibility of the Secretary of State, working with High Speed 2, to ensure that they are dealt with. The concerns relate to the environment, value for money and ensuring maximum economic benefit, including giving opportunities during construction for employment and apprenticeships across the country. The project is essential, but it must benefit the maximum number of people, and that is the Secretary of State’s responsibility as we reach this very important juncture.

Photo of Mark Pawsey Mark Pawsey Conservative, Rugby 4:59 pm, 31st October 2013

Being given the opportunity to speak now feels like winning the lottery, Madam Deputy Speaker.

I will make one quick point on the impact on my constituents in Rugby. We currently benefit from a fast and frequent service on the west coast main line, so with Virgin Trains we can be in London in 50 minutes and with London Midland we can be there in just under an hour. That is attractive to businesses coming to Rugby, which we can present as a great location. My fear is that, if the Bill goes ahead and the money is given to build High Speed 2, the legacy line will become a stopping line, with trains stopping at every station as the operator seeks to maximise revenues, because the city-to-city business will have been lost—

Debate interrupted (Programme Order, 26 June).

The Deputy Speaker put forthwith the Question already proposed from the Chair (Standing Order No. 83E), That the Bill be now read the Third time.

The House divided:

Ayes 350, Noes 34.

Division number 117

See full list of votes (From The Public Whip)

Aye

No

Question accordingly agreed to.

Bill read the Third time and passed.