Report on the application of compensation schemes

High Speed Rail (London-West Midlands) Bill – in a Public Bill Committee at 4:04 pm on 8th March 2016.

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(1) The Secretary of State shall appoint an independent body to report annually on the application of compensation schemes for the works to be carried out under this Act.

(2) The report shall include, but not be limited to—

(a) information on the take up of the various schemes available,

(b) an assessment of the comparative take up of the schemes available in urban and rural areas,

(c) the judgement of the independent body of the effectiveness of the application of compensation schemes, and

(d) the judgement of the independent body of the application of the compensation schemes available in rural and urban areas.

(3) The Secretary of State shall lay this report before both Houses of Parliament.—

This new clause would require an annual independent assessment of the compensation schemes which apply to the HS2 scheme, including an assessment of the application of the compensation schemes available in rural and urban areas and any consequences, including suggested remedies, resulting from this.

Brought up, and read the First time.

Photo of Andy McDonald Andy McDonald Shadow Minister (Transport) 4:15 pm, 8th March 2016

I beg to move, That the clause be read a Second time. As the Minister will be aware, issues surrounding compensation schemes have been, and no doubt will continue to be, points of contention for those who will be adversely impacted by the construction of HS2. There will be significant disruption in urban areas. Approximately 250 homes in Camden and 200 in Ealing could be made uninhabitable during and after the construction phase and open space and community facilities will be lost to Camden, Ealing and Hillingdon. Residents and businesses in urban areas have argued that it is wrong that they will receive less compensation than those in rural areas, despite the urban areas suffering more disruption; just three out of five compensation measures apply only to rural areas, with only the express purchase scheme and need to sell scheme available in urban areas.

The HS2 Select Committee has said that the £34,800 rateable value cap for need-to-sell business applications was not appropriate in the case of London businesses, given that too many would exceed the cap. It has asked for a Government re-evaluation, such that the proportion of London businesses falling beneath the cap is broadly the same as elsewhere. The Minister may be open to looking at that. One might also argue that the need to sell scheme’s requirement to demonstrate a 15% loss in property value, or the express purchase scheme’s £49,000 cap for a 10% addition to the market value of a property, are unsuitable for urban areas, given that the average price for a property in some of the boroughs most affected in London is £650,000. The Select Committee also noted that beyond need to sell, there is still little recognition of the effects on others who are blighted, including tenants and licensed occupiers, with many of the affected residents in Camden being council tenants. An annual independent assessment of the compensation schemes that apply to the HS2 scheme, including an assessment of the equivalence of the compensation schemes available in rural and urban areas, and any consequences, is therefore necessary.

The issues surrounding compensation are hotly contested and are causing a degree of animus among some of those affected, so the establishment of an independent body to report annually on the application of compensation schemes for the works to be carried out under this Bill would help to ensure that compensation schemes were both fair and effective.

Photo of Robert Goodwill Robert Goodwill Parliamentary Under-Secretary (Department for Transport)

Although we have different compensation schemes in place for urban and rural areas, the need to sell scheme has no geographical limit. However, it is unlikely that the impact of the project away from the line of the route will be felt as much in urban areas as in rural areas, as they are built-up areas with a lot of traffic and existing railway stations, certainly in the case of Euston. The property schemes in place for HS2 are way above those for other infrastructure, or indeed compulsory purchase schemes for other projects.

I fully endorse the need for the Government to be transparent with respect to the application of our property compensation schemes. We are already reporting on the performance of our key discretionary property scheme, the need to sell scheme. We are reporting on the number of applications we receive, the outcome of those applications and the overall amounts spent on compensation under the scheme. Rather than doing so annually, as the new clause suggests, we have been reporting on a monthly basis. The reports are publicly available.

I also recognise the benefit of appointing a body to scrutinise our performance in relation to property compensation. For that reason, we have already appointed a residents’ commissioner to monitor how we communicate with the public with respect to our compensation scheme and to monitor and report against our general performance in relation to the operation of all the various discretionary compensation schemes. I have met the residents’ commissioner and intend to meet her regularly. I have also made it clear to her that if any problems emerge, she should consider my door always open to her to raise them with me directly. The residents’ commissioner produces a report broadly quarterly, and the chairman of HS2 Ltd is obliged to provide a response to the issues raised in each report. The reports and responses are also publicly available. I therefore believe that all the points made by the hon. Gentleman have been addressed, and I hope that he will withdraw the proposed new clause.

Photo of Andy McDonald Andy McDonald Shadow Minister (Transport)

I have listened carefully to what the Minister has said, and I accept entirely his assurances that the issues that we sought to address in the new clause have been recognised and will continue to be addressed. On that basis, I beg to ask leave to withdraw the new clause.

Clause, by leave, withdrawn.

New Clause 40