Financial Provision

High Speed Rail (West Midlands - Crewe) Bill – in a Public Bill Committee at 10:30 am on 25th June 2019.

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Question put, That the clause stand part of the Bill.

Photo of Nusrat Ghani Nusrat Ghani Parliamentary Under-Secretary (Department for Transport), Assistant Whip (HM Treasury)

This is the standard clause that appears in Bills and provides for the expenditure of public money. It simply provides that any expenditure incurred by the Secretary of State under the Bill shall be paid out of money provided by Parliament.

Photo of Matt Rodda Matt Rodda Shadow Minister (Transport) (Buses)

The Minister has addressed some of these issues, but it is vital to get this right. HS2 will allow for more reliable rail services. The current Secretary of State has plunged punctuality on the railways to a new depth—a 13-year low—and we must get on top of that issue. This is a tremendous opportunity to improve connectivity, and it is vital to get urban-to-urban connectivity within the country. We are committed to delivering a transformative package of investment across the rail network in the north of England, backed by a commitment of at least £10 billion to transform connections between major northern cities. The Government have touted similar plans, sometimes described as Northern Powerhouse Rail or HS3, but there is no commitment to the funding—it is interesting that the Minister used that point to address the financial side of the programme.

Any incoming Labour Government would rescope the project to seriously reduce costs and provide far better integration. Furthermore, there is concern over the accountability and the ability of our colleagues in this House to scrutinise HS2, ensure that costs are kept under control, and address the issue of public trust. We believe there is the potential to reduce the cost of HS2 by using a number of other technical measures—I will not address those in detail now—and the operation of HS2 is also contentious. Billions of pounds of taxpayers’ money is being invested in HS2, and it is right that revenues go back to the Exchequer and not into the hands of private train operating companies. HS2 should be run in the public sector as a public service. I will return to some of those points later in relation to the new clauses.

The Government have been somewhat inept in handling another specific aspect. HS2 has been rightly criticised for sometimes failing to provide value for public money. For example, the Public Accounts Committee described an unauthorised redundancy bill of £1.76 million as

“a shocking waste of taxpayers’ money”,

blaming it on

“weak internal processes at HS2”,

and there have been other concerns about the project.

Photo of Tan Dhesi Tan Dhesi Labour, Slough

Does my hon. Friend agree that the issue of spiralling costs concerns many of us up and down the country? If we do not get this right, it will have a huge impact on how services are delivered in our local communities in terms of housing, education, hospitals and so forth. Does he agree that the Government need to get a grip on the costs of HS2?

Photo of Matt Rodda Matt Rodda Shadow Minister (Transport) (Buses)

I thank my hon. Friend for his intervention; it is nice to have a colleague from Berkshire Labour intervening on me. The Government need to be responsible with these very large sums of public money, and it is deeply disappointing that they have fallen well short at times.

The words of the Public Accounts Committee are worth considering:

“a shocking waste of taxpayers’ money” is a severe condemnation of the Government. There have been many other allegations about HS2’s potentially not being well planned or managed. Ensuring that HS2 secures value for money is essential if we are to retain public support for the project. There should be no blank cheque.

Photo of Paul Sweeney Paul Sweeney Shadow Minister (Scotland)

My hon. Friend makes an important point about the general principles of HS2 and the need to ensure that the project delivers maximum economic benefit to the nation, including industrial skills and job opportunities. When we look at how the Treasury assesses such projects, we see that very little consideration is given to how much value is created in the wider economy, particularly through industrial development. In my own constituency, the Caledonian railway works in Springburn faces closure. Would it not have been possible to utilise the supply chain opportunities of HS2 to ensure that highly skilled jobs in the railway industry are supported and maximised through the project’s supply chain?

Photo of Matt Rodda Matt Rodda Shadow Minister (Transport) (Buses)

I thank my hon. Friend for his intervention and particularly for pointing out the importance of the supply chain. I will add that the value of apprenticeships, degree qualifications and other opportunities for young people linked to the programme should be first and foremost in the Government’s mind when they come to look at the supply chain.

Returning briefly to clause 61, essentially it says that there is potential for uncapped Government expenditure, leaving open the possibility of no upper limit on the costs of HS2. Will the Minister update the Committee on the latest cost estimate, and does she believe that the project will be delivered at cost?

Photo of Nusrat Ghani Nusrat Ghani Parliamentary Under-Secretary (Department for Transport), Assistant Whip (HM Treasury)

I remind the hon. Gentleman that we are here to scrutinise the Bill line by line, but I welcome the opportunity to remind everybody of the importance of HS2. Of course, it is a crucial project, linking eight of our 10 greatest cities. Supportive comments have been made recently by everybody involved, including the Mayors of Manchester and Liverpool and the leader of Leeds City Council, who have been watching very closely. They are northern, locally elected leaders who are waiting for HS2 to roll through their communities, because they fully understand not only that, at its peak, it will provide work for 30,000 people—most of those jobs being outside London—but its value for money and how it will smash the north-south divide, encourage our communities to come even closer together and force investment in rail infrastructure in the north of England for more than 100 years. This is a key infrastructure, social and economic project for our country.

Photo of Paul Sweeney Paul Sweeney Shadow Minister (Scotland)

The Minister notes that there is an opportunity to close the north-south divide, but the project’s scope does not include extending the infrastructure to Scotland, to include Glasgow, Britain’s third-largest city. That is critical to the success of this project, and I hope that in the next phase of the HS2 programme the Minister will consider extending the railway all the way to Glasgow, because although Glasgow will benefit from reduced journey times to and from London, the journey times to and from Manchester will actually increase, which is detrimental to the Glaswegian economy.

Photo of Nusrat Ghani Nusrat Ghani Parliamentary Under-Secretary (Department for Transport), Assistant Whip (HM Treasury)

I look forward to joining the hon. Gentleman in the Committee and the Chamber, and I welcome his support for the next phase, but let us deal with this Bill in these few short sittings.

We know that this project creates jobs and supports apprenticeships. There are already 2,000 businesses in the chain, and two colleges are supporting it. I do not want to move too far away from the clause, but a valid argument was made about the rest of the Government’s investment in the north. We know that Northern Powerhouse Rail is based on HS2 infrastructure, which is why this Bill, these clauses and this line are so important. We are investing more than £2.5 billion in a rolling programme to upgrade the railway between Manchester, Leeds and York, and the great north rail project is investing more than £1 billion by 2022. I have never seen HS2 as an either/or project; we need to do both. This is a great investment in the north of our country. There is no upper limit. There is just one budget, which is the budget that HS2 must hold itself to. It must also hold itself to the schedules.

Question put and agreed to.

Clause 61 accordingly ordered to stand part of the Bill.