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The Minister of State, Department for Transport (Baroness Kramer) (LD)
My Lords, with the leave of the House, I shall now repeat a Statement made by my right honourable friend the Secretary of State for Transport in another place. The Statement is as follows:
“Mr Speaker, the past few days have brought important proposals to make the most of High Speed 2. They will help us to build the line better, bring benefits to the north sooner and support job creation and economic growth. I want to update the House at the first opportunity, and I am sorry that, for unavoidable reasons, I was not able to do that last week.
The proposals are welcome, because HS2 is a vital project. It can do for future generations what Victorian railways did for previous generations and the motorways for ours. That is why it has the strong support of the Government, and it is why cities in the Midlands and the north are calling for its benefits to be spread as widely as possible.
We must heed that call, but for this to happen we also need to get the basics right: stick to cost, plan well, listen, respect the environment, build what really works and what we really need for the future and, of course, make sure that people get the benefits as quickly as possible.
I know, too, that HS2 is just part—but a vital part—of our long-term economic plan, one that will see better infrastructure for all parts of the country. It is a clear and ambitious plan, a plan that is already paying dividends—shown by last week’s welcome decision by Hitachi, the company that invented the bullet train, to move its global rail headquarters to Britain. That is the sort of opportunity presented by HS2.
First, let me respond to the report by Sir David Higgins. He began work as chairman of HS2 in January. The first task that I set was to look at how to maximise the benefits of HS2 and manage the costs. Last year, Parliament backed the principle of a high-speed rail link to the north with 350 votes in favour and only 34 against. Now it is up to us to make it happen. Given his great track record, there is no one better suited to the job than Sir David.
I turn to his proposals. First, on costs, Sir David has reviewed the cost estimates for constructing phase 1 and confirmed that they are realistic. The budget set by the Government in 2013 stands. As experience shows, in Britain we can build great projects on time and on budget, such as High Speed 1 and Crossrail. However, at this early stage, before Parliament has considered the hybrid Bill, we must include a proper contingency. Of course, for popularity’s sake, one option would be to slash the contingency and claim it as a saving. Sir David says that would be the wrong thing to do. I agree, but, as he also says, with growing certainty comes growing confidence. There will be the stage when we can bring the contingency down.
Let me turn to his second proposal. I have heard many honourable Members ask why we cannot build in the north sooner. I agree: we can. His report suggests opening the line to a new hub station in Crewe six years earlier than planned. Direct trains will of course be able to run off HS2 lines to serve places such as Stoke, Liverpool, Manchester, north Wales—and Scotland—faster too. A line to Crewe sooner would mean shorter journeys than with just the current phase 1: quicker to Manchester, quicker to Liverpool, quicker to Scotland.
This is a welcome proposal and I am commissioning HS2 Ltd to undertake work to allow it to be considered in detail. However, this must be seen as an acceleration of phase 2, not an alternative. Sir David said that we must make the most of this investment so that as many towns and cities as possible benefit. I agree, and we will make sure that happens.
With the third proposal—for the southern end of the line—our priority must be to get the benefits to the Midlands and the north as soon as possible. In short, we must put our money and time where it can do most good. Sir David is clear that he does not think existing proposals for the HS2-HS1 link meet that test. The HS2-HS1 link proposed in the hybrid Bill has not secured a consensus. The link requires too many compromises in terms of impacts on freight, passengers and the community in Camden. I therefore intend to remove the link from the hybrid Bill and withdraw safeguarding as soon as possible. I will also commission a study into options for improving connections to the continent which could be built once the initial stages of HS2 are complete.
I also agree with the report that much more can be made of Euston station—not just to build something we can be proud of but to maximise the economic potential of the line and use a site which has been neglected, and to generate private sector investment which can reduce the overall burden on taxpayers. I will, therefore, ask HS2 Ltd and Network Rail to develop comprehensive proposals for the redevelopment of Euston. Our ambitions for Euston must not, however, conflict with our commitment to control costs. I want to see substantive private sector investment to ensure this.
Secondly, I turn to the report from the growth task force published last week. It is from an impressive panel, including business leaders such as Sir John Rose, Alison Nimmo and Ray O’Rourke, city leaders such as Julie Dore from Sheffield, and the general secretary of the TUC, Frances O’Grady. I thank everyone involved and in particular the Commercial Secretary for his committed leadership. Their message is clear: we need HS2 and we need to act now to squeeze the most from it in terms of jobs, skills and growth.
The task force’s recommendations are plain common sense: things that business, government and cities can do together, and must start doing now. In relation to skills, this means proper training to ensure that our young people get the best jobs on the project. In relation to planning, it is ensuring that the line brings new strength to our cities. On transport it is ensuring that we link the existing road and rail network properly to HS2, and plan investment in them together. Regeneration and economic growth are vital parts of HS2.
City leaders have already started to put plans in place, but government has a role to play as well. That is why I am asking HS2 Ltd, and London and Continental Railways—which developed the King’s Cross St Pancras site—to come forward with proposals for a regeneration company that will respond to the growth task force’s recommendations on regeneration. This matters because, as I have said before, HS2 is a project that will be built over many Parliaments—and no doubt Governments too—and it will serve people through many generations. It is not the only answer to our transport needs but it is a central part of the answer. That means designing it carefully and building it right: building something that works, that we can be proud of, and that benefits as many people and places as possible for the lowest cost. We are on schedule to open the line in 2026—which, by the way, is exactly the date the previous Government set in 2010—or ahead of that date in the case of the Crewe proposal.
The Government are keen to rise to the challenge. I hope that honourable Members on all sides of the House will do the same”.
Lord Davies of Oldham (Lab)
My Lords, I thank the Minister for repeating the Statement. None of us underestimates its significance. We should begin by congratulating Sir David Higgins and the noble Lord, Lord Deighton, on their substantial and very thorough reports. Significantly increasing capacity south of Birmingham and improving connectivity north of Birmingham are vital and will transform our great cities. I am glad that the penny has at last dropped and that the emphasis is being put on the real role of HS2, which is significantly to increase capacity in our crowded stations and not to reduce journey times from Birmingham to London by 20 minutes for businessmen. It is not that that reduction is unwelcome but it is not as important as the other concepts.
We will of course continue to hold the Government to account for keeping costs down on the project. One of the issues which Sir David Higgins emphasised is that significant savings will be made if the Government set about reducing delays. Therefore, I ask the obvious questions. Where is the hybrid Bill? When will we be able to consider it? What steps is the Secretary of State taking to ensure that we consider the Bill at the earliest possible time? Delay costs money.
I am also glad that one significant objection, which was the concern of a very large number of people, has been allayed by agreeing to scrap the link between HS1 and HS2. That link was always fraught and it brought immense troubles to very large numbers of residents in the London Borough of Camden, while effecting the link on that route looked to be a matter which would be subject to great challenges during the passage of any hybrid Bill. Given the acute affordable housing crisis in Camden, a significant proportion of any new housing must be social housing. There will still be consequences for Camden from the fact that Euston is to be significantly enlarged, even though the link is not to be pursued. At Old Oak Common, where significant regeneration is planned, there is no decision yet from the Government about the relocation of the First Great Western and Heathrow Express train depots. That is of considerable significance to this project and we want to see a decision and proposals on that as soon as possible.
This means that the Government have to put themselves out and talk to the local authorities concerned, as indeed they need to talk constructively to the local authorities that govern our great cities in the Midlands and to the north of London, which will welcome the suggestion that Crewe should be developed several years ahead of what was forecast earlier. However, there are significant implications for our northern cities, which have every right to be prioritised for integration as much as elsewhere in the country. We want a coherent transport plan for the north, which of course has been historically underfunded. We are all too well aware that the Government committed the sin only a couple of years ago of transferring excellent rolling stock from the north to Thameslink. It is not surprising therefore that northern cities think that their needs take a lower priority than they ought.
We need a rebalancing of railway investment into the regions in order to close the economic divide. Even the Government, despite their commitment to government having little role to play in huge areas in the economy and everything being left to the market, recognise that we cannot afford such a significant and drastic difference between the growth of London and the growth prospects of our other major cities. We welcome the proposal on Crewe and the faster construction of phase 2 that is promised.
There is a great deal of consultation to be done. When will the Government announce their response to the phase 2 route consultation? Time means money with such a project in which so many resources are invested. I hope also that there will soon be an announcement of the site of the HS2 skills college. We have seen from the construction of Crossrail the stimulus that is given to high-level skills. We have also seen the difficulty of our own people being able to respond at the relevant level of skills in all aspects. It would be tragic if we did not ensure that the benefits of the construction of HS2 were directed towards the British people from the very construction of the lines.
We must also learn lessons from Crossrail on SME procurement. Contract numbers are high in volume, but the total value of the contracts is uncertain. We must ensure that the high speed pound reaches all parts of the United Kingdom. It is vital that we maximise the opportunity that this new north/south line can bring to the whole of our country. Of course we support the project, but we wait for the Government to rise to the challenge.
Baroness Kramer
My Lords, there is clearly a great deal of consensus across the Benches in this House. I very much welcome that because, as the Secretary of State said in his Statement, this project will span many Parliaments and inevitably a number of Governments. Therefore, that consensus is absolutely vital.
I thank the noble Lord, Lord Davies, and I welcome the comments that he made. I did not identify many questions within his comments. I found one to which I think he wanted a response, which concerned when we would respond to the consultation on HS2. We expect that to be in the autumn. There have been a very substantial number of responses. We need to go through those in a great deal of detail and we need to pay a great deal of attention to them. That is a complex process.
I assure the noble Lord that we have long recognised the importance of the Midlands and the north. In this process I have been spending a great deal of time myself in the north. I welcomed the growth task force report in Manchester with the leaders of Manchester council, the former leader of Trafford, and a number of other representatives of local communities. I underscore that importance and look forward to further questions from other Members of this House.
Lord Berkeley (Lab)
My Lords, I congratulate Sir David Higgins and the noble Lord, Lord Deighton, on their two reports. I am very pleased that the Government have accepted them. They are a breath of fresh air. I look forward to continuing to work on the project.
I am particularly pleased that the HS1 link has been removed as it was not fit for purpose, but can the Minister encourage her ministerial colleagues not to be too negative about that? She may know that there is already a link with HS1—it was built with HS1—on to the North London Line and the west coast main line which could be used to run Eurostars north of London. It needs signalling—they have forgotten to do that—but that is a minor detail. The trains are operating in France but they could operate in Birmingham and Manchester very quickly and provide that link if there was a demand. I hope that she will take that back to stop any negativity coming from the northern part of the route and the claims that cancelling the HS1 link is a disaster. It is not.
Baroness Kramer
I fully agree with the noble Lord’s comments about the HS1/HS2 link, and those were indeed the comments of Sir David Higgins. It is something that could technically have been done but, given the impact that it would have had not just on the community but on passengers and freight traffic, trains would have travelled at 20 miles per hour on that particular link and no more of them than three an hour, at that, so it was not fit for purpose.
However, I give assurances, as the Secretary of State has said, that there will be an important study to look at how to connect the north through to the continent as HS2 progresses. We recognise the importance of that; it is a significant and serious piece of work. Sir David Higgins has recently welcomed proposals from others who understand transport and community issues, and the department had done so previously. We will continue to appreciate the input that comes in, and that expertise.
The Lord Bishop of Chester
My Lords, the spirit of the Statement is in for a penny, in for pound—a lot of pounds, of course—but if it is to be done, it should be done well and quicker. I particularly welcome the extension to Crewe, which is in my diocese, so much sooner; I am sure that the people of Crewe, that noble old railway city, will welcome that warmly.
I notice in the Statement, though, that direct trains will be able to run off HS2 to serve north Wales. I have always assumed that the trains on the high-speed rail link will be electric. Does this mean that the Government are announcing plans to electrify the railways beyond Crewe to Chester and into north Wales? If so, when is that going to happen?
Baroness Kramer
My Lords, the line will be able to take classic-compatibles immediately, which will provide a great deal of the flexibility that is needed. Obviously there is a wide programme of electrification already under way. I can take a look again at the route that he has just suggested and come back to him with comments on it but, essentially, the way in which the line is being designed does not just mean that HS2 trains themselves will be able to run up and down it but ensures that it can be used by classic-compatibles that can go on to a wide range of other destinations.
Lord Bradshaw (LD)
My Lords, I wonder whether I can start with a question: can anything be done to expedite the tortuous Bill procedure in both Houses? This is a matter for the Government and the House authorities, but we really should not wait for years and years while the Bill waits at the convenience of the House—or, rather, the convenience of the nation.
We have already been told that the fares policy will encourage use rather than deter it. I agree that the HS1/HS2 link as tabled is not very satisfactory, but we need a modern transport link between Kings Cross, St Pancras and Euston. I regretted to see in the report the issue of one stop on the Underground. That would mean carting your cases, luggage and everything down to where it is very congested. The time has come to bite the bullet and make a proper link. If these stations were an airport, they would be one terminal; the distance is very short.
I am most interested in what has been said about the north. I think that the north has been done badly to by successive Governments. The most recent bad thing that was done was when the noble Lord, Lord Adonis, cancelled an order for 200 new diesel trains that would have improved the services there. The north must have decent rolling stock, not the cast-offs from other railways and certainly not antiquated stock. Every city in the north needs its local enterprise partnership to get down now to planning how they will link supporting services into the stations that are served.
Lastly, I challenge the Government on the consistent reports I have seen for years that there is no business case for investing in the north. I think that the reason is that, with the present trains and present service, it is difficult to see why people should use the railway. However, we are looking at a new era, and I am sure that there will be a business case for investing properly in the north.
Baroness Kramer
We absolutely agree that we are looking at a new era. It is frankly inspiring to meet the city leaders, businesses and other stakeholders of the great cities of the north and the Midlands, who are coming together to create a sort of common strategy for maximising the benefits of HS2 by building interconnectivity between them. That is absolutely crucial. My noble friend may be hinting at a rolling stock issue in the north. That is an immediate problem that the department has said that it will find a way to resolve no matter what, but it has not yet found an absolute answer.
Parliamentary procedure is a matter for the two Houses. I am sure, though, that with the good will of Members of both Houses, we can encourage the process to move according to the speediest possible timetable. It is important that people who are petitioning are properly heard and listened to; I would not want to cut short the opportunity for that proper interface.
On fares policy, we have said that this will not be a premium service. There will be many ways to link Euston and St Pancras. They have to be looked at. Travelators have been mentioned; there is one stop on the Northern line.
Lord Popat (Con)
Order, please. I think it is my noble friend Lord Jenkin, then it will be the noble Lord’s turn.
Lord Snape
My Lords, I am grateful that the normal procedures of the House are being abided by. I strike a discordant note, as a supporter of this project, to say how disappointed I am—as I am sure many people in the Midlands and north will be—at the abandonment of the link between HS1 and HS2. Thirty years ago, during the passage of the Channel Tunnel Act, we were told that there would be through trains from Paris, Brussels and other continental cities to our great cities of the Midlands and the north. This was, at least, a chance for those through trains to run between those cities. How does the Minister suggest that a businessperson coming from the continent to the Midlands or the north gets between Euston and St Pancras? Do they take the Victoria or the Northern line? Or will they pull their luggage along Euston Road? Will the Minister accept from me that there will be a great deal of disquiet in many parts of the country about the abandonment of this link?
Baroness Kramer
Many of the cities in the north and the Midlands accept that the link as it was designed did not fit the purpose that they saw for it. It simply was not adequate in the role that it played. We will be looking at many more trains going to many more destinations out of Kings Cross and St Pancras. There has to be a much better way to create a link between HS1 and HS2. That will be a major study. It is a piece of work and it needs to be of the standard that a high-speed intercontinental link deserves.
In the short term, we will need a way to get between Euston and St Pancras. As I say, that will be looked at. The distance, as other people have said, is very limited; I walked between the two in four minutes yesterday. However, it will be important to make sure that that is an efficient and effective link and not a matter of trundling down the street.
Lord Jenkin of Roding
My Lords, on this question of the HS1/HS2 link, there could be an additional dimension. I have had discussions with Sir Howard Davies who, with his commission, is currently looking at whether a Thames estuary airport could be a realistic addition to the shortlist of options that will be given to the Government after the next election. If, indeed, it becomes a realistic option—which is not impossible at all—then the question of a link from the north will become absolutely vital. People must have a way of travelling down on the HS2 and going on the HS1, with a link to the airport at the Isle of Grain if that is the one which is approved. That would be almost more important than a direct rail link to the continent.
Baroness Kramer
My Lords, none of us is attempting to second-guess what the conclusions of the Davies report will be, or the conclusions of the Government of the day that will make the final decision. At that time it will be appropriate to take a look and work out how links can be created if they will be relevant to whatever the major airport will be for the south-east, and to the high-speed line. However, to attempt to do so at this point would delay HS2, which we want to get into the ground by 2017 to deliver the benefits which we all discussed earlier. That is absolutely crucial.
Lord Foulkes of Cumnock (Lab)
My Lords, I was very glad that the Statement mentioned Scotland on a couple of occasions. However, in her replies to all the previous questions, the noble Baroness mentioned just the Midlands and the north—she is reverting back to that again. Will she confirm that the best part of the whole economic case is regarding journeys between London and Scotland, and that that also frees the existing lines to have more stops at intermediate stations in England? Will she therefore initiate discussions with the Scottish Government as quickly as possible to ensure that work is under way to determine the route to Scotland, to start to think about the funding and to start working on dates for construction? Unless she and the Government do that, we will not think that they are being serious about Scotland.
Baroness Kramer
I am delighted to say that the department is somewhat ahead of the game. I have already commissioned a report and consultants have been retained; we expect a preliminary response on how to take the benefits of high-speed rail to Scotland. We will get our interim response in July, and that will be a very important document in being able to identify the future. Of course, HS2—even the “Y” that is currently planned—will help to bring journey times to Glasgow and Edinburgh down to less than three hours.
Lord Shutt of Greetland (LD)
My Lords, I welcome this report; I am in favour of HS2. However, I am rather more in favour of the “plus”. In this report, one word which bellows out is “connectivity”. In the foreword it says that there is,
“poor connectivity in the North”.
It wants us to be,
“more ambitious … about producing a coherent transport plan for the North”.
On page 9, the report states:
“In contrast, connectivity in the North is poor”.
I agree.
I do not want to detract from what has been said about getting to Crewe earlier, and the connectivity in the north-west. However, I want to speak about the other leg, from Birmingham up into Yorkshire, and the possibilities beyond that. The original proposals in January 2013 propose a terminal station in Leeds—what I describe as a “hammerhead terminus”—where the only connectivity is a long walk. That might suit Leeds but it is useless for connectivity for anywhere else, such as Huddersfield, Halifax, Bradford, Keighley, Skipton, Ilkley, going back round to Wakefield, or further connectivity to York, the north-east and Scotland.
Does the Minister agree that connectivity will be achieved if, in Leeds, we get a new station parallel to the Leeds City station of today, not a station that is a hammerhead terminus, which would mean that people would have to leg it such a long way, and the detraction that that would bring?
Baroness Kramer
Yes; I can reassure my noble friend that we are looking very closely at all the proposals that have come in through the consultation, and more generally we are going back to look at all the detailed elements of the second phase of HS2. The issues he raised have been raised with the department and will be looked at, as will other proposals. As I said, we will come back with our conclusions in the autumn.
Lord Beecham (Lab)
My Lords, I declare an interest in HS2. Unfortunately, it is likely to be a post-mortem interest because by the time it reaches Newcastle I will have long since been dead and buried. The urgent need is for investment now, or as soon as possible, in the north-east in the intra-regional rail infrastructure and indeed, that which will extend across the Pennines to the north-west. It is a very poor route and service at the moment. Can the Minister give any assurance that investment will take place sooner rather than later in those regards, irrespective of what happens in the timing of the HS2 project as such? After all, the north-east has a mere fraction of the per capita expenditure on transport infrastructure, particularly of the south-east, but also in relation to many other regions in the country.
Baroness Kramer
The noble Lord will be aware that spending on transport in the next Parliament is to be £73 billion, of which only £17 billion will be on HS2. There will be a very substantial spend on other transport services, including upgrading and improvement of rail, electrification, and so on. I could go on with a very long list. I can assure the noble Lord that that is not being ignored. There are also great opportunities with the local growth fund, which is a £2 billion-a-year fund for stakeholders to bring forward plans that they see linking into and maximising the benefits to HS2, so that they can go ahead in preparation for the arrival of HS2. I expect many of the cities and communities in the Midlands and the north to be doing exactly that.
Lord Brooke of Sutton Mandeville (Con)
Does my noble friend share my enhanced confidence in recent developments from the fact that the growth task force is chaired by our noble friend the Commercial Secretary, following his remarkable achievements on the infrastructure of the London Olympics, in particular?
Baroness Kramer
The noble Lord, Lord Deighton, has brought so much to this issue, not just his experience. The House will be aware that some years ago transport was looked at primarily in silos. It was about how to get people or freight from one place to another. It is now seen as inherently part of an economic development strategy. Local connectivity and integration with the rest of the network now have an importance that perhaps they once did not have. The noble Lord, Lord Deighton, has been very instrumental, with others, in making sure that we have those thoughts right at the forefront of the HS2 scheme.
Lord Clark of Windermere (Lab)
My Lords, I greatly appreciate the Statement today, but when we talk about the great cities of the north, are we including cities such as Preston or Carlisle, which almost certainly will end up with an inferior rail service to the capital in London unless we get the connectivity right, as the noble Lord, Lord Shutt, has wisely drawn our attention to? There is no sign of that at the moment. For example, in a Parliamentary Question in the past few months, I was told that there was not even a business case made for high-speed trains from Wigan, which was to be the terminal to Glasgow. I find that incredible. I am also told that the high-speed trains will not run on the high-speed line, so the tilting trains will be providing an inferior service down the conventional west coast line.
Baroness Kramer
I am not sure that I fully understood the noble Lord’s last point. There will be the fast, specially designed HS2 trains, but the line can also take the classic-compatibles—diesel or otherwise—that can go off to a whole variety of other connections on the west coast main line and other routes. This frees up the west coast main line, the east coast main line and the Midland main line to take a whole complexity of other services. That issue has been raised by others on the Floor today. The expectation of an enhanced service from a much greater number of cities than those absolutely directly connected to HS2 is entirely viable. We just have to make sure that it is deeply embedded in our planning.
Lord Grocott (Lab)
My Lords, I warmly welcome the Statement, representing as it does an increased and restated commitment to this project from the Government, added to by my noble friend Lord Davies, who spoke for the Opposition. It is extremely important that it is restated in that way, and it is encouraging to see what questions have been asked as well. However, I share some of the concerns raised by my noble friend Lord Snape. I certainly do not wish to delay anything—the quicker the better, in terms of preparing the scheme and getting it going. However, with regard to the statement:
“I will also commission a study into options for ways to improve connections to the continent which could be built once the initial stages of HS2 are complete”,
I would like it to be spelt out in a little more detail what this commission is going to do and within what timescale, and I would like just a clue as to what the other conceivable options would be if there were not to be a direct link between HS1 and HS2, because that must be a concern for those of us in the Midlands and the north.
Baroness Kramer
The decision to not develop the proposed HS1-HS2 link is very recent. A lot of work and thought needs to go into framing the study. As soon as we are able to do that, I will be glad to share it with the House.