Highways (Financing) Bill (Third sitting)

(Limited Text - Ministerial Extracts only)

Committee stage
Tuesday 3rd November 2026 Public Bill Committees

[Greg Smith]

I am grateful to my hon. Friend for reasserting my argument. I hope that the Minister can answer the question. Some speculation has been that the Government want to avoid a hybrid Bill on the lower Thames crossing, and believe you me, Mr Dowd, I see the pitfalls of hybrid Bills in my own constituency, with 35 km of a certain railway being built through the middle of it, but I do not see a real argument why a hybrid Bill would be necessary. Why can we not talk explicitly about the lower Thames crossing in this piece of legislation?

I know the Minister to be a reasonable man, with whom we share agreement on this particular point of the lower Thames crossing, and on a determination to get on with it, so I gently ask him why we cannot have this piece of legislation on something that all parties can get behind. Later, we can have the debate on the other matters, which will take more time to get right with parliamentary scrutiny, but meanwhile we can move forwards.

[The Parliamentary Under-Secretary of State for Transport (Justin Madders)]

It is a pleasure to see you in the Chair, Mr Dowd. I thank hon. Members in Committee for attending. I hope that we will all learn a little as we go along. I start by recognising the desire of the shadow Minister to reach consensus wherever possible. As the Committee goes on, I am sure that he will find that he is in agreement with me 90% of the time. If not, the Committee will ensure that we are in agreement with the Government position.

The hon. Member makes a lucid argument, which I am here to address. The amendment’s intention is very clear: it would restrict the Bill’s application to the lower Thames crossing. I understand the shadow Minister’s desire to seek clarity on what other projects this legislation might be used for, and it is the case that the Bill has very much been made with a single project in mind—the lower Thames crossing. However, I think that naming the project in the Bill would undermine our attempt here to set up a framework for potential future uses.

It is clear that under the intended operating model, ownership and operations of the Dartford crossing would transfer to the new regulated private sector entity, which would be responsible for operating and maintaining both the Dartford crossing and the new lower Thames crossing, ensuring a consistent and reliable service. It is important to have both crossings covered, because that will ensure that they are operating in an integrated way. The amendment specifically refers to only the lower Thames crossing, but restricting the Bill in that way would undermine the Government’s intention. Were the legislation used only for the lower Thames crossing, that would undermine its purpose of building a framework for major road infrastructure, and we should not unnecessarily constrain future Governments where this financing approach may be appropriate.

The shadow Minister tempts me to come up with a shopping list of potential projects, but the truth of the matter is that, at the moment, the lower Thames crossing is the only suitable project. It is probably worth flagging that the New Roads and Street Works Act 1991, which was passed under a Conservative Government, created a power to create tolling roads and I think only one project has ever been built under that legislation. That is not to say that the same will happen here, but getting the lower Thames crossing right will give us confidence moving forward, if a suitable project arises in the future. We do not want to constrain future Governments in this way.

It is also worth bearing in mind what the shadow Minister said about the amendment having potential procedural consequences, such as the potential risk of hybridisation, which is of course a matter for the House. As the shadow Minister said, the amendment would risk hybridising the Bill, meaning that it would introduce additional parliamentary stages and considerable delay to the delivery of the lower Thames crossing. Hybrid Bills are often used for projects that do not have planning consent, and which need planning consent via Parliament, but that is not the case for the lower Thames crossing.

As we all know, the lower Thames crossing has finally got planning consent, and it already has a very long history. As we discussed on Second Reading, we know that the original work to address the capacity issues around the Thames goes back as far as 2009. Risking hybridisation of this framework Bill would put at risk the timetable for this legislation, and therefore the financing and, ultimately, the delivery of the new crossing.

The 2025 autumn Budget confirmed the importance of harnessing private investment to build the lower Thames crossing, unlocking the next stage of delivery for one of the UK’s most important infrastructure projects, but I am afraid that the amendment would risk the opposite happening. Of course, the Conservatives’ reasoned amendment on Second Reading recognised the urgency of this particular project, so I gently suggest that, were we to accept amendment 46, the progress that has been made would be put at risk of further delay. I invite the shadow Minister to withdraw the amendment.

[Greg Smith]

I hear and understand the points that the Minister has made, but the key word he used in his response was “risk”. Although I accept that such risk can exist, I cannot and do not accept that it cannot be mitigated or worked through. The most powerful question all of us have to ask, particularly when Members find themselves in a ministerial position and wanting to make progress on manifesto commitments or on other things the country needs—and that the Government perceive the country needs—is not one about procedure. We must ask: how? How do we make this happen without a hybrid process? How do we make this happen in the fastest possible way?

From the research I have done, though the risk exists that some would argue that a hybrid process would be the only way forward, I can see that there are pathways to doing it as more straightforward legislation, with a usual Second Reading, Bill Committee, Report and Third Reading before we get to the other place. Therefore, we will press this amendment to a vote. We want to show our commitment to building the lower Thames crossing but not write a blank cheque for other schemes.

--- Later in debate ---

Division 1

Question accordingly negatived.

Ayes: 4

Noes: 13

[Zöe Franklin (Guildford) (LD)]

I beg to move amendment 37, in clause 1, page 2, line 3, after “strategic” insert “and local”.

This amendment expands the general duty of the ORR so that it must consider and avoid adverse impacts on local roads, as well as the strategic road network.

--- Later in debate ---

[Greg Smith]

No, I do not think we should stall the project. I was very clear in my comments on group 1 that the Conservatives want to see the lower Thames crossing built. We want to see it as a major road building priority for this country, and therefore anything that adds delay is something that we do have to think very seriously about. However, I do not believe it is beyond the wit of any of us to find a way to lower costs without having to relitigate and relegislate on absolutely everything. We should apply a bit of common sense, which is precisely what amendments 47 and 48, by removing that duty from both the ORR and the Secretary of State, would do in this instance.

I very much hope the Committee will consider those amendments in the spirit in which they are intended of delivering value and speed on this project. Indeed, while HVO is in fairly plentiful supply in this country, even with the global challenges we face at the moment, it is not in as plentiful supply as white diesel.

Amendment 68 was tabled in my name and that of my hon. Friend the Member for Bognor Regis and Littlehampton. It would prevent

“the Act from coming into force until the Secretary of State has published the guidance to the ORR on how”—

how is the critical word here—

“it must undertake its regulatory functions under the Act.”

I have noticed from having debated other Bills in Committee during this Parliament that there seems to be a bit of a theme of kicking many features of intended legislation into the long grass for future publication; it happened with the Employment Rights Bill, as was. Governments from time immemorial have done that, so it is not a point I make just to the current Government, but I invite the Committee to reflect on it more widely.

Our constituents send us here to do things in their best interests and in the best interests of our country, yet too often, including in the Bill, we are in a place where we straightforwardly say that we are going to pass a law but too much of it has to come later. Too much of the regulation that will actually shape the Bill will come far down the road so we cannot be confident as Members of this place, whether we sit on the Opposition Benches or the Government Benches, precisely what it will look like.

I ask the Minister to give examples of how duties will be applied and whether they could actually form an override of the main task of delivering and regulating roads built under this scheme, including the lower Thames crossing. I confirm that we will support amendment 37, and I hope that the Committee can back amendments 47, 48 and 68.

[Justin Madders]

I thank hon. Members for their contributions, and I welcome the hon. Member for Guildford to the Committee and thank her for moving her amendment. The concern she raises through the amendment is that the impact of licensed roads on the surrounding network should be properly considered. However, that does not mean that we need to extend the Office of Road and Rail’s general duties in clause 1, nor does it mean that the licence holder would be free to disregard the impact of its activities on surrounding local roads, because clause 1 reflects the scope of the licensing regime concerning trunk roads. The Bill deals with the impact on local roads in other, more appropriate ways elsewhere, for example under clause 4.

Before a licence can be granted, the licensing authority must consult appropriate persons exercising functions in relation to highways. That enables local highway authorities to feed in their views where roads may be affected. The relationship does not end once the licence is granted; clause 8 also allows the ORR to require the licence holder to co-operate with other highways authorities as part of the licence. The framework for the Bill provides a route for local road impacts to be addressed, without extending the ORR’s overarching duty beyond the roads it is regulating. Local roads are considered as part of the Bill, which provides appropriate ways for their interests to be considered without extending the overarching statutory duties beyond the scope of the licensing regime. The existing provision provides the appropriate balance between ensuring that the wider impacts are considered and giving the ORR a clear and workable statutory duty.

In terms of the specifics of the lower Thames crossing, it is difficult to see what this other local road crossing the Thames would be and how it would be affected. As my hon. Friend the Member for Dartford has explained so clearly, that is one of the reasons why this project is crucial. I would therefore ask the hon. Member to withdraw her amendment.

I turn to amendment 47 from the shadow Minister, the hon. Member for Mid Buckinghamshire. It would remove the ORR’s duty to contribute to sustainable development when carrying out its duties under the Act. We have deliberately designed those duties as a balanced package. The ORR’s principal focus remains the interests of road users, alongside the efficient and economic delivery of highways and the ability of licence holders to finance their activities. Sustainable development is one of the wider considerations that the ORR must have regard to when carrying out those functions—it does not override the principle considerations.

This is not a novel duty; it is an approach consistent with established economic regulatory regimes in the energy and water sectors, where sustainable development forms part of the wider statutory framework within which independent regulators operate. Projects put forward under this legislation will involve significant infrastructure works, including the construction and improvement of roads. This can have significant environmental and wider impacts, therefore it is right that sustainable development, including the consideration of environmental impacts, is expressed in the duties in the Bill.

[Douglas Lumsden (Aberdeen South) (Con)]

It is a pleasure to serve under your stewardship, Mr Dowd. Can the Minister give us any idea of how much the sustainable measures are actually costing on the project?

[Justin Madders]

I do not have any particular details on that, so I will write to the hon. Member. The requirements on sustainable development originate from the Environment Act 2021. I know he was not here at that time, but that was a piece of legislation brought in under the then Conservative Government. Under section 19 of that Act, Ministers are required to have due regard to the Government’s environmental principles policy statement when making policy. Those principles ensure that environmental considerations are built into policy making from the outset, as is the case in this Bill, so we are not breaking new ground or doing anything different from what has been done before on sustainable development.

There are real factors to bear in mind in delivering major infrastructure, and it is right that we consider them as part of our consideration of the Bill. I am sure that my hon. Friend the Member for Dartford, whose constituents are affected by this Bill, would want the local environment to be considered.

I turn now to amendment 48. I think the general thrust of the arguments here will be the same, because the approach we are taking is consistent with established economic regulatory precedents, as seen in the energy and water sectors. The Secretary of State’s primary focus remains the interest of users of trunk roads in England, particularly the efficient and economic delivery of highways and the ability of the licence holder to finance its activities. As I have already stated, sustainable development does not override those considerations. Decisions under this framework should take into account the wider public interest factors set out in the clause and not focus on any single consideration in isolation.

To respond to the questions that the hon. Member for Mid Buckinghamshire asked about diesel, as we have already heard, the evidence is clear that this is at best a marginal issue in terms of costs. As my hon. Friend the Member for Northampton South suggested, reopening this question could lead to significant delay on the project.

Of course, the DCO has been settled for a considerable period. It has brought significant benefits already, in particular large landscape-scale environmental enhancements of semi-natural habitats, woodlands, species-rich grasslands, open mosaic habitats, and wetlands. This approach will support a greater, more diverse range of wildlife than areas such as agricultural land or amenity grasslands. By making LTC a tunnel and extending it, the project will avoid protected wetlands on the banks of the River Thames, helping to reduce impacts on environmentally sensitive habitats such as the marshes special protection area and Ramsar site. That will be of benefit to the wider community, and the suggestion that we withdraw that element of the Bill is regrettable.

Amendment 68 is in this group of amendments, but I do not think the shadow Minister spoke to it, so I seek your advice, Mr Dowd, as to whether we are dealing with it now.

[Greg Smith]

I spoke to amendment 68.

[Justin Madders]

Did you? I must have missed that.

In effect, amendment 68 would force the Secretary of State to publish guidance for the ORR under section 1(5) before the Act came into force and would simultaneously remove the Government’s ability to make regulations ahead of particular clauses coming into force.

Amendment 68 would mean that the vast majority of the Act cannot come into force until the guidance of section 1(5) is published, but there would be nothing meaningful to issue guidance about until the Act is in force, because the bidding would not have happened, we would not know who the investors would be, and therefore we would not know what the ORR would have to provide guidance on. In those circumstances, the Secretary of State could not meaningfully provide guidance.

I turn now to clause 1 stand part and the overall duty that will guide the ORR in carrying out its functions under the Bill, which we have probably already covered in some detail. The ORR must act in a way that it considers best supports the interests of users who use highways covered or potentially covered by the licensing regime. That includes future users, which is important because the ORR might make decisions about a road before construction works or improvement works have been completed.

When carrying out this duty, the ORR must consider the efficient and economical construction, improvement, operation and maintenance of those highways. It must also consider the need for licence holders to be able to finance their activities required under the licence. Of course, those are not the only considerations for the ORR. It must also have regard to safety, as I have said, as well as sustainable development, competition and the effects of its decisions on the wider strategic road network.

The clause also reflects the principles of good regulation. ORR’s regulatory activities should be transparent, accountable, proportionate and consistent, and they should be targeted only when action is needed. ORR must also have regard to guidance issued by the Secretary of State.

Clause 1 places road users at the heart of ORR’s role, while ensuring that it takes account of safety, efficient delivery, financial viability and the wider public interest. That is an important framework, and I commend the clause to the Committee.

[Jim Dickson]

It is clearly incredibly important to all users of this future infrastructure and the present Dartford crossing that the ORR is as capable and fully equipped as it can be to carry out its duties. Up to now, the ORR has been more equipped on rail than on road, even though it has considerable responsibilities for roads at the moment. A recent report commissioned by the Department for Business and Trade indicated that the ORR needed to increase its skills and capacity in order to do this work. Will the Minister reassure my constituents and all other future users of the infrastructure that the ORR will be fully equipped, have full capability and be able to discharge its duties under the Bill?

[Justin Madders]

I can give my hon. Friend that assurance. It is vital that the duties set out in clause 1 can be delivered to the best of the ORR’s ability. The whole purpose of the RAB model is that we have a functioning and effective regulator, so resourcing it is vital.

[Greg Smith]

The Minister is making an eminently sensible point about the ORR’s ability. Given that the Department for Transport, in relation to the Railways Bill, is playing down the ability and role of the ORR, will he assure the Committee that the framework being set out is deliverable by the ORR and that it is a capable organisation to take on this important work, when the other arm of the DFT is suggesting that it is not for railways?

[Justin Madders]

I am grateful for the shadow Minister’s question. The Bill’s purpose is to give the ORR the powers and ultimately the responsibility to regulate this model. It will be able to levy the licence holder to finance that particular work. A great deal of preparatory work is already going on to ensure that the ORR is capable of delivering the important functions set out under the Bill.

[Alison Griffiths]

The Minister just made the point that the ORR is not yet capable of delivering this. What is the plan from the Secretary of State and the Minister to deliver an ORR that has that capability? We also heard in evidence last week that the ORR does not believe that it is ready for it either.

[Justin Madders]

I am grateful for the hon. Lady’s question. There is a plan in place, but it would be a bit ridiculous for us to have everyone ready now when the legislation has not been passed. I assure her that a number of considerations are already taking place about having the right skills. We heard evidence last week that there is confidence that the right skillsets and people will be in place to provide the important functions that the ORR will have to deliver under the legislation.

Clause 2 sets out the overarching duty that will guide the Secretary of State when exercising functions under the Bill. It mirrors the duty placed on the ORR in clause 1 and ensures that both key decision makers operate within a consistent statutory framework. As the Bill gives important functions to the Secretary of State and the ORR, it is therefore important that decisions made by each are guided by the same overarching objectives and principles.

The clause requires the Secretary of State, like the ORR, to act in a way that furthers the interests of road users. In doing so, the Secretary of State must balance a range of important considerations, including efficiency, safety, sustainability and the impact of decisions on the wider strategic road network. These duties are underpinned by established principles of good regulation, helping to ensure that decisions are transparent, accountable, proportionate and targeted only when action is needed. I therefore commend the clause to the Committee.

[Zöe Franklin]

I thank the Minister for his comments. However, I remain unconvinced about local authorities not having that statutory duty, so I wish to press the amendment to a Division.

Question put, That the amendment be made.

Division 2

Question accordingly negatived.

Ayes: 6

Noes: 11

Clauses 1 and 2 ordered to stand part of the Bill.

--- Later in debate ---

[Greg Smith]

The amendment would ensure that licences could only be granted for the construction of new roads. The key word is “only”.

I would be grateful if the Minister could explain in detail why the Government think a licence should extend beyond simply the construction of a new road, and how the Bill prevents modest works being used to justify a toll-backed licence. This goes to the crux of what we are debating today and of what we are being asked to consent to, on behalf of all our constituents who are motorists and who use the strategic road network; I am sure they will enjoy the new lower Thames crossing once it is constructed, but they are concerned that some of the drafting of the Bill opens a back door and a pathway to enabling things that most people, looking through any lens of common sense, would consider to be minor to allow for increases in tolls or, indeed, new tolls.

I do not think that anyone who backed the lower Thames crossing would necessarily be willing to back something that did not itself support, say, a major new piece of road infrastructure, be that the lower Thames crossing or anything else. We explored that point a lot in last week’s oral evidence sessions and on Second Reading. I commend the Minister for his clarity at the Dispatch Box on Second Reading and in his oral evidence in the Boothroyd Room last Thursday about how the Government have—that favoured political phrase—“no intention” of delivering new tolls for other projects. That perhaps includes things as simple as new cameras, line painting that makes the road a bit clearer or smart motorway provisions—not that I believe there is anything smart about smart motorways.

The Government say they do not intend to use any of those mechanisms to introduce new tolls. We therefore have to ask ourselves a question, which is why the Opposition tabled amendment 82. If what the Minister has said is a clear signal and there genuinely is absolutely no intention—for the record, I believe the Minister—why not put it on the face of the Bill? Let us say clearly and unequivocally that the Bill is only about the construction of new roads in the United Kingdom—well, I am sorry to say to my hon. Friend the Member for Aberdeen South that Scotland is not included in the Bill’s scope—

[Justin Madders]

Or Wales.

[Greg Smith]

Or Wales.

Can the Minister rise to the challenge? Can he make a legislative commitment in line with his words at the Dispatch Box and in oral evidence, and accept amendment 82? If the Government are reluctant, or straightforwardly do not want, to accept the amendment, I fear those questions are forever going to persist in the minds of British motorists and of all road users, be they driving a car themselves or reliant on a car’s passenger seat to be taken wherever they want to go. That is an important point of principle on which the Minister must surely accept the view out there in the country, and the view of His Majesty’s loyal Opposition. He should put it on the face of the Bill.

--- Later in debate ---

[Douglas Lumsden]

Last week, we heard that the Bill is potentially a Trojan horse. We could have narrowed its scope earlier to just the lower Thames crossing with amendment 46, but that was ruled out. We also have issues with what constitutes an “improvement…increasing the capacity”. We have heard that that is not necessarily a new road, or even a new lane built along the whole length of the highway; it could just be smart cameras or other little improvements that increase capacity slightly.

We have had some assurance from the Minister that this will not be a Trojan horse Bill and that it will be used only for the lower Thames crossing, but as we know, Ministers change, Governments change. We are meant to put that all down to trust. The amendment therefore makes it quite clear that this has to be a new road, and the measure would only be able to be used on that new road.

As things stand, I think we are leaving too much down to interpretation—leaving too much to having faith in Governments that may come and go. This is probably the most important amendment that we will look at today, so I think it is vital that it is included in the Bill to make it as clear as possible that the Bill applies just to new roads. It even should apply just to the lower Thames crossing.

[Justin Madders]

I thank hon. Members for their contributions on this group. Without doubt, the scope of the licensing regime is an important subject, including which road schemes can be brought in and—as amendment 81 refers to—how local authorities should be consulted.

Turning to amendment 82, I thank the shadow Minister for raising the issue of the circumstances in which a licence can be granted for improvements to existing highways. He asked why the licence would extend beyond the construction period. The simple answer to that is that the model is deliberately designed around the whole life cycle of major infrastructure, not simply the point at which it is built. That is why the Bill provides not only for construction, but for qualifying capacity-enhancing improvements and the subsequent operation and maintenance of infrastructure within the regime.

In particular, things such as the lower Thames crossing, a very expensive project, will need consistent and persistent maintenance and repair. That matters because one of the benefits we seek from this model is strong long-term management of assets. The regulatory framework provides ongoing oversight, with incentives to manage operating costs and maintenance investment efficiently over the life of the infrastructure. Removing capacity-enhancing improvements would unnecessarily restrict the framework. It would mean that the model could not be used for major upgrades to existing road infrastructure, simply because the project involves improving an existing road rather than constructing an entirely new one. For example, a significant reconstruction of an existing bridge to add capacity, or a new tunnel that increases the capacity of an existing highway, could be excluded from the regime.

[Douglas Lumsden]

I asked this question of my hon. Friend the Member for Mid Buckinghamshire and I will ask the Minister the same. When this Bill comes into play, if an improvement were made on one small section of a road, could a toll be introduced for the whole length of that highway, or could it be introduced only for the small section where the improvement was made?

[Justin Madders]

That would be where clauses 1 and 2 come in, which should give the hon. Member sufficient reassurance. It is important to say—I will use scouse terminology, if you do not mind, Mr Dowd—that I think the arguments coming forward are a bit jarg. I do not know if that is a phrase the Committee is familiar with, but it is a bit of a scaring-the-horses moment—a bit of a ride on the ghost train. Unfortunately, that is what we have come to expect from the Opposition. They are trying to create a scare story where none exists. I have to be clear, as I was on Second Reading and in the evidence sessions, that improving an existing road does not mean that the road will automatically be brought into the regime or be subject to tolls.

[Alison Griffiths]

Will the Minister give way?

[Justin Madders]

I will just finish.

Establishing and structuring a RAB arrangement comes with significant costs, so for small-scale improvements such as the setting up of a speed camera, it is just not going to be financially viable for anyone to consider it. In practice, it simply would not be justified, or work, in any way. We are clear from the evidence that we heard last week that the model will make sense only for projects of sufficient scale, where the benefits of bringing in long-term private investment justify those costs.

Members should be clear that I know that what I say on the record is relevant to the intention of the Bill, and that that will be something that any future court will take into account.

[Greg Smith]

rose—

[Justin Madders]

I will now give way to the hon. Member for Bognor Regis and Littlehampton.

[Alison Griffiths]

I will pass to my hon. Friend the shadow Minister.

[Greg Smith]

I am grateful to the Minister for giving way. I understand the arguments he is putting forward, and I reiterate that I believe his intent—but we are not being asked to put his intent on the statute book; we are being asked to put the words that are printed in the Bill on to the statute book. Therefore, to the question asked by my hon. Friend the Member for Aberdeen South, is it conceivable, under the Bill as currently written, that if, at some point down the path, a new road licensed under this Bill that carries a toll has another enhancement built into it under a new licence—a bridge, a crossing or whatever it might be—that enhancement could have a new and separate toll added just for that small section, compared with the entire length of the original road?

[Justin Madders]

We are very clear that the clause is about the specified highway. It is about the trunk road. It is about the protections in clauses 1 and 2. I will simply push back that, if there was some secret plan to expand road tolls, there is already legislation in place that would allow us to do that. The New Roads and Street Works Act 1991, which was passed by the hon. Member’s party in Government, created the powers to introduce road tolling. If there was a secret plan to do that, we would not need to bring forward legislation. This is about setting up a new regulatory model to bring in investment for particular projects.

[Alison Griffiths]

I refer back to the intervention that I was going to make earlier, which was about clarity. The Minister said several times that he was being very clear, but I would gently suggest that the legislation is not very clear. That is the point that several of us are making: we are in danger of passing legislation that may not deliver what is perhaps intended by the Minister at this stage. It is at a point where a future Government, perhaps not as benign as others, might abuse the wording of the legislation. We are really just looking to ask the Minister to be clear in the Bill, not just in his words.

[Justin Madders]

I am grateful for the hon. Lady’s question and her description of “benign”, which I will frame and put on my wall at home.

The Bill is clear. There are reasons why we have to look at the existing network, particularly when we consider what is happening in the lower Thames crossing. The simple economics of this would not be attractive to investors if we were going to broadly open up road charging across the country—as I say, there is already legislation that would enable us to do that. The clause is about setting up a specific financial model, which will have strong regulation and will enable capacity-enhancing improvements to be made to the road network. As I say, it is very clear that there are sufficient protections already within the legislation to avoid the situation that Opposition Members are concerned about.

Turning to amendment 44, I thank the hon. Member for Didcot and Wantage for raising the question of capacity-enhancing improvements. We will be clear that this framework is intended for major road infrastructure, not for minor changes to the road network. There are practical constraints on the use of this model. Again, as I have referred to, clauses 1 and 2 require the ORR to act in the “interests of users” of the highway specified in licences or proposed to be specified. Clause 2 requires the Secretary of State to act in the

“interests of users of trunk roads in England.”

Both have regard to the principle that regulatory action should be proportionate and targeted only where it is needed. I am not entirely sure that the amendment would deliver the changes that the hon. Gentleman proposes. I am concerned that, while he is talking about an extra lane, he has not put any de minimis length on that, which might give a future non-benign Government encouragement to take it further than is our intention.

We have to be clear that establishing and structuring a RAB arrangement carries substantial costs. It must be sufficiently large and economically viable for that financing approach to make sense. We heard evidence that the geography of this country is such that simply adding lanes on here and there is not a viable option. I therefore suggest that the hon. Gentleman not press his amendment to a Division.

The shadow Minister spoke to amendment 81. I hope I never have a call from him when he is feeling frustrated—I am not sure how that would go for either of us—but he made an important point about ensuring that local and mayoral authorities are notified where there may be a proposed scheme. It is of course the case that the Bill already ensures that the relevant authorities are consulted. As set out in clause 4, before any licence can be granted, the licensing authority must publish the proposal, which must also be shared with the relevant bodies, expressly including the strategic highways company and any other appropriate bodies exercising highway functions. At least 28 days must be allowed for representations from those bodies.

Different projects will affect different places and different authorities. Therefore, the right consultees will depend on the project. As we have seen in recent times, the structure of local government can change, so it would not make sense to hardwire into legislation that particular types of authority should be consulted, because that could become outdated.

[Greg Smith]

Is the Minister seriously suggesting that we might move on from either a local authority or mayoral model? Those are the two that we have at the moment, and no one is suggesting anything else, so it is hard to see how it could possibly be the case that we move on from the environment, which we are trying to lock into the Bill with amendment 81, of local authorities and/or mayors.

[Justin Madders]

Of course the answer to that is that we cannot predict the future. In 2010, the idea of a mayoral combined authority was nothing more than a glint in George Osborne’s eye. It is about future-proofing the legislation: it does not make sense for us to come back at a later stage to add in extra consultees, because the Bill already has the correct powers to ensure that the licensing authority must consult appropriate bodies. That makes the framework flexible enough to respond both to the circumstances of individual projects and to changes in local government structures over the life of the legislation, which will be significant, because of the LTC project.

Clause 3 is at the heart of a lot of the debate today. The clause establishes what a licence is, what it can authorise and the circumstances in which one can be granted. The purpose of the licensing regime is to provide the framework through which private investment can support the delivery of strategic road infrastructure. In simple terms, clause 3 allows a licensing authority to grant a person a licence giving them the right to charge tolls on a highway specified in that licence. But that right is not freestanding; it is granted in return for the licence holder securing specified works to the highway.

The works fall into three main categories. A licence may support the construction of a highway; it may support the improvement of an existing highway, where the purpose is to increase its capacity; and, where a highway has already been constructed or improved under this licensing regime, it may provide for its maintenance, operation or further improvement. If another highway is specified in the licence, the licence may also authorise the licence holder to charge tolls in respect of that highway. That is an important point about the structure of the regime. Clause 3 is not simply a general power to allow private companies to charge motorists; the authority to charge tolls is tied directly to the licence holder securing the highway works specified in the licence. In addition, clause 3 does not allow the model to be applied indiscriminately across the road network.

We have heard the concern about the measure meaning a change to existing roads. A small improvement to an existing road, such as a smart motorway camera, does not automatically mean that that road will be brought into the regime or become subject to tolls. A highway can be included in a licence only if it is, or is to be, a trunk road in England, or part of one. The licensing regime created by this part is therefore deliberately confined to that network.

Clause 3 also sets out who may grant the licences. When the regime first begins, both the Secretary of State and the ORR will be licensing authorities. This is known as the “initial period”. Put simply, it is the period for dealing with the first licence under the Bill. Once the first licence has been issued, the initial period will end and the ORR will become the licensing authority. The end of the initial period will be specified by the Secretary of State in regulations.

It is important to say that there is an additional safeguard during that initial period. The ORR cannot itself grant a licence without the Secretary of State’s consent. Where the Secretary of State gives that consent, the decision must be published in a way that the Secretary of State considers appropriate to bring it to the attention of people likely to be affected. Where the Secretary of State grants the licence directly, a copy must be provided to the ORR as soon as reasonably practicable.

Clause 3 should also be read alongside the safeguards in the rest of the licensing framework. In particular, clause 4 requires consultation before a licence can be granted. The proposal must identify both the works to be secured and the highway on which tolls would be authorised, and there must be at least 28 days for representations. A licence cannot be granted unless that consultation requirement has been met.

That is an important safeguard because bringing a road into this regime is of course a significant decision. Before a licence is granted, those likely to be affected have an opportunity to understand what is proposed and make representations. The licensing authority must go through that process before deciding whether the licence should be granted.

It is also important to be clear that, whether we are talking about a new road or a capacity enhancing improvement, the regime is confined to the trunk road network. A highway can only be included in a licence if it is, or is to become, a trunk road in England.

We will come later to clause 81, which makes the necessary changes to the existing trunking provisions in section 10 of the Highways Act 1980 so that a new highway built under this licensing regime can become a trunk road. It does not create a blanket new power to designate any road as a trunk road; rather, it enables the existing process to work for the new type of highway.

[Alison Griffiths]

I thank the Minister for giving way. This should be the easiest intervention to reply to—I only wish to ask him to speak more slowly so that I can understand what he is saying.

[Justin Madders]

Apologies to the hon. Member.

Taken together, these provisions mean that the Bill can support both new strategic roads and significant capacity enhancing improvements, while remaining firmly focused on the trunk road network. The licensing authorities will also exercise their functions within the overarching statutory duties we have just debated. Those duties put the interests of road users at the centre of decision making, while requiring consideration of matters including efficiency and economy, safety, the wider strategic road network, sustainable development and competition.

[Greg Smith]

I am grateful for the Minister’s response, particularly on amendment 82. However, as the debate has moved on, the official Opposition are actually no further forward on the clarity we seek. The Minister likes to paint a picture of us looking for a scare story or something that would be more befitting of trick-or-treating last Saturday night; that is not what the Opposition are seeking to do. We are seeking clarity. We are seeking, through the usual procedures of this House, to check that the Bill in front of us does what it says it is going to do, without having an unintended negative consequence.

In the answers the Minister has given about whether we should restrict the measure to the construction of a new road in its entirety, we still do not know the answer to whether it is feasible, to the point my hon. Friend the Member for Aberdeen South made, that a licence could be granted for a subsection of a road that already has a master licence for the entirely of its run.

In his response, the Minister made reference to the installation of smart motorway cameras. I accept the point on a simple set of cameras. What is still unclear is whether a motorway that is part of the strategic road network, and is not currently designated as a smart motorway—the M40, which runs in part through my own constituency, is an example—could suddenly find itself with a licence, and therefore a toll, if it is permanently changed to an all-lane running motorway by turning what we currently know as the hard shoulder into a permanent running lane. I categorically do not want that scenario, but as this Bill is drafted it is unclear at best whether that would be permitted.

Therefore, without repeating it, I come back to the core argument that, for the Bill to work as I think the Minister intends it to, it should restrict the operation of a new licence to the construction of new roads, as amendment 82 makes clear.

--- Later in debate ---

Division 3

Question accordingly negatived.

Ayes: 4

Noes: 12

Clause 3 ordered to stand part of the Bill.

--- Later in debate ---

[Greg Smith]

I am not sure the private motorcar has been promoted over everything else. I accept the challenge the hon. Member lays down about the issues young people have securing a driving test in a timely manner, but the statistics out there absolutely show that—whether it is people commuting to work, travelling for leisure or a holiday, getting kids to school or whatever—the majority of miles travelled across the totality of the country are by private car. That is why the Bill seeks to ensure that the lower Thames crossing is built and there are potential future capacity increases elsewhere: so that the vast majority of our constituents—outside of the country’s major cities, like London, which have tube networks and more frequent bus services—can use their cars. We take issue with amendment 45. I will reflect, when we break for lunch, on whether to report to my hon. Friend the Member for Spelthorne (Lincoln Jopp) that the Liberal Democrats have called the junction to Staines on the M25 a “road to hell.”

Amendment 87, which would provide for a comprehensive assessment of the impact on local roads, has more to be said for it. I will not repeat the arguments I made earlier about the importance of the local road network supporting any new infrastructure. There is some merit in the amendment, which was tabled by the hon. Member for Didcot and Wantage. This is something we should all reflect on. We must try not to look at the road network as if it can be compartmentalised into the strategic road network and local roads, but to see the two as part of a single ecosystem that cannot be separated.

[Justin Madders]

I turn first to amendment 45. I thank the hon. Member for Didcot and Wantage for raising whether alternative transport investment should be considered before a licence is granted. I have to say that I have never been entirely clear whether the Liberal Democrats support the lower Thames crossing. The hon. Gentleman’s comments push him more into the “no” territory, but as the Bill progresses we will no doubt see whether they can support it.

[Olly Glover]

Given that the Minister was putting words in my mouth, let me clarify my view. We do support the lower Thames crossing, because the Dartford crossing is under pressure and there is no resilience when it closes, but that does not mean that we support only the lower Thames crossing. The problem with policy over decades—I disagree with the shadow Minister on this—is that it has been roads, roads, roads, and motorways, motorways, motorways. It should be not either/or, but both.

[Justin Madders]

I appreciate the hon. Gentleman’s clarity. I understand his argument, but it is probably a bit late now. The assessment on alternative transport options belongs in the scheme appraisal and the business case process, not in this Bill, which is about whether to grant a licence in the first place.

The Association for Consultancy and Engineering was clear in its written evidence that schemes must be

“sufficiently developed before financing and procurement decisions are taken.”

As the hon. Gentleman knows, for the lower Thames crossing, the development consent order has already been issued, and all the issues that he talked about were considered. It has been approved, and construction is under way.

The Bill is not about which road should be built; it is about creating an additional financing and regulatory framework, which can be used where there is a need for a road scheme. It is not about putting roads ahead of rail or bus transport. That will be considered through the earlier business case process. Requiring that to be assessed again once the licence has been granted would duplicate the work and add delay. As hon. Members have said, there is an urgent need for this scheme to proceed, so I ask the hon. Gentleman to withdraw the amendment.

On Opposition amendment 78, we debated a similar point when we discussed amendment 81. The shadow Minister did not press that amendment to a vote, but given the gusto with which he advanced his argument today, he may press amendment 78. I will not repeat the point that have been made, but clause 4(1)(b)(iv) requires that consultation includes

“such other persons (including persons exercising functions in relation to highways) as the licensing authority considers appropriate.”

So the assurances that Opposition Members seek are there in black and white.

If we are too prescriptive, we may not cover every type of authority. At the moment, we know exactly what the local authority structures are but, as we have seen in recent years, that can change, so it would not be prudent to hardwire that into primary legislation. The Bill rightly allows the licensing authority to identify and consult the appropriate bodies exercising high-risk functions for the scheme. That makes the framework flexible enough to respond to the circumstances of individual projects and changes to local government structures over the lifetime of the legislation.

On amendment 87, I understand the concerns of the hon. Member for Didcot and Wantage. We absolutely recognise that major road schemes can have impacts on surrounding local roads, and they need to be properly considered—indeed, the lower Thames crossing is proceeding because we want to improve the conditions on the local roads—but I do not believe that the amendment puts the consideration in the right place.

Licences granted under the Bill are about bringing qualifying trunk road projects within the new financing and regulatory framework. It is not the process through which the underlying impacts of a road scheme are first identified and addressed. Those impacts, including changes to traffic and congestion, should be considered through the development and planning of the road scheme. As the hon. Gentleman knows, for the lower Thames crossing, traffic forecasts were assessed and considered as part of the development consent order, which is the appropriate stage for such considerations. Carrying out that work again would delay the project and duplicate work that has already been completed.

Clause 4 sets out the requirements that must be met for consultation before a licence can be granted under the Bill. It ensures that the grant of a licence is subject to a clear, transparent and accessible consultation process, giving those likely to be affected a proper opportunity to make representations before the licence is granted. I therefore commend the clause to the Committee.