High Speed Rail (Preparation) Bill

Frank Dobson Excerpts

Thursday 31st October 2013 Commons Chamber

[Mrs Ellman]

I do agree. I think that that is an excellent example of what could be done. However, I want to be sure that such examples are being followed up nationally.

[Frank Dobson (Holborn and St Pancras) (Lab)]

Let us assume that the Government’s £50 billion estimate is correct. That investment is expected to bring the greatest benefits to Birmingham, Nottingham, Sheffield, Leeds and Manchester: five cities. Does my hon. Friend think that if the £50 billion were broken up into nuggets of £10 billion, and if each city were offered that amount to promote its local economy, the five of them would decide to club together to pay for a high-speed rail link? [Laughter.]

[Mrs Ellman]

The whole point of major infrastructure is that it makes a major difference in connectivity across the country, which benefits all parts of the country. If that benefit is fragmented, it will not accrue.

I certainly support economic development in the regions, and I deplore the abolition of the regional development agencies, but I hope that the local enterprise partnerships—alone, working together, or working in transport cores—will ensure that economic benefit comes to their areas, and that the Government provide the support that will enable that effort to be private sector-led and succeed.

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[Stephen Timms]

I think that investment in this project will contribute to national wealth. My concern, however, is that it should be adequately designed and planned. To have a single track connecting High Speed 2 and High Speed 1, with a capacity of three trains an hour, is a mistake.

[Frank Dobson]

Will my right hon. Friend give way?

[Stephen Timms]

I will make one more point before I give way to my right hon. Friend because it relates to the concerns that he has raised.

If there were a proper link between High Speed 1 and High Speed 2, some of the trains coming towards London on High Speed 2 would not have to terminate at Euston. Some could run on to High Speed 1, some could terminate at Stratford International station, in which I have a particular interest, and some could run further along High Speed 1. As a result, significantly fewer platforms would be required at Euston than are proposed and there would be a reduction in the big problems in my right hon. Friend’s constituency, to which he has rightly drawn attention.

[Frank Dobson]

I am sure my right hon. Friend is right that the proposal to have a tunnel from Old Oak Common to Primrose Hill and to run the rest of the connection above ground across Camden Town will not provide an adequate service. It will certainly wreak destruction in Camden Town, which the people behind the project denied until recently. As an indication of their general incompetence, when the cost of that proposal went up from £170 million to £300 million, they said that it was because of unforeseen circumstances, including the need to widen the line.

[Stephen Timms]

I am grateful to my right hon. Friend. I am aware that the proposal for that interconnection is now rather more costly that it was initially. However, as far as I can see, the problem has not been solved. There is still a limit of three trains per hour, which is clearly insufficient. I warmly welcome amendment 17.

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[Frank Dobson]

It may interest the hon. Gentleman to know that about 220 households in my constituency will need to be re-housed at the expense of HS2. The authorities were rather shocked to discover that a one-bedroom flat in a block recently built in the locality is currently going for £482,000. Most of the people who need to be re-housed need a family-sized flat.

[Stephen Barclay]

The right hon. Gentleman brings great expertise to these issues. That takes me back to the reference to a blank cheque: my concern is that the House is being asked to exercise blind faith, which will have a hugely distorting effect on transport schemes elsewhere in the country—as pressure grows, for example, for Crossrail 2 to connect not at Tottenham Court Road, but at Euston. Other schemes in the system, such as the one in my area of Cambridgeshire, will be asset-stripped of what they rightly deserve.

Let me leave the House with the image that we look like someone coming down the platform with five business cases, while the train has already left the station and we are waiting for the announcement of whether we will hit our destination, which will be given next year not by the Government, but by the shadow Chancellor. I do not think that is the right way to proceed. We need to be far more careful with controlling the costs.

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[Mr Straw]

I will in a moment, but I am conscious that others want to get in before the knife.

I come to the issue of the costs. No one is in favour of providing blank cheques for schemes, but I have seen no evidence that a blank cheque is being provided for this scheme. What we are talking about is £42 billion until 2033, which works out at just over £2 billion a year. That is a lot of money but, in the grand scheme of things, including infrastructure investment, it is not huge, particularly when compared with the massive amount of money that has rightly been put in by successive Governments to improve infrastructure in London and the south-east. I would be happy to support that, but it is time that the investment went elsewhere.

[Frank Dobson]

Does my right hon. Friend feel that some people might be a bit suspicious that a contingency sum of £14 billion closely resembles a blank cheque?

[Mr Straw]

Not in the least. I was just about to come on to the central issue of the level of contingency, and when I do so I shall explain why that is the case, but before I do, however, I will give way to the hon. Member for North West Leicestershire (Andrew Bridgen).

[Mr Straw]

I have certainly never wished to speak for my right hon. and noble Friend Lord Mandelson. All I can report as a matter of fact is that my right hon. and noble Friend was in the same Cabinet Room in 2009 when the project was endorsed. If he has had some reverse damascene conversion, it is for him to explain that, not me.

Let me turn to the issue of costs. I was chairman of the Cabinet Committee on the Olympics for its first four years. The first bid was put in at about £2.5 billion and the ultimate cost came out at £9 billion. Let me explain why there is no direct comparison. The bid was not based on the contingency but on a prayer that we would win it. Not a huge amount of effort was put into costing it because, frankly, very few people ever thought we would win. It was only after we had won on 6 July 2005 that the serious work began and led, quite properly, by the Treasury, we considered the contingencies.

I say to my right hon. Friend the Member for Holborn and St Pancras (Frank Dobson) that a contingency of such a size is sensible, because there needs to be an optimism bias. That was what was put into the budget for the Olympics by the man who is now Sir David Higgins, who turned that project around. Contrary to what was said by the right hon. Member for Chesham and Amersham (Mrs Gillan), the Olympics as an infrastructure project came in not only on time, because it had to, but on budget. Those who are worried about a blank cheque—any Chancellor or shadow Chancellor needs to be—should be reassured that Sir David Higgins is now in charge. I have every confidence in him, not only from his time running this operation and the Olympics, but from his time at Network Rail. He got costs down and took a close interest in the detail of the projects.

[Frank Dobson]

Can my right hon. Friend confirm that Sir David Higgins spent all the contingency sum on the Olympics?

[Mr Straw]

Not quite, I think. There were reasons for that, however, and for the contingencies. These are very large projects. There were also contingencies for Crossrail, for Thameslink and for the expansion of Euston in 1968 and I do not recall Members who would have benefited directly from those projects raising issues about contingencies at the time.

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[Mr McLoughlin]

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

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

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

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

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

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

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

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

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

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

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

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

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

It is still important to recognise that the benefit-cost ratio cannot take account of unpredictable factors. That was true of the Jubilee line extension in London, for instance, which did not include the 100,000 jobs it now supports at Canary Wharf. It was true for High Speed 1, which did not include benefits from redevelopment at King’s Cross and St Pancras. When I first became a Member of Parliament, King’s Cross and St Pancras were places where people did not want to spend any time if they could possibly get away with it. They would try to turn up just before their train was due to leave. Those stations are now destinations in their own right. People go there and look with amazement at what has happened to the UK’s railway system.

[Frank Dobson]

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

[Mr McLoughlin]

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

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[Frank Dobson]

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

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

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

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

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

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

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

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

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

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

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