4.45 p.m.
Mrs. Margaret Thatcher (Finchley)
I will follow the Minister in trying to be brief because I know that a large number of my Friends wish to speak. Many of their constituents are affected by this Bill.
There is another reason why I need not speak for too long. As the Minister pointed out, the Bill is the same as that introduced by my right hon. Friend the Member for Yeovil (Mr. Peyton), to whom I must pay tribute. He handled this subject magnificently while he was in power, and I know that the right hon. Gentleman will understand when I say I am sorry he could not see it through. The then Under-Secretary, Keith Speed, made a very clear introduction of the Bill on 5th December. We have only to read that to see what it is all about.
As an old parliamentarian——
Mr. Eric Ogden (Liverpool, West Derby)
Oh!
Mrs. Thatcher
As one who has been in this House for some considerable time, may I make a preliminary point. We all understand that the right hon. Gentleman may find himself in a little difficulty today. We have changed sides in this House and unfortunately there have been times when changing sides has appeared to change opinions. That is one of the things which has led to a certain amount of cynicism on the part of the public [column 967]towards politicians. I noted that last time we debated the matter the right hon. Gentleman said,
“If I were now in a position to take this kind of decision I should not be recommending to the Government and the House that we proceed with the present tunnel plan as composed, or at this moment of time with any tunnel plan at all” .—[Official Report, 5th December 1973; Vol. 865, c. 1321.]
I welcome the right hon. Gentleman's partial conversion and hope that in the end it will be a complete conversion. I am sure that he will begin to understand that this is one of the exciting big projects on the political agenda. We are going through a period in politics when it seems that all the exciting big projects are stopped and politics appears to have become about bread and cheese. There are more things in life than that. [Interruption.] Bread and cheese are also important but so are some of the more visionary ideas to the abilities and resourcefulness of our people.
The first issue I want to raise is that of compensation for those affected by works associated with the tunnel. One of the most encouraging things about the whole project has been the way in which Members whose constituencies are most affected have refused to be limited in their vision by a specifically parochial view but have been prepared to look at the wider national outlook. Part of this is due to the action taken by successive Governments, particularly the last one, to see that those whose properties and lives were affected should have generous compensation.
It is also due to the strenous efforts of my right hon. Friend the Member for Yeovil to see the people concerned, to meet points put to him and to meet hon. Members who care on behalf of their constituents. It is due, too, to the willingness of the companies concerned to help in these matters. I am sure that the right hon. Gentleman will continue this and will be anxious to see that those affected receive full and generous compensation.
Mr. Mulley
May I echo the right hon. Lady's tribute to her right hon. Friend the Member for Yeovil (Mr. Peyton) for the way in which he met local authorities and Members concerned. I will try to follow that lead.
[column 968]Mrs. Thatcher
We are most grateful.
The White Paper said that the provisions of the Land Compensation Act 1973 would apply to those whose property was to be affected by the proposals. Although that paragraph comes shortly after the paragraphs headed “The Railway Link and Installations” , I understand there is some doubt as to whether the Act applies to railway works, since it was drafted with roadworks and airports in mind. May I ask the Minister specifically whether it does apply to the rail link, because that is obviously one of the most important questions for a number of my hon. Friends. Further, will the noise insulation regulations of 1973 apply? If not, will steps be taken to ensure that they do? This is particularly important for Members representing Kent and Surrey, where much land and property will be affected. My hon. Friends who represent Surrey and Kent constituencies, particularly my right hon. and learned Friend the Member for Surrey, East (Sir G. Howe), are very anxious about this.
I was a little confused by what the Minister said about the timetable. I do not see the timetable stretching ahead as clearly as he seems to see it. I understand that phase 2 ends in July next year, 15 months from now. The teams who are working on the project will want a decision whether the project will continue three or four months before that. We do not want the design and working teams on a big project like this wondering three or four months in advance whether the scheme has a future, so that we must have a decision at least a clear three or four months before the end of phase 2. That will bring the timetable back to about March.
In a statement made a few weeks ago Anthony Croslandthe Secretary of State for the Environment said that the reassessment would be complete by the end of next summer. I challenged him on it at the time and asked whether that was time enough to make the reassessment, and the more I look at it the more it seems an insufficient time for making the sort of reassessment he had in mind.
I understood that the Secretary of State was to consider whether the existing traffic could be provided for by alternative means. There is not time for that to [column 969]be done and for a judgment to be made by the early months of next year. The treaty has to be ratified by 1st January. In the meantime we have to go ahead drafting Agreement No. 3, and that draft must be deposited by 1st April. Between those times we must have received the report from the independent consultants, considered it, debated it and made a decision upon it. Are we going to ratify the treaty before a final decision is made? When do we expect to make a final decision? Before doing so we must have time to consider the report.
Mr. Mulley
We need to ratify the treaty that was signed in November by 1st January so as to allow phase 2 to continue. If we do not do that the project is abandoned. That is why the Bill is so important. We do not—and under the treaty we cannot—have in mind any change in the timetable set by the previous Government. My hon. Friend in winding up the debate will deal with the complexities at greater length.
Mrs. Thatcher
My recollection is that the Conservative Government intended that the final decision should be made by about the time of the Third Reading of the Bill—although I may not be quite right about that. But there is this totally new factor of the reassessment. I hope that the Minister who winds up the debate will give more details about what that reassessment includes. The Secretary of State was vague. His few words were more a cloak to what he meant than a revelation.
We should also like to know a little more about the road-to-rail orientation. The whole costing of the tunnel is based upon the rolling motorway as well as the rail concept. I understood that the right hon. Gentleman had rejected the rail-only link. If that part of the time-table can be sorted out I shall be grateful.
There are two matters about the British railways timetable which concern me. The first is the short-term timetable which particularly affects my hon. Friends who represent constituencies on the shores of the rail link. The right hon. Gentleman said, rightly, that no decision about the precise route had yet been taken. Of course it has not. The plans have been available to the people [column 970]affected only for a few weeks, and many have not yet seen them. We are worried about the shortness of the timetable. If the plans for the Private Bill are to be deposited by 1st November, the full details of every property affected will have to be worked out by about June. Remembering the summer holidays, that does not leave much time for the appropriate consultations, particularly as Surrey has produced a plan of four different routes. People will be alarmed if they feel that their interests are not being properly protected and that they are not to have full consultations before the decision is made. Some of my hon. Friends will need a great deal of reassurance on that.
On the longer-term British Railways timetable, is the right hon. Gentleman confident that the money made available by his Government to British Railways will be adequate and that British Railways will be able to construct the rail links in time? The treaty contains a penalty clause in Article 5.6.2 to the effect that, if neither road nor rail links are properly constructed by the date of the operation of the tunnel, the Government in default must pay to the authority a sum equal to the net loss of income to the authority resulting from the absence of the road or rail link. To settle the route, to have the capital sums made available and to get all the construction work completed within a six-year period is a large undertaking, and I should like to hear that the right hon. Gentleman is confident that it can be done.
In considering alternatives to the tunnel, will the right hon. Gentleman take into account that Kent—with which I have had connections for many years—already has problems caused by the volume of traffic and heavy freight passing through it. It already urgently needs the requisite roads to be constructed. A great deal of expenditure will be needed whatever view is taken about the Channel Tunnel.
There are several reasons why the costs of any project may rise. First, they may rise because the design is substantially altered during the project. That happens with an unknown project in which new technologies are involved. One would not expect much of the design of the tunnel to be changed. There may be one or two minor variations arising from [column 971]the technical work that is now being done on the tunnel, but no substantial design alterations. There may also be one or two decisions which we cannot yet cost on the design of the rolling stock, but I do not believe that many increases will come from the alteration of the design of the project.
Secondly, there may be increases in cost because of insufficient allowance for contingencies. Sufficient allowance for these has probably been made in this project.
The third reason is the difficult one. I noticed that the right hon. Gentleman referred to the real cost, which is the usual convention by which we cost projects in which the Government have a hand. There could be differences in the out-term cost because of the level of inflation used in the calculations. That level is just as much a decision for the Government to take as those connected with the project, and the Government must be prepared to take it, if we are to get a realistic cost assessment. I say that, knowing how difficult it is to take an economic view in these matters for any length of time ahead as the economic climate changes so quickly. If we are in difficulties about the precise outturn cost, this is one of the reasons for it.
I understand that there is a new assessment of the cost of the project amounting to £970 million, based on the following three factors—a higher construction cost escalation averaging 8.5 per cent. per annum, compared with the former figure of 7 per cent.; a higher interest rate during the construction and the remuneration period averaging 10 per cent. per annum, compared with the previous figure of 9 per cent.; and a delay of three months in the completion of the construction. Any delay is very expensive in terms of cost. On that basis the total estimate is £970 million. Therefore, I hope that before a final costing is reached, the Government will make it clear that they understand and agree with the levels of inflation put into the actual projections. This does not mean that they are committed to this level of inflation; indeed we hope that it will come down.
When all those assumptions have been made and the sets of figures calculated, [column 972]the Government will have at last to come to a final, positive decision. I believe that will have to be well before Easter next year. I hope that there will be no question of putting off the decision by the classic method of having further inquiries. In the end that process turns out to be a way of saying “No” by a slow strangulation process. I believe that between January and Easter next year we shall have to take the decision and that the facts from the new assessment will have to be available by that time.
It is possible that the Bill may be obtained this side of a General Election. It is also possible that it will be a question of “third time lucky” for the introduction of this Bill. If that is the case, then I should like the Minister to know that I shall not adopt his tactics in any way. I shall be as happy to support the Bill in opposition as we were to support it when we were in government—and the same will apply when our places are reversed.