High Speed Rail (Preparation) Bill

Jack Straw Excerpts

Thursday 31st October 2013 Commons Chamber

[Mrs Gillan]

No, not at all. I am not arguing that, but I have always been of the principle that if it is to be done, it is to be done properly. I am quite clear about my position—I do not want HS2 at all, but I also do not want a Bill to go through the House that does not reflect what I think the project should encompass, and indeed what the Bill itself states it encompasses.

[Mr Jack Straw (Blackburn) (Lab)]

Would the right hon. Lady not accept that, on the current plans for phase 1 and 2, there will be a 45-minute reduction in journey times to Edinburgh?

[Mrs Gillan]

The right hon. Gentleman makes a good point, but the Government recently produced the new business case, and I believe that there is doubt over the timing used for Edinburgh to London. I have been informed by a commentator that they failed to take into account the new rolling stock and the existing time savings from improvements being made to the line. I stand to be corrected—perhaps the Minister can tell us—but I believe that there has been an error in the calculation.

I would like the Bill to refer to Scotland, because it is important that a definite intent be put in the Bill. It would send a good message to Scotland, at a time when we are trying to keep this United Kingdom together, in the teeth of opposition from the nationalist parties, and I think it should be in the Bill simply for that reason.

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[Eric Ollerenshaw]

I thank my right hon. Friend for bringing us back to reality—[Interruption.] Sorry, he is my hon. Friend, soon to be right hon. Friend.

We must be serious on capacity. I and fellow Lancashire Members have been fighting for some time for a direct train service from London Euston to Blackpool. We had the agreement of Virgin, and a cross-party group was involved, including me, my hon. Friend the Member for Blackpool North and Cleveleys (Paul Maynard) and the hon. Member for Blackpool South (Mr Marsden). We thought we were there, but only a month ago, Network Rail said, “We cannot put on two direct trains per day from Euston to Blackpool because the line cannot cope.”

[Mr Straw]

I confirm what the hon. Gentleman says, although I would much prefer all trains to turn right at Preston to go to Blackburn. The truth is we all have an interest in the prosperity of Lancashire as a whole. I would like the line to start from the north, but all the economic arguments say that it should start from the south. Does he accept that the benefit of the reduction in journey time to Preston is one of the best in the plans for the area? The journey time is improved by 44 minutes—it is cut to an hour and a half—which will have a dramatic impact not only on Preston and central Lancashire, but on the whole county.

[Eric Ollerenshaw]

Lancaster is not on the line yet—it might be eventually, and I might stand here in future asking for a stop there—but we will reap the benefit, as the right hon. Gentleman says. The spur line that will be built means that high-speed trains will enter the normal west coast main line just above Wigan. We will enjoy the benefits of that service, which will be fantastic for the economy of our area.

I am grateful to my right hon. Friend the Member for Chelmsford (Mr Burns), the previous Minister. I congratulate him on his incredible speech and I am grateful for the support he has provided all the way through the process to get the Bill right.

Another issue is the north-south balance. People in some areas of the north ask why we are spending that money. I am grateful for what appears to be an outbreak of political consensus. Some Government Members and some northern Members were worried that the consensus would break down, but from what right hon. and hon. Opposition Members have said today, it looks like the consensus is restored, for which I am grateful.

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[Mr Straw]

I shall speak particularly to amendment 25, which has the support of my Front Bench and, I am pleased to say, of the Government as well. I was a member of the Cabinet in 2009 which first gave formal approval to HS2. That was endorsed in the run-up to the general election by all-party agreement. Although I have taken a close interest in the project ever since, I have seen nothing in the intervening period to persuade me to withdraw my support for it.

The case is clear. First, thanks to a dramatic increase in the usage of the railways in the past 15 years—I am very proud of Labour’s record—we face a situation where, for both freight and passengers, the existing lines cannot cope. As someone who for years has had to endure the west coast main line, I have to say that large sums of money were spent during that period—one of the reasons why there was so little electrification—on patch and mend to that line and on quadrupling the line in the Trent valley, with very little overall benefit. If folk in the House and outside think there is an alternative to HS2, they are right that there is, but it is a worse alternative, with more disruption and greater cost.

The second reason why I strongly support HS2 is that it will help to rebalance our economies. I have listened to some fancy arguments in the House, but among the fanciest are those that I have heard today and from colleagues in the Tea Room—that if we put in this investment, it will somehow suck more economic activity into London. It is worth turning that argument on its head or, as the Treasury likes to say, looking at the counterfactual. If that were the case, it would be overwhelmingly an argument for reducing the capacity of the railways north-south and for slowing up the lines. It is simple nonsense.

[Andrew Bridgen]

Will the right hon. Gentleman give way?

[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).

[Andrew Bridgen]

The right hon. Gentleman is obviously an advocate of HS2, and that can be his view, but will he explain the discrepancy between his view and that of the noble Lord Mandelson, who was also a member of the previous Labour Government?

[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.

[Jake Berry (Rossendale and Darwen) (Con)]

The right hon. Gentleman and I worked with David Higgins on the improvements to the Blackburn-Manchester rail line, which serves both our constituencies. Given the right hon. Gentleman’s experience with that project, does he regret the fact that a long-term view, which we found we needed, is not being taken by those on his own Front Bench, who seem to be holding a question mark over the future of HS2?

[Mr Straw]

The hon. Gentleman is absolutely right that he and I have had direct experience of dealing with Sir David Higgins on a micro-level as well as a macro-level, and very impressive he is too. I do not criticise anybody who either holds or might hold the purse strings for wanting to ensure that we bear down on costs, but those on my Front Bench and the whole of the parliamentary Labour party, as has been made clear, support the project and the Bill. That is why, if a Division is called at 5 o’clock, we will be in the Lobby with the Government in support of the Third Reading of the Bill. Let me make that clear. We started this project and I hope very much that the Labour party is in a position to ensure that we finish it.

[Steve McCabe]

Does my right hon. Friend agree that it might help those who want to support the project and perhaps make it easier for the softer opponents if the contingency figure was reduced? At a third of the projected total cost, it seems remarkably high, and it might risk inflating the project’s costs.

[Mr Straw]

I know about optimism bias contingency costs because I faced exactly the same situation when I chaired the Cabinet Committee for the Olympics. My initial reaction was the same as that of my hon. Friend and my right hon. Friend the Member for Holborn and St Pancras: “Why on earth are we building in a contingency reserve on this scale?” I got the Treasury officials in and cross-examined them—I bumped into one the other day who remembers it—but in the end I was convinced that what was proposed was prudent, to use an adjective that used to be owned by the Labour party, and still is. Contingency reserves of that size are sensible and realistic. Yes, the cost is £42 billion, but that is over 20 years, so we are looking at a cost of about £2 billion a year, of which the optimism bias contingency reserve is about £700 million. In my judgment, such things are manageable.

[Charlie Elphicke]

rose—

[Mr Straw]

I must make some progress.

Of course I understand the concerns of Members on both sides of the House about their constituencies. Were I in their position, I would probably be voicing similar concerns. However, when the grand motorway schemes were being built across the country, including in the Chilterns—the M40 goes right through them—there was no parliamentary process of this kind at all. There were no private Bills; there were private inquiries and compulsory purchase orders, and on it went. Of course there was an argument about the exact route the M40 would take when it went through the escarpment out of the Chilterns and around Oxfordshire, but I do not recall any Member from Buckinghamshire standing up in the House recently to say that building it was a disaster, that the effect on biodiversity was terrible and that we should return the land to the way it was.

Had there been a parliamentary process for the M40, the right hon. Member for Chesham and Amersham can bet her life that such would have been the opposition in the Chilterns—I understand exactly why, because we are all concerned about our own back gardens, including me—that it would never have been built. However, that road, at far greater disruption to the area than any railway will ever cause, has brought benefits to her constituency and county. While she continues to pursue her constituency concerns, I hope that she also recognises that there is a national interest in rebalancing our economy and ensuring that people in the north can get to the south more quickly.

[Mrs Gillan]

My concern is not only about my constituency, but about how we use taxpayers’ money. I am as keen as the right hon. Gentleman to rebalance the economy between the north and the south; I just do not think that HS2 is the way to do it. The M40 has of course brought benefits, but that does not mean that the damage that will be done to the environment by yet another breach of the area of outstanding natural beauty can be brushed aside, although it is quite obvious that he thinks that the suffering of my constituents and their businesses is a price worth paying.

[Mr Straw]

My last point is this: far from being brushed aside, the environmental concerns are being taken into account in far greater measure than was ever the case with the motorway schemes. I hope that the Bill goes through this afternoon so that we can then see an all-party consensus behind the project and introduce the hybrid Bill, if possible before the general election.