Highways (Financing) Bill

Olly Glover Excerpts

2nd reading
Thursday 15th October 2026 Commons Chamber

[Olly Glover (Didcot and Wantage) (LD)]

I start by welcoming the Minister to his place. He has been blessed with the opportunity to bring another scintillating transport Bill to this House, which has clearly excited a very large number of hon. Members.

Starting with the Minister’s comments about the lower Thames crossing, which is clearly a major reason why this legislation has been laid, he is quite right to say that there is a clear need to relieve pressure on the Dartford crossings that connect the two ends of the M25 across the Thames. However, it is interesting that we seem to be assuming that traffic growth is inevitable, which is an assumption that the Government were not quite so willing to make when they opposed passenger growth targets in the Railways Bill. I make that point purely because although we of course need to cater for future increases in road demand, there is also a lot we can do to transfer that demand—both passenger and freight—to other transport modes, particularly for long-distance traffic.

In that context, while the lower Thames crossing has merit in that it will relieve the existing Thames crossings, the Government appear to be repeating the mistake of many past Labour and Conservative Governments by seeing road building as the sole answer and neglecting rail infrastructure. The channel tunnel is one of the engineering wonders of the world, yet it continues to be under-utilised, especially for rail freight—in fact, largely the rail freight does not exist, beyond lorries going on LeShuttle or whatever it is called this week. Channel tunnel use charges are one of the barriers; another is the capabilities of the UK rail network within Kent. There are well-developed plans for upgrades to the Kent conventional rail network to accommodate W12 loading gauge freight trains, and intentions to create a freight hub served by High Speed 1 at Barking, which would benefit from acceleration.

As drafted, the Bill would also give the Government significant powers to impose road tolls and charges on major roads. Introducing a new financing model for the strategic road network, while the local roads that make up 99% of the country’s roads in terms of length are facing an £18 billion repairs backlog, is an interesting choice by the Government, but let us engage directly with that choice.

There are examples of the concept of tolls and charges working well both here and abroad. Many choose to use the M6 toll road instead of the M6 despite there being a fee to pay, because it reduces some of the “road to hell” experience that the M6 often is for many. In France, motorway tolls are common, if not universal, and many European countries use a vignette system, where a driver pays for a sticker, or a digital version of that, to go on their vehicle, which enables them to use motorways and trunk roads. The advantage is that people who want to use motorways and trunk roads pay a little bit more for those roads, but people who use their car only for very local purposes do not have to pay that cost.

[Mr Holden]

Would the hon. Member accept that the Bill allows for exactly what we see in France, which is toll roads across the entire strategic road network?

[Olly Glover]

Not all French motorways are tolled. Certain sections of them are—often the busiest sections. I will come to what the right hon. Gentleman said about what the Bill does and does not do.

The Liberal Democrats’ position is that there needs to be close attention to the detail and scrutiny of the way in which charges and tolls—like those in Europe and on the M6, which I mentioned—are implemented. However, the Bill leaves all of those questions of operation, management, oversight and regulation of tolls and charges largely undefined; they are often relegated to secondary legislation. The Government must ensure that road users are not held to ransom by licence holders, who must be properly regulated. We have seen disastrous effects in other sectors when these things have been got wrong.

The Minister and the hon. Member for Northampton South (Mike Reader) gave good examples of how a regulated asset base approach, and indeed private finance initiatives, can be used for good, but of course there are many bad examples as well. I am not sure whether too many people believe that the water industry’s use of the regulated asset base approach has been enormously successful. We certainly need regulation of private investors and to ensure that the triggers for the special administration regime defined in the legislation are not too weak. Of course, there are also many examples of public private partnerships and private finance initiatives that have not ended well, particularly with hospitals and the London underground.

[Mr Francois]

The hon. Member is making a very thoughtful speech. I was recently on a private holiday in Texas, being driven by a friend. In that state, there is a number of toll roads, so people have a chip attached to the windscreen that allows them to transition from public roads, as it were, to toll roads and back again, with that chip recording what they have to pay as they go from one to the other. The technology to do this already exists—I saw it with my own eyes. We are just a bit worried that the Government might be a bit too keen to adopt it.

[Olly Glover]

The right hon. Gentleman is right to say that if we are to go down that road, it needs to be transparent and done in a way that gives confidence to consumers. Car drivers and road users are consumers, and we should think of them in the same way we do customers on the railway or on planes. If such a thing is to be done, it must be done with great care and thought. That is why we need to scrutinise the legislation carefully.

[Ruth Cadbury (Brentford and Isleworth) (Lab)]

Such schemes are hardly new: in London, we have had the congestion charge for many years now—[Interruption.] We have it elsewhere, too; drivers in and around our major cities are used to a charge they have to include in their budgets.

[Olly Glover]

Yes, London is another example of where some of these things are already happening, but the fact that they have been controversial at times is exactly why they need to be done with thought and, ideally, in a manner that avoids some of the interminable cultural wars that we must always have on every topic these days. Instead, they should be done with consensus and based on sound reason and analysis.

We are not satisfied that the Bill as drafted provides that transparency and accountability, so we will not take a view on it as a whole today. We hope that the Government will be more receptive to some of our ideas to improving the Bill at later Commons stages than perhaps they have been hitherto.

Highways (Financing) Bill (Second sitting)

Olly Glover Excerpts

Committee stage
Thursday 29th October 2026 Public Bill Committees

[Justin Madders]

We hope the Bill will address those concerns.

[Olly Glover (Didcot and Wantage) (LD)]

Q Both of your organisations and many others have highlighted how the UK is not great at delivering infrastructure quickly and efficiently. Do you believe that the Bill in its current form has the potential to accelerate the delivery of major road projects?

Ben Hopkinson: I completely agree that the UK has a long historical challenge with delivering infrastructure cheaply and quickly. HS2 is the most expensive railway ever built, and the Bakerloo line extension will be one of the most expensive underground lines ever built. Tramlines are double the cost here compared to other European countries. We have the most expensive nuclear power plant ever built. There is a real long-term failure to build infrastructure quickly and cheaply.

On the Bill, it is good that we are getting private financing in, and that will help ease some of the burden on the state, when we are already pushed up against our fiscal limits. As I have mentioned, I have a little concern about the incentive structure, especially insofar as the private constructor has incentives to escalate costs as much as they can get away with under the ORR. A concession model might work a little better.

Sam Dumitriu: One of the important things when it comes to infrastructure delivery is ensuring you have a pipeline of projects, you know what you will build next and you can plan appropriately. We have many reasons why, in the UK, those pipelines get knocked about. Sometimes you have a road that you want to build, and everyone wants it built, but someone has brought a lawsuit against the road and it is delayed by a year. That makes planning for that really challenging.

One of the other problems is that sometimes those delays mean that you get pushed into different funding windows—the Treasury can reopen conversations about value for money, especially when in every Budget someone is trying to squeeze things into the fiscal rules and moving things from one period into another period, and cost-saving measures that are really delays. Those things tend to happen, and have happened for ever.

One thing that was really impressive under the last Government was the road investment strategy approach, which essentially said “We will set out a strategic case for all the big roads we want to build, we will give a pot of money and then we will give a delivery body the freedom to execute that.” The freedom to execute was slightly constrained by the planning system and all those delays, but fundamentally that is a very good approach. The challenge comes when the money is not quite there from the public purse, in part because the fiscal situation is tighter, but also because different choices are being made. In that case, private finance can fill the gap and ensure that you have a much more stable pipeline. I am in favour of that aspect and I think that will speed up delivery.

[Tristan Osborne (Chatham and Aylesford) (Lab)]

Q Under the French model which you have cited as a template, 91% of roads are owned by privatised companies, and that is very different to the UK. They are extremely controversial and many accuse companies in France of price gouging. We have concerns about asset management and the valuations. You have said that the RAB model is potentially ideal, but is there any element of it that you can say is better than the French concessionary model? What teeth would you give the regulator to make it so, if we were to go down that route? What is missing from the RAB model that would make it more effective?

Ben Hopkinson: It is a good question. First, in the French example, I am well aware that it is quite expensive to drive on a French motorway. On the other hand, they have many more miles of motorway, and if it is too expensive you can take the equivalent of an A road for certain journeys. Judging by the number of people who drive on French motorways, I think people are generally willing to accept the costs, especially given that they have built many more miles of motorway just this century than we have in total.

I could be proved wrong if it works really well, but the main challenge with the RAB model is the sheer uncertainty of whether the ORR is up to the task and has the right staff in place. It has never done this before. I know there have already been some concerns about capacity issues and general commercial experience within the ORR. I would be concerned if the private sector had large commercial control and contract teams and the public sector did not have them and was out-negotiated. That is certainly possible if civil servants are not able to properly push back on price increases.

I think the fundamental incentives in a RAB model are not right for delivering one-of-a-kind, unique pieces of infrastructure. It works a lot better for infrastructure that has very clear unit costs—for example, the cost of laying 100 metres of pipe. That is good because a regulator is clearly able to understand how much 100 metres of pipe costs to lay and can apply that across its base, whereas the cost of one lower Thames crossing is up in the air. Some additions from the private contractor might seem sensible; they might get away with that. Having a more environmentally friendly construction process certainly seems sensible on the face of it, but that also adds cost. I would want to be reassured that the ORR is up to the task and has both the capacity and the know-how to properly understand the arrangements it is entering into.

Sam Dumitriu: You mentioned price gouging. It is important to work out what the main risks are. Roads are, in most cases, natural monopolies, and the best thing about being a monopoly is a quiet life. It is not necessarily that you have all these opportunities to gouge your customers; it is that the lack of competition means you are not forced to adopt cost-saving measures, or become more customer-friendly and so on. You might have a situation where various people are claiming quite high margins or they are being aggressive in that sense, but the UK has the other problem, where people are not on it around costs. They are not working out what the best structure is to ensure that costs keep falling.

On Ben’s point, one possible way of resolving the issue is quite a radical reform that is probably beyond the scope of the Bill. I have always wondered whether it makes sense for the UK to have Ofgem doing RAB regulation for energy networks, Ofwat doing it for water, the ORR for road and rail and Ofcom for telecoms, or whether it makes sense to have a specialist economic regulator that deals with the costs of natural monopoly networks. That would have a bunch of advantages. It would potentially resolve some of the revolving door problems that you might see. It would also ensure that there is a similar expertise and a standard approach. You do not want varying approaches between all the regulators, because that suggests that they are doing something wrong when you have essentially the same economic problem to solve. As I say, however, that would be far beyond the scope of the Bill.

--- Later in debate ---

[The Chair]

I call Olly Glover.

[Olly Glover]

I am all right, Chair—I will defer to other colleagues.

[The Chair]

If there are no further questions from Members, I will thank the witness for his evidence and we will move on to the next panel.

Examination of Witnesses

Will Godfrey and Matt Palmer gave evidence.

--- Later in debate ---

[Justin Madders]

Do have anything to add, Mr Godfrey?

Will Godfrey: I would reiterate the point that the development consent order tightly defines the scope of what is being delivered. As Matt said, the project is already well advanced.

There are a few other points to bring up. Getting the cost forecast right, which underpins the allowed revenue for the first control period, is really important. That is the baseline against which you are holding the company to account. The instruments thereafter are what you specify in the licence, and that is really important to get right. That is not stuff you put in the Bill, but it is really important that you get it right in the licence and that you have the right incentives for the privately financed entity to deliver against that schedule. You need to make sure that the balance in the allocation of risk is right and that end users are ultimately protected from the risks of cost overruns.

As I say, this project is fairly well advanced already; it is not like we are talking about starting one from scratch.

[Olly Glover]

Q Over the decades, we have often heard the wisdom that private finance is better than the Treasury, because it helps to keep things off the Treasury books and avoids constraints from public sector financing. But with some of those private finance initiatives, the whole-life costs can end up being quite a lot higher and being a burden on the taxpayer in a different way. What metrics do you feel that the Government should use to determine whether alternative finance arrangements, rather than direct Treasury funding, deliver better value for money for individual road schemes? What criteria should there be for deciding that?

Will Godfrey: I think the ORR’s role, as envisaged in the Bill, would not be to advise on those questions. That would be more of a question to address to Government. It is perhaps relevant here that it is important to take account of the risk-adjusted cost of financing. You have already made the point about whether things are on the balance sheet or not. Another point to bring in is the certainty around the funding and delivery arrangements. RAB-based price controls are a commitment to a certain cycle of, typically, five-year reviews in which you set the funding requirements, the price control limits and what is delivered in that period. You reset each time but the point is that it is not potentially subject to Government reopening the arrangements for the funding, which is sometimes encountered in other publicly funded arrangements. I think that is as much as I am able to say. That is more of a question for Government.

[Olly Glover]

Q Any thoughts from you, Mr Palmer, using your rich and wide-ranging career experience?

Matt Palmer: If you talk specifically about the lower Thames crossing, its strategic case is incredibly strong and it was introduced by Government to be built because of the broader economic benefit for the country. There is a mixture of models that the Government could choose to fund it. There was a discussion about concessions and RAB-based models earlier. They will all carry the same carrot and stick for driving cost performance. In the end, it is the Government’s decision to bring a project forward. If it is of a strategic nature then this Bill will allow you to fund it.

[Olly Glover]

Q I have a quick follow-up on something you said earlier, Mr Godfrey, about the importance of getting the licence right. You perhaps cannot answer, but let me ask the question in a slightly mischievous way. There was a debate about the Railways Bill and how it was important to see ancillary documents that it referred to while considering it, because those documents had a lot of implications for how the Bill would operate in practice. Would you view the licence and the code, which this Bill stipulates that the ORR must create, as operationally critical to how the Bill would be implemented in practice?

Will Godfrey: One distinction I would draw with the Railways Bill is that that Bill was so significantly concerned with the creation of Great British Railways, which will be responsible for something like 75% of all traffic on the network—not quite the whole market but a very significant proportion of the market. People are therefore understandably keen to see what arrangements are in the licence for that entity. This Bill is enabling and economy-wide. Clearly, the main project that we are talking about currently is the lower Thames crossing, but in principle several other licensed entities could be out there. That is one distinction that I would draw.

As to whether a particular licence is essential to inform the scrutiny of a Bill, my feeling is that the Bill gives you, as a regulator, the kind of duties, functions and powers that you would expect. On the licence, clearly there is work to be done there, but one advantage is that the licences will be put out to competitive tender. That provides a different level of scrutiny from the arrangements under the Railways Bill, in which the licence is awarded to GBR as the given entity that will receive it.

[Tristan Osborne]

Q The recent independent regulatory review of the ORR included a section specifically about the Thames crossing. Paragraph 5.58 of that review indicated that there are resource concerns:

“There are, however, likely to be gaps such as those relating to construction phase price controls, project specific

I know you said that you had confidence in that area, but that report was published just last month. Can I get some clarity? Are you saying that the report is not entirely right and that you are confident that the three aspects it raised will be covered going forward?

Will Godfrey: We very much welcome that independent review of the ORR. It is always helpful to have that sort of outside-in look and scrutiny.

On what it describes as gaps, the other point that Dr Richard Judge brought out was that we are not building from scratch, so this is about providing incremental capacity. I think he was right to draw out those areas as ones where you would want to make sure that the gaps have been filled by the time you are past Royal Assent, the first licence has been awarded and you are into the start of the first price control, which is a long way from today. The point I am making is that, from the discussions I have been having with the Department, I am reasonably confident about being able to resource what I would describe as incremental gaps, rather than starting from a blank sheet.

--- Later in debate ---

[The Chair]

Olly Glover?

[Olly Glover]

Q This Bill proposes use of alternative financing models. Do you have any thoughts on the principles that should be used to make sure that risk is appropriately allocated among Government, investors, contractors and the eventual road users, to keep the project deliverable and affordable for all those parties?

Andrew Truscott: My biggest concern about this project is the ultimate cost to the end user. That is a piece of maths that we all, collectively, need to get right, because we cannot end up with a wonderful project that unfortunately saddles the user with an uneconomic toll for the next 50 or 60 years. How can we manage that? We can manage it by, obviously, trying to keep the cost of construction as low as we possibly can. Other things in our toll roads and our businesses globally include dynamic tolling, where we encourage road use by differentiated pricing depending on the time of day—I would love to explore that with the Government at the right time—and differentiation for different types of vehicles. I think there is a way of getting the end users’ experience to be a little fairer than if there was just a flat toll.

In terms of the overall costs and delivery, obviously, the cost of financing at the moment is as high as it has been in my career. That is a factor that we all have to be aware of. I am sure you guys all know this, but infrastructure is a diversifier in pension fund portfolios. We are a spread to the risk-free investor. That is how we calculate our returns, so unfortunately, as risk-free rates go up, the expectation of the returns on our capital also goes up.

Innovation around how we can collectively deliver a financing package against that backdrop that is as cheap and deliverable as possible is also quite important. How do we do that? Certainty of outcome, high-quality regulation and ensuring that everybody who commits capital understands the limits of their capital and is therefore able to calculate their returns accordingly.

[Olly Glover]

Any thoughts from you, Mr Forsdyke?

Roger Forsdyke: Not on the subject of financing; it is outside my experience.

[Olly Glover]

Fair enough.

[Tristan Osborne]

Q This question links to the independent review. I questioned the ORR on this. Obviously, you are sitting on the other side of the table, and you are looking to extract as much as you can from an investor perspective. You represent one side of the spectrum, and the regulators are on the other side. There has to be a working partnership between you both. Obviously, the efficiency of a project finance model such as the one for this crossing relies on certainty and predictability for investors, and regulators being there to ensure the stability of the regime. Obviously, we do not have a regulator that manages this at the moment. Where does investor confidence stand regarding the ORR? Do you think investor confidence is there for this model to work going forward?

Andrew Truscott: I would slightly reject your first statement, if I am honest. As an infrastructure investor, we provide, candidly, the lowest cost private capital that is available across the world. If you are attracting John Laing and people like us, I can guarantee that you are getting the lowest cost of equity capital that you can possibly attract and therefore the risk transfer needs to be accordingly appropriate.

I will slightly repeat my opening comments: when we first started interacting with DFT about this project, I was quite nervous about the RAB model. I am not a RAB nerd; there are lots of RAB nerds, and I am not one. RAB can be incredibly complicated, and it can take a huge amount of time to drill down. There is not a regulator. There is an awful lot of work that needs to be done. Am I nervous that that is going to take longer than it should do or could do? Yes, I am, but again, credit to DFT and the Treasury, they seem to be well on track. Maybe the better answer to your question is that we as investors will need absolute certainty—and I mean absolute certainty—about what that regulatory model is, who the regulator is and how that regulation is going to work before we will put in a dollar, a pound, or a euro—whatever currency you like.

--- Later in debate ---

[Jim Dickson]

Q I am a very strong supporter of the Bill, because it enables major projects such as the lower Thames crossing to be funded, but the tolling issue is important. We cannot talk about individual toll levels, but we can talk about mechanisms by which reasonable—hopefully affordable—tolls will be set for both industry and individual motorists. Could the Minister enlarge a bit on how the ORR, with the legislation designed and passed by Parliament, will ensure that tolls fit the definition of “affordable” as far as possible?

Justin Madders: I understand why you ask that question. The Bill sets the framework for the RAB model, and that will establish the independent regulator. Its remit is clear, and it is there in the first few clauses of the Bill: to take account of the interests of road users. There will be fair pricing, transparency and long-term sustainability as a result of that. You will also be aware that there will be a stakeholder group in which users will have the opportunity to feed in. We have a pretty robust set of reassurances that I hope will satisfy you and your constituents.

[Olly Glover]

Q A witness said that one of my questions was best aimed at Government, so it would be churlish of me not to avail myself of the opportunity to ask it to you, Minister. What metrics should the Government use to determine whether alternative financing arrangements deliver better value for money for road infrastructure projects than direct Treasury funding? How are the Government thinking about that question?

Justin Madders: First, as it made clear, the Treasury will not fund the totality of the project, so we have to look at other models. There are different views about how that would work. If we want to compare it to the private finance initiative, which has been the major funding source for a number of crossings in recent years, costs under the RAB model tend to be lower.

Clearly, we have an independent regulator that will, as I have explained and you have heard in evidence, be able to limit cost recovery, to make sure it is economic and efficient. There will be regular requirements set out to review that under the licence. Ultimately, the Government will not be left, as they would be under PFI, with repaying a debt over many years. That might be off the balance sheet, but it still ends up coming to the taxpayer.

[Olly Glover]

Q We hope that will end up being the case, because they have not all ended up marvellously—although you are right to say that some have gone well. You mentioned the Office of Rail and Road as the regulator. Why has it been selected as a regulator, given that the Railways Bill was rather shunted into the siding, some could say? Why the ORR rather than a different kind of regulatory arrangement?

Justin Madders: As this is a road, the Office of Rail and Road seems to be the appropriate regulator.

[Olly Glover]

Q Yes, but it is for rail, which is also in its title. I alluded to the Railways Bill, and I am just interested in the different approach.

Justin Madders: There is a different approach because this is a different situation. This is the regulated asset base model, which is about a long-term investment, balancing the interests of users and investors and having a strong regulator that understands the sector. As we have heard, the ORR is already working on it. That is absolutely the right balance to make sure this delivers for everyone.

[Olly Glover]

That is an interesting answer, because railways also have both users and investors, but perhaps that is a debate for another day. I will happily let other people come in now.

Highways (Financing) Bill (Third sitting)

Olly Glover Excerpts

Committee stage
Tuesday 3rd November 2026 Public Bill Committees

This group also contains amendment 44, tabled by the Liberal Democrat spokesperson, the hon. Member for Didcot and Wantage. I will not steal his thunder, but it would set a strict physical threshold for what legally constitutes “increasing capacity”. Again, the official Opposition have sympathy with this amendment. We always come from the standpoint that it is better to have clarity than to leave something completely vague. Any measure that seeks to pin down precisely what the Government mean will work pretty well, hand in hand, with my amendment 82 to be really clear about what we are trying to do. If the Liberal Democrats wish to press amendment 44 to a vote, His Majesty’s loyal Opposition will support it. When the Minister responds, can he be as clear as possible about the full intent of the Bill and, particularly on amendment 82, will he make a legislative commitment where there are currently only words?

[Olly Glover (Didcot and Wantage) (LD)]

It is a pleasure to serve under your chairship, Mr Dowd—I hope you are not too distraught about not having been in the Chair for some of the other very exciting transport Bill Committees that we have had this year.

I want to start by addressing amendment 82, tabled by the shadow Minister. We understand where he is coming from, because the Committee heard evidence from Steve Gooding of the RAC Foundation about the danger of clause 3 being used as a Trojan horse for widespread road pricing, which is something that the Minister has assured us will not happen.

Our amendment 44 takes a different approach to the problem of excluding non-new roads altogether. As I said on Second Reading, we feel that the idea of tolls and fees is reasonable in principle, and it is used quite widely in Europe, but the safeguards must be clear. That is why our amendment 44 would require a strict threshold for applying tolls to existing roads, which we are defining as a continuous extra lane, to show a genuine improvement in the road’s capacity and to justify any introduction.

I agree with the shadow Minister on clause 3, in that so much of the Bill relies on us to take it on trust that the Government will do the right thing with the extensive powers that it creates. There was a good article in The Economist a few years ago about the problem with the good chaps theory of government, which has been an historic feature of the British so-called constitution. The problem is that it is difficult to take things on trust and rely on the current generation to do the right thing and interpret a Bill as it was intended, because a Bill cannot force the hand of a future Government, but future Governments do need to work to the legislation that has been passed. We therefore have some concerns about that and would be interested to hear the Minister’s comments.

We support the shadow Minister’s amendment 81. It is sensible to require consultation with the relevant local and mayoral authorities and important to involve them in any major changes to their areas that could increase local traffic flow and the burden on the local community, so we would support the amendment if it were pressed to a Division.

Subject to what the Minister says, at this point we would be keen, with your permission, Mr Dowd, to press amendment 44 to Division.

[Alison Griffiths]

I will speak to amendment 82, standing in the shadow Minister’s name and my name.

On the face of it, clause 3 looks quite straightforward. The licence would be granted for “works involving”—not delivering, just involving—

“the construction of a highway specified in the licence”.

However, granting a licence for being involved in the work set out in subsections (1)(b) and (1)(c), which our amendment 82 would remove, would make the ORR responsible for determining what is fair and transparent in terms of a toll that could be charged in future for that work. Again, to be clear, the clause does not talk about delivery; it just talks about involvement, so there is a total lack of clarity.

The ORR will rely on a code that has not yet been written and that will not come before this House, so we will have no say in what it looks like. As far as I am aware, there will be no cost-effectiveness constraints on the licensee, so the toll could be considerable. Nor does the toll need to end when the costs have been recovered. Paragraphs (b) and (c) create the prospect of a never-ending toll upon our constituents for what could be a pretty unspecific piece of work.

To return to the points already made by the shadow Minister, a licence should be granted only for the construction of new roads. If we want to look at future roads, the code should be subject to a parliamentary vote at a later stage. Obviously the Committee has voted against this, but to return to our earlier discussion, we would prefer to be looking at two specific roads: the lower Thames crossing and, potentially, the associated Dartford crossing. Without those constraints, however, this piece of legislation is very problematic. I support the amendment.

--- Later in debate ---

Consultation in relation to grant of licence

[Olly Glover]

I beg to move amendment 45, in clause 4, page 4, line 27, at end insert—

“(c) publish an independent assessment evaluating whether alternative transport investments, including rail and bus connectivity, could fulfil the transport requirements of the proposed licence.”

This amendment would require the Secretary of State and the ORR to evaluate whether alternative transport investment, including rail and bus, is needed and suitable before granting a license to upgrade or build new highways infrastructure.

[The Chair]

With this it will be convenient to discuss the following:

Amendment 78, clause 4, page 4, line 27, at end insert—

“(v) any mayoral combined authority, combined county authority or local highway authority whose area includes, or is likely to be affected by, a highway specified in the proposed licence.”

This amendment would require licensing authorities to send a copy of the notice to mayoral combined authorities, combined county authorities or local highway authorities who may be affected.

Amendment 87, in clause 4, page 4, line 27, at end insert—

“(c) prepare, consult upon, and publish a report assessing—

(i) the anticipated impact of the specified highway on traffic volumes, congestion, and highway wear across local road networks maintained by adjacent local highway authorities; and

(ii) the specific traffic management, infrastructure, and financial mitigation measures required to address any adverse impacts identified under subparagraph (i).”

This amendment requires the licensing authority to publish a comprehensive local road impact and mitigation report prior to granting any licence, ensuring that traffic displacement onto surrounding local council roads is fully evaluated and mitigated in advance.

Clause stand part.

[Olly Glover]

I want to be clear at the beginning that we are keen to press amendment 87 to a vote.

Amendment 45 would mandate an independent modal shift and alternative transport assessment before any new highway tolling licence could be granted. It would prevent multibillion-pound road schemes from proceeding in isolation without evaluating whether rail passenger, rail freight or bus upgrades could deliver better value and lower carbon emissions. There is a clear need to reduce pressure on the Dartford crossing and improve connectivity in the south-east of England via the lower Thames crossing. But so far, the Labour Government appear to be looking only at roads-based means to do so.

I grew up in Staines, which is very close to junction 13 of the M25 and which road nerds will know is the busiest segment of motorway in Europe. When I was growing up and the M25 was new, it had three lanes, which then increased to four and eventually to five. Seeing the M25 permanently under upgrade was the accompaniment to my youth and adolescence. Do people who use that section of the M25 now find it a joyous driving experience, one that is entirely bereft of stress and complaint, or do they still consider it to be what Chris Rea once called a “road to hell”? They still consider it a road to hell, because while the M25 is of course a useful asset, one of the challenges of increased road investment is that very often that capacity gets absorbed and it does not address some of the wider transport challenges.

There is a clear need to improve rail connectivity in the region alongside the lower Thames crossing project. There is currently no Kent to Essex rail connection and very limited provision for channel port freight to move by rail—only by road. There are developed proposals on the table to upgrade the Kent railway network and the Barking freight terminal via High Speed 1 as part of the plan to significantly increase rail freight through the channel tunnel.

As Ralph Smyth from the Transport Action Network argued in front of the Committee last week, granting certainty to a major private road scheme can make it significantly harder for regional mayors or local authorities to promote sustainable alternatives like rail, tram or bus upgrades. Ben Garratt of Logistics UK noted that while road capacity is needed at Dartford, rail freight connectivity to ports plays a vital role in national supply chain resilience and must be integrated into transport planning.

Why should Ministers grant a potentially century-long highway licence without first publishing an independent evaluation of whether rail or public transport investment could solve the bottleneck? If we are to move towards achieving our environmental goals and providing good transport for those who cannot, will not or cannot afford to drive, serious investment in other infrastructure and public transport is needed alongside improving the road network.

Amendment 87 would make it mandatory to publish a local road impact and mitigation report. Toll-avoiding traffic that diverts into surrounding residential streets and local A roads could cause severe congestion, noise, air pollution and safety hazards for nearby communities. The amendment would force the licensing authority to assess the exact financial cost of extraordinary road wear imposed on “adjacent local highway authorities” such as Kent, Essex or Surrey—or whatever they are called now as part of local government reorganisation. As Declan Pang, the director of policy at the Road Haulage Association, warned us last week, traffic displacement and unmitigated local congestion can drive significant indirect costs across local economies and businesses.

I will turn briefly to Opposition amendment 78, which we support. It would require licensing authorities to send a copy of the notice to mayoral combined authorities, combined county authorities or local highway authorities. That would go some way towards addressing some of the deficiencies of clause 4, which leaves it quite open as to which organisations need to be consulted. Clause 4 does not explicitly list local highway authorities, local planning authorities or emergency services—among others—as mandatory statutory consultees. In his comments, I hope the Minister will address why clause 4 is so open and why it does not explicitly name local highway authorities and emergency services as mandatory statutory consultees.

[Greg Smith]

I will start with amendment 78, which was tabled in my name and that of my hon. Friend the Member for Bognor Regis and Littlehampton. The hon. Member for Didcot and Wantage hit the nail on the head regarding why we tabled this amendment. We have come back to what I fear will be a familiar theme as we go through the clauses of this Bill in Committee: the openness, at times fuzziness, of the drafting, which leaves too much open to the imagination.

Ill-defined legislation that then gets caught up in the courts forever, with lawyers forever arguing over what was really meant, gives none of us, certainly none of our constituents, our local authorities or those areas of the country that have mayors—mine does not—the clarity that they need and want from this Bill. So amendment 78 really is a very clear and straightforward amendment. It was not tabled with any intent to undermine or derail the Bill, or push it off course, but to give the Government an opportunity to lock in something that gives clarity to the important institutions out there that we and our constituents rely on to deliver local services.

Local authorities and councils—in my case Buckinghamshire, which is also the highways authority covering my constituency—and in other parts of the country, mayors like the Mayor of London, where we are right now, and as per my earlier reference, the Mayor of Cambridgeshire and Peterborough, should be locked into the process. I cannot see a single argument why the Government would not want that clarity in the Bill. If they have an in-principle opposition to that, there needs to be a very clear and compelling reason not to simply include the status quo of local authorities, mayors, mayoral combined authorities and the emergency services, as the hon. Member for Didcot and Wantage said, in the Bill. I cannot see us moving away from a local authority and mayoral model, but in any future Government—we cannot predict changes—I am sure it will not be difficult to update the legislation to bring those authorities and institutions into effect.

--- Later in debate ---

However, the official Opposition take issue with trying to prioritise modal shift over improving, in this instance, the lower Thames crossing and solving the problems the hon. Member for Dartford spoke about very eloquently with the current arrangements. Some Members may not like this, but in reality, most people in this country choose the private motor vehicle as their primary way of getting around. It is not for any of us in this House to tell people how they should or should not get about. It is for us to ensure that the road network is sufficient—which the existing arrangements at the Dartford crossing clearly are not—and is there for road users, including private cars and the haulage sector, to get about freely.

[Olly Glover]

I did not seek to say that we should not have more cars or support private road users, merely that the reason a lot of people choose to drive is that it has been the relentless direction of policy going back decades. The rail network has significantly contracted, and a lot of investment has gone into motorways. Does the hon. Member accept the clear statistics showing that far fewer young people are learning to drive and they need alternatives? We cannot rely on continuing to promote the private motorcar over everything else.

[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.

Highways (Financing) Bill (Fourth sitting)

Olly Glover Excerpts

Committee stage
Tuesday 3rd November 2026 Public Bill Committees

[The Chair]

I remind the Committee that with this we are discussing the following:

Amendment 78, in clause 4, page 4, line 27, at end insert—

“(v) any mayoral combined authority, combined county authority or local highway authority whose area includes, or is likely to be affected by, a highway specified in the proposed licence.”

This amendment would require licensing authorities to send a copy of the notice to mayoral combined authorities, combined county authorities or local highway authorities who may be affected.

Amendment 87, in clause 4, page 4, line 27, at end insert—

“(c) prepare, consult upon, and publish a report assessing—

(i) the anticipated impact of the specified highway on traffic volumes, congestion, and highway wear across local road networks maintained by adjacent local highway authorities; and

(ii) the specific traffic management, infrastructure, and financial mitigation measures required to address any adverse impacts identified under subparagraph (i).”

This amendment requires the licensing authority to publish a comprehensive local road impact and mitigation report prior to granting any licence, ensuring that traffic displacement onto surrounding local council roads is fully evaluated and mitigated in advance.

Clause stand part.

[Olly Glover (Didcot and Wantage) (LD)]

It is a pleasure to serve under your chairship, Ms Lewell. I think where we got to before we adjourned was that we would withdraw amendment 45, but press amendment 87 to a Division, so I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Amendment proposed: 87, in clause 4, page 4, line 27, at end insert—

“(c) prepare, consult upon, and publish a report assessing—

(i) the anticipated impact of the specified highway on traffic volumes, congestion, and highway wear across local road networks maintained by adjacent local highway authorities; and

(ii) the specific traffic management, infrastructure, and financial mitigation measures required to address any adverse impacts identified under subparagraph (i).”—(Olly Glover.)

This amendment requires the licensing authority to publish a comprehensive local road impact and mitigation report prior to granting any licence, ensuring that traffic displacement onto surrounding local council roads is fully evaluated and mitigated in advance.

--- Later in debate ---

[Justin Madders]

I was about to sit down, but there are publication requirements in clause 78, which will deal with a number of the issues that the hon. Member referred to, so I request that the Committee reject the amendment.

Question put and agreed to.

Clause 5 accordingly ordered to stand part of the Bill.

Clause 6 ordered to stand part of the Bill.

Clause 7

Tolling and other mandatory conditions

[Olly Glover]

I beg to move amendment 39, in clause 7, page 6, line 11, at end insert—

“(c) a condition requiring the holder of the licence to compensate affected local highway authorities for extraordinary maintenance costs, traffic management or congestion mitigation arising from any increased traffic as a result of vehicles avoiding tolls on the chargeable highway.”

This amendment ensures that local authorities are compensated for the knock-on costs of increased traffic on local roads as a result of drivers aiming to avoid the toll road.

[The Chair]

With this it will be convenient to discuss the following:

Amendment 40, in clause 7, page 6, line 11, at end insert—

“(c) a condition requiring the holder of the licence to establish a scheme for issuing automatic partial or full refunds of tolls to users in the event of significant traffic delays as a result of roadworks on the specified highway.”

This amendment would ensure that license conditions must include automatic refunds for drivers who face severe delays as a result of roadworks.

Clause stand part.

Amendment 72, in clause 103, page 67, line 18, leave out lines 18 to 21 and insert—

“after the Secretary of State has published a report setting out the proposed licence conditions including proposed arrangements for setting toll levels and approving any increases.”

This amendment would prevent the Act from coming into force until after the Secretary of State has published a report setting out the proposed licence conditions including tolling arrangements.

[Olly Glover]

It is a pleasure to serve under your chairship, Ms Lewell. Amendment 39 would create a mechanism for compulsory compensation for local councils as a result of additional traffic due to people avoiding tolls.

Local council taxpayers must not be forced to subsidise private toll road profits by picking up the repair bill for local roads damaged by heavy diverted traffic. As Declan Pang of the Road Haulage Association noted in front of the Committee last week, local A and B roads are heavily used by small businesses and hauliers, and severe wear caused by toll evasion can hurt the wider local economy.

Placing compensation in clause 7 would make it a binding legal condition so that private operators cannot bypass or negotiate away the wider impacts. One of the reasons I have tabled the amendment is because of the problem with the current roads funding formula. It is based overwhelmingly on miles rather than use levels. Higher use of existing roads would not necessarily lead to more funding for local authorities as a result, so we need a mechanism to deal with that.

Amendment 40 would, in effect, extend the delay repay concept from the railway to toll roads. It would mean an automatic toll refund scheme that issues partial or full refunds to drivers trapped in severe congestion, roadworks or operator-induced disruptions would come into existence. Motorists paying premium commercial tolls expect a reliable, free-flowing journey and should not be charged full price when the operator fails to maintain traffic flow.

Drawing on European tolling models, the Italian network has a motorway refund system, which creates a direct financial incentive for operators to clear incidents and manage roadworks efficiently. Currently, operators do not always manage to do that here. We are not necessarily saying that that is the right system for the UK context, but it is an illustration of what is possible and an example that the Minister may wish to consider.

As Edmund King told the Committee last week, if drivers pay a higher toll under an independent business model, it must work both ways, giving drivers money back when the road fails to operate properly. I look forward to hearing the Minister’s comments.

[Greg Smith]

I largely wish to comment on amendment 72 in my name and that of my hon. Friend the Member for Bognor Regis and Littlehampton, but before I do so, I will speak briefly to amendments 39 and 40.

The hon. Member for Didcot and Wantage makes a good point about the increased use of local roads that feed vehicles on to new infrastructure, such as the lower Thames crossing, or indeed bring motorists—be they private motorists or haulage operators—off those pieces of new infrastructure. The current modelling that finances local highway authorities—predominantly councils—up and down the land has no mechanism whatsoever for acknowledging the point that the hon. Member makes. When traffic flows are massively increased on an existing road, those surfaces very quickly degrade and start to resemble the surface of the moon. I am sure we all see that in our own constituencies. It something that drives all of our constituents—and me—absolutely potty on a daily basis.

I see that in my own constituency, where we have seen a large amount of big infrastructure being built over recent years, such as East West Rail. That happens where compounds are put in for heavy goods and groundworks vehicles. The traction zones where those vehicles are accelerating to pull out, or braking to come in, as they go to site, move earth away and bring aggregate in, very quickly degrade.

It makes sense to take into account where an existing local road—one that is owned by a local highway authority and is the responsibility of local council tax payers—is suddenly asked, as they will be in the case of the new lower Thames crossing and potentially other schemes in the future, to be used for infrastructure projects. There should be a flow of funding, either from the licensee or from the Government through the Department for Transport, and ultimately the Treasury, that ensures that council tax payers in local areas are not asked to pick up the bill—as my council has been asked to do for roads broken by HS2 construction—for the construction of the lower Thames crossing and other schemes under the Bill. Indeed, they should not be asked to pick up the bill for the ultimate operation of them, either. I have some sympathy for amendment 39 tabled by the hon. Member for Didcot and Wantage.

Amendment 40 is a more problematic proposition. I do not disagree with the sentiment. No one can tell us what the toll on the lower Thames crossing would ultimately be, but we can presume it to be commensurate with the M6 toll, where an average vehicle pays £7 or £8. Therefore, it makes eminent common sense, and is surely reasonable, that someone would be entitled to some sort of compensation, or money back, if they paid the toll but then got snarled up in a traffic jam and just sat in a queue that they could have sat in on the original M6 anyway. I have sat in a jam on that road many times over my life.

The problem with the proposition that the hon. Member for Didcot and Wantage has put forward is how that would be determined. With trains, delay repay is very straightforward: what time does the train ultimately pull into the destination station? That is very clear: it is either on time or a number of minutes late. Certainly, since Chiltern Railways was nationalised, I have been on late trains from my constituency every single day, but that is beside the point.

However, how is that level of delay really determined in a private vehicle? Everyone’s journey will be slightly different. What is to stop someone from deliberately driving slowly in order to avoid paying the full toll, artificially making their journey seem longer? Is it for the ORR to determine whether someone has had a longer than usual journey? How will they determine that without—and I do not want to sound all conspiracy theorist—some level of state snooping on people’s exact movements in order to determine how long that journey actually took them?

[Olly Glover]

The shadow Minister gives me an opportunity to say something I omitted from my notes—despite everyone’s obsession with Google, it is incapable of formatting a document properly when it is printed, but that is for another day. The Italian model calculates a base amount for roadworks, plus an extra amount for time lost. One qualifies after any delay on a trip up to 30 km, after a 10-minute delay on trips of 30 to 50 km, or after a 15-minute delay on trips over 50 km. I do not know how they determine that. It may be through some sort of monitoring system, and we already have that in many formats, such as automatic number plate recognition. The Italians are not generally well known for welcoming state surveillance. That is just one mechanism, and I am sure that many options are available using 21st-century technology.

--- Later in debate ---

[Justin Madders]

I thank the hon. Members for Mid Buckinghamshire and for Bognor Regis and Littlehampton for their amendment.

The hon. Member for Didcot and Wantage tried to make a noble case for something that this Government are already dealing with through the record funding for highways maintenance that we have announced and are already delivering on. I understand the thrust of his argument about compensation to local highway authorities for displaced traffic. The right approach is to undertake an assessment of the whole strategic road network, to understand what improvements and likely increases to overall capacity could achieve more widely. Then, we should assess the impact if we do not proceed.

Of course, the whole thrust of the Bill is to reduce congestion, not increase it. As my hon. Friend the Member for Dartford has said on many occasions, we know that his part of the country is already at bursting point. We know what happens when things go wrong at that vital section of the strategic road network. There are already local problems as people try to find alternatives to avoid the congestion it has caused. That is clearly not because people are trying to avoid the toll, which has been in place for many years; it is actually about the lack of reliability at that vital pinch point. The answer is not to compensate people for delays caused by trying to avoid that unreliability; the answer is to make the Dartford crossing more reliable so that people actively choose that road.

[Olly Glover]

The Minister, as he has in a few of his speeches, is talking as if the Bill is only about the lower Thames crossing, but it is not. It is much broader than that, as he has acknowledged, although it is focused on the lower Thames crossing. If the Bill was just about the lower Thames crossing, I might well agree with his argument, as there are no alternatives in that particular case. But as drafted, it is not just about the lower Thames crossing, is it?

[Justin Madders]

The hon. Gentleman is absolutely correct that the Bill is scheme-agnostic, but as the lower Thames crossing is the only scheme we currently have in mind, it is helpful to draw examples from that for why the amendment is not acceptable.

It is probably also worth pointing out that I am not aware of any other such toll schemes operating in this country at the moment. Is it his position that this compensation measure should be extended to the Mersey tunnels or the Mersey Gateway crossing, for example? My local transport authorities might be interested to hear that, and they might wonder where the funding would come from.

As I have said, the whole purpose of the Bill is to create the regulated asset base model that will fund the crossing. It will be a separate income stream from the general roads budget, and those who benefit directly from the new infrastructure will pay for it. It will improve the reliability of the whole network, which is the correct approach and is far more effective than trying to compensate people for an already overstretched and failing network.

--- Later in debate ---

Clause 4 already requires the licensing authority, be that the Secretary of State or the ORR, to consult on a licence before it can be granted. In my view, that is adequate consultation on licence conditions, and consultation at an appropriate time. Requiring the publication of a report before a licence comes into force would delay the process and add inefficiency. It would also be duplicative. As I have said several times already, we have been waiting an awfully long time for this project to proceed, and I am afraid this amendment would further delay an already elongated process.

[Olly Glover]

I am grateful for the Minister’s comments. On amendment 40, the Minister said that delay repay could incentivise toll road operators to do less maintenance, but I disagree. It would incentivise them to do maintenance efficiently and at appropriate times, such as overnight, rather than making a case for recreating the Conservative party’s cones hotline of the 1990s. One sometimes sees plenty of cones and lane closures out there with very little work taking place.

In light of the shadow Minister’s offer to work collaboratively on a proposal, and of my offer to help him with his conspiracy theories of state suspicion, I will leave amendment 40 for another day. However, I will press amendment 39 to a Division.

Question put, That the amendment be made.