HC Deb 26 November 1974 vol 882 cc245-52
The Secretary of State for the Environment (Mr. Anthony Crosland)

With permission, Mr. Speaker, I will make a statement about the Channel Tunnel.

The House will recall that when on 11th November it debated a motion enabling the Channel Tunnel Bill to be rein-troduced my hon. Friend the Undersecretary undertook that the current estimated cost of the rail link from Cheriton to London would be published as soon as possible. The estimated cost in the 1973 White Paper was some £120 million in February 1973 prices.

The Government have now completed their examination of a revised cost estimate by British Railways. This amounts to £373 million at May 1974 prices, and this excludes the additional environmental works which have been canvassed in Surrey and Kent, the greater part of the cost of compensation under the 1973 Land Compensation Act, and the cost of enabling the link to carry freight, which was not previously envisaged.

It is out of the question that the Government should approve or finance an investment of this magnitude. We must find some less expensive means of enabling the through rail traffic, which forms so essential an aspect of the tunnel project, to gain access to London and the British rail network. British Railways are, therefore, urgently examining a range of lower-cost options intended to achieve the greatest possible volume of through traffic, including freight, while avoiding detriment to the existing Southern system.

In this situation it is clearly now impracticable for us to adhere to the previous timetable for decisions on the main tunnel project, which were due to be taken in the summer of next year. I have, therefore, today formally proposed to our partners in the project, the French Government and the two Channel Tunnel companies, that the timetable be put back to enable alternative lower-cost rail links to be thoroughly examined before we decide whether to build the tunnel or not. I have asked our partners for an early indication of their readiness to renegotiate the detailed arrangements on this basis.

If such an indication is forthcoming, the Government will immediately reintroduce the Channel Tunnel Bill, for this still has to be passed in order to keep open the option of proceeding with phase III. Indeed the sole purpose of reintroduction is to prevent the project from being abandoned by default. It implies no commitment to go beyond the present phase II.

The House should be aware, however, that the French Government have now re-emphasised to Her Majesty's Government their intention to complete phase II and the current economic studies with a view to signing Agreement 3 within the agreed time schedule. They expect the studies to confirm the economic and financial viability of the project. This may or may not be so. But in view of the large increase in the estimated cost of the rail link it is, as I have said, clearly essential in the interests of both Governments and the Channel Tunnel companies that the position be reassessed in depth. It is for this reason that I have now formally invited the French Government and the companies to reconsider with us the timetable leading up to the final decision on phase III.

When I have received and considered the further phase II studies, the report of the Cairncross Group and the advice from British Rail on an alternative rail strategy, I shall report them to the House. Meanwhile, as I have repeatedly told the House, the decision on whether to proceed with phase III and build the tunnel remains completely open, and the House will have the fullest opportunity for debate before this final decision is taken.

Mr. Channon

The House understands that, before final decisions are taken, there will be a full opportunity to take a decision in principle on whether to proceed with the project. Will the right hon. Gentleman give further details of the astonishing increase in costs which seems to have occurred? Can he publish a detailed breakdown of the reasons why these costs now appear to have trebled in such a short time? The House is entitled to know on what basis these estimated costs have been made.

What will be the scope of the re-examination of the project? Is the right hon. Gentleman saying, in effect, that he is re-opening the possibility of other routes on the rail link? If so, that will cause widespread concern in Kent, Surrey and parts of London.

Does the right hon. Gentleman agree that if the project is to go ahead it is essential that it should be designed in a way which will be environmentally desirable, and that if he goes for cheaper solutions he must bear in mind the need to make them environmentally as acceptable as possible?

What effect will this decision have upon the investment of British Railways in, and the progress on, the advanced passenger train? Finally, how long will it be before the right hon. Gentleman can report to the House the detailed results of this discussion?

Mr. Crosland

The hon. Gentleman asked me first about why the estimated costs have escalated. There are three main reasons—inflation, environmental factors, and development and design. In fairness to British Railways, it is right to remember that this country has not built a new railway line since the turn of the century, when the Marylebone line was built.

The re-examination will consider other routes and, above all, the use, or partial use, of existing routes and infrastructure. In that way, I hope that the threat of blight to the environment will be greatly diminished. I agree that it is crucial, whatever option is finally chosen, that the route should be the most environmentally attractive and desirable of the options.

This decision will have no effect on the advanced passenger train. I hope that early next year we shall begin to get the preliminary views of British Railways, and by the spring, when the Cairncross and phase II studies are available, we should have a fairly firm idea of the options open to us.

Mr. Prescott

Is my right hon. Friend aware that I am glad he has now confirmed the caution and fears which many of us felt on 11th November and which led us to vote against the procedure then put forward? Is he further aware that it is plain that renegotiation of this agreement can take place beyond 1st January? May we now have a more detailed reassessment? Can he confirm that the figure he has given for the British Rail link is the 1974 one? Most of the figures we have been operating on from Government sources were 1980 figures. Can he say what is the estimated cost in 1980? Is it not nearer to £500 million, and is it not time that we finished this folly?

Mr. Crosland

I am afraid that I cannot give an estimate of the cost of the alternative rail options in 1980 because we have not yet seen what the alternative rail options are. As to a decision about what my hon. Friend calls "this folly", surely the sensible time for the House to take a decision is not now, when it lacks most of the crucial facts and information, but in the spring, when it will have the advantage of the Cairncross study, the phase II studies and the report from British Railways on alternative rail strategies.

Mr. Stephen Ross

May I assure the Secretary of State that we welcome his statement? Is he aware that his words will be a great relief to the residents of Surrey and Kent who would have been affected by the proposed rail link? Will he now please listen to our requests for a short, sharp, public inquiry into the whole Channel Tunnel construction scheme, because this has been needed for many months and is now highly desirable?

Mr. Crosland

No, Sir. In my view this is not a subject which ought to be farmed out to a conventional public inquiry. This is a subject on which the final decision can be taken in only one place, and that is in Parliament.

Mr. Cohen

Would my right hon. Friend also consider the possible cost of the alternative to providing a Channel Tunnel, particularly for the benefit of my hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott)? Will he advise the House of the possible cost of such an alternative, particularly in relation to the development of the port installation area, packing areas and so on, which might arise if we decide to abandon the tunnel project?

Mr. Crosland

My hon. Friend has put his finger on what is the crux of the whole question and on which, with respect to many of my hon. Friends, there was a complete misunderstanding in the debate of 11th November. What we are asked to decide, and what Parliament must eventually decide, is which is the cheaper method of carrying across the Channel the inevitable increase in traffic. Is it to be the Channel Tunnel, or is it to be the heavy alternative transport investment in ships, hovercrafts, port facilities and the rest, which would certainly be incurred by the country if we were not to have the tunnel?

Mr. Peyton

While I entirely endorse the last comments of the right hon. Gentleman, may I ask him whether this new estimate is entirely accepted by British Railways, and, if it is, how they reconcile these new figures with what was their own. admittedly provisional, estimate?

Mr. Crosland

British Railways accept the new estimate. Indeed, the new estimate is theirs, not the Government's. I have given three reasons why there is this marked discrepancy between this and the previous estimate. It is right to stress the fact that the main reason is probably because we have not built a single railway line since the turn of the century. We lack the detailed experience of the likely costs of building a new railway line.

Mr. Bagier

Will my right hon. Friend accept that those of us who agree with the Channel Tunnel project would welcome a full evaluation of all the costs involved? Will he give an assurance that there will be an examination of the comparative costs of alternative options? Will he further say whether, because of this delay, any penalty costs will be involved?

Mr. Crosland

The answer about penalty costs is "No". There will be a full evaluation of the costs involved. We shall have the phase II studies. It was precisely so that we would have an independent and full evaluation that, at the request of many hon. Members in many parts of the House, we set up the Cairn-cross inquiry. It will be for it to comment on the costs of the tunnel on the one hand and the costs of alternative transport on the other.

Mr. Wells

Can the right hon. Gentleman tell the House whether the French have already abandoned a similar highspeed rail link and are relying on a conventional rail link? If we step down from the high-speed rail link, shall we not be doing the same as the French? Can he, in his inquiries, give the House the full comparative costs, as asked for by his hon. Friend the Member for Sunderland, South (Mr. Bagier), because it is imperative that the House, in reaching a proper judgment, is able to assess the escalation in Channel Tunnel costs—which are once-for-all costs—and contrast them with the endless escalation in costs for shipbuilding and hovercraft building?

Mr. Crosland

I understand that the French Government did not propose a completely new high-speeed rail link of the kind British Railways were proposing, which was announced in the 1973 White Paper. The answer to the second part of the hon. Gentleman's question is "Yes". The phase II studies and the Cairncross Report will be useless unless they enable the House to make a fair and exact comparison between the costs of the alternative methods of coping with cross-Channel traffic.

Mr. Crawford

Will the Minister accept that the news that certain things are to be examined before we decide whether or not to build the tunnel will be most welcome in Scotland? Does he also agree that what the people of Scotland want is either a scrapping of the tunnel or, if that does not happen, no financial burden being placed on the people of Scotland? Will he not further agree that the people of Scotland should not have to pay for something which they do not want?

Hon Members: Rubbish.

Mr. Crosland

I am delighted to hear that my statement will be welcome in Scotland. If I possibly can, I am delighted always to give pleasure to the Scots. It is not right to say that no one in Scotland supports the tunnel. Some of my Scottish hon. Friends are strong supporters of it. If this were to turn out to be the cheaper method of coping with cross-Channel traffic, the advantage of linking, for example, Glasgow with Milan is not something to be sneezed at.

Mr. Skinner

Is my right hon. Friend aware that the Government Chief Whip will be greatly relieved at my right hon. Friend's statement because he will now be able to push through further legislation for public ownership? Does he not agree that there has been a tactical back-bench victory based on common sense?

Mr. Bagier


Mr. Skinner

Does my right hon. Friend also realise that his statement has been slightly marred by the fact that it did not go all the way and kill the project once and for all?

Mr. Crosland

One of my main objects in life is to try to relieve my right hon. Friend the Government Chief Whip. That comes as a rather higher priority than satisfying my hon. Friend for the whole of the time. As for this being a tactical victory for a back-bench revolt, I am always extremely happy to give whatever credit I can to my hon. Friends on the back benches, but I have to point out it was not really a back-bench revolt. There was, rather, a major escalation in the cost of the rail link.

Mr. Stanley

Since thousands of houses from the White City to Folkestone were blighted by the publication of the line of the high-speed rail link, may I ask the right hon. Gentleman to confirm that his statement means that those whose homes are blighted may now regard the planning blight as having been lifted by a formal Government decision to abandon the construction of a high-speed rail link?

Mr. Crosland

My statement is a formal Government decision to abandon the construction of the high-speed rail link.

Mr. Snape

Does my right hon. Friend concede that the reasons advanced for the construction of the Channel Tunnel and the associated rail link at the time when the treaty was agreed with the French Government are equally relevant today? Does he agree that if it makes economic sense to build a supersonic albatross in Bristol it makes even more sense to build the Channel Tunnel? Will he concede that some of the reasons advanced by hon. Members on both sides of the House for the dislocation that might be caused by the proposed rail link are even more relevant to motorways, although, surprisingly enough, hon. Members seem to be muted in their criticism of such developments?

Mr. Crosland

Detailed questions on Concorde should be addressed to my right hon. Friend the Secretary of State for Industry. My hon. Friend has made a valid statement about motorways. When we come to take a final decision, one matter to be taken into account is the consequence for road traffic of not having a Channel Tunnel. The arguments, both pro and con, are just as relevant now as they were when we debated the matter a year ago. What we must have now is these arguments and the detailed facts on which they are based brought up to date by the phase II studies and the Cairn-cross Report.

Several Hon. Members rose——

Mr. Speaker

Order. We cannot debate this matter further today.

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