HC Deb 20 January 1975 vol 884 cc1021-34
The Secretary of State for the Environment (Mr. Anthony Crosland)

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

When the present administration took office in March 1974, a Channel Tunnel treaty and various agreements had already been concluded. A Hybrid Bill had been introduced by the previous administration to enable them to ratify the treaty by 1st January 1975, as required by these agreements. The present Government reintroduced the Bill with the intention of meeting this ratification deadline. However, the incidence of a second General Election in the course of 1974 affected the timetable, even though the House agreed in November that the Bill should be reintroduced at the stage which it had reached before the Dissolution.

By that time, however, it had become clear that we would not be able to meet the deadline for ratification of 1st January 1975. Moreover, as I told the House on 26th November, the estimated cost of the proposed high-speed rail link had so increased that the Government felt unable to proceed with it. Accordingly, I proposed to our partners—the French Government and the two Channel Tunnel companies—that the whole timetable should be put back to enable alternative lower-cost rail options to be thoroughly examined. This would have meant taking the final decision on whether to build the tunnel in the summer of 1976, instead of the summer of 1975 as previously envisaged. At the same time, I requested our partners to give us some latitude over ratification.

Naturally, our partners expressed concern at these developments, but they all indicated their willingness to discuss ways of carrying the project forward. At the French Government's suggestion, we explored with the companies the possibility of a short standstill agreement designed to protect the interests of all the parties during a negotiating period lasting into the spring.

Unfortunately, the companies rejected this proposal. They felt obliged in the interests of their shareholders to take advantage of our inability to ratify the treaty by 1st January, and to claim that the Governments had abandoned the project. On 2nd January they served notices of abandonment which expire tonight.

Notwithstanding these notices, the companies on 9th January put forward to British and French officials a scheme for continuing the project. This scheme did not, in the Government's view, provide a reasonable basis for negotiation. It would have given phase II shareholders the right to withdraw their money at a premium now. It would have given the shareholders who remained the right to withdraw their money at a premium if for any reason the project were abandoned before main construction began.

Also, the timetable proposed—a new Hybrid Bill in autumn 1975 to complete all its stages by summer 1976, with an effective commitment to be given in October 1975 that construction would start by the end of 1976—was quite unacceptable to the British Government.

I have therefore regretfully informed the French Government that I see no alternative to accepting the companies' claim that the present arrangements have been abandoned. Nor, in the current economic circumstances, and in the light of the Government's first determination to control public expenditure in the difficult years which lie immediately ahead, do I see the slightest prospect of the tunnel being taken over as a directly Government-financed project. The project will, therefore, be run down as soon as possible. However, the studies, plans and works will be preserved in the best possible state so far as practicable in case the tunnel scheme should be revived when circumstances are more propitious. Nothing will be done which might prejudice this possibility.

I shall be considering with those concerned the implications of this decision for the development of our conventional transport links with Europe.

Mr. Channon

Is the right hon. Gentleman aware that he has made a very serious statement with very serious long-term consequences for this country? Can he answer the following questions?

First, why has the right hon. Gentleman made this statement today, contrary to the specific assurance that he gave to the House in his statement on 26th November 1974, when he promised that the House would have the fullest opportunity for a debate before the final decision was taken and that the decision remained completely open until the House had expressed its view? Why has the right hon. Gentleman come to the conclusion that he has announced this afternoon?

Secondly, is the right hon. Gentleman aware that the Government set up the Cairncross Committee a few months ago with the object of making an impartial review of the whole progress of this project? How can the Government decide to abandon it several months before the Cairncross Committee has even reported? What has led the Government to this view?

Thirdly, is the right hon. Gentleman aware that his attempt to attach responsibility for this state of affairs to the shoulders of the companies rather than the shoulders of the Government is a wholly unworthy and shoddy attempt on his part? Is he aware that what he has cited as the alleged activities of the companies concerned are precisely their rights under the agreement signed with them by the British Government? Is it not the case that the companies exercised only what in fact were their rights in the agreement reached with Her Majesty's Government? Can the right hon. Gentleman confirm that the Government themselves have put forward no alternative proposals whatever?

Does the right hon. Gentleman also agree that the environmental consequences of his decision, particularly for Kent, will be extremely serious, often with a doubling of traffic, with the environmental damage resulting from that?

Finally, has the right hon. Gentleman estimated what it will cost the country not to build the Channel Tunnel? What will be the cost in environmental terms, in terms of extra road traffic and particularly for British Railways? Is it not the case that his attempt to blame the companies is merely a shoddy pretext for a decision that has been maliciously taken by the anti-Europeans and Left wing in the Government?

Mr. Crosland

Let me first answer the question about the Left wing and anti-Europeans. Many of my best friends are members of the Tribune Group. To judge by the weekly attacks on me in Tribune, they do not share the hon. Gentleman's view of my susceptibility to pressure. The hon. Gentleman's question about anti-Europeans was ludicrous and disgraceful. Of course that does not come into the matter at all. His remarks have not helped the objective that he and I have in common—enabling Britain to remain a member of the Community. I am happy to say that the French Foreign Secretary made a much more statesmanlike remark when he said that, while he regretted this decision, it would have no effect on Britain's relations and Britain's co-operation with France and Europe.

The hon. Gentleman asked why I had made a statement today. I have done so because today is the date on which the notices of abandonment presented by the companies run out, and, therefore, a statement has had to be made.

The hon. Gentleman asked me about the Cairncross Committee and the cost of not having a Channel Tunnel. This, of course, is the point of the matter. The hon. Gentleman knows perfectly well that what I wanted was a year's postponement during which time we should have the Cairncross study and the phase II study and be able to examine alternative rail options, which would have helped the House to come to a rational and mature decision as to whether it was more costly to proceed or not proceed with the tunnel. It was that proposal for a year's postponement that was rejected, and that is why we are in this situation today.

The hon. Gentleman is quite wrong to say that I blame the companies. I do not blame the companies. They are acting within their rights in taking these steps and no moral blame attaches to them, nor did I imply any in the slightest degree. I merely stated the fact that it happens to be the companies and not the Government which have given notice of abandonment.

The hon. Gentleman mentioned the effect that this development would have on the environment of Kent. No doubt Kent Members of Parliament will be expressing their views, but I know that there are many who take precisely the contrary view.

Dr. Edmund Marshall

Having chaired the Select Committee that considered the Channel Tunnel Bill, may I assure my right hon. Friend that I believe his decision now to be correct in every respect? Does he agree with me that it was the wrong kind of tunnel in any case, and that if ever in future another tunnel is planned, it ought to be a straightforward rail tunnel—that is, for long-distance through trains—without any associated terminals for handling road traffic?

Mr. Crosland

I have always taken the view, as my hon. Friend knows, that the main case for building a tunnel is the boost that would be given to rail by linking the British and Continental rail systems direct, and I still take that view. My personal view is that at some point in the future we shall want a direct electric fixed link with the Continent. I believe that at some time, probably in my lifetime, a tunnel will, therefore, be built but I certainly believe that for a number of reasons, partly those my hon. Friend gives, but also many others, the present project is now dead.

Several Hon. Members


Mr. Speaker

I am in a certain difficulty. It is clear that many hon. Members want to ask questions. I have had notice of an application to move the Adjournment of the House under Standing Order No. 9 from the hon. Member for Liverpool, West Derby (Mr. Ogden). I must tell the House that at the moment I am disposed to accept that motion if the hon. Member gets the leave of the House. It would seem much more satisfactory to have three hours of debate rather than about 40 minutes of questions now. I shall therefore call the hon. Member for West Derby to make his application under Standing Order No. 9.

Mr. Ogden

Thank you, Mr. Speaker.

I beg to ask leave to move the Adjournment of the House under Standing Order No. 9 for a specific and important matter that should be given urgent consideration, namely, the announcement made by the Secretary of State for the Environment today that the British Government have unilaterally abandoned the Channel Tunnel project. I submit that it is a specific matter and that it is not only important for the Channel Tunnel developers, the shareholders and others but even more important for the environment, for industry, for regional development and many other considerations.

Further, I stress the specific pledge given to the House by the Under-Secretary on 11th November 1974 when he said: Parliament would, however, be given the opportunity to vote on so important a question before any such final decision was taken. That pledge was repeated a few seconds later: we still have the Report stage, Third Reading and the proceedings in another place. After that, Parliament will still be given the final decision as to whether the project as a whole should continue".—[Official Report, 11th November 1974; Vol. 881, c. 136.] That is an important matter for the House. Employment, regional investment, British Railways investment and, not least, compensation charges are urgent and vital matters that should have the consideration of the House. For those reasons among others, I beg to ask leave to move the Adjournment of the House under Standing Order No. 9.

Mr. Heath

On a point of order, Mr. Speaker. May I ask you to elucidate one matter? If you now proceed to grant the application under Standing Order No. 9, as you have suggested you will, would that be an end of the questioning of the Secretary of State at this time? If so, would not this create a precedent? I do not recall a similar incident.

Would you take account of the fact that, whereas when a statement is made by a Minister, a considerable number of back-bench Members have an opportunity to ask questions, in the course of a three-hour debate there is a considerable limit on the number of Members able to put a view and ask questions? May I draw your attention to the fact that in this instance only one question has been put by a back-bench Member on the Government side, following my hon. Friend the Member for Southend, West (Mr. Channon), and no question at all from a back-bench Member of any party on this side of the House? May I ask you to consider this matter, because your action today may well establish a precedent?

Mr. Speaker

I indicated that I was in a difficulty. It was quite clear that we could have 40 or 45 minutes of questions to the Secretary of State, and I thought that it would be more satisfactory as I intended to allow the application under Standing Order No. 9 if I were to say so. But what I have done must not be taken as a precedent. I hope that it will be regarded as something that I have done in the particular circumstances of this case.

I have made my decision, and I must ask whether the hon. Member has the leave of the House to move the Adjournment of the House for the purpose of discussing a specific and important matter that he thinks should be given urgent consideration, namely, the announcement made by the Secretary of State for the Environment today that the British Government have unilaterally abandoned the Channel Tunnel project. I am satisfied that the matter raised by the hon. Gentleman is proper to be discussed under Standing Order No. 9. Does the hon. Member have the leave of the House?

The leave of the House having been refused, Mr. SPEAKER called on those Members who supported the Motion to rise in their places and, not less than Forty Members having accordingly risen and Mr. SPEAKER having directed that the urgency of the matter so required, the Motion stood over, under Standing Order No. 9 (Adjournment on specific and important matter that should have urgent consideration), until Seven o'clock this evening.

The Prime Minister (Mr. Harold Wilson)

Further to the point of order raised by the Leader of the Opposition, Mr. Speaker. While what you have done may well prove to be for the benefit of the House in that there will be a debate this evening—and it is important that it should be this evening and not tomorrow in view of the circumstances—may I ask whether your decision and the leave given by the House means that there will not be any further questions today? I thought that the point made by the right hon. Gentleman was a perfectly fair one. Obviously, you were trying to save the time of the House. On the other hand, it would be possible for some hon. Members who might not get into the debate to put some questions. The debate may be better informed if some fairly obvious and straight questions are answered first. Does your ruling mean, since the debate will be better as a result of a short period of questions, that you are now precluded from allowing such further questions? I am not sure about the rules of the House on this point.

Mr. Speaker

I will be guided on this matter by the wishes of the House. If it is the desire of the House that there should be questions for, say, another 15 minutes—[HON. MEMBERS: "Hear, hear."] If that is the general view I will agree. I must warn the House that such questions must stop after 15 minutes because I have to protect the other business of the House.

Sir John Rodgers

This is the first time that in agreeing with the Secretary of State I have been classed with the anti-Europeans. Is the Secretary of State aware that not everyone in Kent regards the abandonment of this project as an environmental disaster? Far from it. Now it has been abandoned, may I ask the right hon. Gentleman to give urgent consideration to improvements of the M2 and M20 and one or two other roads? Will he also provide, as urgently as possible, a bypass for Dover?

Mr. Crosland

The hon. Gentleman reflects the opinions of Kent environmentalists more accurately than his hon. Friend the Member for Southend, West (Mr. Channon). This decision will have no effect on plans for the M20, which would go ahead, tunnel or no. The Maidstone-Folkestone route will be announced shortly.

Mr. Michael Stewart

Does my right hon. Friend recollect that there are several pieces of land belonging to the London borough of Hammersmith and badly needed for housing which have been withheld by his Department or British Rail because of the tunnel project? Will he please make sure that these pieces of land are made available to Hammersmith as soon as possible?

Mr. Crosland

Yes, Sir. I can see no reason at all why that should not be done if the reason for holding the land was the Channel Tunnel project.

Mr. Stephen Ross

Since I hope to catch your eye later in the debate, Mr. Speaker—[Interruption.]—may I put some brief questions? Who is to pay for the work to date? Will the French Government pay half? Is the right hon. Gentleman aware that I welcome his comments on saving public expenditure? May I express the hope that this is not restricted to the Department of the Environment? Will the Cairncross report and the alternative rail studies ultimately be made public?

Mr. Crosland

The exchange of letters of 17th November 1973 makes it categorically clear that in these circumstances the financial liabilities as a result of abandonment are shared 50–50 between the two Governments. I have not finally decided about the Cairncross report but it is my strong preference that it should be published.

Mr. Wellbeloved

While the reasons for the Secretary of State's statement will be understood and supported by an overwhelming majority in the House, may I ask my right hon. Friend to say a little more about the grave problems that will face South-East London and Kent as a result of the heavy volume of commercial traffic that is slowly but surely destroying the last vestiges of decent living standards for those living in this area? Is my right hon. Friend aware that there is an urgent need for a Government statement on the road programme for South-East London and Kent?

Mr. Crosland

I will certainly consider whether a statement should be made on that wider issue. I should point out that the Channel Tunnel, as it has been conceived so far, would not have given an enormous amount of relief from heavy commercial vehicles.

Mr. Peter Rees

Is the right hon. Gentleman aware that his statement has raised more questions for East Kent than it has answered? May I remind him that there are roads other than the A20 and M20 in East Kent? Will he consult the county council as a matter of urgency to see how far the whole road system in East Kent needs to be improved to take the inevitably increased volume of traffic which will follow this decision? Will he also consult the interested parties to see how far over the next decade the port facilities in East Kent, particularly the port facilities at Dover and Richborough need to be improved to take the increased volume of traffic which will arise as a result of his decision?

Mr. Crosland

Yes, I shall be happy to do so.

Mr. Palmer

Does my right hon. Friend appreciate that this decision will be deeply regretted by British engineers because the Channel Tunnel would give many opportunities for demonstrating the strength of British technology in many areas? Although circumstances may have forced this position upon us, may I ask my right hon. Friend to give an assurance that in principle the British Government are still in favour of the Channel Tunnel?

Mr. Crosland

No, Sir. I cannot give that assurance, which has never been given by this Government. What the Government have consistently sought to do is to keep open the options of either building or not building until we had a sufficient volume of evidence and information on which to base a sensible and rational decision.

Mr. Crouch

The point I wish to make to the right hon. Gentleman is so pertinent and crisp that it does not merit a speech later on. Mine is a simple question. I believe that I heard the Secretary of State say that the M2 and M20 would proceed as planned and connect with Dover. Is he aware that the system of road connections from this country to Europe is so bad that he should assure us that the M20 will proceed with even greater urgency than is already planned?

Mr. Crosland

The M20 will proceed as planned.

Mr. Snape

Can my right hon. Friend tell the House exactly how much his disgraceful decision will cost the British taxpayer? Will he come clean and admit that the course of action the companies have taken was provided for in the agreements, was predicted in the newspapers last year and has been brought about by the lukewarm approach of himself and his Department?

Mr. Crosland

I regret to see this marked fissure in the ranks of the Tribune Group. The cost to the British taxpayer of abandoning now will be about £20 million. The decision to bring the project to an end has not been through any lack of desire on my part to keep it alive; indeed, I have tried extremely hard to keep it alive. However, we are presented with terms which the companies had every right to put forward to the Government but which in the Government's view are not acceptable.

Sir D. Walker-Smith

Can the right hon. Gentleman say whether his view as to the apportionment of the liabilities arising is shared by the French Government? Have they accepted it?

Mr. Crosland

I do not know whether they have accepted it but this is quite firmly in the agreements. The legal advice I have had is that those agreements are watertight.

Mr. Leslie Huckfield

As one who has consistently opposed this project since its inception, may I now congratulate my right hon. Friend on his foresight, particularly since he has explained the avaricious financial gymnastics of the companies involved? In a situation when only 25 per cent. of existing ferry capacity is being used, would it not have been folly to commit £2,000 million of resources to a project when 80 per cent. of the beneficiaries would have been holidaymakers with cars? Will my right hon. Friend liaise with his right hon. Friends to ensure that these resources are diverted to the re-equipment of British industry and to the building of the houses, hospitals and schools which the nation so desperately needs?

Mr. Crosland

I am, naturally, grateful for congratulations at any time from any source, though my approach to this matter differs markedly from that of my hon. Friend. I do not share his view about the "avaricious financial gymnastics" of the companies. I repeat that the companies are fully within their rights under the agreements to behave as they have done. The wider economic issues to which my hon. Friend has alluded will be discussed as part of the implications of abandoning the project.

Mr. Rathbone

Will the Secretary of State give the same reassurance with regard to East Sussex County Council as he gave about Kent? In particular, will he consider how quickly he can announce the relief schemes, which have been far too long awaited, for various parts of Lewes, particularly South Street, and will he make additional sums available to build the necessary link roads in connection with the East Sussex County Council to help the Port of Newhaven?

Mr. Crosland

I cannot today give assurances on particular road schemes, but, as I said at the end of my statement, we shall discuss with all the authorities and operators concerned the implications for other modes of transport of the decision to abandon the building of the tunnel.

Mr. Alan Lee Williams

In view of my right hon. Friend's statement, which I personally welcome, will he consider making a positive statement about the seaport at Maplin, because it seems to me very important if we are to remain competitive within the EEC?

Mr. Crosland

That is a most interesting question, but it does not arise on this matter. I stress to my hon. Friend that, as he probably already knows, the Port of London Authority has not put to me detailed proposals for the Maplin seaport.

Mr. Churchill

Is the Secretary of State aware that his statement will be greeted with disappointment by industry in Manchester and North-West England which has been looking forward to being able to switch a higher proportion of its exports to Europe to the freightliner system? What estimate have the Government made of how many millions of tons of freight which would have gone by rail had the Channel Tunnel been built will now have to go by road, and what will be the additional cost in motorway expenditure?

Mr. Crosland

It is quite impossible to make any such estimate for the simple reason that we do not have a detailed and concrete plan from British Railways for an alternative rail link, and until we have such firm proposals it is impossible to make any assessment of how much traffic might be transferred.

Mr. Stoddart

Is my right hon. Friend aware that many right hon. and hon. Members will feel that, if he has succumbed to anything, he has succumbed not to pressure from the Tribune Group but to common sense in cancelling the project? Will the resources released be used for the improvement of the railway network and the re-equipping of the railway stock of locomotives, wagons and carriages?

Mr. Crosland

My hon. Friend, as usual, shows sound judgment in these matters. Generally the resources released as a result of not building the tunnel will find their way into investment in other forms of cross-Channel traffic—in other words, ports, roads to the ports, hovercraft, ferries, and so on.

Mr. Ridsdale

Does the right hon. Gentleman agree that we have every chance of winning the battle for exports if we make proper use of the facilities at our East Coast ports? Will he make sure that investment in this respect is not cut but is increased?

Mr. Crosland

I am most anxious to see a dramatic expansion in the trade from Grimsby, although, unfortunately, it is hard to get by rail from Grimsby to King's Cross, as I discovered on Saturday when the British Rail engine drawing the train struck a cow and was so bruised by the encounter that it stood motionless for four hours a mile outside Lincoln Station. Subject to such difficulties, yes.

Dr. M. S. Miller

Is my right hon. Friend aware that his statement will be warmly welcomed by my constituents who, for the last two years, have been living in mortal fear that the Government would take seriously my suggestion that the United Kingdom entrance to and exit from the tunnel should be situated in East Kilbride?

Mr. Crosland

That is a most interesting suggestion.