Second Severn Crossing

HC Deb 28 July 1988 vol 138 cc556-64

4.7 pm

The Secretary of State for Transport (Mr. Paul Channon)

With permission, Mr. Speaker, I wish to make a statement. I am now able to announce the next step in the provision of the second crossing of the River Severn.

The Severn bridge is important to Wales and to economic development on both sides of the estuary. That is why in July 1986 we announced that a second crossing would be built at the English Stones, and that preparatory and survey work would proceed with a view to providing that crossing in the mid-1990s if traffic levels showed it was needed by then. The Government have now decided to give the private sector a major opportunity to participate in the provision of this important project.

Essential geotechnical and hydrological surveys are being carried out urgently, and will be completed early next year. As soon as possible after that, I shall be publishing guidelines and inviting bids to build the new bridge. Promoters will be asked to submit proposals on two bases: to design and build the new bridge and to finance and operate it in conjunction with the existing bridge; or to design and build it with the Government responsible for funding and operation. In either case the costs will be recovered through tolls. Promoters will be asked to indicate possible completion dates and the toll levels associated with them. Whichever option is chosen, legislation will be needed to provide, amongst other things, for levying tolls.

We also need to take immediate steps to place the finances of the existing bridge on a sound footing. This is required to meet the objectives laid down when tolls were first introduced in 1966. The accumulated deficit of the bridge is now approaching £100 million. It is therefore proposed that the tolls on the existing bridge should be increased with effect from 1 September 1989 to £1 for cars and £2 for lorries. The present strengthening will have been completed before the new tolls are introduced.

Mr. Robert Hughes (Aberdeen, North)

There is only one item of substance in the Minister's statement, which is that the Severn bridge is important to Wales and to economic development on both sides of the estuary. The statement brings forward the completion of the bridge not one iota. There is no starting date, finishing date or target date. There is nothing except a hype for private industry. All the Minister has said is that he intends to ask private industry to submit bids as soon as practicable next year.

Will the Minister tell the House which solution he prefers? Does he prefer the wholly private sector solution? Does his statement mean that the new company, if there were to be one, would take over the running of the existing bridge too, and become an entirely private company, as is the case with the Dartford-Thurrock crossing? Why does he not take the most obvious and direct solution and have the bridge built with public money and by direct public tender, which he has the opportunity to do?

Secondly, is it not the case that his statement is an attempt to dampen down the anger that there will be on either side of the bridge about the doubling of the tolls, and the fact that he has now totally abandoned any possibility of free estuarial crossings? Tolls must be paid by people who need proper investment in their areas, but which they are not getting from the Government.

Mr. Channon

I am a little astonished by the latter part of the hon. Gentleman's question. He speaks about abandoning free estuarial crossings, but it was his party when in office which introduced tolls on the bridge. The history of the Severn crossing is that the Labour party, when in office, has tolls, but when out of office says it will not. That is the standard against which we must judge the hon. Gentleman's remark.

My statement advances the building of a new crossing considerably. We are now asking for designs. We shall give the private sector the opportunity of participating in this important project next year on these two bases. They can come forward with suggestions for funding in the public or in the private sector. My right hon. and noble Friend Lord Crickhowell, when he made a statement a few years ago, made it perfectly clear that the public sector would proceed with a view to providing the crossing in the mid-1990s if traffic levels showed that it was needed. One of the potential advantages of the private sector is competition. Private promoters will be asked for a range of opening dates and associated tolls.

The hon. Gentleman asked me about my preference. I have none. I am happy to await the outcome of the competition, but anyone living in Wales or Severnside is likely to prefer the private sector solution.

Mr. Gwilym Jones (Cardiff, North)

My right hon. Friend will not need me to tell him that the increase in charges will not be warmly welcomed. No matter how much of a saving the Severn bridge represents, there will always be a response of wanting something for nothing. The only appropriate consolation for this increase will be his firmest commitment that the second crossing will be in place by 1996 at the latest, because he will know as well as I that estimates of traffic volume across the Severn bridge have notoriously underestimated the problem.

Mr. Channon

I am grateful to my hon. Friend, and I fully understand his worry about the existing tolls. However, the present tolls are lower in real terms than they were 20 years ago. Even after the increase, they will be lower than tolls on other estuarial crossings.

From what my hon. Friend said about the desirability of an early start and completion of this crossing, it sounds as though he will be one of the supporters of a private sector solution, because private promoters will be asked for a range of opening dates and, therefore, there may be the prospect of advancing the project much faster.

Mr. Roy Hughes (Newport, East)

Does the Minister appreciate that his statement will be recognised throughout Wales as nothing more than a sprat to catch a mackerel? Does he appreciate that it is important that our main point in and out of Wales should not be handed over to private speculators? When will he recognise that tolls are nothing more than an abomination, especially when the Treasury is receiving no less than £16 billion from motor taxation, and only £3–6 billion of that is being spent on roads and maintenance?

Will the right hon. Gentleman also recognise the cost of delays in collecting tolls, which is an important commercial consideration? Will he reconsider the recommendation of the Select Committee on Transport which called for their abolition? Does he recognise that the basic figures for the existing bridge are a complete farce? The bridge cost £8 million to build, £52 million has been collected in tolls, and there is now a debt of £100 million. Why should there be this additional tax on Wales, an area of such deprivation and mass unemployment?

Mr. Channon

Again, I find it astonishing that the hon. Gentleman should launch a strong attack on tolls across the Severn, when it was his own party that introduced them. It was his party that retained them when it had a second period in office. His party was in office from 1966 to 1970 and from 1974 to 1979, and it did nothing about the tolls, but now that it is out of office it complains. I hope that any reasonably minded person in Wales and Severnside will recognise that my announcement is an opportunity for the bridge to be completed earlier than it otherwise might have been. The promoters will be asked to gjve a range of opening times, and at the end of the day we shall see whether it is a private or public sector bridge.

The hon. Gentleman referred to private speculators. Of course, the private sector will build the bridge whichever solution is chosen, and, therefore, the hon. Gentleman is talking only about its financing. The private sector might provide a Severn crossing more quickly than would otherwise be the case.

Sir Anthony Meyer (Clwyd, North-West)

I am not sure whether my hon. Friend has said anything about access roads to the new crossing, but will he ensure that access roads are so designed as to provide for toll plazas of reasonable width? One of the main problems of the present bridge is its narrowness and the inevitable queues to the toll booth.

Mr. Channon

My hon. Friend has mentioned two extremely important points. Of course, we shall have to provide access roads in time for the completion of the new Severn crossing. That is a matter which is in hand and in which my Department is involved.

It will be important to make sure that the toll plazas do not cause delay. The advances in techniques used at the Dartford bridge have made it a far quicker operation, and I believe that by the time the Severn crossing is open there will be further advances.

Mr. Donald Anderson (Swansea, East)

Is it not clear that the doubling of the tolls is the price that the people of Wales must pay to make this second bridge construction and financing attractive to the private sector? That is the motive behind the doubling of tolls. Is this not clear proof that, when it comes to the test, the Government will always give priority to privatisation and the ideological obsession of rolling back the frontiers of the state rather than the regional development needs of Wales?

Mr. Channon

No. The tolls were put on in the first place by the party which the hon. Gentleman supports. They have now to be increased, because we have had two reports from the Comptroller and Auditor General saying that the increase was long overdue. I am surprised that Opposition Members should disagree with the Comptroller and Auditor General's desire to see a proper economic situation prevail at this bridge as at other estuarial crossings.

Mr. Nicholas Bennett (Pembroke)

I welcome my right hon. Friend's statement about the second crossing—I am a frequent user of the Severn bridge—but can he explain why those who have to cross estuaries, alone of all people who use trunk roads, have to pay for that privilege? Also, when will there be automatic tolls on the Severn bridge to speed up the crossing?

Mr. Channon

My hon. Friend will know that successive Governments of all political persuasions have taken the view that it is right to charge tolls on certain estuarial crossings. Next week, I shall go to the start of the new Dartford crossing, which will be financed by tolls and provide an extremely important service to travellers and the economy as a whole. The policy has been followed by successive Governments.

The House should realise that tolls on the Severn crossing have increased only twice since the bridge was opened 22 years ago in 1966. The increase that I have announced should be compared with the toll across the Humber, which is £1.50 for cars and £8 for lorries, and an increase is proposed.

Mr. Ieuan Wyn Jones (Ynys Môn)

Is the right hon. Gentleman's statement made with the full authority and consent of the Secretary of State for Wales? I see that the Under-Secretary of State for Wales is here, but will the right hon. Gentleman confirm that the Secretary of State for Wales agrees with the main thrust of the statement, which is that the second crossing is to be financed by private funds? Has the right hon. Gentleman discussed with the Secretary of State for Wales how the programme for a second crossing fits into an integrated road network for Wales? I am sure that he appreciates that it must be viewed in the wider context of the development of east-west roads and the much needed north-south road.

Mr. Channon

As the hon. Gentleman knows, we have not necessarily decided to build with private financing. We shall have a competition to see whether there should be private sector financing or Government responsibility for funding. We shall see what comes forward and make a decision accordingly. I take the hon. Gentleman's point about the provision of roads. My hon. Friend the Under-Secretary of State for Wales and my right hon. Friend the Secretary of State for Wales will examine carefully what the hon. Gentleman has said. My right hon. Friend the Secretary of State is, of course, in agreement with the statement and the presence of my hon. Friend the Under-Secretary of State for Wales proves it.

Mr. Michael Stern (Bristol, North-West)

Does my right hon. Friend agree that his statement will be welcome in my constituency and in Northavon as it puts a terminal date on the uncertainty about the southern link road, its route, its grade, and its relationship with the Avonmouth relief road? Would my right hon. Friend care to estimate the cost to the motorist or lorry driver of going around via Gloucester?

Mr. Channon

I am grateful to my hon. Friend for what he says. I read with interest what he said when a similar statement was made a few years ago. It is difficult to estimate the cost of going around the estuary, but I should have thought that it would be infinitely greater than taking the crossing.

Mr. Paul Flynn (Newport, West)

Does the Secretary of State recognise that he has made one statement which he hopes will be eclipsed by another? There is to be an increase in tolls which is unpalatable to all parts of the House. The right hon. Gentleman has tried to eclipse that announcement with his re-announcement of a recommitment made two years and four days ago when the Secretary of State for Wales announced that there was to be a second Severn crossing.

Is it not true that the absence of the Secretary of State for Wales today is proof that Wales and its Secretary of State have received a bloody nose with this decision? Does the right hon. Gentleman agree that there has been a great change of attitude towards tolls? Does he agree that the increase has nothing to do with the original cost of the bridge, which was £8 million? Tolls have gone up because of the Government's disgraceful neglect and the fact that the bridge has been shaken into premature senility by lorries which could have been controlled five or six years ago. The Government are culpable, and we are paying for their incompetence.

Mr. Channon

I am afraid that I do not agree with a great deal of what the hon. Gentleman said. I assure him that there is a need in any case to increase tolls on the Severn crossing, for the reasons that I have given. The report of the Comptroller and Auditor General criticised the fact that tolls have not been increased. They have been increased only twice in 22 years. They were imposed by the hon. Gentleman's party when it was in office. If it is so wrong to have tolls, why on earth did the Labour party impose them in the first place?

If the hon. Gentleman reads the statement which was made in 1986, he will see why I have made this statement. The former Secretary of State for Wales said that this is a major piece of infrastructure and that The Department of Transport has the technical expertise, which clearly makes it appropriate for it to be the responsible Department."—[Official Report, 24 July 1986; Vol. 102, c. 612.] As for giving my right hon. Friend the Secretary of State for Wales a bloody nose, since I was his Parliamentary Secretary in the early 1970s I have taken the view that it is much better not to fall out with him on anything, and nor have I on this.

Mr. David Nicholson (Taunton)

Is my right hon. Friend aware that rapid completion of the second Severn crossing will be of great importance to Wales and the English side of the Bristol channel, given the rapid growth of the Welsh economy recently and the expectation that that will continue under the present Government? Is he aware that involvement of the private sector in this enterprise is greatly welcomed and may well be the harbinger of private sector involvement in future desirable infrastructure projects?

Mr. Channon

I am most grateful to my hon. Friend, and agree with him.

Mr. Alun Michael (Cardiff, South and Penarth)

Does the right hon. Gentleman accept that the failure of the Secretary of State for Wales is reflected in his announcement because the Secretary of State would have had to declare it a "pay more" initiative? It is all initiatives from the Secretary of State for Wales. Does the right hon. Gentleman recognise that local authorities and industry in Wales have made great efforts to achieve economic recovery and that both have pleaded for the burden of the toll to be lightened because it is a tax on being Welsh, on doing business in Wales and on tourism in Wales? Will the right hon. Gentleman think again?

Mr. Channon

I cannot agree. If it is such an awful thing to have tolls on estuarial crossings, perhaps it would have been better if the hon. Gentleman's party had not introduced them.

Mr. James Couchman (Gillingham)

I am tempted, in view of today's news that the Severn bridge is to be closed for a couple of weekends soon, to ask whether that is a necessary step for having a second crossing, but that would be frivolous. As one who spent seven weeks serving on the Select Committee which considered the Dartford-Thurrock bridge, may I be assured that my right hon. Friend will do the most exhaustive studies into wind shielding before any Bill is committed to a Select Committee?

Mr. Channon

Yes, I certainly will. We are minded to have wind shielding on the bridge because winds on the Severn are thought to be considerably greater than those on the Thames.

Mr. Gareth Wardell (Gower)

Is the Secretary of State saying that there is a choice here between further increases in tolls and the quick erection of a new crossing using public funds, and waiting for a long time for a bridge if public funds are to be used? If the answer is yes, provided that the necessary toll increases are reasonable, from my end of the M4, the view is that, the sooner a second crossing is built, the better it will be. I hope that the Secretary of State can tell me whether I have summed up the situation correctly and whether we are likely to have a second crossing in the very near future so that there can be more inward investment in Wales. We must remember that 1992 is looming large.

Mr. Channon

I am grateful to the hon. Member, especially for the constructive way in which he asked his question. He is not quite right. There must be an increase in tolls whatever happens. As I have already said, the Comptroller and Auditor General has severely criticised the present regime. It is clearly necessary to bring tolls up to date. The hon. Gentleman may very well be right when he says that, if there is a private sector solution, that may result in a second Severn crossing being available more quickly.

Mr. Michael Colvin (Romsey and Waterside)

Will my right hon. Friend tell contractors who are submitting designs to bear in mind the fact that, by the time the new Severn crossing is constructed, approval may well have been given for the Severn barrage which will generate power by using the tides and have a road across the top of it? Will my right hon. Friend bear in mind the traffic that is likely to travel on that road before finalising designs for the second crossing?

Mr. Channon

My hon. Friend raises an interesting point. I shall consider it carefully.

Mr. Win Griffiths (Bridgend)

Has the right hon. Gentleman's Department made an in-depth study of the level of toll likely to be necessary on the new bridge if it is to be run by a private company? Does he have a view about what would be an acceptable toll if the bridge were built by a private company? As the new bridge would be in competition with the existing one, would the Government automatically increase their tolls to enable the private operators of the second bridge to make a profit? Does he agree that if the bridge is built entirely with private money there will be no access to money from the European regional development fund? Under the rules of that fund, although the bridge is not in an assisted area, money could be forthcoming as it would assist considerably an assisted area—Wales—which is eligible for funding. Is this not a missed opportunity?

Mr. Channon

I certainly do not agree with the hon. Gentleman's point about the European Investment Bank, which I am hoping to meet. I shall certainly examine the point in conjunction with my right hon. Friend the Secretary of State for Wales. We must see what level of tolls is proposed, whether it is acceptable and whether a solution involving that comes from the private sector. [Interruption.] Let us decide that matter when we have more evidence. If there were a private sector solution the odds are that we would run the two crossings together, as is the case with Dartford, to which my hon. Friend the Member for Gillingham (Mr. Couchman) referred. That seems to have been widely accepted. All those considerations must be taken into account when a decision is finally taken. All that I am saying today is that here is another opportunity which will have to be considered carefully and it may well provide a quicker solution to the problem.

Mr. Gerrard Neale (Cornwall, North)

I congratulate my right hon. Friend on accepting the need for a second connection between the south-west and south Wales and on seeking possibilities of encouraging private investment in such a scheme so that it does not impact so much on the rest of his road building programme. Does he accept that it makes the case for extending the principle to non-estuarial crossings and seeking more private investment to accelerate the road building programme? Will he press his colleagues in the Treasury to review what many of us on this side consider to be a somewhat eccentric interpretation of the Ryrie rules, so that this matter will encourage more money and speed up the road building programme?

Mr. Channon

I read with great interest my hon. Friend's article on that very point a few weeks ago. He will not expect me to comment on the Ryrie rules, but I shall draw the attention of my right hon. Friend the Chancellor of the Exchequer to what he says about them. I am grateful for what he said about the possibilities. We shall have to see what is proposed, and at the end of the day Parliament must decide whether to build the crossing with the normal method of financing or with private finance.

Mr. Frank Cook (Stockton, North)

In considering the need to attract private capital and to keep toll charges as low as possible for consumers, will the Secretary of State bear in mind the amendment to early-day motion 1425 in the name of the hon. Member for Devon, North (Mr. Speller) which proposes that consideration be given to the possibility of combining this second Severn Bridge with a hydro electricity generating scheme."? Will he bear in mind the fact that in drawing the outline for the design of the bridge he can incorporate hydro-electric schemes which would bring in income and reduce the need for higher toll charges, which in turn could reduce both the most adverse, disadvantageous ecological effects that environmentalists dread from the Severn barrage and the need for more nuclear power? Will he take that into account and include it in the design specification?

Mr. Channon

I shall study with care all that the hon. Gentleman has said and all that my hon. Friend the Member for Devon, North (Mr. Speller) has said.

Mr. Michael Jack (Fylde)

Does my right hon. Friend agree that the time savings that will result from this bridge will be welcome and that the decision to press ahead with the new bridge is wholly justified in the light of the £56 million which has already been spent on maintenance of the existing bridge?

Mr. Channon

I understand my hon. Friend's point, and I agree in particular with his first point that the time savings will be welcome.

Mr. Chris Butler (Warrington, South)

Will my right hon. Friend tell me whether the £1 level will be sufficient to pay the debt, or will we face ever-increasing tolls on the Severn bridge in future? Is there a difference in writing off the debt between the Humber bridge, the Mersey tunnel and the Severn bridge?

Mr. Channon

Each is a different case. As I have explained to the House, we have not yet written off anything. We are considering a proposal to write off a proportion of the Humber debt, which otherwise would be utterly unrealistic. I should like to receive firm proposals on Merseyside, and anything that my hon. Friend can do about that would be appreciated.

There is no doubt that there is a need now to increase the tolls on the Severn bridge. In real terms they are less than they were in 1966. If my hon. Friend is interested, I can give him a list of the tolls on other estuarial crossings, and he will find that some are higher than the Severn crossing toll. If I have not dealt fully with his point, I shall write to him.

Mr. Alan Williams (Swansea, West)

I am not astonished at the absence of the Secretary of State for Wales. Clearly he has been defeated in Cabinet on the issue of Government funding for the bridge. Will the Secretary of State confirm that today's statement does not commit the Government to one extra, single penny towards the construction of the bridge? He has put up a smokescreen behind which to announce a draconian doubling of the tolls on the bridge. There is no clear statement on dates for the completion of a bridge. Do we understand from his announcement that the decision on dates will be not according to traffic flows, but left to the whim of a private investor? That seems to be what he has been saying.

Will the Secretary of State note that in his statement he talks of providing that crossing in the mid-1990s if traffic levels showed it was needed by then", which is far less specific than the announcement yesterday in the Welsh Select Committee by the Secretary of State for Wales, who said that he expected it to be completed by the mid-1990s on current traffic flows? Who is right? Who is wrong? Does he agree unequivocally with that estimate by the Secretary of State for Wales?

What does the Secretary of State mean by saying that private investors may operate the bridge in conjunction with the existing bridge"? Does that mean privatisation of the existing bridge, or handing managerial control of the existing bridge to private operators? In either case, what has happened to the Government's commitment to competition as the best way of achieving results? Is this not the reverse, in that the Government are saying that we need a private monopoly of the two bridges to obtain the funds to build a bridge at an early date? Is it not a fact that, because of the need to make a profit on the second bridge if it is privately constructed and owned, he cannot allow low tariffs or tolls on the existing bridge, even at the levels he has announced today, because that would divert traffic from the new private bridge to the existing bridge?

As the new bridge is crucially needed for Wales, as the Secretary of State said, as part of our regional policy to help Welsh industry develop, and as, by the time the bridge is completed, if it is, the Government will have robbed Wales of £1 billion in regional aid, why will not the Minister undertake to provide Government funds for the bridge and give us some of our money back?

Mr. Channon

I am absolutely astonished at the grudging way that the right hon. Gentleman greets this announcement. I am surprised because, before he slarted to speak on Welsh affairs, he used to be reasonable I do not know what has happened to him in recent months— and, incidentally, nor does his hon. Friend, who is not present.

In answer to the right hon. Gentleman's irnportant point, my right hon. Friends have made it perfectly clear about public sector financing of this bridge. They will "proceed with a view to providing that crossing in the mid-1990s if traflic levels showcd it was needcd by then." If the bridge goes ahead in the public sector, that was, is and will remain the case. As the right hon. Gentleman said, it will depend on traffic levels. If the bridge goes ahead in the private sector, which it may or may not do depending on whether private sector competition shows that that is the better solution, it will be open to promoters to propose schemes which will provide, conceivably, for an earlier opening of the crossing. I should have thought that that would be welcome to people in Wales and on Severnside. If that is an insuperable objection to involving the private sector, it is someting to be debated at the time. Let us see what comes forward. Running the new bridge in conjunction with the existing crossing seems likely to prove extremely satisfactory for the Dartford-Thurrock crossing and I see no reason at this stage why it should not prove satisfactory for the Severn crossing. We are not at that stage yet, so we must wait to see what develops.

The important point is that I have announced today a major opportunity to create the bridge. As soon as the geological and hydrological surveys are completed, we shall have a design and build competition for the new bridge. It makes much more likely the provision of a second Severn crossing in the mid-1990s. That is a substantial step forward, and I am utterly amazed that the Opposition should respond to the announcement in their typically grudging and mean-spirited way.