Severn Bridge (Tolls) (Hansard, 14 February 1989)

§ Mr. Roy Hughes (Newport, East)

I welcome the opportunity to raise again the issue of tolls on the Severn bridge. I note that the Minister for Roads and Traffic is to reply: I have nothing against him personally, but for me he is essentially the fall guy called upon to defend the indefensible. He is also essentially the voice of south-east England, with little understanding of the chronic problems of Wales.

The man who should be in the hot seat tonight is the Secretary of State for Wales. For the past 18 months or so he has been running around Wales telling us how marvellous he is, and of the miracles that he is performing. The truth, of course, is a little different. Two major collieries are scheduled for closure, Marine colliery in Ebbw Vale and Cynheidre in the Llanelli area. Last weekend we received the shattering news that the newly privatised British Steel was making over 1,000 people redundant. The Velindre steelworks at Swansea were to be closed completely; over 700 jobs would go there, and several hundred more in other steelworks in Wales.

The instant response from our Secretary of State was that we must attract new jobs, and one of the best ways of doing that is to get rid of tolls on the Severn bridge. The issue is vital to the future well-being of Wales: the bridge is our main access point in and out of Wales, and it is merely a short stretch of the M4.

Tolls are a major factor in hindering the economic development of Wales. This additional tax on our people is completely unjustified. For example, my constituents living in Caldicot will now have to earn more than £13 gross to pay £10 per week in toll charges when pursuing their employment on the other side of the channel. That is grossly unfair: it is a charge even before they get their cars out of the garage.

There are no tolls on the Avon bridge which serves nearby Bristol, our principal competitor in attracting new jobs. The old argument that vehicles could use other routes if they did not wish to use the Severn bridge is pretty ridiculous. Any significant increase in traffic in the Gloucester area now would cause chaos and a public outcry.

The Government tend to treat Wales as though it were the south-east of England, but our unemployment—even according to the official figures—is 9.5 per cent. I understand, however, that there have been no fewer than 24 changes in the method of compiling the statistics, and those changes have taken off the register many thousands of people perfectly capable of a normal day's work. Admittedly, the number of unemployed people has fallen in the past year or so, but we could ask who put it up in the first place. I feel that a little modesty in certain quarters would not go amiss. Even allowing for recent improvements, with the same method of compiling the statistics, unemployment is still roughly double what is was when Labour left office in 1979.

Unemployment is only one facet of our argument. Health problems in Wales compare unfavourably with just about any region. We have the highest proportion of pre-1918 housing and so many of those properties lack even basic amenities. I could say much more besides. It is 290 hardly the time for the Government to bring forward a proposal to double tolls on the Severn bridge, when logic demands that they should be abolished.

When we examine the finances of the bridge, the position becomes simply farcical. The total cost of building the Severn crossing, comprising the Severn bridge, the Wye bridge and viaduct and the approach roads with all ancillary equipment was £14,362,334. That figure includes £1,710,143 in respect of interest capitalised during construction. The bridge was opened in September 1966 by Her Majesty the Queen, since when, until 31 March 1988, £48,547,086 has been collected in tolls. The bridge was paid for originally out of the Consolidated Fund, so there was no bank loan, yet I am now told that the debt on the bridge was £85,469,667 at 31 March 1988. All those statistics are from very recent parliamentary answers. The basic figures are the cost of construction at about £14 million, the tolls collected at more than £48 million, and the debt of £85 million.

It has to be recognised that those figures are nearly 12 months out of date. To add insult to injury, I am told that the debt on the bridge will be finally discharged in 2006, if the Government's proposal to double the toll charges is carried through. In other words there are to be 40 years of a superimposed Government tax on a depressed region.

The Government have the cheek to blame the Labour Government. The Thatcher Administration has been in office for nearly 10 years, with a large majority throughout. The Labour party was elected at the end of 1964 with a wafer-thin majority. The legislation for the Severn bridge had already been prepared by the late Mr. Ernest Marples, the then Minister for Transport. Welsh Labour Members had earlier tended to dissociate themselves from the crossing project because of the imposition of tolls. Also, when Labour was in power, unemployment was minimal compared with what it has been in recent years—so the need to remove tolls was not so urgent.

Still, the principle of a toll-free bridge has always been relevant. In bygone years, our Welsh ancestors fought bitterly over a similar principle, and their fight was symbolised by the famous Rebecca riots.

In a letter to me dated 9 February, the Secretary of State for Wales said: the main demand is to proceed as quickly as possible with the building of a second crossing". He went on: This we will do. Yet the response of the Department of Transport has been ringed about with ifs, buts and maybes. It has repeatedly stated that a second crossing will be provided if traffic needs justify it and Parliament decides to build it.

Now there are weird Government plans for a privately funded project. The £200 million estimated cost would be attractive to a private developer only if tolls were sky-high. What if tolls on the new crossing are significantly higher than on the present bridge? Motorists would tend not to use the new private crossing. That provides us with a clue to the reason for the proposal to double charges on the existing bridge—to make the whole proposition more attractive to private capital. That is a cynical exercise on the part of the Government.

What is the state of the bridge? In an Adjournment debate a few years ago, I revealed the contents of a report that until then had been secret and which had been written by an internationally renowned firm of consulting 291 engineers on the state of the bridge. It painted a frightful picture. Subsequently, the Government announced that £33 million was to be spent on strengthening and maintenance work. The Minister told me in a parliamentary written answer on 31 January that £38.9 million had already been spent, and that the estimate for the whole works is now £70 million. Those figures do not say much for the forecasting or technical expertise of the Department.

Meanwhile we suffer perpetual hold-ups and lane closures, the costs of which to the economy of Wales must be astronomical. A few years ago, the situation was summed up by Mrs. Shelagh Salter, then the chairman of the Welsh Consumer Council. She said: We have been paying tolls every day but if the Sale of Goods Act applied to the Severn bridge we would be entitled to get our money back … It is neither fit for the purpose, nor of merchantable quality. The public would certainly endorse those remarks.

Surely my request tonight is a reasonable one. Why cannot Wales, with all its economic and social problems, have a decent, toll-free crossing at its main access point? The motorist is contributing hand over fist in taxes between £16 million and £17 million in the current year, I understand. Less than a quarter of this will actually be spent on roads and maintenance. The Treasury, in this run-up period to the Budget, is awash with money. In February 1986, we had the report of the Select Committee on Transport. It called for the abolition of toll charges on estuarial crossings and set out clearly and simply how this could be brought about.

Vast sums of money have been written off by this Government in pursuit of and to facilitate their privatisation ventures. By comparison, the amount involved in writing off the debt on the Severn bridge is simply peanuts, but such a decision on the part of the Government would be a tremendous psychological boost to Wales, and soon the economic benefits would be self-evident.

§ The Minister for Roads and Traffic (Mr. Peter Bottomley)

I congratulate the hon. Member for Newport, East (Mr. Hughes) on making an extempore speech and for so nearly sticking to half the time available for this debate. I also recognise that he has raised this issue on many occasions. Perhaps I could also acknowledge the presence of my hon. Friend the Member for Monmouth (Sir J. Stradling Thomas), who takes a keen interest, and I think has been acknowledged to do so, whether or not he has been in a position to speak.

I make it plain that the convention in Adjournment debates is that the hon. Member who is fortunate enough to be chosen in the ballot can speak, but I recognise my hon. Friend's interest, and also that of the hon. Member for Clywd, South-West (Mr. Jones) and, just in case there are toll bridges to come in Wells, my hon. Friend the Member for Wells (Mr. Heathcoat-Amory).

The totally unjustified attack by the hon. Member for Newport, East on my right hon. Friend the Secretary of State for Wales makes it appear that the hon. Member believes that my right hon. Friend is a Labour Member and therefore the normal courtesies of the Labour party can be extended to him. I point out that he is actually a Conservative and he should be treated with courtesy.

292 The Severn bridge was opened and the tolls imposed when the Labour party was in government. The legislation governing the Secretary of State's power to levy tolls is the Severn Bridge Tolls Act 1965; that is a point which my hon. Friend for Monmouth would have made.

Section 1 gives the Secretary of State power to levy tolls subject to, and in accordance with, the other provisions of the Act. Sections 2 and 19 provide that he may make orders setting out toll levels for classes of vehicles. Section 3 prescribes the procedure for making orders. In particular, subsection (3) sets out the circumstances in which an inquiry is required. In the present case an inquiry is necessary because one has been demanded by several local authorities and representative objectors.

We must keep toll rates in perspective. When the bridge opened in September 1966 the toll paid by cars was 2s. 6d. That is not quite, but almost, equivalent to the £1 now proposed for cars. We must not forget that there have been only two increases in tolls since the bridge opened, one in 1979 and the other in 1985. The increase now proposed is in line with the Government's intentions to bring to an end the spiral of rising debt on the Severn bridge. Without an increase, debt would rise to abut £400 million by the end of the tolling period in the year 2006. That would be wholly unacceptable. The proposals are designed to enable all debts to be repaid over the period of 40 years that was envisaged by the Labour Government who enacted the legislation in 1965.

This is a rather inopportune moment for the hon Member for Newport, East to raise the question of tolls on the Severn bridge. As he well knows, a public inquiry into the proposed toll increase starts next Tuesday, 21 February. The House will appreciate that I cannot speculate about the results of the inquiry. To do so would prejudice the role of my right hon. Friend the Secretary of State who must determine the outcome of the inquiry, having considered the report of the independent inspector and all the evidence put before him. I intend, therefore, to be careful about my remarks.

On a personal basis, may I say that if we had a Labour Government and if there were many talented Welsh Labour Members of Parliament, with the hon. Member for Newport, East being appointed a Minister with responsibility for issues affecting London, I do not think that I should insult him by making remarks of the kind that he made about me and Wales. The hon. Gentleman may not be aware that in 1968 I was in industrial relations with the Steel Corporation and was concerned with the R, T and B works—and, for that matter with Velindre as well.

I ought also to say that I go to Wales as often as I can to see the Severn bridge and to keep in contact with the police services in Wales that have done much by leading the battles for road casualty reductions. On both the economic and life-saving factors that affect Wales I give way to the hon. Gentleman, who can speak with such fluency about them, but it might be a courtesy and a kindness if he were to acknowledge that we live in the united kingdom and that there are many Welsh people who have an interest in England and that there are many English people who have an interest in Wales.

The hon. Gentleman has received and no doubt read the Department's published statement of reasons for the forthcoming inquiry. Copies have been placed in the Library. We have outlined the Government's policy 293 towards tolling estuarial crossings, the legislation under which the toll increase is proposed, the history of tolling on the bridge and the justification for the proposed increase.

At the pre-inquiry meeting on 17 January, which the hon. Gentleman did not attend, the inspector made it clear that although he would report to the Secretary of State any views expressed at the inquiry, it would not be for him to make recommendations that related to the merits of Government policy. We can now look at that policy and at how little it has changed over the years, including the years when the Labour party formed the Government. It should enable the hon. Gentleman to resist the temptation to make too much of the matter at the public inquiry.

This Government's policy towards the tolling of estuarial crossings was set out in a memorandum submitted by the Department of Transport to the Select Committee on Transport in April 1985. The memorandum noted: Over the past 30 years successive governments have justified the policy of charging tolls on major estuarial crossings on the grounds of the high cost of provision and the exceptional benefits to users conferred by large reductions in journey lengths and times except where tolls would cause substantial diversion of traffic to alternative, untolled routes. Section 4 of the 1965 Act provides for a toll period of 40 years, with the possibility of extensions for periods of five years. It also sets limits on the tolls that may be levied. In particular, subsection (2) says: In the exercise of his powers under section 2 of this Act the Secretary of State shall not specify scales of tolls exceeding those which in his opinion would be requisite to ensure that, taking one year with another, the revenue produced by the tolls during the toll period, if applied for the purposes mentioned in Schedule 2 to this Act, would be sufficient, but not more than sufficient, for those purposes. Schedule 2 specifies the purposes to which toll revenue may be applied. These include the repayment, with interest, of the construction cost of the bridge and of any additions or improvements carried out during the toll period. It further provides for the defrayment of all expenditure incurred during the toll period on the operation, maintenance, repair or renewal of the bridge and the provision for defrayment after the end of the toll period of likely expenditure on the maintenance, repair or renewal of the bridge.

The bridge was built from national funds, but in order to set a limit on the power to levy tolls the 1965 Act introduced the concept of users paying for it as if the bridge had been built by means of a loan. On 1 December 1964, during the debate on the Ways and Means resolution on the Severn bridge, the Financial Secretary to the Treasury, Mr. MacDermot, said: the intention is that tolls should cover amortisation of the capital cost over a period of 30 to 40 years, with interest, and also the maintenance costs of the bridge and the cost of collection."—[Official Report, 1 December 1964; Vol 703, c. 413.] I acknowledge the hon. Gentleman's interests in this matter. I note that the Welsh Nationalists do not appear to be here, nor do the Social and Liberal Democrats, and I am not certain that we have maintained the interest of the hon. Member for Clwyd, South-West. But perhaps I should let that pass.

It has since been the objective of successive Secretaries of State that, so far as reasonably possible, the toll levels should be such that revenue will be sufficient to meet, over 294 a 40-year period, the expenses set out in schedule 2. In practice, the toll levels set in the past have proved insufficient to meet that objective.

It is quite clear that successive Governments since the war have pursued a consistent policy in relation to the tolling of estuarial crossings, including the Severn bridge. There are those who will argue that nothing should ever be tolled and that tolls are inappropriate on trunk roads and motorway crossings. These views were expressed by the Transport Committee in 1986 in its report on tolled crossings. The hon. Member is clearly in sympathy with them.

The Government's policy is quite clear. We said in our response to the second report of the Transport Committee: The Government does not accept the Select Committee's view that tolls are inappropriate on trunk road and motorway crossings. The provision of adequate estuarial crossings is a costly matter; where they offer a substantial time and cost saving to users, like the Severn Bridge and the Dartford Tunnels, the Government considers it appropriate for users to contribute directly to the cost through tolls. The Government is also unable to accept that it should write off or discharge the debts of tolled crossings. It does not regard tolls as unfair, and it takes the view that there are more pressing demands on its resources. We said that we were willing to consider reasoned argument for special treatment in particular cases. We did not accept that the write-off or discharge of all debt was justified.

In that response to the Select Committee's report the Government made it clear that they considered the Humber bridge to be a special case. We are currently considering a report by the inspector into proposals by the Humber Bridge Board for a toll increase. When that has been decided by the Secretary of State we shall consider the carefully reasoned case submitted by the Humber Bridge Board for writing off a proportion of that bridge's debts which cannot be met from tolls or other sources of revenue available to it under the Humber Bridge Act. As we said in our response to the Transport Committee, most crossings should prove to be viable under prudent financial management. That would certainly seem to be true of the Severn bridge.

Directly after the 1979 toll increase the annual deficit, which reflected the system of amortisation or capitalising the debts of the Severn bridge, fell. From 1980–81 onward, toll revenue has been insufficient to cover operating costs, and debts therefore continued to grow. It was clear that a further toll increase was required, especially in view of the need to provide for a substantial part of the cost of repair and strengthening works required on the bridge.

In successive reports on the Severn bridge account the Comptroller and Auditor General has drawn attention to the accumulating deficiencies on the account, having regard to the objective of recovering the total deficit over 40 years after the opening of the bridge. The debt to the Consolidated Fund had reached £46 million at 31 March 1984, and then increased by £10 million in each of the succeeding two years, to bring the total to over £65 million at March 1986. This figure had increased to nearly £77 million at March 1987, and to £85 million at March 1988.

Our current proposals for a toll increase have been embodied in a draft Severn Bridge Tolls Order, which, if made, will revoke the current order of 1985. The draft order proposes an increase in tolls for cars from 50p to £1, and for buses, coaches and goods vehicles having an unladen weight in excess of 1.525 tonnes an increase in tolls from £1 to £2.

295 I should say something about the second Severn bridge. On 28 July 1988 my right hon. Friend the Secretary of State for Transport announced the next step in the provision of this crossing, so we will be in a position to provide the bridge by the mid-1990s, if the traffic justifies it. We are well up to programme and hope shortly to announce a shortlist of companies who will be invited to tender. The construction of this second crossing will require new legislation. It has not been taken into account in considering the need for a tolls increase on the existing bridge.

The House will probably be grateful to the hon. Member for allowing some of these points to be made, but 296 he will understand that I have not spoken with quite my normal articulation—though. I am not sure that "articulation" is the word for a Transport Minister. I repeat that I welcome the fact that the hon. Member instigated the debate. He may have been outnumbered three to one—leaving aside yourself, Madam Deputy Speaker—by the Conservatives who are interested in the subject. I think we should look forward to the inquiry and to the results that will follow from it when the Secretary of State has been able to consider the inspector's report.