HC Deb 23 April 1990 vol 171 cc12-3
18. Mr. Gerald Bowden

To ask the Secretary of State for Transport what discussions he has had with British Rail regarding the funding of the channel tunnel high-speed rail link.

26. Mr. Cyril D. Townsend

To ask the Secretary of State for Transport what discussions he has had with British Rail about the funding of the channel tunnel rail link.

Mr. Parkinson

Since November last year British Rail has been discussing the proposed channel tunnel high-speed rail link with Eurorail Ltd., with a view to forming a joint venture. The parties have kept me in touch with progress and I am now considering their detailed proposals.

Mr. Bowden

I thank my right hon. Friend for that answer. Will he take this opportunity to dispel the well-founded rumours in the press that the Government intend to change course and provide public money for the channel tunnel rail link? Will he deny that?

Mr. Parkinson

It would be illegal for the Government to provide money for the Channel tunnel rail link. That is expressly forbidden by section 42 of the Channel Tunnel Act 1987.

Mr. Townsend

Will my right hon. Friend reconsider his position? I take a different line from my colleague. Is not this a great national project which will bring enormous benefit to the north and north-west? Should not it be managed and financed by a partnership involving Government, business and British Rail? Would not that be in the country's long-term interest?

Mr. Parkinson

The proposed project would be a collaboration between British Rail and the private sector, which have been working together on the finances and have put a detailed proposal to us. We had a meeting with them last Thursday at which we fleshed out their proposals, which we are now carefully considering. I cannot say more than that.

Mr. Leighton

If the private sector falls down on the job and the Secretary of State has to inject about £1 billion of taxpayers' money, will he ensure that it is not just a straight subsidy but that taxpayers get a share of the equity and, subsequently; a share of the profits?

Mr. Parkinson

I prefer not to say any more than I already have. The proposals that have been put to us have been worked up over a period of months; they deserve careful consideration and that is what they are getting.

Ms. Ruddock

Will not the Secretary of State admit, however, that there is no way in which the private sector can fund the environmental projects that will be required for such a rail link in the south-east and in the London area? Will he admit that he will have to find some method—probably through Network SouthEast subsidies—to ensure that the rail link is financed?

Mr. Parkinson

The position is perfectly clear: under the Channel Tunnel Act we are not allowed to build a subsidised rail line, because the ferries and airlines with which the tunnel will compete are not subsidised. That was the decision of Parliament. We are looking at a proposal that has been put to us, but we must bear the law in mind, even if Opposition Members do not want to.