THE CHANNEL TUNNEL

HL Deb 02 May 1973 vol 342 cc89-176

2.38 p.m.

LORD ORR-EWING rose to call attention to the Green Paper on the Channel Tunnel (Cmnd. 5256); and to move for Papers. The noble Lord said: My Lords, I beg to move the Motion standing in my name on the Order Paper. Having studied this plan, I have come to the conclusion that we ought to go ahead, and that we ought to go ahead now, provided that the various reports for which we are waiting are satisfactory and that we have a chance of reassessing the position at the end of Phase II. It is unfortunate that the terms, "Phase I", "Phase II", and "Phase III" have been selected, because there is a possible confusion with the anti-inflation measures, but I shall be referring constantly to the phases mentioned in the Green Paper. As your Lordships know, Phase II will last from July, 1973, until February, 1975, and I wish to put the case that Britain should now proceed for several reasons which I hope to develop.

Has any project ever been so much debated and so long drawn-out? When one looks through the history—and I shall not bore your Lordships by reciting it all—one sees that more than 170 years ago, in 1802, Albert Mathieu, a Frenchman, proposed a tunnel. A year later, a Mr. De Mottray, an Englishman, proposed a steel tube under the Channel. By the time the Great Exhibition came along in 1851, De Gramond had proposed that there should be a causeway and three movable bridges, but that was abandoned because of the high cost. As your Lordships know, work was started at St. Margaret's Bay, and on the French side, but in 1882 the Board of Trade marched in and stopped all further work for possible defence reasons. In 1930 there was an exhaustive official document, Cmnd. 3513, which gave detailed plans for a tunnel. In that instance also, there were defence objections and the proposal was dropped. In 1947, a Parliamentary group was set up. Engineers estimated that the cost of the Tunnel at 1947 prices would be £65 million. In 1963, we had another White Paper and by then the estimate had gone up to £143 million. That investigation also considered a bridge, but it was reckoned that a bridge would cost at least twice as much and therefore was not a true consideration. Now, in 1973, we have a Green Paper which your Lordships are considering to-day, and the estimate, based on a rather false assumption which does not allow for inflation or for the time of building, is £366 million. Your Lordships will recognise that, consistently throughout tins programme which I have outlined, every time the Tunnel is postponed the cost goes up, and goes up very substantially.

Obviously, a project of this sort would not be undertaken without the most detailed market survey, and your Lordships will understand that the number of people travelling from the Continent to Britain, and from Britain to the Continent, will naturally be considerably influenced by the growth of the wealth of this country as shown by the national product. But on a conservative and pessimistic basis of a 3½ per cent. growth rate, it is estimated that, whereas in 1971 24.5 million people crossed the Channel, by 1980 the figure will have risen to 45 million, and by 1990 to 75 million. Of course, the number travelling through the Tunnel will depend on how it attracts travellers from the short sea routes and from the air, as well as upon the growth of the gross national product, but the British Channel Tunnel Company have done an exhaustive survey and they suggest that, of those 45 million in 1980, nearly 15 million will go by the Channel Tunnel; and, of those, 8.8 million are passengers without vehicles and 5.8 million are passengers with vehicles. Incidentally, it divides up in this way, that the great majority, 75 per cent., are leisure travellers and a smaller percentage, only 17 per cent., are likely to be business travellers. But your Lordships will have seen on page 1 that there is a very convincing argument showing the growth of demand for cross-Channel journeys, and particularly vivid are the figures for accompanied car traffic. More and more people are taking their cars, and even caravans and camping equipment, for holidays on the Continent.

I want to say something about freight, because this is very important, especially to our railways. It is estimated that in 1980 4½ million tons of freight will go across the Channel short sea routes, and by 1990 7.9 million tons. Perhaps I can deal with the expansion of our railways later, and deal now with the question: Is this the right time? My Lords, in the 24 years that I have been in one House of Parliament or another I have always heard the same argument for almost any political project, or indeed for any project that is put forward. You either say, if you are a critic, "It is a very good idea but this is entirely the wrong time" or you say, "It is a very good idea but you are tackling it in entirely the wrong way". I believe, for reasons that I shall indicate in a moment, that this is the right time and that this is the right method for tackling this project. Having examined and studied it, I hope the House will endorse the desirability of getting ahead.

I list seven good reasons why I think it should go ahead as soon as possible. First, all the technology contained in this Tunnel is known and proven, and the risks are very small indeed; and even these risks will be eliminated when the trial borings and the trial Tunnel are completed. Secondly, the defence objections which have held us back in the past have now been set aside. Thirdly, the trade advantages, with the immense growth in our trade with the E.E.C. countries, become increasingly important. Fourthly, I think that, particularly for freight, we need to join our railway system to Europe and to the long-haul routes, which will then be economic and productive for British Railways. Fifthly, we have at the moment got support from bankers, both French and British, who are prepared to risk their own money, admittedly with a Government guarantee; and we have a financial plan which is very similar to the plan approved by the Labour Government a few years ago. Sixthly, we have a management project team which has been recruited, which is efficient and skilled in managing tasks of this sort and which, if it is not put to use, will be dispersed, and I doubt whether we shall ever succeed in reassembling the same talent again. Lastly, we all know that the costs of projects of this kind are subject to escalation, and this is bound to occur. If we do not go ahead now our successors may well rue the day. For these seven reasons I think now is the time, and I have a feeling that if we do not go ahead now the will of the bankers will disperse, as will the project teams, and a tunnel will never be built from this country to France.

I also foresee tremendous advantages to the British railway system, particularly as regards freight. At present, in the United Kingdom only 10 per cent. of our freight goes by rail and 90 per cent. goes by road. The picture is different in Europe, where there is a longer haul. There, 30 per cent. goes by rail and 70 per cent. by road. It is only fair to add that there are certain restrictions on the use of lorries in some of the European countries which would probably encourage the use of rail traffic and distort the picture somewhat. In the U.S.A., where there are no such restrictions, 50 per cent. of the commerce goes by rail and 50 per cent. by road. Studies show that if rail is to be competitive for freight purposes you want something between a 300-mile and 400-mile haul to compete with lorries. Otherwise all merchandise is consigned to lorries, which can collect close to the factory and deliver to customers. We shall not get this 300-mile or 400-mile haul unless British Rail is linked to the Continent. Then, goods can be consigned in Glasgow or on Merseyside, to Milan or Constantinople or to anywhere in Europe. So I believe that this project is not just for the benefit of travellers, both pleasure and business, but provides a possibility to revitalise British Rail with a real shot in the arm. It is absolutely essential to the success of this project that British Rail should be allowed to go ahead with their modern infrastructure in parallel with the construction of the Tunnel, because without that we cannot cash in on the advantages which the Tunnel will provide. I recognise that it will cost British Rail up to £120 million to provide this infrastructure.

There are some people—and before one examines the problem it is an attractive proposition—who suggest how much nicer it is to be on a bridge than in a tunnel. The estimates for a bridge, however, have never been closely defined but every figure I have seen has been more than double the cost of the Tunnel. I believe the Tunnel is going to be economically viable, but I doubt very much whether, if it was double the cost, it would have such a sunny prospect ahead. Secondly, of course, in order to construct a bridge with its supports across the Channel there would have to be international agreement, and international agreements take a long time to negotiate and to sign. Thirdly, there are the navigational hazards, of which the Chesapeake Bay is an example; and the accidents there certainly are a warning. So I would say that in the short term a bridge is out, but do not let us close our minds to it. It is completely possible that by the year 2000 the Tunnel itself, on this plan, will be saturated, and it may then be possible to negotiate for a bridge as an alternative.

Now I want to turn to the question of control and finance. I believe that these plans will allow for a better physical and financial control than any previous project of this dimension. I think that we in Britain have learned by our mistakes in the past. I am, incidentally, a supporter of the Concorde project, particularly at this stage; but while Concorde had no break points in its contract here we have break points. Concorde was right on the edge of scientific development. Here we are using known and proven technologies. I think I should remind your Lordships that after Phase II there is, in 1975, the possibility—if errors have been made, and I do not believe they have—of having a cut, and the cost on these terms at that stage will be £27 million at 1972 prices. As your Lordships will know, in this Phase II 30 per cent. will be raised by these two companies, French and British, by way of risk capital and the balance by bank loan. I do not know how the cost will work out by 1980, but allowing for interest and inflation during the next seven years it might well be £700 million. Perhaps the noble Viscount, Lord Harcourt, the Chairman of the British Channel Tunnel Company, who will speak later, may be able to give us more exact figures.

My Lords, it is sometimes said that figures of this sort are such an enormous drag on our economy that we cannot afford them. When I say "our economy" I do not mean in money terms; I mean in real resources, manpower and materials. If we look to see how much money is being spent on the infrastructure of our country, or committed, the sums are much larger than in respect of the project we are discussing this afternoon. As an example, in the next five years the Post Office aims to spend £3,200 million, at a rate of more than £600 million a year. For electricity supply the figure is £2,909 million. I take these figures from the White Paper on Government and public expenditure. That figure for electricity supply also is at the rate of £600 million a year. Steel, £1,569 million in five years at the rate of £300 million a year; the cleaning of our rivers at the rate of £125 million a year; coal, £80 million a year and rail, without this project, £80 million a year. Yet at its peak this project will be absorbing in real resources only £70 million; and of that 30 per cent, is in labour costs and 40 per cent. in material costs. I submit that that is a small contribution, a small investment, in what I believe to be a most essential project for the future. I think, too, that it should be made clear that none of this—whatever the figure may be; £700 million, shall we say?—comes from the Government. It is raised in the markets here and in overseas countries. Of course it contains a Government guarantee. None of it falls on the Budget. My Lords, I turn secondly—

LORD BALOGH

My Lords, will the noble Lord allow me to interrupt him in order to ask what is the difference whether or not it is in the Budget? It is a question of resources. Whether it is done through the Budget or by private borrowing is of the utmost irrelevance.

LORD ORR-EWING

My Lords, it is not irrelevant in political circles. I think that if the noble Lord, Lord Balogh, had been in the House of Commons he would know that what people are sensitive about is what is in the Budget, what is going to be the amount of their taxes. That is why I was dealing with that as a hyper-political point. I dealt first with the call on resources and related that to some other calls on resources. Perhaps I may go on and say that if it is thought that the manpower call for this project is excessive your Lordships may remember that there have been 1,500 people employed on the Dungeness nuclear power station project which is now coming to an end. That is the sort of number which could be redeployed on the Channel Tunnel project. So I submit that the call on resources is small compared with the call in other areas of our economy. In fact, that point is brought out here in the Green Paper where it says that it is a 2½ per cent. call on resources of the nation, or a 6 per cent. call on the manpower resources in the South-East of England.

My Lords, may I turn now to the people who are organising and running this project. The British Channel Tunnel Company were chosen by Her Majesty's Government to do three things: to conduct preliminary studies, which have been done in depth; to arrange for finance, which is now promised, and to construct the Tunnel. They, in their turn, have appointed R.T.Z. Development Enterprises, Limited, as the British project managers. I think it worth while looking at the "track record" of the R.T.Z. group. They have done well on another enormous project, that of Churchill Falls in Labrador, worth 1,000 million dollars, an eight-year project which at this moment is right on time and right on budget. It will not be completed for some years. Another point which I think of advantage is that penalties will be built in to take effect if there is even a small overrun in the cost of the project. Suppose there was an overrun of 10 per cent., then there would be a very substantial reduction in the management fee paid to R.T.Z. Development Enterprises Limited.

I now turn for a moment to consider the environment. I have never represented a constituency in the South-East, although I lived in Kent for some time. But I can understand that for those who live in Folkestone and Dover this must be an agonising choice. I think it of interest that the Society for Environmental Studies has said that this project ought to go ahead even if it were not economically viable, because its benefit to the environment would be so considerable. I expect that during the peak holiday months of summer some noble Lords have had cause to take their cars down to Dover or Folkestone. One has only to see the immense growth in car traffic to foresee what is going to happen if 5.4 million leisure cars are expected by 1980 and 75 per cent. of that figure in the three summer months. Then there is 1.8 million tons of freight on roll-on, roll-off lorries. There are expected to be 140,000 lorries moving through the ports by 1980, and this figure will expand to 220,000 lorries by 1990. Your Lordships will appreciate the disastrous effect of this increase when we contemplate the effect of a few of these large lorries passing through London. It would have a terrifically detrimental effect on the environment of the relatively small towns of Dover and Folkestone. How much better that these vehicles should go underground before they reach the towns. I say that the growth in car-rail traffic will also be an advantage because more and more people going on holiday from Birmingham, Merseyside or Glasgow will wish to put their cars on the rail, and to travel through the night and wake up on the Continent ready to continue their holiday. Again, if there is no tunnel the feed roads to these ports will be more heavily loaded as the growth in the number of vehicles increases.

So, my Lords, I believe that the plan set out in the Green Paper is a coherent, rational and viable plan. I believe it will greatly aid both business and leisure traffic; that it will be of very considerable importance to the growth and prosperity of British Rail; that it will link us physically with Western Europe where lie our destinies, and I believe that now is the time to encourage others to get on with the job. My Lords, I beg to move for Papers.

3.1 p.m.

LORD BESWICK

My Lords, there is no collective policy of the Labour Party on this possibility or project but I am sure that I should carry with me the whole of my noble friends when I say that we are indebted to the noble Lord, Lord Orr-Ewing, for giving us the opportunity of discussing this matter in a constructive way this afternoon, and I would congratulate the noble Lord on the way in which he has deployed his case. My Lords, I for my part have a deeply rooted prejudice in favour of improved communications and there can be no rational case against improvements between our island and the mainland of Europe. Lest any recall our E.E.C. debates and think that I may be tainted with some anti-Community feeling, may I say that I have always argued that a better basis for building a community would be a cooperative policy on power and transport rather than ingenious administrative devices for raising the price of food which, let us face it, was the only fixed administrative agreement when we entered into the E.E.C.

So, my Lords, I approach the Channel Tunnel project with the warmest good will, but this must be the least satisfactory document that we have had before us, the Green Paper, since the green covers were invented. Its facts are incomplete and the deployment of traffic forecast with percentages and increases without reference to base figures reminds one of the early Soviet five-year plans. I pondered, for example, on the figures in paragraph 1.4. It is there stated that by 1980 the Tunnel might attract from air 2.7 million passengers to European destinations. This, it is said, would represent perhaps six months' increase in London's air traffic … The opinion is then given that this is not sufficient significantly to affect Maplin.

I can understand that that sentence was thrown in by those who may think that this is an argument against Maplin. But I find it very difficult to reconcile this calculation with figures given by the European Airlines Research Bureau. On an 8 per cent. growth rate their figures for European destinations ex-London by 1980 would be a total of 15.6 million, or an annual growth of 1.15 million. How can 1.1 million for 12 months be reconciled with the Green Paper figure of 2.7 million for six months? I quote this simply to show that one needs to go into the whole of the statistics with much greater care than is possible, I suggest to the noble Lord, Lord Orr-Ewing, within the time that it is proposed by the Government to give to Parliament. I am not nearly so sanguine as the noble Lord that we have been able to assimilate the statistics, incomplete as I suggest, so far. Moreover, since we have mentioned Maplin, although a reference was made to the possibility of diverting air traffic from Maplin there are many of us who think that probably the more important of the projects in Maplin Sands will be the seaport, and there is nothing in the Green Paper so far as I can make out about the possible impact, on that seaport and its trade, of this tunnel project.

Of course, there are positive statements in this Green Paper with which one must agree. For example, I agree wholeheartedly with what is said in paragraph 10 of the Summary, where it states quite unequivocally that the project will be undertaken only if it is shown by current studies to be in the interests of all participants. I should have been more than mildly surprised if we had been told anything to the contrary. But more seriously, it is these current studies which I find worrying, and I was a little surprised when the noble Lord, Lord Orr-Ewing, qualified his approval by saying that the approval was given provided that the results of the other studies were satisfactory. Here in this document I find 18 separate references to further studies now being, or about to be, made and all of them relevant to the case set out in the Green Paper. Although to-day we may be given more information, as the noble Lord indicates, nevertheless this Green Paper has been written before those other facts apparently were known; and certainly the facts are not set out in the Paper. For example, in paragraph 11 of the Summary we learn that: Consultants have been engaged to undertake a transport cost/benefit study and a detailed examination of the economic and social implications for South-East Kent. My Lords, could anything be more important than that—the economic and social implications for Kent? Although I was very interested in what the noble Lord, Lord Orr-Ewing, said on this point, nevertheless this is a matter which ought to be gone into in depth and we should have before us, before a decision is taken, the results of that kind of study.

In paragraph 3.5(d) we are told that the University of Leeds and the St. Cyr Laboratories in Paris are still working on the aero-dynamic effects of trains moving at speed in this long tunnel. I have absolutely no doubt at all that any drag problem which might be identified can, with other outstanding engineering problems—and I agree with the noble Lord, Lord Orr-Ewing, that they are few in number—be resolved, but is it reasonable to expect a realistic estimate of the cost in advance of such studies as those?

Again in Chapter 4 we are told that such fundamental problems as terminal design, the differences in loading gauge of tracks, the line of rail access from London to the English portal, all have to be studied further and decisions taken. On page 23 we have the frank admission that while current studies can provide the answer to the question, "Will a tunnel pay?" —and I accept again what the noble Lord, Lord Orr-Ewing, said about this—it is said that additional important factors need to be assessed before we can answer the Question: Would construction of a tunnel be better for the U.K. than continued reliance on developing existing forms of Cross-Channel transport? My Lords, I am bound to ask the question: Does this incomplete statement merit the description of a Green Paper? My understanding was that a Green Paper should set out the facts and then give us time before the White Paper to discuss the conclusions, but we are not here given all the facts on which we can properly discuss the conclusions. I put as a definite question to the noble Lord who is to reply: Why was not this Paper produced six months ago? What is it that is known to-day that was not known six months ago? That would have given us six months for discussion, and then you come along with your Green Paper with the facts contained in the other studies which are still being pursued. I put this, too, to the noble Lord, and I believe it to be important. If at intervals, all subsequent to the publication of this Green Paper, we are to get results of the different studies, are the Government justified in asking for legislative agreement to substantial expenditure before July 31, which I understand is the timetable proposed? Can that really be justified? Can Parliament be expected to digest all the new facts given to them possibly at the beginning of July and then get a Bill through both Houses of Parliament by the end of July? I happen to be well aware that if one delays the go-ahead of a big projects of this kind one's costs will mount. Given delays, I know the difficulty of keeping skilled teams together. But I believe that it would be quite unfair if those responsible for the engineering side of this great project were called upon to bear the cost of a deliberate delay if such were considered to be in the national interest.

This is an important issue; it is a national issue. It can be argued, and to a large extent this is all that the noble Lord, Lord Orr-Ewing, was arguing, that the engineering task, boring from one side of the Channel to the other, is the least difficult of the problems we have to resolve. Such extra cost resulting from proper consideration would be small for the countries concerned, even if large for the companies. But I put it to the House that it is the country that counts. We need to take decisions in relation to the total impact of this large investment on our social and economic life. Yet all that we have in this Green Paper, so fat as that is concerned, is the paragraph on page 23 telling us that a very competent firm of accountants have been asked to study aspects of these vital national issues.

Moreover, in advance of those studies, one Governmental policy directive appears to have been given to those responsible for the preparatory planning, which could, in my view, go quite contrary to the findings reached by the additional and conclusive social and economic studies. I refer to the directive that the Channel system as a whole will be operated to ensure parity of treatment as between through rail and road. I understood the noble Lord, Lord Orr-Ewing, to say that he approved of this conception. I put this to your Lordships: is it really in the best economic and environmental interests of our country that there should be in this big, new, imaginative and hopeful development, parity of treatment as between road and rail? I suggest that it probably is not to our best national advantage. I suggest that if there is parity of treatment then the worst fears of those who oppose the Tunnel on environmental grounds—because, partially, of the damage to the fair County of Kent and because it will over-concentrate development in the South-East—may be realised. I suggest also that the finest hopes of the pro-Tunnel enthusiasts who see this project, as the noble Lord, Lord Orr-Ewing, put it, as being a "shot in the arm" for our railways and an aid to our environmental improvement, will not and cannot be fully realised by this parity of opportunity conception.

My Lords, let me give one example of the sort of consideration I have in mind—although I agree that there may be other factors and the noble Lord, Lord Orr-Ewing, pointed to some of them in his speech. The Green Paper—and I am leaning on the Green Paper rather than on what the noble Lord said—tells us that the volume of accompanied cars crossing the Channel has more than doubled between 1962 and 1970. More recent studies, which both he and I have seen, indicate that the volume will be doubled again in the 1970s and quadrupled by the 1980s. I am told that the revenue estimates for the Tunnel assumed that 62 per cent. of this quite frightening total of accompanied cars will cross by the Tunnel. What is going to happen to Kent if, from all over England, Scotland and Wales, we have these cars converging on to the loading bays at Ashford? I know that a similar proportion of the smaller number (but still a frightening number) now goes by the Dover and Folkestone ports. The Green Paper, and the noble Lord, emphasises the environmental damage that is already being done, but what will be the result if a quadrupled volume of this traffic goes, not through two points but through one? Ought we not to be racking our brains to spread, instead of to concentrate, this traffic? Could we not insist on a pricing policy which would develop other embarkation points in the are from Harwich to Southampton?

This category of traffic, the accompanied car, is really quite different in kind from the other categories of traffic. It needs only the link between coast and coast; the journey from point of origin to point of embarkation is entirely a matter of judgment of the individual and is independent of any integrated transport system. It could be attracted by a suitable pricing policy to any one of half a dozen points of embarkation on our coastline. Moreover, the time factor of the journey for people going on holidays is of less decisive importance than that of some of the business freight and travel that we have in mind. The carrying capacity could be provided for a lesser investment than that of a Tunnel.

If I am told that without this category of traffic the Tunnel project is less financially attractive, I should want to weigh the financial against the environmental factors. On the other hand, and let us face this, I believe—and in this I agree with the noble Lord, Lord OrrEwing—that there are enormous environmental advantages to be gained if we can fill the capacity on this rail link with freight and do more to encourage the transfer of freight movements from the road to the rail. But the need for this encouragement cannot be squared with the directive to the Tunnel companies to accord parity of treatment as between road and rail.

My Lords, one of the most attractive features of the whole project is this concept of through rail services, both passenger and freight, from, say, Birmingham to Brussels and Glasgow to Munich. Here we see (if I may allow my other King Charles's head to rise) a little light for the regions in the darkness which E.E.C. otherwise threatens. In terms of time, it could bring Gateshead and Glasgow much nearer to Liège and Luxembourg. But this idea of a through rail system is not realised simply by boring a tunnel; it has to be planned for in a much bigger way than is provided in this Green Paper. Partially, through-rail traffic would be possible, as the noble Lord indicated, on a one-way basis from England to the Continent, but it would be quite impossible on a two-way basis; for in the United Kingdom, bridges, tunnels, tracks and traction are not, I am advised, suitable. What is the capital cost of bringing our United Kingdom rail system up to date so that it can exploit the Tunnel potential? Can we afford it? Is the Tunnel a proposition without it? What are the complete costs? These, I suggest, are the sort of facts that we ought to have before us.

So the conclusions that I come to are these. The engineering case for the Tunnel itself, I believe, is made, and those concerned for its presentation, if I may say so, are to be congratulated, but the project upon which Parliament should be asked to make a judgment is nothing less than a total transport system. The facts on this are incomplete; and they are certainly not in the Green Paper. We need, of course, the up-dating of the Tunnel costs. We need the results of the study, which we are told on page 23 Cooper Brothers and Co. Limited are making, to enable us to answer the question: Is the Tunnel a good buy? We need an estimate of the cost of putting our rail system into the shape essential for the proper exploitation of the Tunnel potential. And in the light of those two latter factors we need a review of the present basic assumption that road traffic should be afforded parity of opportunity with rail. Personally, I would add that I still have to learn what advantages there are to the nation of the loan capital being raised privately and guaranteed by the Government rather than being raised by the Government in the first place—but that is a subsidiary argument to the conception as a whole.

All these considerations lead me to suggest that it would be quite wrong to expect to have a proper discussion and still expect Parliament to see a Bill at the beginning of July and pass it through all stages in both Houses by the end of July. The noble Lord, Lord Orr-Ewing, made a powerful plea for a decision and for action, and he said how long the project had been discussed. But the fact that it has been a matter for discussion for some 200 years does not seem to me to be an excellent argument for suddenly rushing it through its final decisive stages, when we are beginning to assemble the facts, in a matter of two months. I believe that it would be in the best interests of all concerned if time were taken to get all the facts and for Parliament to be able to digest them all thoroughly. There is ample evidence to suggest that it would be in the best interests of all concerned if this extra time were given. On that basis, however, I of course should wish that the most favourable and sympathetic consideration should be given to the whole project.

3.22 p.m.

EARL AMHERST

My Lords, I should like to join in thanking the noble Lord, Lord Orr-Ewing, for giving us the opportunity to debate this subject. My colleagues on these Benches have generally and in principle welcomed the whole idea of a Channel Tunnel project. We feel that its completion and the facilities to be afforded by the fulfilment of its ultimate objectives should provide facilities that will forge one of the major links in our entry into the Common Market. As has been said, it was first mooted over 200 years ago and since then many criticisms and objections have been raised. Not least has been the suggestion that our defences might be weakened against an ill-intentioned enemy on the other side of the Channel. But the Green Paper states that no defence risks are now to be foreseen. So this ghost has now been laid.

As I understand it, the final objective is to connect the rail systems of this country to those of the Continent so that passenger traffic, freight, motor cars and vehicles of all kinds from the major centres of this country—Manchester, Liverpool, Birmingham, Edinburgh and Glasgow, to mention but a few—and not just from London or the Southern Counties, will be able to travel on rail from their originating points not through London, but round it, to their final destination in Europe without change of vehicle, without having to onload on to a ship or transfer to another vehicle on this side of the Channel and again when it gets to the other side, and that such a connection would be entirely free from any weather hazards. But I do not think the Government's present Green Paper makes this clear, despite paragraph 5 of the Summary on page v, which says: These (the tunnels) would link the rail systems of Britain and France. Through day and night trains would run from London and other cities to the main centres on the Continent. So would motor-rail services and freight trains, including container services. It mentions only France, but surely it means over and through a section of the French rail systems to the other rail systems of Western Europe, including Spain and Portugal, which countries are not mentioned in the list given in a footnote to the Green Paper. I am told that Scandinavia has been ruled out as being too far away; and there are also sea difficulties against making that a practical proposition.

I suggest that there is likely to be confusion in that this Green Paper talks in paragraph 6, on page v, about a rolling motor-way of frequent drive-on and drive-off ferry trains between the terminals near the main portals", and about through passenger freight and motor-rail traffic between centres in Britain and the Continent—paragraph 4, page v. I suggest that the diagram showing the design for the Terminal at Cheriton with its loops of sidings, marshalling yards and platforms tends further to confuse. I imagine that the average reader of this Green Paper could hardly be blamed for thinking that the design is just for a quick turn-round rail service between Cheriton and Sangatte and back again. If this is really to be the case, surely the roads through Kent and Sussex leading to Cheriton would become worse clogged up than those leading to the ferries of Folkestone and Dover to-day—and the noble Lord, Lord Beswick, made a strong point about this.

By developing this Tunnel project do we aim ultimately to get the bulk of the traffic of all kinds to and from the centres in the United Kingdom to the Continent, and back again, off the road and on to the rail, and save ourselves and the environment from plunging headlong into further road development, or do we not? Can the noble Lord who is to reply clarify this point once and for all?

I am told that designs are well advanced to provide suitable rolling stock for passengers, motor rail, freight, container traffic and rail floats large enough to carry the juggernaut lorries. I understand that the Tunnel bores will be large enough to accommodate all these types of vehicles, ours as well as the Continental models, and that there is no question of driving a smaller bore to take care of traffic just between Cheriton and Sangatte, in the first place, and then having to make a larger tunnel later, presumably at huge expense. Perhaps the noble Lord can confirm this.

There is, however, another not inconsiderable difficulty, as the noble Lord, Lord Beswick, pointed out. As things go at the present moment, most of the Continental rolling stock cannot clear many of our station platforms, bridges over the railways and tunnels as they are to-day. But presumably if we are to go into the Channel Tunnel project and obtain the ultimate objectives of through running, although the problem must be a major one for British Railways, we shall have to provide ways and means of eliminating these restrictions. There can also be the problem of locomotive power in that the present British rail system South of London operates on the third-rail principle, while on the main systems North of London and on the Continent the overhead electric supply system is used. This might be overcome, at least in the initial stages, by changing locomotives when the trains arrive on the British side. The Green Paper indicates that further current studies, estimates, analyses and reports are under way. Can we be assured that all these will be completed and published in plenty of time for detailed examination before Parliament is to be asked to proceed with Phase I of the project?

My Lords, I do not propose to say much on finance, because I am not qualified to do so. I am not an economist, and I claim no knowledge of economics or high finance. But here we are contemplating a huge expenditure. Does not this scheme mean the employment of a great many people, and for a long time? Does not the cost of their wages and salaries account for a considerable amount of the total cost? The noble Lord, Lord Orr-Ewing, mentioned some 40 per cent. Will not the Treasury in due course recover quite a considerable amount of this sum by way of taxation on wages and salaries? Could there not be at least an approximate estimate of what the final cost might be after the Treasury has had its "whack", so that the scheme might not ultimately look so fearsome a financial commitment? Before sitting down, my Lords, I must apologise to the noble Lords, Lord Orr-Ewing and Lord Sandford, as owing to a prior engagement I am doubtful whether I shall be in my place when the debate is wound up.

3.31 p.m.

THE PARLIAMENTARY UNDERSECRETARY OF STATE, DEPARTMENT OF THE ENVIRONMENT (LORD SANDFORD)

My Lords, may I, on behalf of the Government, welcome this opportunity for a debate on the Channel Tunnel at this stage and say how grateful I am to my noble friend Lord Orr-Ewing for the way in which he opened our debate. May I also straightaway give the apologies to the House of my noble friend the Lord Privy Seal, the Leader of the House, for his absence from the debate. Until late yesterday he had fully intended to take part, but I am sorry to say that he was struck down overnight and is now indisposed and unable to join us. Therefore it will fall to me not only to make the opening speech but also to wind up the debate.

I should first like to remind the House that the Government have not yet taken any decisions to take this project beyond the end of the study phase this July. As the House knows, the Green Paper sets out broadly two alternative approaches to the problem of providing for the rapidly increasing cross-Channel traffic. It outlines—and does no morel than outline—the steps we are taking to provide a sound basis for a decision whether or not to commit ourselves to the next phase of initial works. We will do so only if we are convinced that the project as a whole should go ahead. But the Green Paper itself does not imply any decision on this point—and here I fully take the point made by the noble Lord, Lord Beswick—nor does it provide fully for the necessary information for a decision to be taken on the point, and noble Lords are not being asked to take one to-day. As my noble friend said, the idea of a Channel Tunnel—

LORD BESWICK

My Lords, before the noble Lord leaves that point, may I ask him whether he is going to tell us the proposed timetable?

LORD SANDFORD

My Lords, I certainly shall be referring to the timetable and the availability of studies, and so on, which were the points raised by the noble Lord. I shall refer to these as I go along. My noble friend Lord Orr-Ewing made the point that the general idea of the cross-Channel Tunnel—though of course not this particular proposal—has been with us for 170 years. But, as he says, we are now in the situation where we must shortly make up our minds whether we want one—not just because of historic delays, but because in one way or another we must cope with the increase of traffic that is building up between Great Britain and Europe. Broadly speaking, the timetable involved here is already set out in Chapter 9, paragraphs 9.2, 9.3 and 9.4 of the Green Paper. Many statistics have been and are still being produced. With the impact of entry into the E.E.C., the increase in overseas holidays and the developments of generally closer links with Europe, all this traffic will continue to grow. The very latest studies in fact indicate that the growth of traffic will certainly be no slower than is indicated in Chapter 1 of the Green Paper, where the basic problem is set out. There are a number of statistics there. I think the most startling and the most worrying one—particularly for Kent and the Channel ports—is the 43 per cent. increase last year alone in the number of freight lorries using the roll-on/roll-off services through Dover. That is an indication of the scale and urgency of the problem that must be solved in one way or another. The question is how to provide for this traffic economically with the least damage to the environment—and possibly with improvement to the environment, thinking particularly of Kent and the Channel ports.

When we talk of "the Tunnel" we are in fact talking of a system of rail tunnels. The reasons for this choice are set out in the Green Paper. Many alternatives have been suggested. Some, for instance the road tunnel, are not feasible with present techniques. Others may be. We certainly have not ruled out for all time such possible alternatives as a bridge or a bridge/ tunnel scheme. But there is no scheme in the state of development which would make it a possible answer to the needs that we foresee within this decade.

LORD DAVIES or LEEK

My Lords, might I interrupt the Minister for a moment? I am grateful to him for giving way. Why is there no alternative scheme available? Have the Government asked people who are interested in modern techniques of bridge-building to present such a scheme?

LORD SANDFORD

My Lords, I believe we had an earlier debate on this subject. I am just saying that we are debating now a rail tunnel of the kind set out in the Green Paper, and not any of the other alternatives which have been proposed at various times and set aside, chiefly for the reasons I have just mentioned.

The details of this particular project are set out in the Green Paper. In essence, the proposal involves the construction of two main tunnels, each carrying a single rail-track, with a service tunnel between them, to run between Cheriton near Folkestone and Sangatte near Calais. The tunnels would provide, first of all, a link between the rail systems of Great Britain and the Continent, carrying through passenger and freight services, including container trains and Motorail services. I hope that is a sufficient answer for the noble Earl, Lord Amherst, but I would draw his attention to paragraph 4.9 on page 10 of the Green Paper, where the problems involved in giving full effect to that concept are fairly and squarely recognised. They do, of course, involve building additional tunnels, enlarging tunnels and altering platforms, if we are to handle Continental—

EARL AMHERST

My Lords, perhaps I could interrupt for just a moment. I was talking about the bores of the tunnels and not making changes to them. I was referring to the boring of the actual tunnels capable of taking all types of rail traffic, and not the train tunnels over here.

LORD SANDFORD

My Lords, I can certainly reassure the noble Earl on this: the tunnel going under the Channel is amply large enough to carry both sets of rolling stock. It will be considerably larger than the stock used either on the Continent or in Great Britain. The chief problem to be met in order fully to develop the concept of linking the rail systems of Britain and the Continent is one of enlarging our tunnels, and so on, in this country.

LORD BESWICK

My Lords, may I ask the noble Lord a question? He now says, as I understand him, that the Government proposed to stick to the timetable set out in Chapter 9. That means that by July 31 they expect to have had Parliamentary consent to enable them to go on to the next phase. Is the noble Lord saying that by that date, or by the time we get this legislation before us, we shall have an estimate of the cost of this necessary work he is now dealing with, in order to bring the British rail system up to date?

LORD SANDFORD

My Lords, I wonder whether the noble Lord would allow me to continue. I have indicated that in this speech I shall cover some of the anxieties and points he made, and I have another speech at the end. If then I have not met his points, perhaps he would intervene once more. For the moment I should just like to refer to Chapter 9, paragraphs 9.2, 9.3 and 9.4, referring to the broad programme involved.

May I now turn to the financial and organisational arrangements. The Green Paper goes some way to setting those out. I am glad to say they are the outcome of continuous development from agreements reached between the previous Administration and the French Government in 1966. As the noble Lord, Lord Beswick, said, although the Tunnel may be a matter of controversy it is not one of Party conflict. Briefly, if the Tunnel is built it will be built by an international group of banking and other interests (including the British and French railways) organised into the British and French Channel Tunnel Companies. They will be responsible for raising the necessary finance, at least 10 per cent. of which will be risk capital, the rest being loans carrying a Government guarantee. On completion, the Tunnel will be handed over to the Governments who will arrange for its operation by a joint Anglo-French authority, which will be responsible for servicing and repayment of the guaranteed debt and for remunerating the risk capital out of profits over 50 years in accordance with an agreed formula. Net profits above these payments, and all profits after 50 years, will belong to the Governments.

I turn now to some of the studies. The decision whether or not to proceed with the project will be taken in the light of the results of the studies which are outlined in Chapter 8 of the Green Paper. I am coming to one of the points with which I think the noble Lord, Lord Beswick, was concerned. I agree with him that further details beyond those available in the Green Paper are needed before Parliament can come to a final view. I disagree with him when he says that there was not enough information available to make the publication of this Green Paper worth while, and that there is not enough information available to make this debate to-day thoroughly worth while.

The first results of these studies are coining in. The companies are due to present to the Government the key results of the joint economic and financial studies, to which most of Chapter 8 refers—everything from Chapter 8.3 up to 8.17; their estimates of the "most expected" cost, net and gross revenue of the Tunnel, together with certain supporting material on the traffic estimates and the sensitivity of the results to various factors, such as inflation, and so on, and hence the degree of risk to which the forecasts are subject. These key results, with certain explanatory material which we hope will be available in a few days, will be published very shortly. The Government will naturally require some time to assess these results and reach their own conclusions as to the likely profitability of the project. The final report on these studies will not be available for some time, but the figures and related material to be published shortly comprise some of the most important results of the whole study programme. These are the ones which all noble Lords, and the noble Lord, Lord Beswick, in particular, will want to study carefully, and they will be able to study them carefully before Parliament is required to take any decision.

The results of other studies, both those being undertaken by consultants and those done "in house", are beginning to emerge and are expected shortly. One which has already been referred to is that by Economic Consultants Limited of the economic and social impact of the project on Kent. This has been received and will be published as soon as we can arrange it—probably later this month. Its findings are broadly reassuring. They are as follows. If and when the Tunnel is built there will be a temporary employment problem in the Dover area. The Tunnel and related facilities would create a broadly comparable number of jobs to those lost in shipping and the ports, but not of the same types or so conveniently located for Dover people. While the Tunnel would somewhat accelerate the movement of industry and offices into the area, these could if necessary be restrained by planning and development control.

Overall, the impact of the project on land pressures in the area is expected to be considerably smaller than that of developments which will take place whether or not the Tunnel is built. In general, while the consultants foresee some problems of physical planning, they say that they have no reason to suppose that they could not be tackled successfully". We shall be examining the potential problems carefully in consultation with the local authorities, whose association with the Government in the commissioning of this study proved invaluable.

I now turn to cost. A number of points of concern have been raised, both in this House and elsewhere—and in The Times this morning. Perhaps the major one is that the Tunnel might not be viable and would prove a millstone round our necks. No one is going into this project unless the studies show that, on any reasonable assumptions, it will be profitable. The private interests will not put their money at risk, and the Governments will not agree to proceed if there is any danger of their guarantees being invoked. European Ferries have produced some figures which I understand the British Channel Tunnel Company do not accept. If the former are anywhere near right, we shall have no Tunnel; but if, after a full appraisal of the results of the joint studies, the Governments and companies all expect the project to be profitable, the primary condition will have been met. But we shall still need to be sure that it is in our overall economic interest.

Reference has been made to the possibility of the cost escalating—and this will always be a matter of concern. I confirm what my noble friend Lord Orr-Ewing has already said, that we are dealing with the normal tunnelling technique in material which is not particularly difficult—it is impermeable chalk. We are embarking on an operating system which is not at all unusual. There is no reason to expect major increases in the real cost of the Tunnel now that the basic design has been completed. It is reassuring to know that the current Phase I, running to the end of July this year, is likely to have been completed well within budget. But, as the noble Lord, Lord Beswick, points out, what turns out to be the cost in 1980 will inevitably be much higher than the estimate of £366 million for construction costs in 1972 prices given in the Green Paper. As my noble friend Lord On-Ewing said, allowance has to be made for inflation and the cost of interest during construction. Because of the way the money is being raised it is necessary to estimate this now (something which is not of course done for public projects). But it is important that the higher cash cost figure is not taken to imply an increase in the real cost of the Tunnel. I understand that the latest estimates are being worked upon and are expected to be available very shortly indeed. They have not yet been made formally available to the Government; but I have reason to hope that my noble friend Lord Harcourt will be able to give the House the latest information, which is highly relevant on this matter, in the course of his speech which follows immediately after my own.

The next consideration is the effect on the environment. If the project goes ahead, there will certainly be some adverse effects on the environment in the immediate area of the terminal. Those affected will now have the benefit of the new provision for compensation in the Land Compensation Bill if this successfully passes through Parliament. It is now before the House. More important, every effort will be made to limit any adverse effects, either permanent or during construction. In this both the Government and the companies will be working closely with the local authorities; we are also already in touch with the Royal Fine Art Commission and amenity interests on the immediate local impact that would arise if the project were proceeded with.

But this local damage and loss needs to be balanced against the overall advantages of relieving congestion in the port towns and of transferring at least some traffic, particularly freight in containers, to the railways for the end-to-end journey over the longer distances across the European Continent. The noble Lords, Lord Orr-Ewing and Lord Amherst, particularly, and rightly, gave emphasis to this benefit. We have to recognise the already serious congestion at the Channel and other seaports and airports linking us with Europe and the certainty that this is going to increase sharply, particularly in respect of heavy lorries at the Channel ports. The Channel Tunnel project would add a further, additional alternative to those already available to the methods of getting between Great Britain and Europe; and we have to bear in mind the benefits to the public from the provision of a wider choice of methods, especially one which would provide for inter-city transport across the Channel without the inconveniences now inherent in both air and sea crossings. We also have to consider what would be involved in other proposals for catering for this traffic by further expanding existing ports and building yet more motorways and trunk roads connecting them with the national trunk road network. So it is a question of whether or not in all those circumstances the Tunnel provides the best "buy".

This debate has provided, and does provide, an opportunity for noble Lords to draw attention to factors which we may have overlooked, or to which they attach particular importance, before the Government have completed their own analysis of the project and before a decision to proceed beyond the end of the studies phase is reached. As I have said, the broad programme for this study phase and its relationship to the decisions that Parliament is required to take are, set out in chapters 8 and 9. There will be further opportunities to debate the issue before any commitments are entered into. As I have said, some of the latest studies are now complete. The main results of the studies will be published shortly and the Government will make known their further views in the light of the studies and of subsequent negotiations. Thereafter—and not, of course, before—there will be another opportunity for both Houses to consider the matter. Indeed, as foreshadowed in chapter 2.7 a short Money Bill will be needed before the Government will be in a position to sign the further agreement with the international group and the treaty with the French which are a prerequisite to entry to the second phase of the project, which consists of certain initial works, including a trial boring of some kilometres of the service tunnel. Thereafter, as indicated in chapter 2.8 of the Green Paper a major hybrid Bill will be needed before the main works can be undertaken.

The Tunnel could bring us wide benefits, not only as an improvement in our transport links but also as a symbol of our closer links with Europe and as a joint project with our nearest European neighbour, France, and as an example of co-operation between the private and public sectors. But our primary task is to be severely practical: it is to establish beyond all reasonable doubt whether the project is technically sound, whether it is economically viable and whether it is environmentally advantageous; that is to say, whether it is a better "buy" than continued reliance solely on air and sea transport and expanding facilities for existing methods of crossing the Channel. If the result of that decision is to proceed then our further duty is to see that it is carried out with economy and all due despatch.

3.54 p.m.

VISCOUNT HARCOURT

My Lords, I must declare an interest in this question of the Channel Tunnel in that I am the Chairman of the Channel Tunnel Company and have been since its inception and formation four years ago. Even before that I was associated with the original Channel-Tunnel Study Group which began work again on the study of the Channel Tunnel in 1957. As your Lordships have heard from my noble friend Lord Orr-Ewing, the original idea of the Channel Tunnel was mooted I think 170 years ago, but it so happened this morning that while waiting for a telephone call in an office in the project management company I saw hanging on the wail a copy of the Graphic of June 24, 1876, headed, "Proposed Channel Tunnel". It starts with a thought which I believe might be worth repeating to your Lordships and which we might take to heart. It says: The gigantic and long talked of scheme is one which must be admitted at least to be a splendid evidence of the determination and perseverance with which obstacles and impediments are met by the scientific men of the present age. Progress, though slow, is most encouraging. That, my Lords, was 97 years ago. But we are making progress and we are being encouraged.

I am particularly encouraged at the opportunity presented by the Motion moved by my noble friend Lord Orr-Ewing for allowing us to discuss the Green Paper in your Lordships' House. I feel that I have been associated with this project for so long that if I really started to speak about all aspects of the Channel Tunnel I should bore your Lordships to an empty House in a comparatively short time. Therefore I intend to deal with only a very limited facet, and that is really the financial facet. Fears have been expressed in your Lordships' House and outside and in the Press as to the total cost, and particularly on the risk of a savage escalation over the period of construction. I should like to assure your Lordships that there is no possibility of the Tunnel project becoming a second Concorde in terms of cost. That possibility does not exist. No unusual technology is involved. In fact, the most modern tunnelling machines existing are still only developments of a machine invented exactly 100 years ago and used in the original borings for the Channel Tunnel in 1870. It was a machine invented by a British sapper officer and all tunnelling machines have been developed from that. The amount of studies, geological and engineering, which have taken place are such that there can virtually be no unforeseen difficulty. We think that we have the knowledge to foresee everything which we may come up against. The strata is good, there is no major fissuring and it is soft, and when we proceed—and I have no doubt that we shall proceed—to Phase II the boring of three kilometres of service tunnel will enable us to make an accurate estimate of the speed at which the most modern equipment can bore through the lower chalk and also, in giving us that speed of tunnelling, it will give us the ability to forecast the final cost of the Tunnel very accurately indeed.

As to the question of actual cost, I had hoped to be able to give your Lordships a considerable number of detailed figures to-day. I am afraid I cannot, and I apologise for that. They have very recently come off the computers, which are extremely complicated models; they are being processed in Paris at this moment and, although I think I can give your Lordships an idea of the cost, I shall not be able to give the further figures which I had hoped to be able to give. They are due to be presented to the Minister here and to his French opposite number and I hope they will in fact be presented either late to-night or to-morrow morning. But they will then need a considerable amount of processing before they reach a form which would have been presentable to your Lordships to-day. I can assure your Lordships, however, that they will be published at the earliest possible moment so that we can have as much time as possible to study them before we next discuss this question.

In the Green Paper the cost of the Tunnel was given as £366 million; that was the cost in 1972 terms. The cost is almost evenly divided between England and France, but that cost, in 1972 prices, did not include any allowance for inflation over the next seven years; no allowance for money borrowed and interest payable thereon during construction; and meanwhile, since that figure was given, the pound has been devalued in terms of the franc so that we have already had a change. As of to-day, allowing for the devaluation of sterling, and since that 1972 figure was arrived at, allowing for certain modifications, particularly to the terminals, to deal with even bigger traffic as the figures from the consultants began to come in, the cost in terms of January 1973 is £470 million. That is an actual cost if you could construct a Tunnel immediately. But allowing for the fact that completion of the Tunnel, even if we go straight ahead without any interruption to the existing timetable, will take seven years, allowance must be made for an escalation in prices due to inflation and interest on money during construction. The result of all of that is that we arrive at an "out-turn" cost of the Tunnel in 1980 of £823 million—somewhere between £820 million and £830 million.

That sum is made up of the £470 million to which I have just drawn attention; provision for inflation between now and 1980 of £160 million; and the interest payable on the money used during construction of £189 million—that is, the financial charges. That amounts to somewhere between £820 million and £830 million. That I believe is an accurate figure and that is the figure for which we will construct the Tunnel. Nobody, of course, can say what the rates of exchange between sterling and the franc are to be; that remains unknown. But everything else has been allowed for. As the noble Lord, Lord Orr-Ewing, said, the Project Managers for this, RTZ Development, have a record of completing major engineering and mining projects on time, within budget. I am confident that the Channel Tunnel Company for whom RTZ will be acting as Project Managers on this side, will be able to do that.

As I said, the report of the consultants is almost ready—and let me say that these are independent consultants. On this side of the Tunnel Messrs. Cooper Brothers have been in charge of the economic research. The engineering has been given to Messrs. Mott, Hay and Anderson in conjunction with Sir William Halcrow and Partners, who are probably the engineers most skilled in tunnelling. On the French side the economic research has been carried out by a company called SETEC-Economie and the engineering by a company called SITUMER. The report that is to be published shortly will be the result of those four independent consultants working under the project management team. All I can say at the moment about the revenue, which I had thought I would be able to talk to your Lordships about, is that I am not in a position to give you the figure, but from all I can find out—what I knew before and what I can find out from the team who are processing these figures at the moment in Paris—they look healthy and they are certainly within the measure set out in the Green Paper, and in money terms I think that they will prove thoroughly satisfactory.

The question is often raised about the Government guarantee of debt as well as the equity financing. May I, as Chairman of the Company, say a few words about that to try to clear up this matter. The guarantee of the Government on the debt portion of the cost of the Tunnel is highly desirable for two reasons: the first is that outside this country there are considerable limitations on the powers of the big institutional investors to invest in foreign securities and foreign bonds unless they are Government guaranteed. Those restrictions do not apply in England. The very large institutions in England are entirely free as to the use of their funds. That is not so on the Continent, particularly inside the E.E.C., but provided the bonds are offered with the Government guarantee, they are wholly acceptable in unlimited quantities. That, when we are talking about large sums of money, is a very considerable advantage.

It also has the second great advantage that it will enable us to raise this money at the finest possible rate. With interest rates as high as they are at the moment, these savings are all important. May I just point out at this moment that the eventual beneficiaries of the saving in interest rates are Her Majesty's Government in that the final equity in the whole of this project rests with the Government. The Government debt will not be provided by the taxpayer and it will not be a charge on the Budget as the noble Lord, Lord Orr-Ewing, said. It will be raised by the French and British companies, which include bankers—merchant bankers and issuing houses—on both sides. It will be raised partly in England, partly in France, and largely on the international markets—the Eurobond market, the Eurosterling market—such markets which are not actually domiciled anywhere they are truly international. We shall tap every source of money that we can.

The risk capital, which, as my noble friend Lord Sandford said, will amount to at least 10 per cent., ranks behind the guaranteed debt and provides a considerable insurance that the Government's guarantees will not be called into being. The noble Lord said that on no account would the Government go forward with this scheme unless the risk of the Government guarantees being called into being was absolutely minimal. I cannot support that more strongly, because I am, with my colleagues, a large contributor to the equity capital, and the only moment at which the Government guarantees could be called into play would be when all the equity capital had been wiped out. So I can assure your Lordships that the promoters and the bankers who have been working and taking the initiative on this Tunnel are no more anxious to build an uneconomic tunnel than are Her Majesty's Government or Lord Beswick. We are all concerned that this Tunnel should be economic, that it should be beneficial, and that it should be profitable. The risk capital, let me just remind your Lordships, cannot be raised unless the investor to whom we offer it is virtually certain that he will be adequately remunerated for that risk. All the remuneration on that risk capital would have to be totally eliminated before the Government guarantees could be called in.

My Lords, what is the actual measure of risk capital provided by the private sector? As you have already been told, the building of the Tunnel is divided into three phases. Phase I is just about to end with the presentation of the economic, financial and engineering studies, and these have been provided at a cost of a little over £5 million. If I may say so at this point of time, they have been delivered within and below the budget which we submitted to the Government. I hope that this is a good sign. Of this £5 million, the two companies have contributed 50 per cent. by way of equity, and the remaining 50 per cent. has been raised by guaranteed bank loans. Phase II is really what we are discussing here to-day, because, as your Lordships have been reminded, the important thing is to move into Phase II, which is admittedly a more expensive phase in order to keep the momentum going, to obtain even more knowledge of the terrain on the spot. But there will still be a chance to debate this matter again before we get into Phase III in 1975. The important thing is to press ahead with Phase II. The cost of Phase II is estimated at £27 million, and of this amount the two companies will contribute 30 per cent.. 70 per cent. being raised by guaranteed bank loans again. Phase III, which will start in 1975 and consist of the digging of the main tunnel and the building of the terminals and the ports, will absorb the balance of the cost. The companies have undertaken to raise a minimum of 10 per cent. of the total cost by way of equity capital, and this may be or could be increased up to 30 per cent., depending on the market conditions and on the economic research.

The minimum of equity capital, therefore, of which we are talking is £80 million, which is a considerable sum, and all the risk money contributed by the companies both in Phase I and in Phase II would be lost without Phase III. Everything in Phase I will be lost if we do not go into Phase II because the project does not appear to be viable. I assure your Lordships that that will not happen. I am sure that we will enter into Phase II. But equally at the end of Phase II if Phase III is not entered into because the Tunnel does not appear to be viable, all the equity money contributed in both Phase I and Phase II will be lost. The risk capital, therefore, bears a very considerable risk, since it ranks for remuneration after all operating costs and after the servicing of interest and principle on the Government guaranteed debt. Moreover, the risk capital will not receive the whole of the residual profits, but only sufficient, on a formula which is being negotiated with the two Governments, to enable the raising of this risk capital in the markets of the world. The residual equity, as I said earlier, lies with the two Governments. Moreover, should the Government guarantees ever be called on in any one year, the Governments must be repaid any monies expended in meeting the guarantees out of the profits of subsequent years before any profit again accrues to the equity capital. So this, I hope, gives your Lordships some reassurance on this question which I know has bothered some people, as to why the loan capital is guaranteed by the Government. So much for the broad outline of the financial plan and for the cost of the Tunnel.

I sincerely hope that I have shown that this is no ill-considered venture leading to ever-increasing and uncontrollable costs, and, morever, that this is an undertaking financed wholly from the private sector, not only of this country but that of France and those of all the capital producing countries of the world, since it is all these markets which will be tapped. I hope also that I have shown that the risk of the Government guarantees being called into play are minimal, and that even should they be, as a result of some totally unforeseen result in any one year, they will be fully recouped before any remuneration is again payable to the equity holders. At the end of the 50-year concession, the Tunnel and the extensive terminals built on the initiative of the two companies and wholly financed by the private sector will revert wholly to the Government at no cost. The more and the longer I have worked with this problem, the more convinced I am that this is a wholly desirable project from the point of view of the benefit of the United Kingdom.

From the environmental point of view, there is a growing pressure of traffic in Kent. The congestion will continue to get worse. People are not going to stop travelling. It all flows through Kent. I think it is without doubt that the building of the Tunnel will reduce the effect of traffic in Kent. It will improve the environment of Kent. The M.20 is to be built anyway. The M.20 will run within 200 yards of the proposed site of the terminal. The terminal, which is where the car ferry trains will be dealt with, will occupy a site North of Folkestone underneath the escarpment of the South Downs near to the village of Cheri-ton. On the English side, the terminal will cover an area of somewhere between 250 and 300 acres, and it will be landscaped. It is a comparatively small area, but we are convinced that in that terminal we can handle the maximum amount of traffic foreseen right into the year 2000. The French are providing for a terminal of about 1,500 acres, as opposed to the 250 to 300 acres on this side. That is due to a variety of reasons. First of all, their terrain is very much easier to deal with because it is flat. Secondly, there are strong economic reasons why the French wish to see their terminal developed into a large resort area, with hotels, restaurants, bars, theatres and a variety of other things which I do not think would be a welcome addition to the outskirts of Folkestone, and which are not proposed on the British side. The terminal will be heavily landscaped, it will be low and, so far as possible, I think it will be inconspicuous.

The Tunnel must, I think, reduce the traffic. It must of its own impetus draw traffic away from the roads and on to the rail, and it will prevent a rush of industry towards Kent. Many people have thought that the building of the Tunnel would lead to an increase in the desire to be near the entrance to the Tunnel, but I believe exactly the opposite to be the case. I think that with the building of the Tunnel and the connection of the rail system and, as the noble Lord, Lord Beswick, said, if we achieve—which I am absolutely convinced is the ideal—a unified transport system, whereby through trains from the Continent, of continental gauge, can run right into England, the desire of industry to be near the portal of the Tunnel will be removed. We shall, in fact, be moving Glasgow, Manchester, Liverpool and Cardiff nearer to Europe by the mere building of the Tunnel. For that reason I am convinced, as is my noble friend Lord Orr-Ewing, that now is the time to go ahead at least with Phase II to keep the momentum going and to take the Channel Tunnel one stage further.

4.22 p.m.

LORD KINGS NORTON

My Lords, I should like, first of all, to add my thanks to those he has already received to the noble Lord, Lord Orr-Ewing, for initiating this debate to-day, and to thank him for his excellent opening speech. If I may, I should like to express my gratitude to the noble Viscount, Lord Harcourt, for his most exhilarating, encouraging speech, and for giving us a view of the financial aspects of the project which we have not previously had so well expressed, or indeed been made to understand so well. Both he and the noble Lord, Lord Orr-Ewing, began by referring to the pre-history of the Channel Tunnel and, if I may, just for a moment, I should like to follow them in that, because I have recently been impressed by an old French print dated, I think, 1805 in which Napoleon is envisaged as invading England. It shows a three-pronged attack. His sailing ships full of troops are at sea, overhead are great balloons crammed with soldiers, and a great army is advancing through a tunnel under the Channel. Technologically, the three means of transport were roughly contemporaneous. The Channel had been crossed a few years earlier by balloon by Blanchard and Jeffries, and a few years afterwards the elder Brunel began his great tunnel under the Thames. In its applicability to modern transport, I have been tempted to equate the Channel Tunnel with the balloon and the sailing ship, and the temptation is one which I found it difficult but—as some noble Lords will be glad to hear—not impossible, as your Lordships will see later, to resist.

That old print, for all its technological antiquity, indicated an attitude of mind which I wish were more evident in the proposals before us. The projected crossing exhibited in that old picture was a co-ordinated use of transport by land, sea and air, and I feel that we, too, should be planning our connection with Europe as a carefully co-ordinated system combining land, sea and air vehicles. We should, in other words, look at the Tunnel as part of a much greater whole, both in space and time, and my few remarks, necessarily of a far more general character than those which have preceded them, derive from that point of view.

One impression I get from the Green Paper is a rather unfortunate one. Apparently, either we rely on developing our present marine system or we have the Tunnel. If I am told, as I may well he told by the noble Lord, Lord Sandford, later, that this is not intended, then paragraph 17 of the summary and paragraph 19 on page 3 are, I think, rather unfortunately phrased. If the development of surface transport is intended in addition to the Tunnel project, then I consider that wording more revealing of that attitude should have been used, because in my view a determined development of the sea-going link is absolutely essential whether there is a Channel Tunnel or not.

My information from the most reliable source—the project team—is that the aim is for the Tunnel to carry 80 per cent. of the short-crossing traffic. If that is the correct figure—and my argument would not be seriously affected if the figure were considerably smaller—then I think the project is really rather shortsighted, because if this 80 per cent. or other large load factor, is achieved and a tunnel breakdown occurs—and, unfortunately, both railways and tunnels are subject to failures—then the alternative means of crossing will be wholly inadequate. And when the Tunnel is running to capacity—a state of affairs which I imagine is envisaged at a fairly early stage of its life—what comes next? There is no development potential in the Tunnel, so, short of another tunnel or a bridge—and there is a great deal of merit in the bridge project—only the air and the sea routes will be available to cope.

The conclusion that I draw from this is that it is essential to develop a farsighted, highly sophisticated and expansible system which employs land, sea and air vehicles, designed to be very flexible in the sense that if one element was under strain—if, for example, there was a storm at sea, a strike at Heathrow, a leak in the Tunnel, or something of that kind—then the others could take up the load. Under normal working conditions, I would expect that passengers in a hurry would travel by air, by hydrofoil, by hovercraft or by train, and that freight and people who like the sea would travel by fast ships of specialised character with highly automated docking, harbour and loading facilities. In other words, I believe that marine transport has a tremendous potential, has a long way to go and that we must develop it.

In the Green Paper, the traffic to the ports through Kent is deplored. This afternoon, there has already been a lot of discussion about the effect on the environment; but I believe that the environment is bound to suffer. One imagined that we should be told that, somehow or other, the traffic would be lifted off the roads and on to trains at some points distant from the ports—and some of it clearly will. But the rate of increase is going to be enormous; and the heavy traffic through the Tunnel is to board the train, as I understand it, at the terminal near Folkestone and leave at the terminal just on the other side; so the heavy, and increasingly heavy, crossing traffic is to get denser and denser as it proceeds through the County of Kent until it finally disappears into this submarine tube. As the noble Earl, Lord Amherst, and the noble Lord, Lord Beswick, both implied, this seems to be an incredible development, and designed to make things in Kent rather worse than they are. I know that the noble Lord, Lord Sandford, referred to Dover and Folkestone and to the relief of those places, but there are many other places in Kent which I feel are open to severe damage from deterioration of the environment. I should have thought that the objective should not be to canalise a major part of the traffic into one narrow pipe but to distribute it over a number of ports spaced along the coasts of Kent and Sussex. That might of course require some amendment of the road construction plans in those areas; but to distribute the traffic flow to the coast over a length of coastline has clear environmental advantages and provides a degree of flexibility which I suggest is absent from the present proposals.

Your Lordships may recall that at the beginning of my remarks I was tempted to equate the Tunnel technologically with the sailing ship and the balloon. My temptation was in a way increased by the statement, in a document issued by the British Channel Tunnel Company, that "the Tunnel is a low-technology project". That, to me, in an age when the advance of prosperity and of technology go hand in hand, is just a little odd as a recommendation. At a time when there are so many high-technology projects of potential profit which are demanding investment, I would indeed be cautious about investing £470 million in a low-technology project unless there is a clear potential for high technology being associated with it.

Now the Tunnel need not be such an out of date project as I have indicated it might be. We can have a high-technology tunnel, and this I would support. If I could get into a train at Victoria and get out an hour afterwards in Paris, I should feel that we had made a real advance. This could be done, my Lords, by building a tunnel suitable for carrying trains propelled by the linear induction motor, a simple electrical device which I had the pleasure of recommending to your Lordships a few weeks ago and which, following a remark by Lord Beswick, I suppose is becoming a King Charles's head of mine. But, my Lords, it is not a pipe dream at all. It is just a rather more imaginative idea than the present proposal, which in my view, despite the protests this afternoon, spoils Kent, which does not benefit any environment except possibly that of Dover and Folkestone, and which at the best employs the so-called Advanced Passenger Train, which by 1980 will, I am sure, he looking a little passé.

To sum up the views which I have been putting briefly before your Lordships, I believe, first of all, that we should plan communication with the Continent as a system in which air, sea and tunnel methods are all co-ordinated. I believe, secondly, that high-speed passenger traffic, and perhaps a great deal of light freight traffic, should go through the Tunnel by a special high-speed service of the kind that I have described. I think that for that purpose the linear motor' would be au ideal propulsive system. I believe that other traffic should be dispersed over a variety of routes, with docking facilities distributed over such length of coastline as is likely, with a good road system, to avoid traffic concentration and environmental distortion; and to speed up this other traffic highly-mechanised docking facilities and ships to suit should continue to be developed. Finally, for high speed passenger traffic over the sea routes suitable hydrofoil and hovercraft should be developed.

My Lords, the speed at which a decision is to be reached has already been mentioned this afternoon, and it is a little difficult to understand why this should be after hesitating for a century and a half. But if we must reach a decision quickly, and if the decision is to have a tunnel, then I want to make the two-fold plea that no step should be taken which precludes a solution of the communication problem along the lines which I have indicated, and that those proposals are given serious consideration.

4.36 p.m.

LORD DAVIES OF LEEK

My Lords, I have listened with avidity to this debate, and I regret that, though I shall try to do it courteously, I am going to throw a huge boulder into this gentle duck pond in this spring sunlight, because we have not looked at all at the realities of the problem that we are being asked to face. First of all, the British taxpayer, unless we are careful, is again going to be jockeyed into the position of granting, through Parliament, which has not had time to study the problem, a vast amount of money to guarantee losses. We are working a new system of society: privatising profits and socialising losses. That is exactly the system of society to-day. It is no good noble Lords smiling about it: it is a reality of the corporate State and the economics of Toryism at the present moment.

I do not want to take a Party line in this matter because the Labour Party has done the same thing at certain times, and there may be times when it is justified. That is when the project gives comfort and succour to the people and is in furtherance of, as the good old Book says in Matthew XXV, the six corporal acts of mercy; namely, shelter for the homeless, visitation of the sick and the afflicted, clothing the naked, and giving drink to the thirsty and food to the hungry. Those are the six acts of corporal mercy that we are asked to do; and the purpose of the Conservative Welfare State and of the Labour Welfare State is to do that. To do it, we have sometimes justified the socialisation of losses because there has been a human factor. Here, the first factor to look at is mobility. In a world where the combustion engine, the car and the lorry dominate, no matter what we say about railways—and we are going to get more traffic back on to the railways, I hope—we are boring two holes under the sea to carry (and we are given the figures) millions of tons of freight and tens of thousands of people at holiday times. This is inadequate.

I listened with interest to the authoritative speech made by the Chairman of the Tunnel Group, Lord Harcourt, but his speech was exactly what The Times contains to-day. It was a hand-out from The Times. Most of our information in this House is secondhand. We are debating the Tunnel problem with secondhand information, and half of that is botched because there are 18 unanswered questions in the Green Paper. Let me quote to-day's The Times, although I do not usually do it. I am going to take a little longer to-day, my Lords. I do not often speak for more than about 10 or 12 minutes, but I may take 18 to-day. The transport correspondent for The Times says: The Channel Tunnel is expected to cost nearly £500 million, compared with the last official estimate of £366 million in the Government's Green Paper six weeks ago". So that estimate is already out of date. The revised figure is to be reported to the British and French governments by the tunnel companies today, coinciding with a House of Lords debate on the subject"— and I am grateful to the noble Lord, Lord Orr-Ewing, for his wisdom in bringing up this subject for discussion to-day.

The quotation continues: It is bound to increase concern over the project. I do not see that concern here. It goes on: The new estimate, based on recent studies by the official consultants, does not allow for interest charges"— they have not been allowed for in the Harcourt Report— inflation or essential new road and rail links. If those are added the final cost seems likely to exceed £1,000 million. A representative of the tunnel interests said last night that the revised estimates also put a more optimistic complexion on traffic and revenue forecasts. Detailed research into the tunnel's likely share of cross-Channel traffic in 1980 apparently suggests that revenue will be nearer the Green Paper's upper estimate of £66 million than the lower estimate of £54 million. The Government is under strong pressure, notably from trade and industry, to disclose details of current tunnel studies to allow time for informed public debate before the Anglo-French Treaty is signed on July 31. That is, July 31, this year.

My Lords, this House has a duty to-day to protect the British public, although we have no powers over finance. If anything shows the value of a second Chamber this debate raised by the noble Lord, Lord Orr-Ewing, does so; it shows the value of having somewhere where we can discuss, without out-and-out prejudice or without any Party approach, a problem of vital importance to the taxpayers. Before I finish I shall deal with some of the reasons for that. The article goes on: Mr. Peyton, Minister for Transport Industries at the Department of the Environment is in a difficult position, however. He has not received the necessary information from the consultants on which to compile a White Paper or comparable government statement as an official basis for parliamentary and public discussion. The information to be given today, although important, is limited. Many questions remain to be answered. Therefore we should not, in the name of the British taxpayer, be asked to rush into a decision about the Tunnel by July 31 this year.

That does not mean to say that one is damning the Tunnel. The Tunnel is as obsolete as the balloon as far as mobility in traffic is concerned. Let me prove it. We heard from the noble Lord, quite correctly, that we have used computers in our forecasts and that marvellous geological surveys have been made. But this has been done, too, with bridges and islands. There exists to-day a mass of hydrodynamic knowledge of the sea which makes the old, 1960, Tunnel report (which I have here) produced by the French, as out of date as the Battle of Waterloo. We are not taking the grand, creative vision that the old British engineers and British entrepreneurs used to take.

My Lords, the Channel Tunnel is not a promising project and it has gained no momentum since the publication of the hasty and vague conclusions of the Green Paper. As The Times said on Monday, June 26, 1972: The British and French governments have been embarrassed by an unexpectedly unfavourable assessment of the Channel tunnel project received recently from the official consultants. That report was then sent back by our Minister. We have had another report since which Parliament has not seen. The fact is that the case for the Tunnel is weaker than was originally thought. It is admitted that the Tunnel would yield an inadequate financial return in the early years of operation. Consultants submitted the results of their studies in April, 1972; and because the report was pessimistic it was returned. Now I am told that the consultants and the consortium concerned with the Tunnel are getting restive and impatient. Nevertheless, this is no reason why Parliament and the British public should be jockeyed into a decision to guarantee millions of pounds of taxpayers' money on flimsy forecasts and rash accountancy. We are now seeing the consequences of bludgeoning the people into a Common Market decision. One need not be against the Common Market; but ill-digested information, misconceptions and entrenched bureaucratic arrogance about the technicalities of the Common Market misled the British people. We should have had more time before entering.

This Green Paper is not good enough. The Government are ignoring the people; and both locally and nationally are removing individuals further and further away from influencing the vital decisions of their democratic representatives in the other place. Are we to build an obsolete artefact to please pressure groups? We are told in Chapter 2, paragraph 5, of the Green Paper that the Government will find £5 million. If we get Phase II that they are after, there will be further expenditure of £20 million. In view of the information in the Green Paper and the short time for debate, this is an imperious and overbearing usurpation of the power of Parliament and of the people. We cannot allow an irrevocable step on this vital problem of a Channel link to be made by July 31, 1973. I will do my best, and I hope that Parliament will do its best, to get the public and the mass media to create a debate about which form of Channel link should be built.

I ask a simple question. Why is nothing said about the bridge? Tile original bridge project is 13 years old. I have here the French one. Since then there have been advances. Vast advances have been made in hydrodynamic knowledge. The British Steel Corporation have learned a great deal about building piers in the roughest seas in the world, in the North Sea, and about driving 200 feet or 300 feet or more under the roaring seas to tap oil and about building platforms on which men can work out at sea. We know how to build piers better than before.

We know how to build sea islands and we have a British firm with Dutch influence, Bas Kalis, of the Westminster Dredging Group, who have projects for building sea islands. We have two sea islands ready-made in the English Channel. They are two chalk banks or shoals. One is the Varne, four miles from the French coast, and the other is Le Colbart, which is about five miles to the North-West. Between them are the two deep parts of the Channel, four miles deep, for the big ships. There are only two places here where such ships can go. Until we had international marine co-operation ships were banging into each other there as if it were Clapham Junction.

We had two estimates. Professor Baker in his excellent lecture to the Royal Society of Arts last March—I would ask your Lordships to read that before making a decision—on the possible viability of a Channel link, does not throw out altogether the idea of a tunnel. He says that here there is a possibility of a bridge-cum-tunnel in the Varne and Le Colbart island areas. Actually we have two projects. We have been told that there have been no other projects. That is rubbish! Projects have been sent to the Prime Minister and to the Minister of Transport. Who is blocking their approach to Parliament? Why are they not published?

I have no financial interest in the Tunnel or in the bridge. I have here the proposal for a European Common Market Channel Bridge. I am not enthusiastic about the Common Market; but I am enthusiastic about human beings and neighbourliness. There is the proposed European Common Market Channel Bridge, and an industrial study of a port project and of a Channel Tunnel project or a bridge which could have about 12 lines of traffic and carry about five times as many trains as the Tunnel, and in the open. On those two islands you could build an industrial city half the size of Paris, with restaurants and deep harbours for the mighty oil tankers. Why have not these projects been discussed? Why has not the British Steel Corporation, with all its know-how, learnt during 10 or 13 years of sinking oil wells, been consulted? Why are we left with a half- baked approach to a one-sided Channel link? These are vital questions.

If private enterprise believes that there is a successful future for the Tunnel, let private enterprise take the risk. But private enterprise admits it will lose money. I say that the Tunnel, with its 23 miles of ill-ventilated, vitiated, Stygian gloom, will not be able to compete with the ships, ferries and hovercraft which are increasing in number and improving in design. My Lords, £130 million invested in new hovercraft and ferries would give four times the return of a Channel Tunnel. Everything is being driven into two bottlenecks and at the same time you say, "Ichabod, Ichabod! The glory has departed because we are not linked to France." You are going to build a little bottleneck and you have only 250 acres on which to do it. Do noble Lords realise how much land is represented by 250 acres? It is the equivalent of 110 rugby pitches. And you will have it full of railway trains, and people swearing and revving up their car engines, while waiting to get on the little double-deckers where they will sit in their own cars all the way through the Tunnel. Is that the modern approach to a link?

There is one answer, my Lords, that meets the needs of the 21st century. It is, I think, to follow up Professor Baker's idea. Believing this, I went the other day to Surrey University where we had a conference. There were 300 people present and they came from all over Europe, There were engineers, surveyors, architects, men who had drilled holes in the ground all over the world and thrown a bridge across Chesapeake Bay and burrowed tunnels between Kowloon and Hong Kong; men who use computers and know what they are talking about. They said. "Look, if there is a steel bridge we can cover it with plastic. The whole business of steel erosion is pretty well cured. A steel bridge would want less attention than a tunnel bored under the chalk." These considerations should be borne in mind before Parliament makes its decision.

We are told in the Green Paper that all the studies have not been carried out. If that is so, why in Heaven's name has a half-baked Green Paper been presented to your Lordships? If it be true that all the studies have not been carried out, where is the logic in asking noble Lords to make a decision on the contents of a half-baked Green Paper? To do so is an insult to the common sense of Members of this noble House—to present half-baked conclusions and expect noble Lords to say that the Tunnel is to be a fait accompli. It can never be a fait accompli on those terms unless Parliament throws away its right to represent the taxpayer.

My Lords, let us look at the organisation of finance. Here an explanation and some amplification is needed. Never mind about the analysis of risk capital. One accepts that in any major cross-Channel link there must be Government involvement. But we are not told why private enterprise should get the benefit of having most of its capital backed by Government guarantee. Why put the taxpayer at risk? By these arrangements the taxpayer could be called upon to pay out in certain circumstances, which, to be fair, would be rare. On page 26 of the Green Paper appears the membership of the private group. There is Rio Tinto. Channel Tunnel, Morgan Grenfell and others. I have taken the trouble to find out their percentage of interest. Channel Tunnel Investments Limited has 20 per cent., Rio Tinto has 20 per cent., and Morgan Grenfell. Although they are on the British side they are not a law unto themselves. On the other side there is the Compagnie Financière de Suez et de l'Union Parisienne. All those other companies have to make decisions as well. In other words, my Lords, we do not know what is the financial position, and that is admitted in the Green Paper. We shall not know until we get further information from both groups of companies.

Amplification is needed and it is not given in the Green Paper. We need to know about the relationship between the equity and risk capital and the balance of funds required for the project. We are told in the Green Paper that this has not yet been decided. Accepting that in any major cross-Channel link there must be this involvement, we should know what is the relationship between the equity risk capital and the balance of funds required for the project. There are no complete financial analyses, but we are told at the end of the figures which appear on page 21: These figures are currently being revised in relation to the progress with the Tunnel reference design and up-dated to a 1973 cost base. To-day The Times has told how they have been up-dated. The fact emerges on analysis that, for a cost of £130 million, ships could provide the entire Tunnel capacity—and do so at a profit.

LORD ORR-EWING

My Lords, may I interrupt the noble Lord? He is using so many figures. This figure of £130 million would buy only enough ships to take the amount of traffic going through the Tunnel in the very first year of operation, in 1980. So the idea that this is going to solve the problem by the expenditure of £130 million—apart from the cost of renewing the ships which might have a life of 30 to 50 years—is just to use another figure among the many which the noble Lord is quoting which is totally wrong.

LORD DAVIES OF LEEK

No, my Lords, I am not totally wrong. The noble Lord, Lord Orr-Ewing, has agreed that £130 million would provide the ships—

LORD ORR-EWING

Only for the first year, my Lords.

LORD DAVIES OF LEEK

Yes, my Lords, but another £130 million would be better than the taxpayer guaranteeing £450 million. Consequently, while we are considering a bridge, £150 million would give all the transport that a Tunnel would cater for in one year. My Lords, the taxpayers own the railways, and what are the railways expected to do? If we build a bridge we can find the money without coming to the Government. I do not know whether the Chairman has acquiesced in this or not, but the railways would be expected by the Channel Tunnel Company to finance the terminals, the terminal installations, the fixed railway equipment, new wagons and rolling stock, and would take responsibility for the maintenance and replacement costs as well as the railway operating expenses. None of that is counted in the accountancy cost of the Tunnel. It is a hidden increase to be borne by the taxpayers who own British Rail. I think I have fairly and conclusively proved that, before we make a decision about the Tunnel, the Government should open up and invite engineers from all over Europe to give advice about a bridge. I should like these people to come to Room 14 in your Lordships' House, with their slides and diagrams, to talk to noble Lords.

There was the University of Surrey Conference on "The New Channel Bridge" at Guildford on Wednesday, April 18. The opening address was given by the Chancellor, the noble Lord, Lord Robens, and the historic background was given by Professor Makowski, the Principal of the engineering department of the University. Then we had a talk on making artificial islands in the sea by the Managing Director of the Boskalis Westminster Group. Then we discussed the new Channel bridge and the modern methods of building bridges, not those in operation ten years ago. The bridges on the Forth and the Tay will withstand the Beaufort force of winds and are as mighty as anything in the Channel. What are we afraid of? Navigation in the Channel would have 16 piers, 16 lighthouses and would be able to get through that Channel as never before in the history of navigation. We discussed traffic engineering, the aerodynamics of the bridge and its stability. I will not go through the names; the information is in the Library for noble Lords. It proved to me, with other talks I have had with civil engineers, that this House and the other place should have the opportunity of listening to them. Modern engineering projects can keep the rolling stock on a bridge moving at about 12 times the pace of the tunnel and do not ask for taxpayers' money.

I therefore conclude that it is the duty of Parliament and the duty of the mass media—newspapers, television, Panorama and others—to get across to the public the basic facts of these Channel links. We could have the Tunnel as well; we could afford it. And, without knocking the Tunnel, why is it that the Government have not given an opportunity to engineers, civil engineers and others to give this information on the bridge link? There is an esoteric phrase in the Green Paper: Major projects"— listen to this beautiful phrase— at the limit of the state of art carry exceptional risk of the costs of escalation". They mean that a bridge is at the limit of the state of art. What are they talk- ing about, when we had mighty derricks in the sea, and are going down hundreds of feet with steel derricks and platforms that are as stable as lighthouses? If lighthouses can stand, so can the modern piers stand better than ever. My Lords, although I have had to disturb this gentle pond on this beautiful afternoon, it needed stirring up and I hope as a result that more noble Lords, before they make up their minds, will at least give some attention to this problem as I have tried to do over the last eighteen months or so.

5.4 p.m.

Loan GEDDES

My Lords, the case which is presented in the Green Paper is summarised briefly as follows: Traffic between the United Kingdom and the Continent will continue to grow. Much of it now passes through the Channel ports of Dover and Folkestone and therefore we have to choose between developing existing forms of cross-Channel transport or building a tunnel. I submit that this is a piece of false thinking. Since the days of the Romans until just over a hundred years ago the Channel crossing by sailing ship was subject to the winds—and there is no need to stress how capricious they can be in those waters! For this reason probably more than any other the shortest crossing was the most popular and the ports, the access roads and, lastly, the railways were developed to serve the short crossing. The habits of a thousand years die hard, and with the introduction of the steamship (though not yet the vehicular ferry) little thought, if any, seems to have been given to the true nature of the cross-Channel traffic—from whence does it come and wither does it go? Those responsible were further handicapped by the fact that many were based in London and were thereby misled into thinking of London as the nucleus of our traffic problem.

My Lords, we have heard recently a good deal about London's traffic and I submit that there is a close relation between the concentration of the cross-Channel traffic in the Kentish route and the problem of the London ring roads. If it were possible by the wave of a wand to eliminate all road-hauled cross-Channel freight traffic from the Dover-Folkestone area surely we would have gone some way to relieving the traffic problem of Greater London. I am suggesting nothing less than this, and it is surprising how simple it is. To build the Birmingham-Southampton motorway would enable that part of the traffic from the industrial heart of England which is destined for France to bypass London to the West. And in this connection, it is important to bear in mind that recently market research has shown a strong trend for E.E.C. freight movement towards semi-trailers which are especially suitable for roll-on/roll-off ferries, and appreciably away from containers such as would be more suitable for the Tunnel traffic.

Nothing needs to be done as far as the Dutch-German area is concerned because already shippers have found that the short road haul to the East Coast ports, combined with the North Sea crossing, is a more satisfactory route than driving through the morass of London. Figures and facts of the North Sea crossing, and projections as to its future, may well have been examined in the consideration of the Channel Tunnel, but when 11,000-ton fenies have had to be ordered to supplement the 4,000 tonners which were big enough 10 years ago there is clearly a dramatic development towards that route. It is little wonder that France should be urging us to press on with the Tunnel because what they are seeing is that Rotterdam and Zeebrugge are displacing the French ports in the main cross-Channel trades, with all that that means to their Pas de Calais development plans. Let us keep cool heads about this. Let us not be hurried by any timetable, and let us examine our short sea transport requirements as a whole and not make the mistake of developing one fraction of them in isolation.

My Lords, I have spoken thus far on the broad span of the problem and I come now to some more detailed considerations. I welcome this debate to-day because it seems to me that the time scale indicated in the Green Paper is all too short for thorough consideration and public discussion before a decision is reached whether or not to commit this country to the Tunnel project. I declared no interest at the beginning of these remarks as I have retired from the shipping industry, but as past-president of the Chamber of Shipping of the United Kingdom I speak with the knowledge and experience of the shipping industry, and let me emphasise that shipping is by far the most important of what the Green Paper calls the existing means operators.

Shipowners, through the Chamber of Shipping, have consistently made it clear to successive Governments that they are not opposed in principle to the construction of a Channel Tunnel. But they do insist that the Tunnel should not be constructed and that we should not allow ourselves to be committed to its construction, unless it can be demonstrated on the best possible evidence that the project will be economically viable and not subsidised—in either construction or operation—by Governments. In the belief that the Government, certainly the present Government, do not intend to subsidise the proposed Tunnel, the main concern of the industry has been to ensure that the true up-to-date costs of surface transport should be reflected in the economic studies, and should be correctly interpreted in assessing the competitive ability of a tunnel operation. For this reason the shipowners directly concerned have been at particular pains to provide the project managers and the specialist consultants employed by them with the true facts concerning the service they provide. What they have not achieved is a dialogue in which they might have been able to help towards an acceptable interpretation of the facts.

About 18 months ago the Department of the Environment set up a consultative panel representative of all the interests concerned, including the project managers. The Chamber of Shipping welcomed the invitation to be represented on this body in the belief that it might be the means of establishing a constructive dialogue between the project managers and those who would enjoy or suffer the consequences of a Tunnel. I regret to say that this hope has not been fulfilled. Let me illustrate the point. The Green Paper in paragraph 8.3 refers to Certain interim results from the preliminary pilot work which became available in the spring of 1972, which helped the companies and governments to conclude that the prospects were sufficiently promising to justify the completion of the studies. Neither this Report nor any of its contents were made available to the consultative group. Furthermore, when the group was again convened at the end of February, 1973, it was provided with copies of Agreement No. 1, but was given only the briefest indication of the likely contents of the Green Paper. It is obviously difficult in an operation involving two Governments, two Channel companies and various consultants, to organise effective consultation with the many interests concerned. But I think it must be recognised that, despite the best of intentions, the consultative group have not yet been able to promote effective consultation.

In the foreword to the Green Paper it is stated that the purpose of the Paper is to pat together the available facts and other considerations which will form the background against which those concerned will have to decide whether or not to proceed further with so large and important a project. I welcome the purpose of the Paper, but feel bound to assert—and I believe I have already shown—that it falls far short of achieving its end. However, I am informed that when the President of the Chamber of Shipping met the Minister for Transport Industries recently to discuss a memorandum which the Chamber had submitted on the subject, the Minister was most helpful. He emphasised that both he and his Department will be most ready and willing to discuss the studies referred to in the Green Paper as soon as they are published, with the object of ensuring a truly objective undertaking and appreciation of the facts, the conclusions drawn from them and the methods by which they have been drawn. I welcome this and trust that the objective will be achieved. It is certainly essential if the decision on this immense project is to be sound and, what is more, seen to be sound.

The growth in cross-Channel traffic over the last few years is an undeniable fact, and shipowners readily accept the probability of continuing growth following our entry into the European Community. But there is no evidence that the existing means of crossing by ships and other methods are even approaching the limits of their capacity. Indeed, the Green Paper acknowledges that both the public and private sector have provided substantial new fleets of passenger and vehicle ferries and of containers, as well as conventional short sea vessels. There are today no less than 130 regular services of various kinds serving 16 ports in the United Kingdom. In my view, the cross-Channel industry has proved itself highly competent in anticipating demand in the provision of facilities, and there is no reason to presume that it will not continue to do so. In considering the case for a tunnel, it will be necessary to examine whether the cross-Channel industry will continue to have this ability and whether the gradual development of the facilities as the Market expands may not be preferable to the provision of a tunnel.

In my view, the dispersion of the ferry routes offers many obvious advantages. Interfaces, ports and depots and passenger facilities are smaller and thus more easily managed. The length of land hauls is minimised, and road usage is spread rather than concentrated. Again, it is necessary to take a view on the likely future developments in the design of ferry ships. These have developed considerably over the last 10 or 15 years, and this may well continue. I would add that these developments have led to a remarkable economy in sea transport. To-day, freight is being moved across the Channel at about the same figure per ton weight as applied 10 years ago, and if cubic tons are taken as the basis, the rate has actually fallen during these 10 years. It is quite possible that with greater efficiency and the larger ferries coming into use the downward trend may well continue.

However, as the Green Paper points out, the studies in hand are not only concerned with the question, Will a tunnel pay? but, Would construction of a tunnel be better for the United Kingdom than continued reliance on existing forms of cross-Channel transport? But, my Lords, these studies are not even yet available, and I understand they will not be published until well into this month. They cover matters which are of the most serious consequence, and I should be most surprised if they were capable of being even partly digested in time to permit a responsible final decision on the project to be taken by July 31. I say a "final decision" at that date not because I have overlooked the fact that by that date only Agreement No. 2 would be signed, leaving Agreement No. 3 to be signed in 1975, but because, as the Minister has indicated, when Agreement No. 2 is signed we shall have effectively "opted in", and thereafter it will become increasingly difficult to "opt out" by not signing Agreement No. 3. It seems vital therefore that we should not become further committed by signing Agreement No. 3 unless and until sufficient time has been allowed for the thorough and critical examination of all the relevant facts.

My Lords, the final words of the Green Paper are that the Government wish the decision to be taken in the light of the fullest discussion. I have tried to show that this wish cannot be fulfilled on the basis of the present timetable. My plea to Her Majesty's Government is for an assurance that all of the facts will be fully considered by all concerned before a decision is taken, and that sufficient time will be made available for that purpose.

5.18 p.m.

LORD AUCKLAND

My Lords, it is most opportune that your Lordships' House should discuss this important Green, Paper before the other place, because this afternoon, thanks to my noble friend Lord Orr-Ewing and his initiative in putting down this Motion, together with his very powerful opening speech, we have had an objective debate. Like the noble Lord, Lord Davies of Leek, I was present at the seminar at the University of Surrey, but I will not take up the time of your Lordships by going into any details because it is not strictly germane to the Motion that we are discussing. I must confess that on reading the Green Paper (I have no interest of a financial nature in either the Channel Tunnel or the Channel bridge) I was disappointed at its inadequacy in certain respects: not so much for what it says, as for what it fails to say, bearing in mind that it is over 100 years ago that this project was first mooted. The Green Paper of 1973 is indeed a very muted drum.

Much has been said of the cost of this project, whether we have a Channel Tunnel, a Channel bridge or a combination of the two—and I believe with many people in this country that eventually a combination of the two will be highly desirable. Costs are bound to rise for reasons of escalation, wage rises and through advances in technology. The question which the House and the country must ask is: bearing in mind the progress of technology in the middle 'seventies, are we going to get adequate value for money at a current cost of £336 million for a Channel Tunnel? This does not mean to say that I in any way criticise the efforts of those concerned: in fact, I think my noble friend Lord Harcourt and his team have done an admirable job in the progress they have made on this scheme.

What are the principal disadvantages of the Channel Tunnel? I believe that one of them will be that the amount of traffic generated in the 1980s will be too much for what is at present proposed. We not only have to deal with freight, both light and heavy, and we not only have to deal with people taking their cars to the Continent on a drive-on/drive-off basis, but we also have to take into account those who wish to drive the whole way; and a Channel bridge would do much to solve this problem. It is true, of course, that the cost of a Channel bridge would be approximately three times that of a Channel Tunnel. Inevitably, this will mean that there will be a longer period of return on capital, but more people would use the bridge and it would no doubt be possible to devise a toll system. It would also enable the very important tourist trade, which is bound to expand as the Common Market progresses, to get properly under way.

One of the main disadvantages of a Channel bridge which has been mentioned—indeed, it is mentioned in the Green Paper—is that of navigational hazards. We have had navigational hazards with giant tankers, with or without Channel tunnels and bridges, and I am not particularly convinced—though I speak without the knowledge of the shipping industry that many of your Lordships have—that the existence of a properly constructed Channel bridge with all the present technology and know-how possessed by our construction industry, is going to make this a dangerous matter. We are not here to-day to have an argument on Channel Bridge versus Channel Tunnel; nor, indeed, was the seminar held at the University of Surrey concerned with this argument. We are here to discuss the Green Paper on the Channel Tunnel. However, I submit to your Lordships that we cannot discuss this entirely in isolation. One of the more negative passages in the Green Paper occurs at page 8, paragraph (f), which says: Although all possible steps would be taken to minimise interruptions, Tunnel services, like all transport services, could be halted from time to time, for instance because of breakdowns or industrial disputes. This contingency is being examined. I have no doubt that contingency was probably examined 10 years ago, and even 50 years and 100 years ago. Of course it is an important factor. I think that eventually one of the advantages—and of course it cannot happen within one year or even within five years of having a Channel bridge—is that one would not get hold-ups through industrial disputes and one would not get the claustrophobic conditions that one might get in a tunnel if there were a breakdown or other form of obstruction.

We have been assured that there will be further debates on this topic and therefore I do not wish to develop the argument any further. All I would urge on my noble friend Lord Sandford is that the Government do not close their eyes to a feasibility study of a Channel bridge or, if necessary, of a Channel bridge/tunnel project. The noble Lord, Lord Davies of Leek, has said, and I believe, that there is value in a meeting to be convened between the interested parties in the construction industry and others, to ensure that whatever is eventually built will give value for money—because whatever happens the project will be extremely costly.

5.27 p.m.

LORD SEGAL

My Lords, in following the noble Lord, Lord Auckland, in his advocacy of a Channel bridge, I would assure him that nothing in this debate would necessarily rule out that possibility. Nor, in reply to the noble Lord, Lord Geddes (who advocated a much wider extension of cross-Channel sea services), is there anything in this debate which would rule out that possibility, either. What I would personally object to is that every traveller across the Channel should be compelled to accept one form of travel only, if he wishes to cross in his car. Surely he is entitled to have a choice of various alternative forms. Our immediate suggestion is for a Channel Tunnel, which would enable him to cross over with his car, if need be, without this appalling congestion which now exists at all our Channel ports. If we were to add a system of container services by sea, that would only further add to the existing congestion and might even lead to the creation of new Channel ports or wider facilities with a much heavier financial outlay.

If I had to declare an interest in this debate, it would have to be on the side of European Ferries Limited. Nevertheless, this does not prevent my coming down wholeheartedly in favour of the Channel Tunnel. I regard this project as an immediate possibility and one that is almost inevitable. With the present enormous increase in building costs of every kind, I feel that the sooner the Tunnel is completed, after full information has been made available, the better it will be for everyone concerned. Already, in the course of 170 years, I think we can all agree that much valuable time has been lost. Had the work on the Tunnel commenced 10 years ago we should have been able to benefit today far more fully from our entry into Europe.

The traffic with Europe is bound to grow enormously in the next few years and we should be in a position to reap its full advantages. I can only hope that the Prime Minister, as a good European, will lend his support to this project and pursue it with vigour and imagination, as delay now might well deal a fatal blow to the whole concept and this Government and this generation would be pilloried and condemned in the eyes of generations to come. Now that we are committed to the Common Market, with all its implications, by building a Channel Tunnel we shall be able to achieve a great and imaginative step forward which could bring untold commercial benefits to our country—and, incidentally, inject a new and profitable dimension into our existing railway system.

I feel we ought to have no fears as to the cost. As the noble Viscount, Lord Harcourt, has already indicated, the first charge on the revenues of the Tunnel would compensate for any charge on the taxpayer. In this country we have had to embark on extensions to our Underground railways in London with the Brixton Line and the Fleet line without regard to their cost, in order to relieve the traffic congestion of the capital. So, too, I believe the building of the Channel Tunnel will not only relieve the congestion on the coast by creating vast new terminals well inland, but in addition forge an extra physical link with the Continent of Europe and bring us into far closer contact with the peoples of Europe than all the legislation, pacts and treaties that we could possibly devise.

I believe that European Ferries are wholly ill-advised in their opposition to this project. Their organisation has expanded enormously during the past few years. They have been able for over twenty years to cash-in on the desire of hundreds of thousands of people in this country every year to see Europe for themselves, to be free to roam about the Continent in their cars and to establish close contact with the peoples of the Common Market countries. The building of the Tunnel will not ruin the prospects of European Ferries—quite the contrary. Their ships will remain a valuable asset—indeed, an increasingly valuable asset—even if they are diverted to longer sea routes across the English Channel, to the North Sea or Irish Sea, or even if they have to be disposed of in the open market.

On a note of personal reminiscence, I was one of the original delegates to the Congress of Europe held at The Hague in 1948—one of the 16 Labour Members of Parliament who accompanied Churchill on his mission towards a United Europe. We were accused by Ernest Bevin on our return of having "stabbed him in the back". To-day, 25 years later, I feel I could not have stabbed him in the back—metaphorically speaking—on behalf of a better cause. I have never waivered in my deep faith in the cause of a united Europe from that day to this. Now I hope to see the day when the Channel Tunnel is completed in the year of grace 1980, if not before, when I shall be able to cross over to the Continent of Europe on terra firma and feel that our country is permanently joined to the Continent by indissoluble links which will grow stronger with the passage of time. That is why I firmly support the project of a Channel Tunnel and feel grateful to the noble Lord, Lord Orr-Ewing, for having initiated this debate.

5.34 p.m.

THE MARQUESS OF HERTFORD

My Lords, I must begin by declaring some interest in the Channel Tunnel as I am chairman of a public relations firm which is employed by European Ferries. As they are the largest independent company concerned with cross-Channel traffic, they are obviously interested in any future competition. I must venture to contradict the noble Lord, Lord Segal: the company is not opposing the Channel Tunnel wholeheartedly. Indeed, I do not think it is opposing it at all. What it is genuinely alarmed by—and as a taxpayer so am I —is the prospect of facing competition which is subsidised by the Government. From any other aspect this particular competitor, the Tunnel, is fairly welcome. Its existence should stimulate the additional road improvements which are mentioned in the Government's Green Paper. It might well lead to similar much needed improvements on the other side of the Channel as well, and it may well add to the total volume (which is ever-increasing) of cross-Channel traffic, most of which will continue to pour through Kent in the next few decades.

I am sure we all appreciate and even enjoy the traditional British habit of understatement. There is a particularly fine example of it on page 13 of the Green Paper in which a chapter headed, "The Environment" begins: The construction of a tunnel in an area of great beauty like South-East Kent would inevitably do some damage to the immediate locality. —like the wartime air raids did some damage to London, I suppose!

I should have thought that a great deal of this inevitable damage could be avoided by moving the car ferry terminals much further from the Channel so that the cars and lorries have a longer train journey but a shorter drive. If they are put near the Channel, as the Green Paper seemed to imply, I cannot understand how the noble Viscount could hope to reduce the traffic on the roads through Kent. All the traffic going to the Tunnel from London or the South-East would presumably pour through the roads in addition to the traffic which will in any case be going to the harbours for the car ferries. I could not understand that point at all. I think the Tunnel will generate a far greater load on road traffic.

If the terminal was moved, a longer train journey would reduce the traffic on the Kentish roads and that would be one genuine asset. Whether an extension of the railway lines would be any more expensive than the building of the extra motorways, which will surely be demanded once those now being planned are full, I would not know, but I doubt it. In considering the expense of the whole project, I find it extraordinary that as high a proportion as 90 per cent. of the capital required should be raised on a loan guaranteed by the Government. I will not go into all the figures which have been prepared by both the Channel Tunnel group and by European Ferries—they differ very widely. Other people who have no financial concern also have widely differing opinions as to the ultimate profitability of the Tunnel. If all goes well, it appears that we stand to lose nothing, except a fair bit of Kent. On the other hand, if profits do not come up to expectations it could be very expensive. This is gambling with public money on a very large scale. At the risk of appearing more conservative than the Government—

VISCOUNT HARCOURT

My Lords, this is not gambling with public money; this is private money from the private sector.

THE MARQUESS OF HERTFORD

My Lords, I understood that the loans were guaranteed by the Government. Therefore, if there was a disaster ultimately it would be public money at risk.

VISCOUNT HARCOURT

If there was a total disaster, yes.

TIIE MARQUESS OF HERTFORD

My Lords, I am reckoning on the possibility of a total disaster. I sincerely hope that that will not happen. At the risk of appearing more conservative than the Government, may I suggest that more private capital, more free enterprise and less Government support would be reassuring to those who have some doubts about whether this great enterprise will ever make a profit.

When one reads of the millions of pounds being spent even on the initial investigations, one has an uneasy feeling that it will not be long before we are told that so much has already been spent that it is too late to stop. I know that stopping places are provided for, but a great deal of money will have been spent even before we reach the second stopping point. Like the unsuccessful gambler who has to go on because he has already lost more than he can afford, the Government, one fears, may before long be too heavily committed to draw back. What would then be the future prospects? One can too easily foresee the endless subsidies, the lowering of fares to uneconomic levels to compete with other cheaper forms of transport; the debates as to whether more and more millions of pounds should be invested to make the Tunnel work, or whether it should be kept going for the sake of its usefulness to business, trade or holidaymakers, or even because the French want more development near Calais.

I will not dwell upon the painful possibility of adding one more uneconomic unit to our great nationalised industries. The Tunnel may well be a huge financial success. If all the experts are full of confidence—and they know much more about it than I ever shall—then, surely, private enterprise can find more than 10 per cent. of the capital and bear more than 10 per cent. of the risk. As a straightforward commercial enterprise I should welcome the Channel Tunnel as an exciting gamble, but I do not think that Governments should gamble so heavily with public funds.

5.40 p.m.

EARL LLOYD-GEORGE OF DWYFOR

My Lords, I believe the key to this debate must surely lie in a sentence to be found on page 3 of the Green Paper, as follows: We are not merely examining yet again an old idea but we are looking for the right answer to a very pressing modern problem". I do not believe there is any question of making a Channel link, either above it or below it, simply because it is there, like some local Everest which has got to be challenged. I believe it has got to be done because some reliable economic link is needed, and needed urgently. The growth of cross-Channel traffic by all other means has been phenomenal during the last ten years and page 1 of the Green Paper illustrates that very clearly. We have also heard amplification this afternoon of evidence in that direction. All forecasts for the future show a similar pattern emerging and I think our own common sense and experience would tell us that in fact probably these forecasts would err on the low side and the increase could be even greater, particularly since our entry into Europe and the consequent increased two-way traffic with the European Community, both of passengers and of freight. Therefore we need to accommodate this increase in traffic in the most effective way, and by causing the least damage to the environment. I personally have no hesitation in saying that the correct way to do this is by the proposed bored railway tunnel as set out in the Green Paper. But I should like to comment, if I may, on the other alternatives that we have heard about and on which everyone has different views.

First, there is the road tunnel which I think simply has too many drawbacks. There is the obvious one of ventilation; there is the very real accident/breakdown hazard; there are the claustrophobic conditions—and anyone who has driven through a long road tunnel, such as the Mersey Tunnel or even the Dartford Tunnel, is aware of that. There would also be the inevitable encouragement of juggernauts with the enormous damage that they would do to the roads at either end of the tunnel. Secondly, there is the bridge and tunnel combined, as at Chesapeake Bay, and although this would seem to have certain attractions I believe it is not really feasible simply because the gradients up and down from the artificial islands would be so steep as to rule out traffic other than the road type of traffic.

We then come to the bridge. It is always sad to have to disagree with a fellow countryman but here I fear that I cannot go along with the support expressed by the noble Lord, Lord Davies of Leek, for a bridge as an alternative. I could not quite follow him because he appeared to be concerned about the taxpayers' money, when we have estimates of at least twice—and the noble Lord, Lord Auckland, said that it might be three times—in respect of the cost of the bridge.

LORD DAVIES OF LEEK

My Lords, if I may interrupt the noble Earl, he should look at the economics of this. He would know that he can buy a cheap car at about a quarter of the cost of a Rolls-Royce or a good Rover but the Rover and the Rolls-Royce would outlast a cheap car and give ten times the value for money spent. So with the bridge: it would cost more but it would take twelve times the traffic.

EARL LLOYD-GEORGE OF DWYFOR

My Lords, I think it may last as long as the Tunnel but I do not believe it would last any longer and I think the increased cost is of such dimensions that it is really not a feasibility.

Still on the subject of the bridge, I would point out that the British Steel Corporation came up with an estimate only last week of 1.75 million tons of steel being required. I personally think that if that amount of steel is available it would be better used in the national interest in the construction of drilling rigs. We come then to the main drawback of the bridge, which is the navigational hazard. I submit that this really is too great. There would be anything from 16 to 24 spans, which would mean 24 permanent large structures, possibly 300 metres in height, and this in one of the busiest shipping lanes in the world. There are something like 1,100 to 1,200 shipping movements a day in the Straits of Dover. At this point I should perhaps declare a possible interest as an underwriting member of Lloyd's. I believe that if a bridge were to be built the claims in connection with collisions would be absolutely horrendous: this in spite of modern aids which, as the noble Lord, Lord Auckland, has said, are indeed available to ships; but they have to be sensibly used and applied and we all know that human error will creep in.

Therefore I declares myself a firm Tunnel man on the following simple grounds: the pure engineering practical point of view reveals that we have ideal chalk strata between England and France—ideal for bored tunnel construction at a rapid rate using modern equipment. The resulting direct rail link between London and Paris would fill the last gap in a great possible Continental railway system which, after all, this country pioneered 150 years ago. The great railways of the world followed after us and this system is now entering, both here and in France, a complete new era of high speed trains, both passenger and long-distance freight trains. I believe that the railway traffic thus resulting would take back a good deal of freight from the roads and would at any rate alleviate the congestion and real damage which in terms of money in connection with road repairs is quite fantastic. In connection with rail usage, the only point I have not heard raised but which I think possibly the Government might consider is whether an alternative terminal could not be in the London area rather than necessarily at Folkestone. There are huge areas in the docks, for instance, which could be utilised as an alternative terminal for the freight traffic.

Coming to the question of cost, we have heard to-day from the noble Viscount, Lord Harcourt, that the cost in terms of 1973 money is £470 million and this would raise to £820 million in 1980. That is a great deal of money by any standards but the point that I should like to stress is this: I am no financier but it seems to me to be important that whatever the cost, by the time the Tunnel is opened to traffic it will be known and therefore in comparing this scheme as an alternative to expanding the existing air and sea ferry services one must bear in mind that that figure will be known. There is therefore a fixed sum for repayment, whether it is spread over twenty, thirty or fifty years, as against the alternative of building many more ships and expanding the air ferries which have a life of perhaps ten, fifteen or twenty years and would then have to be replaced at who knows what cost in this inflationary age. We should realise also that although £820 million is a great deal of money, when we look at Concorde which is already well into that realm in its development cost and there is a very big question mark around it as we all know, the Tunnel will not be dependent upon selling its merits to the Chinese.

The only other point to which I should like to refer is the question of the existing cross-Channel services. I do not believe that there is any question of the Tunnel killing off existing ferry services.I believe that they will continue and that they will expand. They will be needed, and I think complementary. I certainly hope that whichever tribunal is set up in due course to levy tariffs on the traffic through the Tunnel will include members of the Road Users' Association. We obviously have a great deal more information to come before us from the studies still in progress and, as other noble Lords have said this afternoon, we look forward to getting that information at the earliest possible date. I hope myself that the result of those studies will be that Phase II will be decided upon after further debate so that this great project goes ahead.

LORD SOMERS

My Lords, before the noble Earl sits down, no doubt he is aware of the fact that Continental rail systems use a voltage of 1200, I believe, and an overhead system, whereas of course Southern Region uses only 600 volts and a third-rail system. If that is going to mean that Southern Region will convert to the Continental system then I heartily welcome the idea, but something will have to be done.

EARL. LLOYD-GEORGE OF DWYFOR

My Lords, I am not an expert on methods of traction but what the noble Lord has said is quite true; we have the so-called third rail in this country and the French have the overhead line, but between now and 1980 one would hope that the two systems could be married up so that that problem will not be a continuing one.

5.53 p.m.

LORD GAINFORD

My Lords, first of all I wish to add my thanks to my noble friend Lord Orr-Ewing for initiating this debate. It certainly gives me an opportunity to express my support of the Channel Tunnel scheme in general, but in addition to emphasise the need for concentrating on the developing of other links with Europe in addition to improving those services which already exist. The noble Lord, Lord Kings Norton, emphasised that in his speech on co-ordination.

The Green Paper stresses that the Channel Tunnel is not to be a monopoly of cross-Channel transport. Naturally, when the Tunnel is opened there will be great excitement and some existing services may notice a slight temporary loss of trade because many travellers will want to say that they were among the first to go through it. In the Green Paper, Plate 2 gives a graphic description of the Running and Service Tunnels, but there does not seem to be any reference to what facilities there will be should there be any breakdown. My noble friend Lord Auckland spoke about the claustrophobic conditions in the unlikely event of a train being stranded in the Tunnel. At the worst the passengers should be able to walk out, perhaps by way of some sort of emergency travelator or moving pavement. The means of walking out in an emergency, however unlikely, would provide passengers with some peace of mind. Most of your Lordships know how annoying it is to be stranded even for a few minutes in the Underground.

From the small map accompanying the Green Paper, it would seem that the length of the Tunnel will be about 30 miles. There may be adventurous, healthy people who would like to say that they had walked to France or to England. Such spirited hikers, with or without a moving pavement, could provide a little extra revenue, small but welcome. In the Paris Metro at the Chatelet Station there is a rolling pavement 500 yards long. If one of that length can be made, why cannot one be made whose length could be measured in miles? The principle is here but the genius of mechanics will not stop at this juncture.

Another matter about which I should like to ask is to what other use can the Tunnel be put—additional continental telephone cables, for example? I understand that there is at least one submarine cable carrying electric currents between this country and France. Could the Tunnel be used possibly for yet a further extension of what was once called "Operation Pluto" and provide further links with the European grid system in addition to the power supply for the trains and the necessary maintenance of the Tunnel?

I was delighted to hear my noble friend Lord Harcourt refute the charge that the English side of the Tunnel will spoil the scenery. Kent is a beautiful county and what I know of it I have loved. But having had a home in the Western Highlands of Scotland for some years, I have heard many criticisms of new ventures up there—from a short stretch of new road, to the hydro-electric schemes—and nearly all of them began with the expression of fear that the scenery would be spoiled. If engineering projects can be carried out in the Highlands of Scotland, renowned for their beauty, and when completed that beauty is unharmed, then surely lovers of the Kent countryside should not find the approaches to the Channel Tunnel such a terrible blot on the landscape.

Your Lordships may recall the debate on transport in your Lordships' House on March 7. It has already been mentioned by the noble Lord, Lord Kings Norton. During that debate the Channel Tunnel was mentioned. I had the privilege to take part in that debate and touched on the problem of the bottleneck of rail traffic at the French side where railways connecting many European countries will converge. That bottleneck may occur unless there is a definite control to maintain an orderly flow through the Tunnel and a quick turn-round at each end.

Turning to a further matter on which I spoke in the debate, I put to your Lordships the idea of a new form of air transport of freight. In declaring an interest, I explained my connection as a minor shareholder of a go-ahead shipping operating company, Manchester Lines Limited, which has a subsidiary company, Cargo Airships Limited. I will not weary your Lordships with a repetition of what I said before except as a reminder that your Lordships' House is not a House of dreamers but one in which dreams can be aired. This dream, I am happy to say, is now a step further towards becoming a reality; a step further towards providing Europe with a flexible air cargo transport system that as a follow-on to the railway age can provide a railway system in the air and will lift some of the juggernaut container lorry traffic off the roads.

The main freight lines to-day are from the Midlands and the North across to the Ruhr. This general area is the most highly populated consumer market in the world. As a result, during the last ten years there has been a marked increase in the roll-on/roll-off lorry trade across the North Sea from the East Anglian ports to the Continental ports such as Rotterdam. But there is no motorway to these East Anglian ports or to those in Lincolnshire; and nor does there seem to be one planned for the foreseeable future. The result is that at present these large juggernaut lorries are hurtling down country roads to the East Anglian ports, with some unhappy results, and, unfortunately, loss of life. This was shown particularly last Sunday. An item appeared in the Sunday Times with the headline, "Big lorries claim fifth victim".

For the last two years the company Cargo Airships Limited have been working on the design and development of a simple technological airship. Naturally, this has been carried out in an atmosphere of secrecy, but negotiations for the construction of the airship are now going on. Ironically, the companies in the British aircraft industry with whom they have been discussing the construction seem to be rather preoccupied with aeroplane projects; and, after all, there is still a great future for the aeroplane. There is the likelihood that Cargo Airships Limited will have to take their design abroad.

In spite of the miseries of certain wars still being waged, and other disasters which make headlines in the newspapers and other news bulletins, I believe that the world is a better and easier place to live in than it was a few years ago. National security must be preserved, but there are better prospects of the world moving into a period of increased peacefulness. In the place of military war there is a different kind of war emerging, a war which may be more pleasant to fight, but still presents a struggle in which nations endeavour to survive and keep ahead of each other—the struggle for economy and trade. These two factors depend on transport. A Channel Tunnel would be an important weapon to us and other countries who make use of it. But, however vital and necessary it is, it is putting all the resources of the latter half of the 20th century into what was an early 19th century idea. If the Tunnel comes to be regarded as the main link between Britain and Europe, then that main link may be in the right place as regards passenger traffic but as regards freight it is in the wrong place. We need a fast link between the Midlands and the Ruhr. I repeat that I shall support a Channel Tunnel scheme. But we must concentrate on other forms of transport, not only those that exist now, but those which may be or could be available in the not too distant future.

6.4 p.m.

LORD POPPLEWELL

My Lords, I should like to add my congratulations to the noble Lord, Lord Orr-Ewing, for initiating this debate. May I also add my congratulations to the noble Viscount, Lord Harcourt, for taking the opportunity to explain more fully the financial arrangements that are contemplated in connection with this matter. This has been a very interesting debate to listen to. The matter seems to have settled down on two sides: there are those who desire the Tunnel, and then there are the air interests who condemn the Tunnel, the bridge people who condemn the Tunnel, the shipping people who condemn the Tunnel, and the financial pundits who think it is too much of a gamble. With these objections in mind, I have heard very little said about whether there is any necessity to increase the services between here and the Continent.

We all well know the road congestion that is taking place. Those of your Lordships who have taken the trouble to follow a cargo of exports from Birmingham down to London, from London to the docks, and then shipment across the Channel, will realise what terrible holdups take place and how utterly nonsensical it is, if there is an alternative form of transport considerably under-used, when exports could be loaded at the production point and taken right through to Dusseldorf, Vienna or wherever their destination may be, without being unloaded. This seems to me to be the cardinal factor as to whether or not we should approve this tunnel idea.

I discount, quite frankly, much of the argument that has been used that this scheme has been too hurriedly brought about. We have been discussing a Channel Tunnel for many years. Various experiments have taken place, including boring practically right across the Channel; I think there are some 100 more samples in Dover Castle which have indicated the feasibility or otherwise of the scheme. I do not like to congratulate a Tory Minister of Transport—Heaven forbid!—but I do congratulate the Minister of Transport for bringing this matter to a head. We have talked about this idea for very many years, and I think the discussion arising from this Green Paper may help to consolidate or to form opinion as to whether now is the time to go ahead. The 170 or 200 years, whatever the period may be, is past history. We are living now in 1973 and we see the developments of technology and science. Are we going to follow the principles of the last 170 years and still consider ourselves an offshore island of the Continent, or are we going to follow the 1973 period and think that we are part of the Continent? If we are part of the Continent, we must ensure that everything possible is done to assist the progress of our economic development.

I think the Green Paper is being very honest with regard to the financial terms. I think, too, that the noble Viscount, Lord Harcourt, was very honest as he laid these matters out. How can we visualise everything? We can make estimates we can make forecasts. We can take the best possible opinion, and we can u4e the computers and then make our predictions accordingly. I feel that that is what is being attempted. It is stated quite frankly in the Green Paper: Between autumn 1973 and early 1975 certain initial works, including trial boring of part of the service tunnel, would be undertaken". The financial implications involved in that operation are dealt with. If we were clairvoyant and could forecast the future to a 100 per cent. degree of accuracy, we should be living in a very peculiar age, to say the least. I have no inhibitions about what has been suggested.

It is bound to assist the areas of the North-West, of the North-East, of Scotland and of Wales, where heavy industrial production has been their life blood, if the Tunnel helps to make their goods more competitive in the markets of the Continent. The argument that there is insufficient information in this Green Paper is a rather weak one, and a willingness to examine certain further projects is made quite clear. It is a very great achievement that, at long last, we and the French are really meeting on common ground, and that private and public undertakings are trying to get ahead with this project. We know that the cost will be terrific, but every step forward is like embarking upon a new venture. I ask your Lordships to consider the case of the Concorde, on which about £1,000 million has been expended. This Tunnel will provide a permanent link with the Continent at less cost than the Concorde, and if it will increase the standard of life of our people by making our products more competitive through providing a more efficient method of transport, then this House should give its blessing to the project, the Government should prepare the necessary legislation, and we should try to embark upon this scheme as quickly as possible.

6.14 p.m.

LORD CHAMPION

My Lords, we all thank the noble Lord, Lord Orr-Ewing, for initiating this debate, which I regard as one of very great importance, and for again giving up his time on a Wednesday so as to spend the whole day in the House listening to the speeches which have ensued as a result of his moving his Motion. I must say, at the outset, that I very much regret the absence of the noble Earl the Leader of the House, for the reasons which the noble Lord, Lord Sandford, gave us. Certainly we wish him a speedy recovery from whatever illness he happens to be suffering from, which I hope is not a serious one. We have had an excellent debate which has by no means been one long song of praise for the Green Paper, nor one long moan of criticism of it. I cannot think of a single speech to which I have listened to-day which is not worthy of study by those who will have to take the final decisions in this important matter of the possibility of a Channel Tunnel.

My noble friend Lord Beswick made a speech early in this debate which, in its searching examination of the statements and assertions in the Green Paper, seemed to me to be an outstanding contribution to the consideration of this great scheme. I am sure that Parliament as a whole will want to hear the answers to the questions which he has posed before permitting the scheme even to proceed beyond Phase II. Perhaps some of the answers will appear when the studies on costs and charges which are mentioned in Annex 3 are completed. As a supporter of the idea of a better link with the rest of Europe, I hope very much that the Government can give us some satisfactory answers to the questions and criticisms of my noble friend Lord Beswick. Speaking almost at the outset of this debate, the noble Lord, Lord Sandford, said that we are not being asked to take a decision to-day, but I am bound to say that if the Government's timetable is to be adhered to, not much time is left to enable the Government to complete the information on which Parliament is to be asked to take a decision. I welcome his assurance to the House that the results of the studies will be available to us shortly.

I am bound to say that the speech of the noble Lord, Lord Sandford, made me feel that the Green Paper and this debate to-day are rather premature. The debate is taking place without all the information being available. The Green Paper has been presented to the country in what might be described by some as a rather half-baked sort of way. Perhaps that is putting it rather too strongly, but it is a thought that is bound to cross our minds. The noble Lord, Lord Sandford did not really answer any of the questions put by my noble friend Lord Beswick, and I hope that when, with the permission of the House, he speaks again in a few moments, he will be able to answer them.

At the outset of his speech, the noble Viscount, Lord Harcourt, declared his interest. In my opinion, it is right that noble Lords whose position is comparable to that of the noble Viscount in relation to the Channel Tunnel project should participate in debates in the outcome of which they may have a pecuniary interest. Their knowledge is often of such a nature as to enable them to make a contribution of an outstanding character to your Lordships' debates, always provided that their interest is completely disclosed and that, for obvious reasons, such disclosure should cause us to examine with very great care what is said by them. I am bound to add that everything I have heard about the Tunnel project causes me to think that the speech of the noble Viscount, Lord Harcourt, will stand up to such a strict examination. I am not quite sure about the extent to which he replied to my noble friend Lord Beswick and satisfied the House, and Parliament will have to spend a little more time in a leisurely study of the speech when it appears in print. It was full of figures which cannot readily be grasped in the course of a speech in this House. Nevertheless, I believe that he made a speech of outstanding importance which deserves our close and detailed study.

My Lords, I come to a consideration of this project from the point of view not only of the commercial advantages but also as to whether or not it may prove to be a step in the direction of freeing Europe from some of its narrow nationalisms; whether it might enable people to travel freely to the Continent without the restrictions of passports, visas and the like, which is something which I remember Ernie Bevin saying was one of his aims as Foreign Secretary of this country. On the commercial advantages, I must admit that, like my noble friend Lord Popplewell, I am specially interested in the railway aspect of the proposal. Time after time in debates in this House we are told that country is a country of short-haul freight traffic which militates against taking the juggernauts off the road and putting the traffic on the railways. Indeed, it was said in our short debate yesterday on the Heavy Commercial Vehicles Bill. As a transport man, I am bound to see and accept the force of that argument. At the same time we are told that the high percentage of freight carried on rail in the Continental countries is owing to as greater length of haul than is possible in this small island.

Just a glance at the map will show that a rail link between this country and the countries of the Continent would produce possibilities of relieving the roads of a large part of the increase in traffic to be expected in the last quarter of this century and beyond. I do not think that we can say that a lot of traffic that exists on the road to-day will be taken on rail. All I think it will do is to mitigate to some extent the big expansion that is inevitable in the years that lie ahead. I like the thought that Glasgow, Manchester, Birmingham and Cardiff will be able in the future to send freight directly by freight liner to, for example, Milan and the other great industrial towns on the Continent. The very thought of this indicates the length of haul to be achieved by a Channel Tunnel. That is something which in my opinion will make the railways increasingly viable. Freight liner services starting from the points I have mentioned are a possibility, without any great structural alterations to our existing railway network. But I am bound to add that, to get the full advantage of a tunnel, clearly we ought to complete the task by bringing our railways up to a condition which would facilitate the free movement of rolling stock in both directions, and this is part of the story for this possibility about which I am speaking.

My Lords, the cost of bringing our railways up to the standard necessary to enable us to take full advantage of a tunnel has been variously estimated. I have seen a figure of £200 million or more. That is the figure which is being bandied about in some quarters. But I cannot help feeling that that would be a small cost if its effect was to contribute substantially to making our railways a more viable undertaking—and I think it would. Certainly £200 million is not much when considered in the light of the subsidies given and the writing off of capital on our railways since the year 1945. As a railwayman, I am bound to welcome the thought of a Channel Tunnel bringing these improvements about, not only to the railways but to the country as a whole, which I think would gain sonic advantage from it.

I shall not go into the possible links and the terminal site, except to say that this matter will require a lot of study; but I like the thought of the White City site, with the existing rail links, which looks to be a distinctly promising project. I must say that after listening to my noble friend Lord Davies of Leek I should very much like more information about the alternative he was urging upon us. He made an exciting speech, which is something he always does in this House. I cannot pretend to arbitrate between my noble friend Lord Davies of Leek and the noble Earl, Lord Lloyd-George of Dwyfor, who did not support the practicability of a Channel bridge. I am not going to ask them to fight it out as between two Welshmen, but, nevertheless, two Welshmen are disagreeing, as Welshmen tend quite often to do—and rightly.

The financial proposals look distinctly promising, and in the long run promise quite possibly to be advantageous for the country as a whole. The projected call on the country's financial resources certainly does not appear to be crippling. The noble Lord, Lord On-Ewing, and the noble Viscount, Lord Harcourt, rightly touched upon this and made points which we can study to-morrow in this context. More important than the financial aspect of the proposal is the assurance that the demand on physical resources will be a relatively small one. This is important in the context of the fact that we are thinking in terms of major physical expansion of the technical and technological equipment of this country over the rest of this century. I certainly regard as important in this financial connection the safeguard of the break-point in 1975, this being available to all the interested parties. If the cost of the Tunnel looks like escalating to an impossible figure, there will be clearly written into all agreements the possibility of saying, "Thus far and no further". That I regard as important.

What the knowledgeable people in this country must fear is the possibility, as in the case of the Concorde, of saying, "We have spent so much already that we cannot stop now", and of guarantees and public finance becoming an open cheque. I hope I expressed that clearly. What I was really saying is that we do not want a situation in which, as in the case of the Concorde, you go so far and you dare not stop because what you have done up to that point will then be wasted. I do not think that this will happen if we retain the break-point which is in the scheme that we have before us. The possibility that I have mentioned does not seem to me to exist in the scheme as at present proposed. What must add to our confidence in the viability of the proposal is the fact that substantial amounts of private capital will be at risk—capital which would not be available if there were not a high degree of confidence in the practicality of the scheme and in its financial viability. In this consideration perhaps I am a little more trusting than is my noble friend Lord Beswick, who expressed some doubts about this aspect of it. Nevertheless, I feel that if one has one's private capital invested in something it sharpens the mind wonderfully about its future outcome and about what has taken place up to now and is likely to take place in the future.

The studies which have taken place up to now appear to me to be realistic ones, and not just figures produced to persuade the country to embark upon the scheme. Many noble Lords have spoken about the possible damage to the environment, particularly in Kent, by the approaches to the Tunnel and possible marshalling yards near to the terminal at Cheriton. I agree with the noble Lord, Lord Sandford, that this is bound to be a question of balance, and I think that ally loss of amenity in Kent would be more than offset by the transfer of traffic from road to rail in the rest of the country. While I strongly favour the construction of a tunnel I feel that much more information must be available before the Government ask Parliament to sanction Phase III. Phase II I think could go ahead, but some of the results to be obtained by that operation and by the further project studies ought to be available before Parliament is asked to give the "go ahead" for the completion of the Tunnel by Phase III. I must end by saying that if we are to dot every i and cross every t of a major project such as this, our technological progress will be disastrously slow, if not indeed completely halted.

6.30 p.m.

LORD SANDFORD

My Lords, with the leave of the House and because of the absence of my noble friend, I should like to speak again in answer to the debate on behalf of the Government. We are all grateful to the noble Viscount, Lord Harcourt, for what he was able to reveal of the results of the current joint studies, and my right honourable friend and I look forward to seeing them and to being able to put them in more detail before the public for further consideration. I agree with the noble Lord, Lord Beswick, and others that this is very necessary.

The noble Lord, Lord Kings Norton, asked about the types of services which would be maintained by this Tunnel and spoke rather as though it was going to serve only as a ferry for goods and passengers brought, as it were, to the terminals. But I should certainly confirm that we mean what is said in Chapter 4; namely, that the Tunnel is also considered as linking the whole of the British and Continental railway systems, subject to a solution of the very considerable problems set out in paragraph 4.9.

LORD KINGS NORTON

My Lords, I was concentrating on the heavy freight which will go through.

LORD SANDFORD

My Lords, the noble Lord mentioned high and low technology as though all the merit were on one side. I think I would dispute that. It is now possible to clean one's teeth by electricity but most of us continue to do it by hand. The fact that that is low technology is not to my mind a disadvantage. He referred to the use of the Tunnel for high speed travel. I should certainly confirm that if we build the Tunnel it will be in the first place to meet the needs of the 1980s and we must start with the form of traction now available. This means the conventional train. The next step, the possibility of which is being kept in mind, certainly in the design of the Tunnel, the gradients and radius of the curves, is that it should be possible to move to high-speed trains of the A.P.T. or T.G.V. type. Once the Tunnel is there it will be possible to adapt it to new forms of traction which do not exclude linear motors. He also asked about the alternatives to the Tunnel. I should certainly confirm that although this debate has been concerned, and studies by the companies have been concerned, with the matters of the viability of the Tunnel, the Government are certainly concerned (as noble Lords would wish us to be) with all other possibilities. Our work is directed to getting full advantage of all sorts of future cross-Channel systems with or without a Tunnel, including the development of marine transport, hydrofoils et cetera. None of that is excluded.

The noble Lord, Lord Davies of Leek, and others complained that we were not discussing alternatives to the Tunnel. I see no harm in there being a discussion in public of alternatives to the Tunnel; but that is not what this debate or the Green Paper is about. I should have spent a little time rebutting the case for consideration of a bridge at this stage had not the job been done adequately for me by the noble Earl, Lord Lloyd-George.

LORD DAVIES OF LEEK

My Lords, will the noble Lord give way for a moment? My copy of the Green Paper distinctly says that it is a "Summary of Considerations Applying to Alternative Forms of Fixed Link" and there is a cross-head: "Road/ Rail Bridge". Consequently, so far as I am concerned, I considered myself in order in discussing the bridge. It is in the Green Paper. The noble Lord made a misleading statement.

LORD SANDFORD

My Lords, I did not claim that the noble Lord, Lord Davies of Leek, was out of order; but the primary object of this debate is to discuss the Green Paper, which is a project for a tunnel under the Channel.

LORD BESWICK

My Lords, is the noble Lord saying that one can discuss this project intelligently without comparing the possibilities of other projects?

LORD SANDFORD

My Lords, I am not complaining at all that the noble Lord, Lord Davies of Leek, introduced the subject. As he says, an Annex to the Green Paper deals with these alternatives. If I may say so, the noble Earl, Lord Lloyd-George, dealt with the reasons why we are not at this moment considering this particular proposal although it is not ruled out for all time. The speech of my noble friend Lord Geddes was particularly welcome as indicating the views of the Chamber of Shipping about this matter and particularly welcome as an indication that the Chamber are not opposed in principle to the construction of a Channel Tunnel. The Government agree that it should not be constructed unless evidence shows it to be economically viable without subsidy and in the overall interest of Britain. As for effective consultation, it certainly is the hope of my right honourable friend the Minister for Transport Industries that both the Consultative Panel's and his personal efforts to ensure that the views of the shipping industry are fully expressed to him will lead to a full dialogue in the crucial period immediately ahead when all concerned will be evaluating the results of the studies. This we cannot do fully to-day. As my right honourable friend promised, and as I said earlier, information will be made available as soon as possible, much of it very shortly. Adequate time will be available for the facts to be fully considered before the commitments for Phase II are entered into.

I would make the point that we cannot delay indefinitely. Once all the preliminary studies are completed and their results have been published it will be necessary to make up our minds on the case before us. It is not possible to hold up a project of this sort, even for a very limited period, without incurring heavy costs. To try to hold it up for more than a limited period would be to kill it. Once management teams have dispersed it will not be possible to pick up the project quickly and the whole of the present financial structure will collapse. Either we decide this year to go ahead broadly on the timetable set out in Agreement No. 1 or we drop the project for the foreseeable future.

LORD BESIMICK

My Lords, is the noble Lord really saying that unless the timetable set out in this Green Paper is kept to, this project will be "washed out" altogether? Is that what he is really saying? Is he further saying that we must wait until the beginning of July before we have the other information? It says in the Green Paper that we shall get the other information by the summer, by June, and then we are to have a White Paper and it is expected that all legislation will be put through both Houses of Parliament by July 31. Is that what he is saying?

LORD SANDFORD

My Lords, I should be grateful if the noble Lord, Lord Beswick, would read my earlier words carefully and also read Chapter 9 carefully. It says it is desirable for the decision to proceed to further agreement—that is for Phase II—by July 31. It may be possible for this date to be slightly postponed. I explained that the result of the joint studies, which are the main ones referred to at page 20, in Chapter 8, are now available to the companies and they are hoping to report them to Ministers very shortly; that is a long way before July 1. We already have the study referred to on page 23, relating to the local environmental, economic and social problems; that is with the printers, so the information is becoming available and a lot of it will be available well before the date in question.

LORD BESWICK

My Lords, we are now in May. How can this information become available well in advance of the beginning of July? We are only two months off the beginning of July now. Is the noble Lord really saying that unless this programme is maintained—namely, that we get legislation by July 31—the project cannot be continued?

LORD SANDFORD

My Lords, I did not say that. What I said—and I will repeat the words—

LORD POPPLEWELL

My Lords, this is shadow boxing.

LORD SANDFORD

—is that once the management team is dispersed it would not be possible to pick up the project quickly and so the present structure would collapse. But we have not reached that stage yet by any means. What I am saying is that once all the preliminary studies are complete—and I have indicated how near we are to that—and the results published, it will be necessary to make up our minds on the case that is before us. Of course, Parliament needs time to do this.

LORD BESWICK

My Lords, may I ask a more simple question of the noble Lord? When are we to be told how much it would cost to bring the rail system of this country up to the point at which it could properly exploit the potentiality of this Tunnel?

LORD SANDFORD

My Lords, that is another of the studies referred to in chapter 8.17(c), and the point is fully taken elsewhere in the chapter referred to. But, of course, the cost of providing these facilities must be included in the total evaluation of the Tunnel project. If I had been able to give the noble Lord a precise date, I would have done so.

LORD BESWICK

My Lords, the point is not properly taken in this Paper. There is nothing at all in the Paper about a date. I am not asking even for the precise date. I am asking the noble Lord whether, to use his own words, we shall have this information well before the time when the White Paper will be laid and legislation will be before one or other of the Houses of Parliament.

LORD SANDFORD

My Lords, I have already given that assurance covering all the studies and not just this particular one. Of course Parliament must have an opportunity to consider the results of all the studies mentioned in Chapter 8.

LORD DAVIES OF LEEK

My Lords, I so dislike to interrupt such a kindly noble Lord as Lord Sandford, but really this is more than I can stand. I have been a Minister myself and I know that this is not the noble Lord's idea. This has come out of the bureaucracy, out of the Ministry. It is coming from the Civil Service probably, as well. Who says that the team could not be brought together again? If there is money in anything, the boys will be there! The point about this is that they are not certain that there is money there. Let us get rid of all this silly shadow boxing and face the facts. It is not right that Parliament and the people should be jockeyed into a decision by this July.

LORD SANDFORD

My Lords, I think it is useful to know that that is the view of the noble Lord, Lord Davies of Leek, and not only his view, but that of a number of other noble Lords. On the one hand, we must have plenty of time to study the whole problem; that is obviously right. Equally, there is the view of a number of other noble Lords that, subject to these studies, not indicating anything which is seriously out of line with what is already in the Green Paper, they would like the whole project to proceed as soon as may be. Clearly, this is not the moment for the Government to ask Parliament to come to a decision. The Government are not committed. They are not asking Parliament to come to a decision. This is a preliminary run over the ground. Of course Parliament has to have more material before it. It must know the view of the Government before it has a further debate and takes the decision even to go into stage 2—that is the preliminary stage before the undertaking of the main work.

LORD BESWICK

My Lords, I wonder whether the noble Lord will answer a question which I put to him in my first speech, and which he did not answer in his first speech, but which he promised to answer in his second speech and at the moment, apparently, is not intending to answer. The noble Lord talks about the need for haste, for making decisions—for not wasting time; let us put it in that way. I asked why the material in this Green Paper had not been published last October at the latest. There is absolutely nothing, so far as I can see, that is in this document that could not have been published last October. If the Government intend to press this forward with such speed, why was that not published last October?

LORD SANDFORD

My Lords, this document—or documents of this kind—could have been published at various stages during the studies. The result of publishing it when it was published, in March, is that we have not available to us the benefit of the result of the current joint studies; and we have seen from the debate to-day how much we feel the lack of that. I think it is a matter of judgment to determine at what stage these documents should be published, particularly Green Papers. The fact of the matter is that we have had, certainly from the Government's point of view, a useful debate to-day, but equally it is quite clear that we shall have to have another debate before Parliament can come to a decision about stage 2.

My Lords, I was speaking about the speech of the noble Lord, Lord Geddes, and saying how we welcomed the views of the Chamber of Shipping and how much we agreed that further information is needed but that once these preliminary studies are available we must come to a decision. This debate has provided us with the opportunity of dealing with the anxieties of the noble Lord, Lord Beswick, as well. If I may now turn to my noble friend Lord Auckland, a discussion on the further alternatives is not ruled out and this is the point I want to make to the noble Lord, Lord Davies of Leek, as well. But as my noble friend Lord Auckland says, the question now is whether a Channel Tunnel is or is not our best buy in catering for the overall cross-Channel traffic in passengers and freight trying to find its way between Great Britain and the Continent and already meeting serious congestion at least at the Channel ports and in the area of the hinterland round them.

LORD AUCKLAND

My Lords, before my noble friend leaves that point, may I say that I accept that, but would he not agree that if there is too long a delay in discussing the two aspects of this matter the costs on both sides will escalate seriously, which is what one wants to try to avoid?

LORD SANDFORD

Yes, my Lords, and the figures which my noble friend Lord Harcourt has already given have shown exactly that. The costs have already escalated under the impact of inflation. This is another factor that we have to put into the balance. My Lords, I thought that the noble Lord, Lord Segal, was right to emphasise—I think he was the only noble Lord who did—the benefit of the increased choice of mode of travel which the Tunnel will provide for the traveller. It was also right to reassure the ferry operators and shipping interests, as did the noble Earl, Lord Lloyd-George of Dwyfor, that there will still be plenty left for them to do even if a tunnel is built. Not only can they provide a different mode of transport but also they can provide it between different points. It is one of the disadvantages of a tunnel that it can link only one particular point on the Continent with one particular point on this island.

The noble Marquess, Lord Hertford, was not satisfied about the assurance which I gave, and which was given by my noble friend Lord Harcourt, about subsidy. It is simply not true to say, as the European Ferries have been claiming, that the existence of a large proportion of funds guaranteed by the Government means that the project would otherwise be a flop in commercial terms. As my noble friend explained, the guarantees are required first of all because of the sheer scale of the operation. Money like this can be raised only by involving institutional investors and, as the noble Viscount, Lord Harcourt, has said, apart from any other interest the Government guarantee is necessary if the institutions are to be allowed to invest. In any case, as the Government have frequently said, there is no question of the project's going forward if it looks as though there is any real likelihood of the guarantees being invoked. The giving of the guarantees would not only make it possible to raise the large sums involved but also cheapen the cost of money and increase the residual profits available to the Government.

I was glad when the noble Earl, Lord Lloyd-George of Dwyfor, drew attention to the scope for shifting traffic to rail and for the use of A.P.T. and T.G.V. both in the Channel Tunnel and in connection with the Channel Tunnel. The noble Lord, Lord Kings Norton, raised that and so did the noble Lord, Lord Champion. I entirely agree with them all that it is only by doing this that we get the full benefit of the link under the Channel and develop the full environmental advantages.

LORD BESWICK

My Lords, would the noble Lord give way? I am most grateful to him. If the noble Lord agrees with what those three noble Lords said, is he not going to make any reference to the criticism I made about the apparent directives now given of parity of opportunity between road and rail in the operation of the Tunnel? Are we not going to have a review of that directive? Is there not a possibility of giving more encouragement to rail than road?

LORD SANDFORD

My Lords, I will come to that question in a moment. There are two points about it. First of all there are the very real problems set out in chapter 4, particularly paragraph 4.9, that have to be considered and tackled and reported upon and this is one of the studies in connection with developing to the full the advantage of the concept of linking the railway systems of the Continent and Great Britain. On the particular question of parity, the position is that there is agreement that there should be no discrimination against one particular system. I think that is what the noble Lord wants and it is what I can give the assurance about.

LORD BESWICK

On the contrary, my Lords, I was asking exactly the opposite. I want there to be a discrimination in favour of rail, and I am asking the noble Lord if he agrees with what has been said about the possibility of getting more freight from the road on to the rail. If he agrees with that, I am then asking if he will give an assurance that the directive about parity of opportunity will be reviewed.

LORD SANDFORD

My Lords, I am not advised that that is the position. My advice is that the position is that there should not be discrimination against one particular user of this Tunnel. Obviously, if we have gone to all this expense to build it, I should have thought the best thing to do would be to make sure that it was used to the maximum capacity for all the traffic that it can attract. The primary problems are those set out on page 10 at paragraph 4.9 about traction and line capacity on the route to London and the ability of our particular system to carry Continental stock.

I am sure the charities will be quick to see the possibility raised by my noble friend Lord Gainford, of sponsored walks through the service tunnel, but I am grateful to him for the other suggestion that he made and can reassure him that the provision of the service tunnel is certainly to increase the safety factor of the whole system and in the event of an accident to a train going through it would be possible for passengers to walk to the nearest cross-passage or adit, which is positioned every 250 metres, and from the service tunnel to get out from the Tunnel to whichever side was nearest.

LORD DAVIES OF LEEK

My Lords, this is a picture of them walking about here. Is this boy selling chocolates, or what, to the people? I remember this in France in the 1914–18 war. People moved along in cattle-wagons and I see no joy in that. I am for the bridge every time if that is the way I go through the Stygian gloom.

LORD SANDFORD

My Lords, there is some confusion there. That is an illustration, an artist's impression, of passengers inside one of the ferry wagons and illustrates the option either to remain in their own cars or to move about inside the container. My noble friend Lord Gainford was asking about escape from one of the main tunnels if there were to be an accident or fire or something and I was assuring him that there was adequate provision for the means of getting out.

I would agree with the noble Lord, Lord Popplewell, and others—and we have already covered this point in discussion with the noble Lord, Lord Beswick—that a full evaluation of this project and the decision upon it must be undertaken with full knowledge of how the problems in paragraph 4.9 are going to be dealt with. The noble Lord, Lord Champion, appeared to me to welcome the project. I agree with him, as with other noble Lords, that the full development of its potential of linking the two railway systems is a crucial factor upon which we shall have to have more information before coming to our decision.

I was going to make the points which I undertook to make to the noble Lord, Lord Beswick, but he has drawn them from me already. The position about the various studies which we have not yet got is set out in Chapter 8. I have explained that the main ones are available to the companies now and are about to be submitted to Ministers. We have already got the environmental ones and I confirm that Parliament cannot be expected to take a decision, even going to Stage II, until it has the full results of the others. I confirm that. Finally, I would again confirm that Her Majesty's Government are not committed at this stage and are not asking your Lordships to take a decision to-day.

LORD BESWICK

My Lords, one other question before the noble Lord reaches his peroration. I did ask about Maplin. There is reference to Maplin in paragraph 1.4. I asked how the figures were arrived at. If the noble Lord could tell me how it can be shown that 2.7 million represents six months' growth in air traffic by 1980 I should be grateful. Secondly, I said that there appeared to be no reference to Maplin as a seaport. To what extent has it been taken into account when making the calculations about traffic through the Tunnel?

LORD SANDFORD

My Lords, I am sure the best thing I can do in response to that is to wait the relatively short time which will be needed before we get the benefit of the report of the joint bodies which carry any study that has hitherto been done on matters of that kind much further and in greater detail and depth. As soon as that is available I will write to the noble Lord and answer that question. It will be a far better answer than I could give him now.

My Lords, we are approaching the moment when we need to take the decision to commit ourselves to enter the next stage, Phase II, and Parliament is not going to be asked to do that until the results of the further studies which are not available to-day are available and have been provided not only for Parliament but for the public at large. Nevertheless, I would say that the debate has served a most useful purpose in indicating the present views of your Lordships on the information now available—this is why I am particularly grateful to the noble Lord, Lord Beswick—in giving us your Lordships' views on how important you think it is and on what further information is required before the House can take the necessary decision on it. This has been the most valuable and useful part of this debate. I am grateful to all noble Lords who have spoken and pressed us on these matters, and to my noble friend Lord Orr-Ewing in particular.

7.0 p.m.

LORD ORR-EWING

My Lords, my first desire is to thank ail those who have contributed to what has been a very worthwhile debate and to express my gratitude for the time that Members on the Front Benches and elsewhere have given. It seems to me that we are now approaching what I hope will be the last phase of discussion. I was reminded on reading page 4 that it was in July, 1966, that Mr. Wilson and M. Pompidou agreed—and perhaps I may quote— … the two Governments have now taken a decision that the Tunnel should be built". I believe I am right in saying that the noble Lord, Lord Beswick, and the noble Lord, Lord Davies of Leek, were members of that Government. I think they have become slightly more critical of that statement and agreement in the ensuing years, because they were certainly asking some penetrating questions and showing rather greater enthusiasm, certainly in Lord Davies of Leek's case, for the bridge.

My Lords, I think the point that we have to get home, not just in this House, but outside, is that cross-Channel traffic has increased, is increasing and is going on increasing, and therefore something has to be done to syphon some of this off into a different form of travel. Of course the bridge is attractive superficially, but we have to face the fact that those design studies are not completed, the international agreements are not completed and the international hazards have not been overcome. Therefore, if we are to find by 1980 another way of getting across the Channel in massive numbers, it must be by the Tunnel.

I think that all noble Lords will be grateful to the noble Viscount, Lord Harcourt, for his studied and detailed speech on finance. I am sure we shall all pay great attention to that speech, because it clearly marked out the manner of the financial structure, which certainly was not clear to me, and I think that would apply to other noble Lords as well. It seems from what the noble Viscount said that the total cost to the United Kingdom of the Tunnel and its associated works is to be £400 million, of which something between £40 million and £120 million will be equity capital—that is, 10 to 30 per cent.

LORD BESWICK

My Lords, so that we do not get this wrong, I think the noble Viscount, Lord Harcourt, would agree that that does not include the necessary work on the rail system here to make it fully integrated with that on the Continent.

LORD ORR-EWING

My Lords, perhaps I did not put the point sufficiently succinctly. It does not of course include the infrastructure of rail up to London and the White City. I think we have to get across—because noble Lords were a little confused about this, and I am grateful to my noble friend for dealing with it—that there is to be no question of subsidy. This is not a cost to the taxpayers. I think those points have to be made, because when criticising projects of this sort everybody is keen to say: What will it cost? When the Hong Kong Tunnel was opened they forecast that the ferries in Hong Kong would be out of business in a couple of weeks. I may say that that tunnel is operating very successfully, and the ferries are still making good money and providing good service. I am sure that the sea ferries here will continue to expand just as they have in Hong Kong.

We must get home the point that if we can load more and more of these large freight weights on to rail at an earlier point, rather than to let them be loaded on juggernauts and crash down our insufficiently wide roads, this will be of tremendous benefit to everyone who lives near a road. I think the Tunnel will make a worthwhile contribution towards getting this loading done further away from Dover and Folkestone. That I think is absolutely desirable.

Finally, I have tried to calculate what the journey might cost. I understand that the cost to a passenger of the future might be something between £2 and £4, and no doubt the tour operators will come up with something more competitive than that: I believe they might even negotiate the Tunnel for £1. If that is so, we are discussing something which will be of tremendous benefit, not perhaps to my generation but to the youngsters who are travelling more and more—travelling light and often hitch-hiking—learning new languages and making new friends. That sort of fee will reach right down to the young people of this country. So I think that everyone will benefit: not just the freight, the railways, the passengers on leisure or the business people, but the young people as well. My Lords, I beg leave to withdraw my Motion.

Motion for Papers, by leave, withdrawn.