Channel Tunnel Bill

HL Deb 02 July 1987 vol 488 cc350-403

3.32 p.m.

Lord Brabazon of Tara

My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.

Moved, that the House do resolve itself into Committee.—(Lord Brahazon of Tara.)

Lord Sefton of Garston rose to move as an amendment to the Motion "That the House do now resolve itself into Committee on this Bill" to leave out all the words after "That" and insert "the order of recommitment of Monday last be discharged and that the Bill be recommitted to Select Committee".

The noble Lord said: My Lords, the last time that the question of examining the Bill in detail was mentioned was during the Second Reading debate. On that occasion I put to the Minister the point that because of the important consequences of the Bill he should perhaps give some consideration to the possibility of the Bill going to an upstairs committee instead of the House taking this matter on the Floor in Committee. That way it would be possible to examine the Bill in detail, to interview people, to examine witnesses and even bring forward special advice. Therefore before the final decision was taken on the Bill we would at least have some knowledge upon which to make up our minds. I assume because the Minister heard my suggestion and will have read the Hansard report that he does not think that idea was worthwhile.

The next step that was taken was when my noble friend Lord Taylor of Blackburn (who expresses his regrets at being unable to be here today) tabled an Instruction. The Instruction was that the hybrid Select Committee should give consideration to the regional impact of building the tunnel. That suggestion was turned down by the Minister and thereupon my noble friend withdrew the Instruction. At that time some of the implications of the tunnel Bill were raised. Some matters mentioned in the Instruction were of the greatest importance. The potential effect of the tunnel upon the rest of the economy should be monitored. If the Instruction went to the Select Committee it would mean that a major area of public policy would be examining the regional impact—a major area of public policy.

It was said that a committee may well need specialist advice and may even want to hear evidence in support of some of the contentions made by the promoters of the Bill. I did not say that and neither did my noble friend Lord Taylor of Blackburn. It was the noble Lord, Lord Brabazon, who said that in this House. Therefore, I assume that the case that there are tremendous potential problems arising from the construction of the tunnel is made and accepted by the Government.

The whole tenor of my argument is that whether or not we like it, if economic steps are taken in the life of a nation a free enterprise society will follow these economic steps. As surely as night follows day they will follow the movement to where the money is. If one wants further proof of that one should go to Newcastle-upon-Tyne. My Lords, Newcastle-upon-Tyne of all places! There we have a housing association and the man in charge is seriously suggesting that we should promote a new town in Essex which would be constructed by the private sector. One of the motives is said to be that it would be easy for Northerners to come down here and find jobs in the South-East. If ever that was a betrayal of a deprived area of this country that certainly is. Of course the man is suffering from bias. His interests are not in the welfare of the nation as a whole, but in making a quick buck to build a new town in Essex.

If I am right—and I believe I am, and the politicians who claimed the largest majority of votes in this country at the last general election think the same—and we allow our kind of society to develop wherever, whenever, and in whatever way they want, then the situation will be worse for the peripheral areas of this land. It must be a contention well worth arguing and well worth looking at with the best advice we can get. We can then cross-examine and discuss with experts and particularly cross-examine the people who want to build the tunnel and the people who initiated it, as to the truth of it.

What point is there in the Government spending money on the infrastructure of a place such as the Albert Dock in Liverpool if all the time as is contained in a report in the Independent newspaper this morning, there is a drift of people away from that place? What is the point of investing huge amounts of social investment in places like Liverpool if, at the end of the day people have drifted away from there? The population of Liverpool has already dropped from 850,000 to just over 500,000.

What is the point of providing such investment out of public money if people are not going to stay there? Are they going to stay there? I say that 45 years of experience in Liverpool in politics has told me that they are not and they are moving with their feet. Worse still, the people who are moving from places such as Liverpool and Newcastle-upon-Tyne—a situation which will be further exacerbated if some people have their way—to the South-East of England are the go-getters, the young people leaving behind the problems of deprivation which are becoming worse and worse. Such problems then fall upon the shoulders of those people in our community who are least able to bear them.

Such are the consequences of the developments that are taking place down here. Of course, there are others, but in the time I should reasonably take in this Chamber I cannot dream of going through all the aspects of where we are falling down on the question of national planning, from the stage when it was commonly accepted across the spectrum of political parties in this country that following the last war we needed consensus. We needed to agree what was good for the nation. We needed to look very carefully upon vested interests and how they decided to spend the money.

The Government say that they are going to encourage entrepreneurs by urban development corporations—good luck to them! Then they say "Look at London dockland!" Well, my Lords, London's East end has some worse deprived areas in area than Liverpool. In places it has an environment which would frighten anyone away. However, it has not stopped entrepreneurs from moving into the dockland—of course not.

If the Minister does not think that there is anything else which encourages this development, he should answer this question or perhaps I should say that he should ask this question because it does not seem that many people on those Benches are asking the right question. Why is it that the Merseyside Dockland Development Corporation, set up with almost an unlimited purse, like the London Dockland Development Corporation, has not encouraged the entrepreneurs? Where are the jobs in the London dockland and where are the jobs on Merseyside? What are the costs of the jobs on Merseyside as compared with those in London? The answer lies in the simple fact that there are other things which are persuading people to develop in London's dockland. It is because the centre of gravity of our economic development has moved there.

This tunnel is another step along that road. British Rail says it will benefit the rest of the nation. In fact one man even took the trouble to go to the Merseyside Chamber of Commerce and say, "We intend to have through trains from Liverpool". There was no qualification about that statement and no ifs or buts. He thought there was some unease on Merseyside concerning the tunnel so he went there to rectify it.

I received a letter from Mr. Bob Reid, who is the Chairman of British Railways, in which he says, in effect, "Oh, yes" —and it is a different story—"for freight we fully expect to run through services from those locations where there are substantial volumes of traffic". Let me give him some information. It may well be that by the time this tunnel is completed the volume of traffic going through the Port of Liverpool will be considerably less than it is today.

I am quite sure that British Rail, especially under pressure from this Government, is not going to chance putting in the infrastructure to persuade more traffic to go through the Port of Liverpool. It will take the easiest way out, and the easiest way out is to say to the people of Liverpool, "Oh no, if you want to send anything through the tunnel get it over to Manchester or get it to a place down in the South-East where it can be rapidly transhipped between domestic and international services at Willesden in North London". That is what it will say.

If anybody ever played a con trick, British Rail played a con trick on the Merseyside Chamber of Commerce and it fell for it, because there is very little opposition to the tunnel now from Merseyside. There is very little demand now from Merseyside to examine the real problems arising out of the concentration of economic activity in the South-East.

When I mentioned to a respected Member of this House that I was about to move this amendment a noble Lord whom I have known all my life—he said to me, "You are a Liverpool lad; what are you bothering about the tunnel for?". I said, "I am bothering about the tunnel because, unless something is done properly and rationally to ease the congestion in the South-East that is slowly strangling that area and to expand into the peripheral parts of the country, Liverpool is doomed".

I am not guessing the future. I am not guessing about what is going to happen in 10 years. I have no need to forecast because I have read the book. I have lived in Liverpool and I was born there. The common sight was the flood of traffic that went from the United States to markets in Europe through Liverpool and back the other way. I have watched it go and I have watched it retreat.

The reason is not that there are bad, deprived areas in Liverpool, because I have shown that about London. It is not that Liverpool people are any worse than others. Liverpool people have a better reputation in certain industries than people anywhere else in the world, let alone in this country. The only time many people see Liverpool is in a television programme, and so they would say something else. Nevertheless, that is true. In spite of that, trade has moved away from Liverpool over the past 50 years and that movement is continuing. While we keep building up the cancerous South-East, which is growing and growing and very shortly will need lancing in order to relieve the pressure and the congestion, the fate of Liverpool is getting even worse.

I mention Liverpool only because I happen to come from there. There are of course other places and we have seen them. For example, in north-east Lancashire 30 years ago anybody could get a house because that area was being depopulated by the movement of the cotton trade. When the iron ran out in Barrow-in-Furness, then Barrow-in-Furness ran out. If it were not for the manufacture of certain submarines, that town would be off the map. Liverpool existed because of the shipping between America and Great Britain. That has gone. We can leave it at that and write it off. Let those people who now live in Liverpool, having lost all the younger element, stay there to wrestle with the problem. Of course we can do that. There is nothing to stop us.

However, if we do that we must accept the consequences, which will be pretty grim, as Mr. Heseltine found out when he went to Liverpool. When he came back he said that those people wanted warming; that people in places like Liverpool needed to be warmed with the glow of the economic progress being made throughout the country. In other words, we want to move some of the prosperity in the South and the South-East—because that is the only damned place where it is—into places like Liverpool.

It is no use throwing money at the problem, Mr. Heseltine said. It is not money that we want. So what do we want? I said nine years ago, in the first speech I made in the House, that we do not need money. It will not take much money to cure Liverpool's problems if you take one example. All we need to do is to shift one government department from London—and it can well afford to lose it because of the congestion down here—and site it right in the Albert Dock. But the powers that be down here will not have that. Nevertheless, that is a solution and all I suggest is that it is worth examining. It is worth having a Select Committee to look at the problem and to ask whether this is an answer to the problems that may arise. The Government set their face against it and said that it was not going to be.

I shall let Members of this House into a secret. Once again I am in the situation of having been told, and supported in my contentions, that the case I am putting forward is a fairly reasonable one; but once again I shall be lucky if I get a Teller. We have been told, and there are Members on the other side of the House who agree, that something ought to be done to equalise the prosperity throughout the country. There must surely still be some supporters there of Michael Heseltine, although I doubt it.

I have taken 14 minutes and I promised myself less than 20. 1 have ventured to put forward a few of the problems that may arise, but nobody knows because nobody is looking at the situation properly. We have not had a Select Committee and we have not gone into these very important matters which the Minister has stated are worth looking at.

Let me come nearer home, if I can describe this part of Great Britain as home in any sense of the word. Milton Keynes, Stevenage, Peterborough and all those new towns north of London—and now I am on familiar ground—were the result of very careful, intensive planning across party lines, following the last world war, when the whole problem of congestion was staring this nation in the face. What is going to happen to those places when the tunnel is built? "Oh!", I suppose somebody will say, "We shall have railway lines or services going around London to get to the tunnel so that those places can share in this wonderful benefit that the tunnel is going to bring". They forget something. Across the Channel, three-quarters of an hour away, is the French coast, which is ready and ripe for development. Sitting behind it in Paris, are a government who have no scruples about playing the game, as witnessed by the incidents involving Welsh lamb and the fears that arose in this country over a little trickle of French milk that it was thought might destroy our milkmen's livelihoods. The House will remember that.

Open this tunnel and in no time that French Government will be subsidising the manufacture of consumer goods that will move through the tunnel into the largest consumer market in Europe, which happens to be London and the South-East. Then what will they say in Milton Keynes? Then what will they say about this wonderful national plan which was designed on the basis that we were an island?

This Government, all those who share their view and all the private interests, only want to build the tunnel because it is a damned good contract. That is how it started. That is why they are having such a hell of a fight to build it. Most of the money-men know damned well that that is how it started. When they finish it, it will be no use saying to the people of Milton Keynes, "We are sorry. We had to build the tunnel because it was an economic necessity". It will be no good telling people that when the area of deprivation—which became so obvious during the recent election—starts to move further down and affect those new towns which until now have had a fairly good record.

I am coming to my last point. I am still below my 20 minutes. What are British Rail doing? They say that they intend to run services to Liverpool. There is a user agreement. That is a good one! If one tries to obtain a reply from the Minister or British Rail as to what is meant by the user agreement they say that its provisions are commercially confidential. Why? How many tunnels are they building? Where is the competition? Why should the information be commercially confidential? Should not the Government and this place know the estimates of the tolls to be received from the use of the tunnel? Should we not know to how much British Rail will commit the Government before we pass the Bill? We are told by British Rail that the information is commercially confidential. I do not know whether they have told us all the facts.

The user agreement states: The detailed provisions of the agreement are commercially confidential. The fact that BR is a public undertaking does not alter the situation". Have they told the Government? Will they express their satisfaction?

British Rail issued a press release. When one reads it one can hardly believe that they are talking to politicians. They must have been talking to the media and no one else. It must have been a public relations man who produced it. It states: The level of tolls is not increased but the formula negotiated on the one hand assures Eurotunnel of more basic revenue over the years". How the hell is it going to get it?

Lord Tordoff

My Lords—

Lord Sefton of Garston

My Lords, does the noble Lord want me to give way? He is concerned about the time. I am sorry about that. The Committee will spend a great deal of time on amendments that will be defeated, because the Government have decided that they are to be defeated. Surely we can spend a couple more minutes discussing the fundamental nature of the problem. No doubt the noble Lord wants to hurry up so that he can be a Teller, because his party agreed that we should have had a public inquiry. His party thought that we should have looked at the proposal more closely.

Lord Tordoff

My Lords, I only pointed at the clock because the noble Lord assured us that he would take less than 20 minutes.

Lord Sefton of Garston

My Lords, I am sorry about that. I humbly tender my apologies. Then the document continues: In return for the concessions"— What are the concessions? It continues: The railways only have an entitlement to use 50 per cent. of the capacity of the tunnel"— that does not mean a thing— as varied from time to time". It does not tell us what the variation is, but no doubt the Minister can tell us. Then there is the most enlightening remark: This agreement is the equivalent in railway terms to giving a green signal to the Channel Tunnel project". That, of course, is what it does. That is why it was signed. That is why it was designed. Are we to buy a pig in a poke? Are we to buy something without knowing what it is just because British Rail say so?

As I have been told my 20 minutes is up, I had better conclude. I conclude on this note: I do not claim to have put the case against the tunnel. I claim merely to say that there are voices in this country which have doubts about certain matters. There are elements of what British Rail are doing which should be exposed to the public glare. They should be examined quietly. They should be examined by experts. Before this place takes a decision on such an important and fundamental step in the reshaping of our nation's economy, it should at least have the opportunity to hear the experts and witnesses, and to cross-examine the people who are promoting this scheme about the general public policy issue.

If the House does not vote for a Select Committee today, this will be the last chance we will have. I insist on saying right up to the very end that I do not agree with the Bill. Everyone else can do so, but no one in the North will be able to say that I voted in favour of the Bill when we have not had a proper examination of all the consequences of building the tunnel. I do not think that any Member of the House should vote for it.

Lord Simon of Glaisdale

My Lords, whether the Motion is carried and whether the matter is examined now by a Select Committee, what has been said by the noble Lord will be of great value to us when we consider the Bill and the amendments. He has emphasised the important question of the regional implications of the measure. That must be constantly borne in mind. There are already signs in the South and South-East of some dangerous overheating of the economy. For example, there is the familiar sign of a shortage of skilled labour.

The noble Lord mentioned that skilled labour was being drawn down to the South-East, some of it permanently, because young people are moving down here. There are also signs of skilled workers commuting from North to South. This measure injects vast sums of money, some private and a great deal public, into an area where there are signs of the economy overheating. That is bound to exacerbate the situation.

Yesterday, this place debated the economy. Attention was drawn to the absence, as it was alleged, of an acceptable government regional policy. When the noble Viscount the Leader of the House replied, he did so in his invariably delightful way. It was discourteous to complain about his reply. But he dealt not at all with that aspect.

The noble Lord, Lord Sefton, has performed a valuable task, and we are obliged to him for drawing our attention so forcibly to the regional applications and implications of the measure.

4 p.m.

Lord Underhill

My Lords, I am certain that the House would consider it remiss if a view was not expressed from the official Opposition. I agree completely with the noble and learned Lord, Lord Simon of Glaisdale, that my noble friend has performed a useful task in drawing attention to some important factors that I am certain we will consider when we proceed with the Bill.

It is generally known, I think, that what we do not want this afternoon is another Second Reading debate. But the noble Lord will surely recognise that throughout all the discussions on the Channel Tunnel Bill I have emphasised the need for facts and for a proper inquiry not purely into the economic consequences of South versus North but into the economic effects throughout the United Kingdom. That said, we made it clear that if the Labour Party were to win the election, we would halt the Bill and conduct a national economic inquiry into the possibility of a Channel Tunnel. But we lost the election.

Both Houses on Second Reading have declared on the principle of a fixed tunnel link. We have the opportunity now in Committee to keep in mind the very things that my noble friend mentioned and the points that the noble and learned Lord, Lord Simon of Glaisdale, emphasised. There are amendments that will give my noble friend and others the opportunity to bring forward some of the points that he raises and to insist that the Minister give us the information. If we do not get it the first time, we can come back another time. But both Houses have declared on the principle.

In our view it would be wrong for this House alone to set up a Committee to defer consideration of the Bill while going into the matters to which my noble friend refers. Therefore, from the Opposition Front Bench, we cannot recommend noble friends on the Benches behind us to support the Motion if my noble friend presses it to a Division. We leave it entirely to noble friends on the Benches behind us to decide whether they support the Motion if it is pressed to a Division. From the Opposition Front Bench we feel that we ought now to proceed with the Bill, consider it in Committee and keep in mind the important matters that my noble friend has raised.

Lord Ferrier

My Lords, conscious as I am of the support that the Government offer to the Bill, and agreeing with the noble Lord, Lord Underhill, that we do not want another Second Reading debate, I must express the view that I have a good deal of sympathy with what the noble Lord, Lord Sefton, said in proposing the amendment.

We are going too quickly. I believe that there has been a mistake, if I may take the liberty of saying so. I think that the usual channels began on the wrong foot by tabling the Second Reading debate on a Monday and then not even putting it as first business on the Order Paper so that we began to debate it at 6.15 p.m. Third Reading is again proposed to take place on a Monday.

There is sympathy with what the noble Lord has said. Real doubts exist in the minds of people who are anxious to proceed with the development of this country. This is not the right way to do it—spending vast quantities of money on transportation through the tunnel when we in this country require every bit of that money to refurbish and put on the right track our own railways. Anyone who sees the crowds at termini, the absence of luggage trolleys and the shortage of staff at ticket offices will realise that. My InterCity express was two hours late on Tuesday. Today is not an occasion for a debate of this nature, but I suggest that the matter is worth considering.

I hold no brief for Liverpool. I remember the day that I sailed from the Mersey in 1920 when the river was a "sicht for sare enn" with the traffic on it. I feel that we are entitled to support what the noble and learned Lord, Lord Simon of Glaisdale, said. This needs a great deal of looking at, more than it has had.

The noble Lord, Lord Sefton, did not mention the matter of money. Enormous sums have already been committed to this mechanical structure for the tunnel without the Bill having been passed by Paliament. After all, it was only this morning that we had a sight of Lord Sefton's amendment. I believe that there is a great deal in what he said and that a great deal more consideration should be given to it.

The noble Lord, Lord Sefton, mentioned, as did the noble and learned Lord, Lord Simon of Glaisdale, the real difficulty of this divide, which does indeed exist. One cannot get away from it. The tunnel is a promotion of the rift that is making such a problem in our nation's life. Scotland, I do not believe, will benefit by this. Although huge contracts will go for steelwork and the like, every bit as much steelwork is required for our own railways. The problem is a serious one, and I therefore support the amendment.

Lord Brabazon of Tara

My Lords, noble Lords will not be surprised when I say that I do not of course accept the contention that the Bill needs to be recommitted to a Select Committee. Some noble Lords suggest that it has received too little attention so far. The Bill, introduced in another place in April 1986, received its Second Reading in June last year and was then committed to a Select Committee, which received almost 5,000 petitions and sat for 34 days. That committee gave the most careful consideration to the effects of the Bill on private interests and published a thorough and impressive report, to which the Government responded in February this year. The wider issues of public policy raised by the Bill were subsequently considered in full at both Committee and Report stages in the other place.

In February this year the Bill was brought to this House. We had a wide-ranging debate on Second Reading and the Bill was given an unopposed Second Reading and then committed to a Select Committee of this House. At that stage we considered a Motion moved by the noble Lord, Lord Taylor of Blackburn, but tabled by the noble Lord, Lord Sefton of Garston, that the committee should be empowered to consider the regional impact of the project. I said then—and repeat now—that these are considerations which the Government believe to be of the greatest importance. But the Government are convinced that the Channel Tunnel project is capable of bringing great benefit to all the regions of the United Kingdom, both while it is being constructed and when it is operating.

I said in February that it would be imprudent to add to the burden of the Select Committee, which had already received 1,460 petitions, by asking it to consider the specific regional consequences of the project. But it did in its wisdom hear evidence from local authorities in the North of England and in Scotland and gave consideration in its report to the points that were made. The committee records in the final paragraphs of its report that it heard evidence on the £700 million-worth of major orders expected to generate some 25,000 man-years of work, and that over half would be located outside the South-East of England. In its introduction, the committee stated that it was firmly convinced that the Eurotunnel project offers immense opportunities for the generation of industrial and commercial development throughout the whole of the United Kingdom. The Government fully acknowledge the need to exploit this potential. They fully support British Rail's intention to seek a significant transfer of freight from road to rail and to run through services from points throughout Britain.

We welcome the insertion into the Bill by the Select Committee of Clause 39, which requires British Rail to draw up a plan for cross-Channel services across the country. I am sure that noble Lords will have realised, when reading the Select Committee's report, the importance they attached to these matters. I should like to take this opportunity to thank the Select Committee for the hard work and long hours that they spent hearing petitions against the Bill. Their work has been much appreciated. I do not believe that we stand to gain anything by recommitting the Bill to another Select Committee for further consideration.

The Motion standing before the House in my name, That the Bill be recommitted, gives the House a full opportunity to debate matters of concern both in areas covered by the Select Committee and in areas of public policy which were outside that committee's remit. I believe that we should proceed in that way to allow the House proper opportunity for consideration of the Bill.

Lord Sefton of Garston

My Lords, I understand that I have the right of reply. I shall try to be as brief as possible.

Let me deal at once with the last point that the Minister made; namely, that when the House was in Committee it would have an opportunity to deal with some of the problems that I raised. One of the difficulties is that nobody in this House has the expertise to doubt what I said about the threat to the service industries that serve London and the South-East from the French coast. We would need to examine the times, what kind of investment has gone into the north coast of France, the intentions, and the timetable.

I remember going to one of the new towns north of London where there was a factory which produced meat pies. They were turned out in massive quantities. What was happening to them was quite evident: they were coming off the factory production belt and being loaded into lorries, which conveyed them down the M.1 to the mouths of thousands of Londoners every day. We do not have the expertise to properly examine that kind of problem. We could not examine just what British Rail are doing.

Three noble Lords have said that they have a great deal of sympathy with what I have said. I thank those three noble Lords. It seems to me that once again the House is faced with a situation in respect of which we are told that there is an awful hurry. There was an awful hurry yesterday to get something approved with regard to the press. There is always a hurry whenever a vested interest is involved.

This tunnel is as important to the economic life of this nation as a power station. I have just been reminded that it took a public inquiry two and a half years to look at Sizewell B. We cannot even afford the time for the witnesses to go before a Select Committee. Why not? I shall tell your Lordships: because if there is any further delay to this Bill the promoters—who in the main are construction companies—will not be able to persuade people to give them the money to build the flaming tunnel; and at the end of the day, when the tunnel is built and does not become economic, they could not care less because they know that the Government of this country will have to pick up the tab. That is the real reason behind the excessive urge to get the decision through.

I am faced once again with the question of what to do. Do I withdraw the amendment? Not on your life, my Lords! If my amendment is to be withdrawn it will be because of a decision of this House. I shall go down to the Floor of the House and I shall stand there for three minutes. I want another Teller if I can get one. If I cannot it is just too bad; I am not withdrawing my amendment.

The Lord Chancellor (Lord Havers)

My Lords, the original Question was that the House do now resolve itself into a Committee upon the Bill, since when an amendment has been moved in the terms set out on the Order Paper. The Question is that this amendment be agreed to. As many as are of that opinion will say, "Content"; to the contrary, "Not-Content".

4.15 p.m.

On Question, Whether the said amendment shall be agreed to?

Their Lordships divided: Contents, 22; Not-Contents, 165.

DIVISION NO. 1
CONTENTS
Alanbrook, V.	Graham of Edmonton, L.
Basnett, L.	Hampton, L.
Brockway, L.	Jacques, L.
Carter, L.	Jenkins of Putney, L.
Ferrier, L. [Teller.]	Kirkhill, L.
Foot, L.	Lovell-Davis, L.

Molloy, L.	Sefton of Garston, L. [Teller.]
Peston, L.	Stallard, L.
Phillips, B.	Stoddart of Swindon, L.
Ritchie of Dundee, L.	Wells-Pestell, L.
Ross of Marnock, L.	Wheatley, L.

NOT-CONTENTS
Addington, L.	Harlech, L.
Airedale, L.	Harris of Greenwich, L.
Alport, L.	Harvington, L.
Amherst, E.	Havers, L.
Annan, L.	Hayter, L.
Ardwick, L.	Hemphill, L.
Arran, E.	Henley, L.
Astor of Hever, L.	Hesketh, L.
Auckland, L.	Hives, L.
Aylestone, L.	Holderness, L.
Banks, L.	Hood, V.
Beaverbrook, L.	Hooper, B.
Belhaven and Stenton, L.	Hylton-Foster, B.
Beloff, L.	Ironside, L.
Bessborough. E.	Jessel, L.
Bethell, L.	Johnston of Rockport, L.
Blake, L.	Killearn, L.
Blyth, L.	Kinnaird, L.
Bonham-Carter, L.	Lawrence, L.
Borthwick, L.	Layton, L.
Bottomley, L.	Leathers, V.
Boyd-Carpenter, L.	Long, V. [Teller.]
Brabazon of Tara, L.	Lucas of Chilworth, L.
Bramall, L.	Lurgan, L.
Brookes, L.	Mancroft, L.
Brougham and Vaux, L.	Marley, L.
Broxbourne, L.	Marsh, L.
Burton of Coventry, B.	Maude of Stratford-upon-Avon, L.
Caccia, L.
Cameron of Lochbroom, L.	Merrivale, L.
Campbell of Alloway, L.	Mersey, V.
Campbell of Croy, L.	Milverton, L.
Carnegy of Lour, B.	Montgomery of Alamein, V.
Carnock, L.	Mountevans, L.
Cathcart, E.	Mowbray and Stourton, L.
Chapple, L.	Munster, E.
Coleraine, L.	Murton of Lindisfarne, L.
Constantine of Stanmore, L.	Nelson, E.
Cornwallis, L.	Newall, L.
Craigavon, V.	Norfolk, D.
Cullen of Ashbourne, L.	Norrie, L.
Davidson, V. [Teller.]	Nugent of Guildford, L.
De Freyne, L.	Pender, L.
De La Warr, E.	Peyton of Yeovil, L.
Denning, L.	Plummer of St Marylebone, L.
Diamond, L.	Porritt, L.
Dilhorne, V.	Radnor, E.
Donegall, M.	Rankeillour, L.
Dowding, L.	Reay, L.
Drogheda, E.	Reigate, L.
Dundee, E.	Renton, L.
Eccles, V.	Richardson, L.
Elibank, L.	Rochester, L.
Elliot of Harwood, B.	Romney, E.
Elliott of Morpeth, L.	Russell of Liverpool, L.
Erne, E.	St. Aldwyn, E.
Ezra, L.	St. Davids, V.
Faithfull, B.	Saltoun of Abernethy, Ly.
Fanshawe of Richmond, L.	Sanderson of Bowden, L.
Ferrers, E.	Sandford, L.
Fortescue, E.	Sandys, L.
Gainford, L.	Scarman, L.
Gardner of Parkes, B.	Seebohm, L.
Gisborough, L.	Sempill, Ly.
Glanusk, L.	Shaughnessy, L.
Glenarthur, L.	Sidmouth, V.
Gray of Contin, L.	Skelmersdale, L.
Greenway, L.	Somers, L.
Gridley, L.	Stanley of Alderley, L.
Hailsham of Saint Marylebone, L.	Stedman, B.
	Strabolgi, L.
Halsbury, E.	Strange, B.
Hanworth, V.	Sudeley, L.
Hardinge of Penshurst, L.	Swansea, L.

Terrington, L.	Vickers, B.
Teviot, L.	Walston, L.
Thomas of Swynnerton, L.	Ward of Witley, V.
Thorneycroft, L.	Wigoder, L.
Tordoff, L.	Willis, L.
Trafford, L.	Windlesham, L.
Tranmire, L.	Wise, L.
Trumpington, B.	Young, B.
Underhill, L.	Ypres, E.
Vaux of Harrowden, L.

Resolved in the negative, and amendment disagreed to accordingly.

4.20 p.m.

On Question, Motion agreed to; House in Committee (on recommitment) accordingly.

[The LORD AYLESTONE in the Chair.]

Clause 1 [Construction and operation of a tunnel rail link between the United Kingdom and France]:

Lord Tordoff moved Amendment No. 1: Page 1, line 8, after ("link") insert ("for rail traffic only").

The noble Lord said: It may be for the convenience of the Committee if we also discuss Amendments Nos. 3, 6, 7, 8, 9, 61, 65, 67, 76, 78, 91, 101, 111 and 134.

Before I start to move this amendment, let me add my congratulations to the members of the Select Committee who spent so much time and effort in producing their special report. Their dedication to this cause is quite remarkable. Perhaps the Birthday or New Year's Honours Lists should acknowledge them in some way and special medals should be struck for work beyond the call of duty in your Lordships' House.

Amendment No. 1 and the linked amendments are on the face of it rather curious, because they seem to do severe damage to the Bill. They would do severe damage to the scheme which Eurotunnel has put forward. Nevertheless, I feel that it is appropriate that this subject should be given an airing in this Chamber since, other than brief references at Second Reading, we have not had a chance to discuss the matter in any great detail.

It has been the contention of the Liberal Party for many years that we should have a Channel Tunnel, a fixed link to the Continent. There is no way that today or at any other stage in the proceedings of this Bill I shall do anything to delay the building of that tunnel. I shall be supporting a number of amendments as we go along which I hope will improve the tunnel, particularly in aspects of safety and in relation to what the noble Lord, Lord Sefton, was speaking about. Although I opposed his method of dealing with the matter, I too have great sympathy with what he was saying about the regional aspects and the regional impact of a fixed link.

If a Mancunian can join in the argument with a Liverpudlian, I must admit that one of the aspects that worries me intensely about the Bill is that there is not sufficient emphasis at the moment on rail links with industry in the North connecting in to central Europe. As I said at Second Reading, the most important thing about the fixed link is not people going on holiday to France but the ability to shift freight from industries in the industrial heartlands of this country to their markets in Europe. That is why the shuttle system conflicts with the tunnel that I should like to see.

The Government have got themselves into this position because of their refusal to put public money up front. I am sure that later in the debate Members of the Committee will suggest that the Government are putting money into the project by indirect routes, by putting money through British Rail and so on. We shall come to that argument in due course. I believe that we should be better served if we were to forget the holiday traffic and concentrate our minds on providing a rail link into central Europe for freight traffic. We shall come later to the infrastructure that is necessary to support that freight traffic, in which I believe the Government should be encouraging British Rail to invest, if not immediately then at a specified time within the near future.

I hope that there will be some support for the principle of a rail traffic link only and I hope that the Government will not dismiss it out of hand. In the worst instance I believe that it provides them with a safety net. Eurotunnel gives every indication at the moment that it will be succcessful in raising the finance in the third phase of its operation. I hope that that will be the case if that is the scheme that is to go ahead. I would want to encourage investment in the scheme if that is the scheme we are going to have. But if it were to fail I hope that the Government would not rule out the possibility of falling back on the kind of scheme which I have suggested in what I have been saying today and which would be provided if the amendments which I have put down on the Marshalled List were to be agreed to. I beg to move.

4.30 p.m.

Lord Mulley

I should like to join the noble Lord in his appreciation of the work of the Select Committee. Even though one may not in every instance endorse its findings, one must at least recognise the tremendous work that was carried out by all members of the Select Committee during what I think was a thorough examination within the scope that they were properly allowed in dealing with the hybridity of the Bill.

As the Committee says in its report, the question which the noble Lord, Lord Tordoff, put was outside its terms of reference, because the principle of the Bill assumed that it would be the Eurotunnel scheme based on the shuttle train service. In speaking for the first time on the Bill perhaps I should declare a minor interest. Having had a previous concern with tunnel matters before the scheme was adopted I was asked recently to advise the ferry companies in their organisation of their current proceedings before the House. I very much support the concept of a fixed link but I feel that the Eurotunnel scheme will give the worst of both worlds.

The previous tunnel, which unfortunately had to be abandoned, was, as the noble Lord suggested, to be publicly funded and to carry rail traffic only. It would make very much more sense if we concentrate on the freight aspects and leave open that question. I was disappointed that it was not thought fit at this stage to have a rail tunnel along the lines of the noble Lord's proposal, along with a separate motorway, so that people who wanted to take their cars to the Continent could drive them there. It may be that technological arguments at that stage raised doubts as to its feasibility. But looking towards the 21st century—we shall be almost there when the tunnel is ready—we should not, as we have done, embrace the technology of the 19th century, which is what is involved. The shuttle trains will get in the way of the free flow of freight and through-passenger trains, which in essence is what I have always thought the tunnel should be about.

If certain categories of goods are to be turned down by the Eurotunnel because they are dangerous and so on, one wonders how the ferry companies will be kept going on the limited business that will then be available to them. On the rail traffic only tunnel, as the noble Lord, Lord Tordoff, proposes, there would be a role—perhaps a reduced role—for the ferry companies. That has wider implications, which we shall be discussing in other amendments, for employment and for the Merchant Navy, which in a sense is an essential reserve for our Royal Navy in the event of difficulties. We know the role that it played in the Falklands.

There are many considerations which attract me to the group of amendments which the noble Lord, Lord Tordoff, has proposed. He went so fast that I confess that I did not take a note of all the amendments involved, but I take it that they are all consequential to permit the conversion of the tunnel scheme, as proposed by Eurotunnel and opposed by the Bill, for the shuttle trains to be rail traffic only. I hope that the noble Lord will press the amendment. I shall not be surprised if the Government show some reservations about it, but if it is not accepted I hope very much that he will press it and I shall be happy to support it.

Lord Somers

I quite understand that the primary importance of the tunnel is for freight traffic, but that surely would have to be a shuttle service, because the only efficient way of transporting freight would be a shuttle service so that there would be no delay at either end. If one is going to have a shuttle service for lorries, it is perfectly logical also to have a shuttle service for cars, with enough passenger coaches to accommodate the drivers of the cars. Therefore I cannot see that it need necessarily be limited only to freight.

The Earl of Radnor

I understand what the noble Lord, Lord Tordoff, means by his amendment, but it is already written in the Bill that rail traffic only is provided for. The shuttle is a railway train that goes round and round. There will be provision for through trains. There is only a service tunnel in the middle, and it seems to be entirely immaterial that the shuttle service should be carrying motor cars, lorries or what have you. It is in point of fact a rail only tunnel.

Lord Underhill

I very much regret that on this one occasion I cannot see eye to eye with my noble friend Lord Tordoff. I say "my noble friend Lord Tordoff" because he and I usually look upon transport matters with somewhat the same view. His series of amendments will eliminate all question of shuttle movements. What he wants is through passenger trains and through freight trains but no shuttles. This would remove from haulage operators their opportunity of choice. We know that over a distance of more than 200 miles it is more viable to send goods by rail than by road. We want to encourage the maximum possible use of rail and this is one way to assist it. If we do not have the shuttle for freight, what will be the position of freight operators and haulage operators who may find it more viable not to use the ferry system and may like to use a shuttle service? One would be removing from them the opportunity of choice. I agree with my noble friend Lord Mulley that we want to see a role for the ferries. Whatever we may be saying in the course of the debates on the Channel Tunnel, we in no way wish to eliminate the position of the ferries.

The position of passengers, in my view, is not the most important consideration. But, again, surely we should not take away the opportunity of choice from passengers who wish to travel with their cars and who wish to to take the short route. Instead of being compelled to use a sea ferry crossing, they may prefer to use the shuttle service. Therefore, we are taking away both from frieght operators and passengers with cars their freedom of choice.

I thoroughly agree with the noble Lord, Lord Tordoff, that the important consideration is the question of BR fast freight trains. That is why throughout our discussions, in my support for a fixed link, I have emphasised that unless it had fast freight train arrangements I would find the proposal difficult to support. If we removed the shuttle service for freight and other cars there is a grave danger that the Eurotunnel project would not be viable. If it is not viable, then the opportunity of BR to seize the position and to assist in the fast movement of freight from the North, from Scotland and other areas, would obviously fall to the ground.

I believe that that is the main consideration for the fixed link. The amendments to eliminate the shuttle could make the position almost impossible for fast freight to continue because of lack of viability of the Eurotunnel scheme.

Lord Scarman

I reluctantly find myself having to disagree with this amendment. I declare an interest. I live in East Kent. I know the unemployment anxieties arising from the shuttle service and the possibility of a substantial curtailment of ferry services. I am also aware of real fears in the county of Kent as to the growth of lorry traffic on the main roads—the M.20 and others—which will feed the lorries across the county into Folkestone or Ashford.

However, I am persuaded that the shuttle service is necessary because the right of choice must be there. It might be a serious matter to deny road users the possibility of the Channel service. All I implore of the Government is that if, as I suspect, this amendment fails, real attention is paid to the unemployment problems of East Kent and to the road traffic problems of central and western Kent.

Lord Brabazon of Tara

I find myself in agreement with the speech of the noble Lord, Lord Underhill, which does not happen all that often. It was a pleasure when it happened this afternoon. These amendments strike at the very heart of the project. The British and French Governments, back in 1985, invited proposals for a Channel fixed link to be financed by the private sector without recourse to government funds or government guarantees. It was on this basis that the Eurotunnel project was selected and on this basis that the Anglo-French treaty was signed in February 1986. It was also on the basis that Eurotunnel would be seeking private finance for its twin tunnel shuttle project that the concession agreement between the two Governments and the British and French concessionaires was signed in March 1986.

Moreover, at Second Reading of the Bill in this House on 16th February I said that the purpose of the debate was to establish the principle of the Bill, that principle being, that there should be a tunnel provided that private finance is forthcoming and that the tunnel should, in essence, be the Eurotunnel scheme". These amendments frustrate that principle.

The amendments seek to remove authority for the shuttle service element of the tunnel project and to confine operation of the tunnel to through trains. It is not clear from the amendments whether the noble Lord, Lord Tordoff, intends that the concessionaires should remain in place and should simply construct and operate the tunnel itself, raising revenue only from tolls paid by British Rail and French railways. But I must make it clear that this would not be the effect. Rather, the effect would be to take the whole project back to the drawing-board.

The concessionaires have signed the concession agreement undertaking to construct and operate the project which they put forward to the Government, not to operate a totally different system imposed on them. I would not expect them to accept such a proposal; nor is there any reason why they should. The Committee should be aware that these amendments would put the Government back in the position of inviting totally fresh proposals for a Channel Tunnel. Moreover, I very much doubt that proposals for a through rail-only tunnel could be financed entirely privately.

The noble Lord, Lord Mulley, reminded us of the 1975 scheme with which I know he was associated as, I think, Minister of Transport at that time. But I should point out that even that scheme was not a rail-only tunnel. It too involved a vehicle shuttle and was very little different in fact from the Eurotunnel scheme put forward at the moment.

The Government remain resolutely opposed to any form of government funding of the project either by funding of the concessionaires or by funding of British Rail. The main purpose of Clause 41 of the Bill, which was inserted at Report stage in another place and welcomed by many concerned about the back-door funding of the Eurotunnel, is to put beyond doubt that BR's involvement in the project must be a commercial decision. That is how it should be. This is a privately-financed project.

We should not throw out the Channel Tunnel project in this indirect way. British Rail's contribution to the Channel Tunnel project, on the basis of their own commercial decisions will be a very substantial one. It will provide for services to Paris and Brussels from London and beyond. And British Rail expect to see a major increase in their freight business as a result of the longer journeys which make rail freight more commercial. This will result in a significant transfer of freight from road to rail.

This will happen only as a result of the project we are now considering—and I would expect benefits such as these to be welcomed by noble Lords. Added to this, the proposed shuttle service will also provide a fast, all-weather means of crossing the Channel for traffic which inevitably will not be carried by through trains. The speedier access this will provide to Europe, already our partners in 60 per cent. of our overseas trade, will help businesses and private travellers alike, and as a result the economy of the whole country will benefit. These amendments would throw all these benefits to the wind, and I therefore urge the noble Lord, Lord Tordoff, to withdraw them.

4.45 p.m

Lord Ezra

The noble Lord has reiterated yet again the Government's firm opposition to any public funding of this project either directly or indirectly. May I ask him, however, whether that restatement of a well-known position would inhibit the railways from making the necessary investment to realise the full potential?

My reason for asking that is that in the report from the Select Committee on page 4, paragraph 13, this same concern was expressed by the committee. They state: The key to spreading the benefits which could flow from the project will mostly lie in the hands of British Rail, at present totally dependent on Government for its resources. The restraints which the Government has accepted … could possibly inhibit the capacity of British Rail to invest in the infrastructure to exploit the potential. May I ask the Minister whether the fear expressed by the Select Committee is a groundless fear and that the necessary investment will in fact be put in by British Rail to secure all the benefits of this project?

Lord Harris of Greenwich

I was wondering whether the Minister was proposing to deal with the questions he was asked by the noble and learned Lord, Lord Scarman?

Lord Brabazon of Tara

The point of the noble and learned Lord, Lord Scarman, concerned the road infrastructure in Kent. We shall be coming in due course to amendments which affect that, so I was not proposing to deal with it at the moment as it is not particularly relevant to this amendment.

As regards the noble Lord, Lord Ezra's point about British Rail investments, I read what was stated in the report of the Select Committee. The position is clear so far as concerns British Rail investment. If they put forward to the Government commercial proposals, the Government will look at them in the way that they normaly do so. If they are sound proposals, permission will be given for them to go ahead.

Lord Tordoff

It seemed to me that, as usual, the remarks of the noble and learned Lord were extremely relevant. I have rarely heard the noble and learned Lord make an irrelevant comment and I am surprised that the Government Front Bench consider them to be irrelevant. These amendments touch precisely on matters referred to by the noble and learned Lord.

One of the benefits of having a rail-only tunnel —that is to say a tunnel without a shuttle—is that the impact of this fixed link on the ferry services would be much less. Those travelling to France by car would continue to go by ferry and we should be able to maintain a minimum level of ferry service against the problems to which the noble Lord, Lord Mulley, referred.

The environmental impact on Kent would be greatly reduced. There would be nothing like the same need for land-take in order for the assembly of vehicles to board the shuttle. There would not be the same volume of road haulage traffic going through Kent because the pressure would be on manufacturers to put their goods into containers and to ship them on railway trains direct to Europe. There would be fewer worries about fire hazards. All the debates that we are likely to have on the question of segregation of passengers from their vehicles become irrelevant if the shuttle is not in place. As regards the passengers' lack of choice, it is true that they would not be able to take their cars on trains to France. However, it may well be that a new form of holidaying will take place; a rail-drive holiday, comparing it with the fly-drive holiday which exists and which is increasing.

There is no doubt in my mind that, as has been pointed out, the stumbling block here is not the question of the shuttle or otherwise but of the Government's refusal to fund this important national project and to leave it entirely to private funding. I believe that that is where they have made a fundamental mistake.

I take the point made by the noble Lord, Lord Underhill, that in putting down this series of amendments I have been unable to produce an economic justification for them. I have no idea what precisely would happen to the economics of the tunnel. It is interesting that the Minister says that the concessionaires might not like it. The concessionaires have gone ahead and signed the concessions while the Bill is passing through Parliament. Perhaps it may have made sense for the Committee to have made up its mind before those things were signed. Nevertheless, they are signed and the project is under way.

At this moment I shall not press these amendments to a division: it would be foolish to do so. I hope that we on these Benches have had the opportunity, first, of spelling out the position that we should like to have seen, and also of re-emphasising some of the issues which will arise over and over again in Committee. They relate to issues which the noble and learned Lord, Lord Scarman, and the noble Lord, Lord Mulley, have raised, and also to matters about which the noble Lord, Lord Sefton of Garston, was speaking in our ealier debate.

I hope that the Government are taking these matters on board and are prepared to give more positive answers when welcome to the detailed examination of the Eurotunnel scheme as it exists at present. With that I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Brabazon of Tara moved Amendment No. 2: Page 2, line 1, leave out ("and its supplementary protocols and arrangements").

The noble Lord said: I beg to move Amendment No. 2 and, with the leave of the Committee, speak at the same time to Amendments Nos. 4 and 100. These amendments are drafting improvements to clarify the meaning of "the treaty". I beg to move.

On Question, amendment agreed to.

[Amendment No. 3 not moved.]

Lord Brabazon of Tara moved Amendment No. 4:

Page 2, line 12, leave out subsection (4) and insert— ("(4) "The Treaty" means the Treaty mentioned in paragraph (a) of subsection (1) above, including its supplementary protocols and arrangements, and "the Concession" means the Concession mentioned in paragraph (b) of that subsection.").

On Question, amendment agreed to.

Lord Brabazon of Tara moved Amendment No. 5: Page 2, line 15, after second ("agreement") insert ("or arrangement").

The noble Lord said: I beg to move Amendment No. 5 and at the same time speak to Amendment No. 35. The amendment to Clause 1 is a drafting improvement. It makes line 15 consistent with the next line which envisages that a concession agreement may be either an agreement or an arrangement. The term "arrangement" is used in the treaty, the concession agreement of 14th March, 1986, and the Bill to connote an agreement which is accepted by the parties as binding, though it lacks the form of say, a protocol or deed. An example of an arrangement might be a joint decision recorded in the agreed minutes of a meeting.

As regards the amendment to Clause 14, subsection (2) of that clause provides that a concession agreement, of which public notice has been given under Clause 4, shall be taken as valid and effective in all legal proceedings from the date specified in the notice. Without this provision formal proof of the validity of the agreement could be required for the exercise of certain powers under the Bill. However, an agreement supplementing or modifying the principal agreement may not be of sufficient moment to warrant publicity in the form of notices in the London Gazette and local newspapers. Nevertheless, its validity must be provided for and this amendment does that. I beg to move.

On Question, amendment agreed to.

[Amendments Nos. 6 to 9 not moved.]

Lord Brabazon of Tara moved Amendment No. 10: Page 2, line 49, leave out ("through the tunnels") and insert ("between Cheriton, Folkestone and Frethun by way of the tunnels").

The noble Lord said: I beg to move Amendment No. 10. The amendment removes the possibility of "shuttle train" being construed as including a motor rail train operated by British Rail or French railways. I beg to move.

On Question, amendment agreed to.

Lord Carmichael of Kelvingrove moved Amendment No. 11:

Page 3, line 7, at end insert— (11) The Secretary of State shall by order make provision for ensuring that a person may not hold shares in the Concessionaires, or in any of them, in circumstances where the Secretary of State is satisfied that his holding of those shares would be contrary to the interests of the United Kingdom. (12) An order under subsection (11) above8—

1. (a) shall contain such consequential provisions (including provisions involving the modification of any enactment) as the Secretary of State thinks fit; and
2. (b) shall be made by statutory instrument which shall not come into force until it has been approved by resolution of each House of Parliament.").

The noble Lord said: I accept the fact that it may be difficult to relate in the wording exactly what is intended in the amendment but I am sure that the Minister is familiar with the argument. When we debated the British Airports Authority some time ago noble Lords from all sides of the House were conscious of the importance of airports authorities not being taken over by an Outside group of people or individual who did not have the best interests of Britain before them. This is also an important communications feature for this country. As noble Lords heard during the earlier debate on whether or not we should have the Committee session, it is a subject which raises great heat. The amendment attempts to give power to the Secretary of State. It does not delegate at all from his powers and it is not stating what he should do. It leaves the matter to the Secretary of State when he is satisfied that the holding of a controlling interest in the Channel Tunnel would be contrary to the interests of the United Kingdom. Therefore the Secretary of State can use these powers to prevent someone from having such control.

It is obvious, from various statements in the press and from the information which has become public knowledge, that there have been problems in raising money for the project. I do not wish to go into the details, nor do I wish to emphasise that fact. I wish to give the tunnel the best possible start that it can have. Because there have been these problems and because the Government have said time and again that there will be absolutely no government money put into this project, the tendency will be for the commercial people to look almost anywhere if matters reach the point, as they did a few months ago, and there is no money, particularly in the British market. The commercial people may be willing to go rather further than they otherwise might to raise the necessary money.

I hope that the Minister will give this a great deal of thought. He will remember that in Standing Committee in another place, and again on Report, the Minister stated that the British Government would review with the French Government and the concessionaires whether the Government should have some back-stop control to ensure that the management of the concessionaires does not pass into undesirable hands. For a project as important and vital as this, that is the least that should be done.

The idea of this project getting into "undesirable hands"—those were, I think, the Minister's actual words—is something we should not contemplate. I hope the Minister will be able to look at this. He knows the arguments from the debates that took place in the other place and I hope we shall have the benefit of his thinking on it, so that either we can have the words that have been put down or perhaps words of his own choosing that will do the same job. I beg to move.

5 p.m.

Lord Sefton of Garston

I am rather puzzled as to whether or not Eurotunnel is a plc. If it is not, when will it become so and when can members of the public buy shares in it?

Lord Brabazon of Tara

To answer the question put by the noble Lord, Lord Sefton, I think Eurotunnel's proposal, if this Bill goes through in timely fashion to Royal Assent, is that there will be a public issue of shares in the autumn. The noble Lord will have to wait until then before investing his money in the project, if that is what he proposes to do.

To deal now with the amendment moved by the noble Lord, Lord Carmichael, the invitation to potential fixed-link promoters was issued in April 1985 and the two Governments made it clear that they might wish to have certain rights in the successful promoting company. Although the fixed link was to be a purely private sector project, it was recognised that safeguards were needed to ensure that the link could not be operated in a manner inimical to the national interests of the United Kingdom and France. The nature of these rights was to be defined in the instrument of concession and the articles of association of companies which might be involved. Following the signing of the concession agreement, which contains an array of such safeguards, the two Governments jointly examined whether additional protective measures were needed. Our clear conclusion was that they were not.

As the Committee will be aware, this Government have no objection to foreign share ownership as such. On the contrary, foreign investment in this country is to be welcomed and encouraged. But what the two Governments have sought to avoid is abuse of such share ownership. During the negotiation of the concession agreement the Government secured a wide range of powers to deter or deal with any serious inadequacies in the operation of the tunnel system. For breaches of their obligations under the agreement the concessionaires can be fined by the Intergovernmental Commission. For serious breaches, such as, for example, failure to ensure that all necessary steps are taken to permit the steady flow of traffic, they would be liable to lose the concession. In addition, both Governments have general powers which would enable either state to act if national security was threatenecd.

In the United Kingdom we also have ample powers in this Bill to make orders to prevent specific courses of conduct prejudicial to the national interest. We are therefore satisfied that sufficient protection for the national interest already exists and that controls over share ownership are therefore unnecessary.

I should perhaps add that the proposed amendment is defective. Because of the equal partnership nature of the concessionaire companies, and particularly the twinned-share arrangement, it is not possible to apply a British solution to the British company and a French solution to the French company. Any measure to control share ownership would need to bite both in Britain and in France and to be apt in both British and French law. Although an arrangment involving both an amendment to the Bill and the protocol to the treaty might produce a workable solution, the Governments have decided, for the reasons I have outlined, not to take this complex indirect course when more direct remedies are already available. I hope that the noble Lord, having heard my explanation of the powers that are available to us, will agree that they are as good at anything that might be proposed in his amendment. I hope therefore that he will feel able to withdraw the amendment.

Lord Mulley

The noble Lord says that it is difficult to draft an amendment to achieve the purpose my noble friend Lord Carmichael seeks namely, to retain the British national interest. I am certain that the French Government would not be unwilling to make sure that they pursue their national interest. My experience is that they tend to do that rather better and more accurately than we do.

Because of the special circumstances, namely, that two Governments are involved, the "golden share" principle, which has hitherto been characteristic of other legislation—British Aerospace and so on—is not appropriate here. I must however say in passing that I regret very much the indication that the Government are about to abandon the golden share principle in the undertakings given. In that sense they will not have the safeguards that one would like to see.

Of course, no-one is against foreign investment. What we are concerned about is that it should not be of a kind prejudicial to the interests of Britain on the one side and of France on the other. While the Minister made a very wide-sweeping statement about how many provisions there are in the Bill which will permit the Government to deal with any possibility that entries might be prejudiced, he did not give chapter and verse. Perhaps he could give us some indication, because unfortunately the concession agreement and treaty will not be submitted to your Lordships. We have to consider the matter in the form of the Bill before us. So if the noble Lord could give us some indication as to where all these safeguards are, that would help us and ease our minds.

Lord Carmichael of Kelvingrove

I should like to thank my noble friend for supporting me in this amendment. I can see the point being made by the Minister that there are safeguards included in the agreement. But, as my noble friend Lord Mulley has suggested, we do not know exactly what the agreement is. I am tempted to divide the Committee. The fact made clear by the Minister in another place that there should be a long-stop was all that we were asking for. We feel that there should be something.

However, rather than divide the Committee, I would be happy if the Minister could put information in the Library. I do not see why, before an important Bill like this goes through, Parliament should not know, what is contained in the agreement. If the Minister would try to help by enabling us to know the type of safeguards involved, I would be prepared to withdraw the amendment and perhaps raise the matter for discussion at Report stage or on Third Reading.

Lord Brabazon of Tara

I have given one example already of the type of thing contained in the concession agreement. The best solution is, I think, that I write to the noble Lord, Lord Carmichael, putting a copy in the Library and sending a copy also to the noble Lord, Lord Mulley. I shall also see whether I can find other things of interest to the noble Lords.

Lord Carmichael of Kelvingrove

With that promise, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Underhill moved Amendment No. 12:

Page 3, line 7, at end insert— ("() The Secretary of State shall by order establish a Channel Tunnel Supplies Office for the purpose of ensuring that undertakings within the United Kingdom obtain any equitable share of contracts in the construction of the tunnel rail link as set out in this section.").

The noble Lord said: There has been considerable controversy in the country about the effect of the tunnel upon jobs and employment. I think it will be generally agreed that if the tunnel project is to proceed, every step must be taken to ensure that the maximum possible number of jobs are created in the United Kingdom in connection with construction equipment and rail equipment. It may be timely to refer to rail equipment, because some of us were very concerned to see that the contract for the East Coast main line electrification has been given to a Swiss firm. All that British Rail has is the contract for the bogies. The major work has been given to a Swiss firm.

What we are proposing in this amendment is that, The Secretary of State shall by order establish a Channel Tunnel Supplies Office". In our view, it is not sufficient to say that of course the concessionaires are bound to look after UK interests, because it is, after all, a private venture with no public money. It is a commercial undertaking. The only purpose of people putting money into the project is the hope of making a profit. People will not put money in for philanthropic or social reasons. They will do it because they believe it is an undertaking which will be successful.

The Offshore Supplies Office was set up to ensure that UK companies had the best possible chance of winning contracts for the North Sea oilfields. My noble friend Lord Carmichael has a fair amount of experience of that, as I believe have other noble Lords. We believe it is essential that what was done for the oilfields should be done for the Channel Tunnel project. The amendment does not say how the proposed Channel Tunnel Supplies Office should be comprised. We suggest that it might be done on the basis of the North Sea model, but this will be determined solely by the Minister by order. This is a very important amendment which we believe will command considerable support in the areas about which my noble friend Lord Sefton spoke—those areas north of Watford. I beg to move.

Lord Brabazon of Tara

I entirely sympathise with the motives of this amendment, in that one of the great benefits of the fixed link will be the tremendous boost that the actual process of building it will give to production and jobs in this country. As has been said on many occasions, it will be a billion pound opportunity for British industry; and that is not the total value of the project, which is £2.7 billion at 1986 prices, not including British Rail's expenditure.

However, it is not in the nature of this project that shares in this work can be laid down by governments. I am sure the Committee will understand that contracts must be won and not given according to some pre-arranged scheme. If Eurotunnel is to make a success of this project, it must be free to place contracts with the most suitable supplier offering the right goods for services on the best terms. British firms will obtain all the work that they deserve. So far I am glad to say that they have secured orders totalling well over £50 million, which is excellent bearing in mind that the project is still in its very early stages.

Nevertheless—and now I come to the heart of this amendment—there is an important role for government in all this in helping to see that British firms are made fully aware of the nature and scale of the opportunities. The job to be done does indeed have some similarities to the role of the Offshore Supplies Office, to which the noble Lord, Lord Underhill, referred in moving the amendment, or indeed similarities to the British Overseas Trade Board, though there are important differences, not least of scale.

In fact, some months ago the Department of Trade and Industry established a special unit to act as a central information and inquiry point for industry on Channel Tunnel matters. Contact points have been set up in each of the department's regional offices in England and in the industry departments of the Scottish Office, the Welsh Office and the Northern Ireland Office, and those are widely publicised. Through these contact points, industry is being made aware of, and being kept up to date about, the project and the main contractors' purchasing procedures and tendering arrangements.

Information is sent to local chambers of commerce, trade associations and individual companies, and the department produces a monthly newsletter to keep firms up to date on matters of design and procurement opportunities. In addition to opportunities for direct orders from the contractors, there are opportunities for many hundreds of companies to win orders for the provision of goods and services from the winners of the major contracts.

The department therefore publishes regularly details of major contracts that have been awarded so as to allow smaller and medium sized companies to follow up these opportunities. The Department of Trade and Industry has also organised a number of regional procurement seminars for industry in order to provide companies with a better understanding of where opportunities lie and of how to win business. Seminars have to date been held in Birmingham, Telford, Glasgow, Bournemouth, Bristol and the East Midlands. These have all been well received, with an average attendance of 200 senior managers from local industry. Further seminars are planned for the near future in the North-West, Yorkshire and Humberside. In addition the department is keeping a close eye on purchasing on the French side of the Channel and is encouraging UK industry to bid for contracts over there.

I hope the Committee will agree that this is a substantial initiative on the part of the Government. It has been undertaken entirely independently of any pressure resulting from the passage of the parliamentary Bill, and the Government believe that it is an appropriate response to the needs of the situation. In these circumstances I hope that the noble Lord, Lord Underhill, will agree to withdraw this amendment.

Lord Carmichael of Kelvingrove

I imagine that the Committee will be pleased with the statement that the Minister made, so far as it went, but there was something slightly complacent when he said that what has been done was done with no pressure from Parliament. I should have thought it was the elementary job of the DTI with a project as big as this tunnel, to jump in in a situation like this. What is most worrying is that all of the schemes set up are advisory. There is no powerful group, such as there is in the North Sea, which almost had a Minister of its own, a very energetic Minister, Mr. Alick Buchanan-Smith, who, alas, has left the Government. He was very involved in bashing heads together and getting things done. But I agree that in some ways that was in a different category from this and that the North Sea was right on the fringe of technology.

In this case there will be the high-speed trains, the boring machines, the signalling equipment and the unique type of safety that will be required in a tunnel which is 30-odd miles long. For all these matters there should be a totally separate section of the DTI for at least the next few months.

It is not easy to tell people in Scotland and in parts of the North that competition will even things out. If you tell the shipbuilding industry that there is evenness of competition in Europe, management and trade unions in the area will tell you that they do not believe there is pure competition. There are all sorts of fancy ways of helping local industries. Therefore we do not want the Department of Trade and Industry to take a passive role and are anxious that it should take a very positive role.

I do not know my noble friend's views on this amendment, but I think it is sufficiently important to divide, having accepted that the Minister has gone a long way by telling us what has happened. However, he needs a little push to go over the edge and to set up separate sections in the Department of Trade and Industry. This will be the biggest engineering project since North Sea oil, involving British Rail and other important industries in Britain. Therefore we believe that it should be looked at separately over the next six months to a year. I hope that my noble friend will press this amendment to a Division.

5.20 p.m.

On Question, Whether the said amendment (No. 12) shall be agreed to?

Their Lordships divided: Contents, 69; Not-Contents, 123.

DIVISION NO. 2
CONTENTS
Addington, L.	Leatherland, L.
Airedale, L.	Lockwood, B.
Ardwick, L.	Longford, E.
Avebury, L.	Lovell-Davis, L.
Aylestone, L.	McCarthy, L.
Basnett, L.	Morton of Shuna, L.
Birk, B.	Mulley, L.
Bonham-Carter, L.	Murray of Epping Forest, L.
Bottomley, L.	Nicol, B.
Brockway, L.	Oram, L.
Bruce of Donington, L.	Peston, L.
Carmichael of Kelvingrove, L.	Phillips, B.
Cledwyn of Penrhos, L.	Ponsonby of Shulbrede, L. [Teller.]
David, B. [Teller.]
Diamond, L.	Prys-Davies, L.
Elwyn-Jones, L.	Ritchie of Dundee, L.
Ennals, L.	Rochester, L.
Ewart-Biggs, B.	Ross of Marnock, L.
Ezra, L.	Seear, B.
Foot, L.	Sefton of Garston, L.
Gallacher, L.	Serota, B.
Galpern, L.	Stedman, B.
Graham of Edmonton, L.	Strabolgi, L.
Hanworth, V.	Tordoff, L.
Harris of Greenwich, L.	Turner of Camden, B.
Hatch of Lusby, L.	Underhill, L.
Hayter, L.	Wallace of Coslany, L.
Hooson, L.	Walston, L.
Houghton of Sowerby, L.	Wells-Pestell, L.
Irvine of Lairg, L.	Whaddon, L.
Jacques, L.	Wheatley, L.
Jeger, B.	Wilson of Langside, L.
John-Mackie, L.	Wilson of Rievaulx, L.
Kilbracken, L.	Winstanley, L.
Kilmarnock, L.	Ypres, E.

NOT-CONTENTS
Ampthill, L.	Colwyn, L.
Arran, E.	Constantine of Stanmore, L.
Astor of Hever, L.	Cornwallis, L.
Auckland, L.	Craigavon, V.
Beaverbrook, L.	Davidson, V. [Teller.]
Belhaven and Stenton, L.	De La Warr, E.
Beloff, L.	Dilhorne, V.
Bessborough, E.	Drogheda, E.
Blake, L.	Dundee, E.
Blyth, L.	Eccles, V.
Bolton, L.	Elibank, L.
Borthwick, L.	Elliot of Harwood, B.
Boyd-Carpenter, L.	Elliott of Morpeth, L.
Brabazon of Tara, L.	Erne, E.
Broadbridge, L.	Faithfull, B.
Brookes, L.	Fanshawe of Richmond, L.
Brougham and Vaux, L.	Ferrers, E.
Broxbourne, L.	Fortescue, E.
Cameron of Lochbroom, L.	Gisborough, L.
Campbell of Alloway, L.	Glanusk, L.
Campbell of Croy, L.	Glenarthur, L.
Carnegy of Lour, B.	Greenway, L.
Carnock, L.	Gridley, L.
Cathcart, E.	Hailsham of Saint Marylebone, L.
Clitheroe, L.
Coleraine, L.	Hardinge of Penshurst, L.
Colville of Culross, V.	Harlech, L.

Harvington, L.	Radnor, E.
Havers, L.	Rankeillour, L.
Hemphill, L.	Reay, L.
Henley, L.	Reigate, L.
Hesketh, L.	Richardson, L.
Hives, L.	Romney, E.
Holderness, L.	St. Aldwyn, E.
Hood, V.	St. Davids, V.
Hylton-Foster, B.	Saltoun of Abernethy, Ly.
Johnston of Rockport, L.	Sanderson of Bowden, L.
Killearn, L.	Sandford, L.
Lane-Fox, B.	Seebohm, L.
Lawrence, L.	Sempill, Ly.
Layton, L.	Shrewsbury, E.
Long, V.[Teller.]	Sidmouth, V.
Mancroft, L.	Skelmersdale, L.
Marley, L.	Somers, L.
Marshall of Leeds, L.	Stanley of Alderley, L.
Merrivale, L.	Sudeley, L.
Mersey, V.	Swansea, L.
Milverton, L.	Terrington, L.
Molson. L.	Teviot, L.
Montgomery of Alamein, V.	Thomas of Swynnerton, L.
Mountevans, L.	Trafford, L.
Mowbray and Stourton, L.	Tranmire, L.
Murton of Lindisfarne, L.	Trumpington, B.
Nelson of Stafford, L.	Vaux of Harrowden, L.
Norfolk, D.	Vickers, B.
Norrie, L.	Ward of Witley, V.
Nugent of Guildford, L.	Whitelaw, V.
Onslow, E.	Windlesham, L.
Pender, L.	Wise, L.
Peyton of Yeovil, L.	Wyatt of Weeford, L.
Plummer of St Marylebone, L.	Young, B.
Portland, D.	Zouche of Haryngworth, L.

Resolved in the negative and amendment disagreed to accordingly.

5.28 p.m.

Lord Underhill

I have a question to ask the Minister on the matter of Clause 1 stand part. There are subsequent clauses in the Bill which refer to various works and also to the establishment of a safety authority.

Chapter VIII of the Select Committee's report states in paragraph 120 that the concession agreement actually established a safety authority. Presumably the safety authority cannot strictly act until the Bill has Royal Assent. Are decisions being taken and certain equipment being put in hand which really require consideration by the safety authority which I gather—and the Minister will be able to confirm this—cannot act until the Bill receives Royal Assent? That is a very important point.

Lord Brabazon of Tara

That is a point which I am not in a position to answer at this precise moment so I may have to write to the noble Lord about it.

Lord Mulley

I may be able to help the Minister on this point. There will be further amendments that will give him the opportunity to tell us the status of the safety commission and perhaps by the time we reach them he will be able to do so.

Lord Brabazon of Tara

That is indeed true. I shall almost certainly be able to cover the point later.

Clause 1, as amended, agreed to.

Clause 2 [No government funds or guarantees for the tunnel system]

5.30 p.m.

Lord Mulley moved Amendment No. 13: Page 3, line 12, at end insert ("nor shall the Concessionaires have recourse to any such Government funds or guarantees.").

The noble Lord said: In moving this amendment, I should like to speak also to Amendment No. 14. I think that we all welcome the fact that Clause 2 is in the Bill and that it sets out very clearly the Government's assurance that no public money in any form is to be involved in this undertaking. As we know, that principle is also embodied in the treaty and the concession agreement. While we do not in any sense question the bona fides and good faith of the present Ministers and others who have made various assurances, either to the House or to the Select Committees, six years is a very long time. It is said that a week is a long time in politics. There may be some argument about that but I think it is indisputable that six years is a very long time. I understand that six years is the time that must elapse before the tunnel will be operational. The legislation now before us may well be in force for much longer than that.

I therefore believe that we need to make the Bill as watertight as we can although one recognises that one parliament cannot bind another parliament. If need arises, the government of the day would have to come to that parliament for amendment of the Act. One can envisage circumstances in which they might desire to do that. My concern is that there should be no backdoor way of giving money to the concessionaires.

My first amendment is concerned not only that, as Clause 2(1) provides: no Minister of the Crown or Government department shall provide funds to the Concessionaires but that it should be made reciprocal that concessionaires should not seek or accept any funds. That is the purpose of my first amendment.

My second amendment is directed to the fact that understandably Clause 2(2) provides for a wide range of exceptions to the general principle that no public funds should go to the concessionaires. One can imagine that there could be various circumstances in which that would be important. For example, one would welcome rather than deplore a move to place orders for equipment in an assisted area. If, in that sense, there was some form of indirect subsidy, one would not complain about that. I think we need to make sure that if profit is made from such exceptions, the total amount of profit from indirect public funds should not be excessive. I therefore propose that: the aggregate effect of all such funds of guarantees provided to the Concessionaires is not such as materially to affect the Concessionaires' competitive position". Without Clause 2(3), they would profit under Section 56 of the Transport Act 1968 where capital expenditure to public passenger transport facilities can be made. There could be other ways in which grants could be made for some forms of transport which would not be available, for example, to ferries. I think it is the case that all of our European competitors give substantial subsidies to their ports and ship operators. We do not. If we saw fit to do that, I should not wish it to come into the question at all. If, as is agreed, this is to be a wholly competitive commercial enterprise, we should close any possible loopholes. If there are good reasons for exceptions to be made to that principle, then Parliament should be consulted about it. I beg to move.

Lord Peyton of Yeovil

It is some 12 years or more since I took part in any debate on the Channel Tunnel. I do not propose on this occasion to weary your Lordships with a long intervention or to intervene frequently. However, I am tempted to my feet by the fact that this amendment is moved by the noble Lord, Lord Mulley. It was he who had the doubtful privilege of being both my predecessor and my successor at the Ministry of Transport. I have always believed—I may be doing the noble Lord a great injustice—that it was he who was very substantially responsible for the ditching of the whole project on a previous occasion in 1974. If I do the noble Lord any injustice I shall immediately give way.

Lord Mulley

I am grateful to the noble Lord. The facts of the failure of the previous venture are that the Bill that the noble Lord introduced provided that unless certain matters were completed by 1st January 1975, automatically those involved would have the right to bring the project to an end. That was not a worked-out scheme such as the one we have today. As the noble Lord will recall, it was a preliminary to getting such a scheme worked out. In fact, because we had two elections in 1974 the Bill did not go through. As we know, the present Bill has taken quite a long time. The previous Bill did not go through and there was considerable public petition and an inquiry as regards the acquisition of land and so forth. Those concerned opted to have their money back on 1st January 1975. That was in accordance with a provision in the Bill which the noble Lord introduced.

Lord Peyton of Yeovil

I am obliged to the noble Lord but I must tell him that what he has said does not entirely rule from my mind the belief that he was at least largely responsible for ditching the previous project. That is something which I have always regretted, even though it has never done anything to undermine my respect and regard for the noble Lord.

On this occasion I simply want to express some bewilderment as to what the noble Lord expects to achieve by Amendment No. 13, unless he has some more subtle reason than is clear to me. Clause 2 states that: no Minister of the Crown or Government department shall provide funds … or guarantees. The noble Lord seeks to add the words: nor shall the Concessionaires have recourse to any such Government funds or guarantees". That seems to me to be putting exactly the same point the other way round. I have always been very much opposed to adding unnecessary words to the Bill. In this case, the noble Lord, Lord Mulley, seems to be doing precisely that. While he is not displaying the same hostility on this occasion as he displayed on the previous occasion, I do not think he ought to add further words to a Bill which is already very clear.

Lord Brabazon of Tara

I am grateful to my noble friend Lord Peyton of Yeovil for the interesting discussions about what happened to the old 1974–75 project, and why it was cancelled. I can only reaffirm once more that this Government's determination, and indeed absolute commitment, is that there should be no public funding of the present project.

Clause 2(1) of the Bill already prevents the British Government providing government funds on guarantees to the concessionaires. It is proper to place the responsibility on government. Were any future government to offer assistance which might infringe the provisions of Clause 2(1) they should take responsibility for their own actions. The effect of this amendment could well be to open the concessionaires to a series of writs which, even if vexatious and quickly dismissed, could completely disrupt their operations. I am sure that the noble Lord, Lord Mulley, did not have that in mind when he moved the amendment.

We recognise that placing a duty on the British Government does not provide a remedy against breaches of the treaty by the French Government. However, a third party with an interest wishing to pursue an alleged infringement could do so in the French courts—that is the right place. Clause 2 already satisfactorily prevents government funds being paid to the concessionaires. This amendment does not assist matters and therefore I cannot recommend it.

Turning to Amendment No. 14 (the amendment to line 23), this amendment sets out to achieve even-handedness between the Channel Tunnel on the one hand and the ports and ferries on the other. I fully share and accept that objective. But I believe it is already met by Clause 2. Moreover, this amendment simply would not work.

It would be quite unreasonable to expect any court to judge as would be required by the amendment—whether the aggregate effect of funds or guarantees provided to the concessionaires was such as materially to affect a firm's competitive position. You can imagine that this is not something which is readily susceptible to objective judgment. It would create infinite scope for endless litigation. The balance provided by Clause 2(2) at present (permitting the concessionaires access to funds available equally to others) is in the Government's view the right one.

I entirely endorse what the noble Lord, Lord Mulley, said. I hope that some of the orders for the Channel Tunnel do go to areas which have assisted status of some sort or another and therefore will indirectly be receiving some modest amount of government aid. But then, if one of the ferry companies ordered a new ferry in this country at the moment, there is a very good chance that that too would go to an area with assisted status.

I think that the Government have Clause 2 right at the moment and therefore I cannot recommend your Lordships to accept these amendments.

Lord Mulley

I should like to say a further word on the point raised by the noble Lord, Lord Peyton. Like him, I do not wish to go into a lengthy discussion on past events, but he will recall that, on Second Reading of the Bill, he moved and I spoke and supported it. Secondly, I moved the reintroduction of the Bill after the change of government in 1974. Many of us are concerned about the principle which we are now talking about—the possibility of undertaking a whole project without any government funding, direct or indirect. The problem at that time was due to the estimates that finally emerged from British railways as to the actual cost involved if they were to be in a position to run the through trains for freight and passengers that we all hope to see. The problem arose because of the difficulties in getting the lines modernised—electrification and so forth, and also the problem of bypassing the commuter traffic in the London area, which is another matter to which we shall have to turn our attention.

I do not think it is unreasonable to say that should there be a responsibility on the Government not only not to make funds available, but also to make sure that the responsibilities are reciprocal, that people should not seek such funds. As we all know, many Ministers quite clearly cannot be concerned with all the details within their administration. It was to make that matter quite clear that I put down these words. I am glad to have the assurances but I repeat that they are valid only while the people who give the assurances are answerable. We are concerned now with the preparing an Act of Parliament which may last for a very long time, and one hopes that it will.

In view of what has been said I will gladly withdraw the amendment if it is thought by the Minister to be unnecessary. Therefore I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 14 not moved.]

5.45 p.m.

Lord Mulley moved Amendment No. 15:

Page 3, line 39, leave out subsection (6) and insert— ("(6) The court shall not make an award of damages—

1. (a) if the person bringing the action fails to prove that he has suffered any loss in consequence of something done in contravention of subsection (1) above; or
2. (b) if the Minister or government department concerned proves that, at the time when the thing was done, he or they did not know and could not reasonably have been expected to know—
1. (i) that it was in contravention of that subsection; and
2. (ii) that it would cause loss of the description suffered either to the persons bringing the action or to persons of a class to which he belongs.").

The noble Lord said: This is a technical point which I hesitate to raise because I know that the patience of the noble Lord, Lord Peyton, is not very extensive and I do not wish to tempt him too much.

I tabled the amendment to find out why in these circumstances it is thought proper to throw the onus of proof entirely on anyone who claims to have been damaged by a breach of Clause 2, instead of pursuing the normal procedure of being able to take action for breach of statutory duty. As the Bill is now drafted it is necessary that they should fall back on what I am told is a very rare legal animal; namely, a tort of misfeasance of public duty.

This is a very difficult matter and happily does not arise very often in this country. It would mean that it would have to be proved that the Minister, or person concerned, was acting maliciously and knowingly to damage the person, and not that damage had been suffered because of the breach of the statutory duty, in not making funds available, for example, to British Rail or Eurotunnel.

Therefore, all I am seeking to do in moving Amendment No. 15 is to put the matter as one would normally have expected it to be, that damages should be awarded by the court in the usual way for breach of statutory duty, which happily is also a rather rare occurrence. The person seeking such a remedy would not then have to prove the very difficult question of malicious intent as well as the actual breach of the statute. I beg to move.

Lord Peyton of Yeovil

I rise to my feet only in order to express briefly my gratification that a reputation for impatience which I have done absolutely nothing to earn should have restrained the noble Lord, Lord Mulley, from speaking at great length on an amendment which I must say I cannot see the need for.

I will not repeat the comment which I made concerning his previous amendment. However, I cannot believe that this amendment will add to the effectiveness, roundness or completeness of the Bill. I hope that my noble friend will advise the House to reject it.

Lord Brabazon of Tara

I hope that I shall be able to persuade the noble Lord, Lord Mulley, that the amendment is unnecessary by giving him the fairly technical explanation as to why that is so.

Clause 2 as drafted provides adequate protection and redress for those who might suffer loss if concessionaires receive government assistance. The Government have no intention of providing such assistance, and have accepted liability for deliberate contravention of this policy. It is not reasonable, however, that an inadvertent breach should give rise to liability. The purpose of Clause 2(6) is to guard against this.

Section 2(2) of the Crown Proceedings Act 1947 established that the Crown is liable only for breach of statutory duty when this duty is also imposed on others. As Clause 2(1) lays a duty on the Crown only, a breach would not involve a liability under this Act. Generally, the Government would not consider it appropriate to go beyond the Crown Proceedings Act. But in this case they have agreed to a special concession.

The requirement in the proposed amendment that the Government must prove they did not know, and could not have been expected to know, both that their action was in breach of Clause 2(1) and that it would cause loss is excessively strong. It would open the way to michievous litigation. The existing subsection (6) seeks to follow the tort of misfeasance in public office. This provides a sound basis for government liability. To go beyond it would significantly extend the normal boundary of such liability. I hope the noble Lord, Lord Mulley, will be satisfied with that explanation.

Lord Mulley

Far from being satisfied, it explains why the Government were not anxious to have my first amendment. That would have laid more responsibility on the Government because it would have made the concessionaires responsible and the Government would not now have to rely or those who wish to take action would not have to rely on the tort of misfeasance of public duty which is a very difficult legal matter to pursue. There have been very few cases, I am happy to say. There was a case last year and if the Minister wants me to give details I shall do so. One sees now why Amendment No. 13 was not wanted. The Government now say that is the reason why they do not want Amendment No. 15.

I accept the genuineness of the Government's desire not to have public money involved. One needs to take a longer view so I hope that between now and the further stages of the Bill the Minister will ask his legal advisers to see whether they really need all these legal innovations in the Bill. We shall see as we go along that they have done this for reasons which do not appear to be necessary or obvious. As I say, it is a very technical matter and I certainly do not seek to divide the Committee. In hoping that it may be further considered by the Government, I ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Mulley moved Amendment No. 16:

Page 3, line 46, at end insert— ("(6A) In this section "enactment" means any enactment contained in this Act or in any Act passed on or after the date on which this Act is passed, but does not include any subordinate legislation (within the meaning of section 21(1) of the Interpretation Act 1978).").

The noble Lord said: This amendment is put down because I do not understand why in this Bill it is sought to define "enactment"—as it does in Clause 48(1) on page 33, line 32—differently from what is normally the recognised legal definition of enactment; namely, an Act or part of an Act.

Clause 48(1) makes it possible for an enactment to include not only statutory instruments that need parliamentary approval but also any form of statutory instrument. Therefore, it would be possible—we are taking the long view as to what the future may bring forward—at a later stage for discriminatory legislation which has not been before Parliament to be made in favour either of the railways or the Eurotunnel, or other people involved. Therefore, why do we need to have this special definition in the Bill and reference to an enactment which is quite different from the normal usage of the word "enactment"? I beg to move.

Lord Brabazon of Tara

As to the narrowing of the definition of enactment in line 46, this would be unduly restrictive on the concessionaires. I can say firmly that it is inconceivable that a power to provide funds to the concessionaires would be granted by means of subordinate legislation. I certainly cannot accept that the effect of Clause 2(2), which I have already said I consider to be properly balanced, should be restricted to future legislation.

The Committee will surely not expect us to prevent Eurotunnel, for example, using suppliers who are in receipt of regional aid under existing legislation—a point which has already been covered. I am not sure that what I have just said fully covers the points which the noble Lord, Lord Mulley, raised. I will certainly read them again and see if there is anything that should be added. In the meantime, I hope the Committee will find the amendment unnecessary.

Lord Mulley

I am puzzled as to why enactment has to be differently defined in this Act than normally. Frankly, one has to be suspicious about giving wide, delegated powers of subordinate legislation that do not have to be referred in any way to Parliament. I accept that present Ministers would not dream of being party to a breach of the legislation, but one does not know what may happen in the future. We are now looking at the Bill which we hope will become an Act and which will govern the operation of the tunnel. With the understanding that the Minister will look at the matter again, I ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Walston moved Amendment No. 17: After Clause 2, insert the following new clause:

("Protection of frontier controls at United Kingdom ports.

.—(1)The Secretary of State shall ensure—

1. (a) that any United Kingdom frontier controls required in connection with the tunnel system are supplied by the provision of additional resources; and
2. (b) that, accordingly, the standard of frontier controls existing at the passing of this Act at United Kingdom ports (wherever situated) is not adversely affected as a result of the opening or proposed opening of the tunnel system.

(2) At no time shall the standard of frontier controls provided in connection with the tunnel system be materially better than the standard provided at United Kingdom ports.").

The noble Lord said: May I say at the outset that I am a wholehearted supporter of the tunnel project. I wish it well and I hope that it will not only come to fruition but that it will be successful for all those involved with it and all those who use it.

Its success may not come at the expense of the convenience to the travellers whether by the tunnel or by other means. It must not come at the expense of its competitors, particularly the ferry operators, and above all it must not come by reducing the adequacy of frontier controls, specifically with regard to the smuggling of drugs, weapons and such items.

We know, because we have read about it and some of the Committee may have experienced it, that already Customs officers are strained to near breaking point. That has been shown by their actions, which are very unusual and unwillingly taken actions. The tunnel will undoubtedly mean that there will be more cross-Channel traffic of all kinds. There will be more passengers and more goods crossing the Channel by whatever means they choose. That inevitably must mean that more Customs officers will be needed.

The Select Committee, in its very searching discussion of many of these points, was well aware of this matter and examined those who understand this issue well and drew attention to it in the evidence which is printed for the Committee to read. I am sure many noble Lords will already have done so. The Government have replied to some extent in an attempt to alleviate these fears. The assurance that the Government have given reads as follows: It will do everything possible to ensure that, when the tunnel opens, the level of service at the ports and tunnel alike is the best practicable within the resources available to it and specifically that, in judging the resources to be allocated to each mode, it will do everything possible to avoid bias in favour of one competitor or the other". Those are fine and good words.

I hope that when the Minister replies he will not repeat them. That is why I have read them out. We know that the Government are full of good intentions but I suggest that this expression of good intentions if far from adequate. What is needed is far more explicit assurances than simply the expression of good will. It is even conceivable—I think the noble Lord, Lord Brabazon of Tara, will agree with me here—that by the time the tunnel actually becomes operative and the first train passes through it there may have been a change of Government. Therefore, even if the present Government are full of goodwill it is possible that the successor Government may not have the same desire or ability.

It is clear that if more Customs officers are not provided, not only for the actual operations but during the training period, there will be very severe difficulties. I should like to emphasise this point of the training period because the types of jobs which Customs officers will have to do on the trains under the tunnel are very different from those that the normal Customs officer has to do at the port of embarkation or disembarkation. A training period will undoubtedly be needed. There is a real danger that Customs officers will be withdrawn from their present duties at ports in order to be trained. That will inevitably lead to a worse service for ferry passengers, and will put freight operators and passengers at a disadvantage when it comes to them choosing their mode of travel.

There is a danger that the ferry operators will be at a disadvantage, because there will be longer delays for them than for tunnel traffic. That will mean that a hidden subsidy will be provided—not by Government action but by Government inaction—to the tunnel, which I am sure the tunnel operators and the Committee do not want. If that does not happen, there will be longer delays for all passengers. There will be an equality of misery, but it will be misery that can be avoided. More seriously, there will be less effective Customs controls. The only beneficiaries of that will be those who wish to import illegally into this country drugs, weapons, explosives and the other things which Customs officers are already having a difficult time combating.

I hope that the Government will agree that the amendment will minimise or remove the risk of any of that happening. It will mean somewhat more expenditure—a minor item when we look at the disadvantages of not having the expenditure. It will be essential if the tunnel is to operate smoothly and passengers using the tunnel or ferries are not to be unduly inconvenienced.

6 p.m.

Lord Holderness

It is true, as the noble Lord, Lord Walston, says, that the subject of frontier controls occupied a great deal of the Select Committee's attention. The committee's emphasis was on the need for even-handedness between the tunnel and the ports. In our report we included the sentence: The Government have said that the frontier control department will ensure that when the tunnel opens the level of service at the ports and the tunnel alike will be the best practicable within the resources available to them". We added: In the Committee's view this assurance is worth little". In the Government's reply there is the sentence: The staffing of the frontier controls for the ports and the tunnel will be kept under close review". I do not know whether the amendment is the right way to achieve what I should like to achieve, but I must warn my noble friend that if I am to oppose the amendment I should like an assurance which is a little more robust than the one which the Government have so far provided.

Lord Harris of Greenwich

I should like to join in what was said by the noble Lord, Lord Holderness, to whom I think I may refer as my noble friend during this debate because we spent so many agreeable weeks together on the Select Committee. We found ourselves in general agreement. I very much agree with what he has just said. I do not regard the Government's response on this matter as satisfactory. The words "close review" are, as the Minister will be aware, wholly devoid of meaning.

The Government must recognise the degree of concern felt about this matter in Dover. Like my noble friend Lord Walston, I am a firm supporter of the Channel Tunnel project. Nevertheless, it is right seriously to consider the anxieties of the port operators at Dover. First, they say that they do not have enough Customs officers now and that there are substantial delays particularly at Easter and sometimes during the summer. Secondly, they are worried that some of those Customs officers will be withdrawn for retraining when the operating date of the tunnel comes nearer, and that therefore the delays now being experienced will worsen. That is a point of substance. I hope that the Minister will say something to reassure us.

I shall come to one of the more bizarre moments during the committee's proceedings. I should like to refer the Minister to the exchange which took place on 6th April. I do not know whether he has the Official Report of our proceedings with him. We were then receiving evidence from Mr. Sloggett, the managing director of the Dover Harbour Board. I think we all took the view that he was a pursuasive witness. He had our close attention when he was giving evidence. He was talking about the current delays at Dover. The harbour board was trying to find out how many Customs officers were being deployed so that representations could be made to the Commissioners of Customs and Excise. He was questioned on that point by the noble Lord, Lord Shepherd, who asked: But have you any data which you could put before this Committee"? Mr. Sloggett answered: We certainly have data about the delays that are experienced. We have no data about the Customs resources that are available. It has been suggested to me that to collect such data would be against the Official Secrets Act. Is that the Government's serious position? I have rarely heard a more extraordinary statement. When I asked a few questions on this matter, Mr. Sloggett said: I did seek this year to try to collect those statistics, but was warned off, I am afraid.". We then had evidence from Mr. Bolt, an Assistant Secretary from the Customs and Excise. He was asked about this rather strange matter. I apologise for quoting myself. It is a bad practice, but it is the ony way in which the committee can enjoy this series of exchanges: We heard one rather strange suggestion made to us. You will have seen this in the official report. When the Port Authorities wanted to find out how many Customs Officers were on duty there was a suggestion if they were to do it that they would be in breach of Section 2 of the Official Secrets Act. Do you know anything about that? A. No. You were astonished? A. I think it is a matter to refer to the Treasury Ministers. They need to respond to questions of particular deployment programmes and give figures. I suppose there is some judgment which may be made about the overall allocation of figures. You are not, with the greatest respect, answering my question. My question was, when you read this in the report on the proceedings, and you heard a suggestion made by a responsible representative of the Port Authority that, when they tried to find out something more about the number of Customs Officers at work, the suggestion was made that were they to do this they could have been in breach of the Official Secrets Act. Do you know anything about that, point one? Were you—point two—astonished when you read it? A. I think perhaps I would have been initially surprised. I am not one of the greatest admirers of Section 2 of the Official Secrets Act, but even during some of our debates on that issue I rarely heard an example of such foolishness directed against perfectly honourable, reasonable people, working for the Dover Harbour Board, who were merely trying to find out how many Customs officers were on duty so that they could make representations to the Commissioners of Customs and Excise. There is serious concern by the harbour board and others on this question. They are fearful that the delays now being experienced at Dover will worsen, and I think they deserve to be satisfied on this point. I hope that the Minister will be able to reassure us, first, on that question, and, secondly, that there will be no more of this nonsense of trying to prevent them getting information to which I believe they are totally entitled.

Lord Peyton of Yeovil

While I understand the purpose that the noble Lord, Lord Walston, has in mind in moving the amendment, I have the greatest misgivings about including the second paragraph, which is extremely negative and could well add to the general depression of standards all round, whereas I should hope that the standard of facilities afforded for the tunnel will prove so good as to be a measure to be aimed at elsewhere. I should not like to see any limitation put upon the facilities offered for the tunnel leading to a standard that is admittedly unsatisfactory elsewhere. The request made by the Select Committee for the facilities best practicable within the resources available in preferable. I hope that my noble friend will not accept the second paragraph of the amendment.

Lord Teviot

I intervene briefly as I have tabled Amendment No. 22 dealing with immigration controls on trains. I believe in absolutely fair competition all round. There is great concern in Dover. The noble Lord, Lord Walston, my noble friend Lord Holderness and the noble Lord, Lord Harris of Greenwich, sat in the committee for hours, and we know of their experience. The wording of the amendment referred to by the noble Lord, Lord Peyton, is at present irrelevant I think, but I believe that we should listen to what my noble friend says.

If the amendment is pressed, like my noble friend Lord Holderness I could find myself in the other Lobby. Let us hope that it will not come to that. It is a vital question not only for this reason but for others that I shall develop when I move Amendment No. 22. There are delays at present, and one does not wish to see delays.

6.15 p.m.

Lord Brabazon of Tara

The objective of the new clause is entirely reasonable. Noble Lords in Committee have expressed that. It seeks to ensure that the tunnel does not benefit competitively in relation to the ferries by having better customs and immigration facilities allocated to it than in fairness it should. However, I cannot support the amendment, partly because on closer inspection it appears to go further than is intended and partly because the Government feel that these are not matters that should be dealt with by legislative provision.

First, the Committee will note that subsection (1) (a) does not merely require fair and equal treatment between the ferries and the tunnel. By requiring all facilities for the tunnel to be supplied from additional resources, it means that the ports can continue with the same level of resources as before the tunnel opens, even though they will almost certainly carry less traffic. How much less is not of course something that the Government or I can comment on, since the Government must not seek to influence investors by giving implicit traffic forecasts. Similarly, subsection (1) (b) indicates that the standard of controls at ports should be no less when the tunnel opens in 1993 than it is today, and this implies the maintenance of a standard which, however laudable it is in its own right, is quite distinct from the question of fair and equal treatment. Subsection (2) means that, however hard the Government were to try to achieve fair and equal treatment between the tunnel and the ports, if events conspired to cause the standard to fall at the ports due to temporary difficulties, there would be a breach. Finally, the Committee will note that the amendment is one-sided. It seeks to prevent discrimination against the ports but not against the tunnel. These may seem to be minor faults, but I believe they serve to underline the fact that the objectives of this clause are not suitable to be achieved, nor could they effectively be enforced, by legislative provision.

As I have said, the general objective of fair and equal treatment is entirely reasonable, and repeatedly in earlier stages of the Bill the Government have attempted to reassure petitioners. The question was dealt with most fully in the Select Committee in another place, and by the time petitioners came before the Select Committee in this Chamber the area of disagreement had considerably narrowed. It may help, however, if I repeat for the benefit of the Committee the commitments the Government gave, which are reproduced in appendix 32 to the special report of the Select Committee in another place.

First, the general principle of equal allocation of resources: The Government entirely shares the objective of the British Ports Association that there should be fair competition between the fixed link and the port and ferry operators. Non-discrimination, meaning consistency and a lack of bias in the provision of facilities and the allocation of resources, is the basis of the Government's policy. In particular, it is not the Government's policy that, just because the total travel time through the tunnel will be less than by the ferries, frontier controls should be expedited relative to the ferries on that account". In relation to equal strictness of controls: Specifically the Government assures the Association that, regardless of how the frontier controls are arranged physically, the checks to which users of the tunnel will be subject will be as stringent, and subject to the same legal code, as the checks to which they would be subject were they to use other modes". The problem is an intractable one, because it is one of forecasting travelling and freight consignment patterns once the tunnel opens. Without a massive increase in staff there must be a risk to both ferries and tunnel alike. If too many frontier officials are transferred to service the tunnel, the ports will be under-resourced and at a competitive disadvantage. If too few are transferred, or none at all, Eurotunnel will be disadvantaged.

However, I can assure the association that the frontier control departments will do everything possible to ensure that, when the tunnel opens, the level of service at the ports and tunnel alike is the best practicable within the resources available to them, and specifically that in judging the resources to be allocated to each mode they will do everything possible to avoid bias in favour of one competitor or the other.

It is difficult to see why deliberate undertakings about evenhandedness are inadequate when they can be quoted at any government who breach them in the future in this place or in another place. It is difficult to see how a statutory obligation would bite more effectively. The frontier authorities take great care to try to allocate their resources fairly. It is disappointing that they are being impugned for this.

The noble Lord, Lord Harris of Greenwich, quoting from the minutes of the select Committee, questioned why the number of frontier officials at a certain port is a secret. Deployment levels of frontier control officials are a sensitive matter because detailed information on this could assist in evading controls. I have to say that it may well be that local officials were a little more reserved on that occasion than they should have been.

The Government have made many statements, and I repeat them this evening. They are very clearly on the record. We are willing, and expect, to be held to them by the ports and ferries companies. I invite the Committee to accept that this is the right way to deal with this serious issue—and we take it very seriously.

For the reasons that I have given for not accepting the amendment, I hope that the noble Lord, Lord Walston, and other noble Lords will be reassured of our absolute commitment to fair treatment, and that the noble Lord will be able to withdraw the amendment.

Lord Harris of Greenwich

Before my noble friend responds, I welcome what the noble Lord has just said about local misunderstandings. I recognise that they can occur. However, we are concerned about the future. Perhaps I may once again refer to the Government's response to the recommendations of your Lordships' Select Committee. Referring specifically to the Dover point, one sees in paragraph 88 of the report that in the view of the committee, The Government should keep the provision of frontier controls for both systems of travel under close examination". That is a point with which we have already dealt. There follows the relevant point— and should in the meantime, give more information to the Dover Harbour Board about the scale of the resources now being deployed". That was our recommendation. What was the Government's response? It was that the present close liaison with Dover Harbour Board, as with all other port authorities, will be maintained. That is wholly unsatisfactory. Concern was expressed vigorously to the committee by the witness whom we all recognised as a man of moderation and common sense. Bland language of the kind used in the Government's response convinces nobody.

The noble Lord made the point that there is some sensitivity about information as to how many customs officers there are at work. His case is not exactly strengthened by Mr. Bolt, the assistant secretary from Customs and Excise who made light of this point when it was put to him. He said that the port operators could almost count them. At one level, that is obviously true. However, when they tried to count them, they were told that they might be in breach of Section 2 of the Official Secrets Act.

Our request is very moderate. It is that the Government and Customs and Excise should have a sensible dialogue with the Dover Harbour Board and put minds at rest. I hope that the Minister will respond more positively than he has done so far.

Lord Mulley

I have listened to the exchanges and in particular to the interventions of the noble Lords, Lord Holderness and Lord Harris of Greenwich, who spent much time in committee on this matter. I am frankly surprised that the Minister, who is invariably so courteous to the House should blandly repeat an assurance based on the Select Committee in another place which is, in the opinion of our own Select Committee, worth very little. It is quite extraordinary. We all know that we are amateur draftsmen when we put down amendments. It is the drafting of the amendment that is involved.

The problem is that the Treasury may not authorise the necessary funds to have adequate customs facilities at both the ports and the tunnel. That is the undertaking that we require. I should have thought that if a Division were called, it would be on the understanding that between now and Report stage the Government might be a little more concerned to meet the very relevant points that members of the committee made in their report and which have been repeated today. It seems extraor- dinary that the Minister cannot go further than he feels able to do.

Lord Brabazon of Tara

The argument has been on two issues. One question is whether there are enough customs officers. The main point of the amendment is surely about even-handedness between the ports and the Eurotunnel scheme. I have tried to reassure the Committee that there will be even-handedness in the allocation of customs officers between the two projects. I shall obviously take into account what has also been said about the overall numbers of customs officers. I cannot commit the Government at this stage, or six years' hence, about the total number of customs officers there might be. However, on the even-handed approach between the two schemes, we should make sure that the allocation is obviously fair.

Lord Harris of Greenwich

I do not wish to be tiresome but I have put a specific point to the Minister concerning the Select Committee's recommendation relating to Dover and to the very bland statement in the Government's response. I asked whether he is prepared to go further. I believe it is reasonable that he should do so. We are asking for remarkably little. I recognise that another government department is involved. Will he agree to look at this matter between now and Report stage and perhaps write to one or two members of the Committee? I believe that that is the least for which we should ask.

Lord Brabazon of Tara

Yes, certainly.

Lord Walston

This has been an interesting exchange, ranging a little wider than at one time appeared likely. The Minister, as always, is extremely courteous and persuasive. However, I am afraid that his persuasion has not been sufficient to convince me that the Government are, or will be, prepared to do what is necessary in the future. If the noble Lord, Lord Peyton, was not entirely persuasive, I found great strength in his criticism of the second paragraph of this amendment, which as worded is extremely difficult to enforce. I shall therefore withdraw this amendment on the understanding that I am free to come back at Report stage with an amended version—subject to some conversations that we may have before then—to implement the feelings of the majority of Members of the Committee who are present and members of the Select Committee. I hope that the Government can help us to work out a measure to achieve that aim. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Northbourne moved Amendment No. 18: After Clause 2 insert the following new clause:

("Control of predatory pricing.

—(1) It shall be the duty of the Concessionaires, and of other providers of transport and terminal facilities for cross-Channel traffic, not to pursue any course of conduct which amounts to an anti-competitive practice.

(2) In subsection (1) above "anti-competitive practice" means:

1. (a) A course of conduct which is an anti-competitive within the meaning of the Competition Act 1980; or
392
2. (b) prolonged pricing at a level which will substantially exclude from a particular market an equally or more efficient competitor.

(3) The duty of the Concessionaires under subsection (1) above shall be deemed to have been satisfied in relation to any course of conduct full details of which shall have been submitted to the Director General of Fair Trading and which shall have been approved by the Director General before such course of conduct is pursued.

(4) Any contravention of the provisions of subsection (1) above shall be actionable at the suit or instance of the Secretary of State or of the Director General of Fair Trading or of any providers of transport or terminal facilities for cross-Channel traffic who have suffered loss or damage as a result of that contravention.").

The noble Lord said: As I said at Second Reading, I am a strong supporter of the Channel project. Furthermore, I am entirely in sympathy with the concept of free and fair competition. The object of free and fair competition must clearly be to achieve a reasonable level of prices and a good standard of service to the public.

The purpose of this amendment is to prevent predatory pricing which is an abuse of genuine price competition. It is a system by which one operator temporarily sells his services below cost in order to force another operator out of business. Expert studies agree that at the opening of the tunnel there will be substantial surplus of capacity for cross-Channel traffic.

The object of this amendment is to prevent one or other of the cross-Channel carriers from dumping its surplus capacity on the market in a do-or-die attempt to put the others out of business. I have spoken to some of those involved in the ferry services and the harbour board who are concerned about the possibility of concessionaires so doing. I have also spoken to those involved in the Channel project itself who are concerned that the ferries might do likewise.

For example, if the fixed-link concessionaires were to pursue this policy and the ferries were to go bankrupt, or the boats were to be moved away—and the Dover Harbour Board under those circumstances has plans to convert its facilities to those of a marina—the tunnel would have a virtual monopoly and could in theory name its own price. Conversely, if the ferries—equipped with larger and more efficient boats which might largely be written off in six years' time—were to adopt a predatory pricing policy the concessionaires might be unable to service their debt. There are various scenarios as to what would then happen. Almost all of them end up with one or other group in a monopoly position. If that were to happen it is certain that the investors in the concession would lose their money. This possibility must be one which may discourage potential investors, if it could be avoided by ensuring that this amendment or something like it ends up on the statute book.

The Select Committee considered a similar but one-sided amendment proposed by the Dover Harbour Board. Paragraph 83 reads: Although the Committee disagree with the contention of the ferry operators and the Dover Harbour Board that the general law on competition as it applies to ferries should be altered in their favour they have questioned whether the competition regime for the tunnel itself is sufficiently consistent with the regimes that apply to other private sector enterprises. This suggests an element of disquiet in the minds of the Select Committee as to the fairness of the competitive régime. I should like to suggest that this amendment, if accepted, would constitute a significant improvement to the competition which would be available to the concessionaires and to the ferries respectively. I beg to move.

6.30 p.m.

Lord Tordoff

I believe it was the intention that we should discuss Amendment No. 149 at this time as well. I dare say that the noble Lord, Lord Underhill, will wish to say something in a moment. I merely support what Lord Northbourne has said. I believe that the possibility of savage predatory pricing is somewhat remote, but it is there. It is a possibility and we ought to take what steps we can within the Bill to block off any such predatory pricing. The noble Lord, Lord Northbourne, is quite right that we also have to remove the fear of predatory pricing from the minds of those who wish to invest in Eurotunnel in the coming months. As we know, there have been difficulties in financing which we hope are now behind them. If the general public are to put money behind this project when it comes to the market, it is important that these sorts of problems are removed from their minds.

The reason I prefer the amendment to which I have added my name to that of the noble Lord, Lord Northbourne, is because I feel it is a rather more evenhanded amendment dealing with predatory pricing either by the tunnel concessionaires or by the ferry owners; indeed these matters could go either way. Between now and the opening of the tunnel there could be predatory pricing by the ferry owners; and afterwards, to jack up their share of the market, there could be predatory pricing by the tunnel concessionaires. Even if the Government do not like the wording of the amendment, I hope they will be prepared to put forward some wording of their own which covers the point.

Lord Carmichael of Kelvingrove

As my name is attached to Amendment No. 149, which is being taken with this, I should like to endorse everything that the noble Lords, Lord Northbourne and Lord Tordoff, have said. The wording of Amendment No. 18 I find is much more explicit and all embracing than my own amendment. I shall be happy not to move my amendment in favour of his amendment.

Lord Brabazon of Tara

The new clause proposed by the noble Lord, Lord Northbourne, will apply to all providers of cross-Channel transport and not just the concessionaires. That is the difference between it and the amendment proposed by the noble Lord, Lord Carmichael.

The ferry companies' contention appears to be that by introducing bigger and faster ships and by making other improvements in efficiency, they will be able to undercut substantially the level of fares that Eurotunnel need to cover its costs, including debt servicing. As a result, it is argued, Eurotunnel will have no alternative but to hold down its own fares for a sufficiently long time to bankrupt the ferries, after which Eurotunnel will he free to raise its fares again to what is, for it, an economical level. Eurotunnel will be able to do this—so the ferry companies claim—because its operating costs, other than debt servicing, will be much lower than those of the ferries, and provided it can cover its operating costs that will always be a better option for Eurotunnel's shareholders and creditors than going into liquidation.

How likely this scenario is to come about is not a matter on which the Government can comment. We made it clear in the White Paper last year that the Government should not seek to influence investors' decisions. The point, however, is that predatory pricing—that is to say, as has been described, deliberate pricing below cost with a view to knocking out a competitor and then raising prices again—is an anti-competitive practice and is subject to the procedures and remedies of the Competition Act 1980 and also Article 86 of the Treaty of Rome. The 1980 Act gives the Director General of Fair Trading power to investigate any course of conduct which appears to restrict, distort or prevent competition in the supply of goods or services in the United Kingdom. It is established that predatory pricing, properly defined, constitutes such a course of conduct. Indeed the Office of Fair Trading investigates such cases. If the director general finds that such a course of conduct is being pursued in a particular case he can stop it by securing undertakings or by referring the case to the Monopolies and Mergers Commission. Alternatively under European Community law the European Commission has powers to investigate complaints and if appropriate to issue interim and final orders and to impose heavy fines. European Community law is also directly enforceable in the United Kingdom and would enable a ferry operator, who considered himself to be the victim of predatory pricing, to seek injunctive relief from a United Kingdom court.

This argument was put by the ferry companies at length before the Select Committee, that by the time any investigation had been completed and the anti-competitive practice brought to an end, they would have suffered irreparable damage. Accordingly, they proposed, much along the lines of the amendment now before the Committee, that Eurotunnel should be placed under a duty not to charge, without the prior consent of the Director General of Fair Trading, fares which an equally efficient competitor could not match. This proposal was not, and is not, acceptable to the Government for the following reasons. First, the Government do not agree that the existing procedures are ineffective. Preliminary investigations can be completed in a matter of months. And the mere fact of launching an investigation is sufficient sometimes to persuade the offender to stop the practice complained of.

Secondly, a process of investigation is inescapable. The amendment achieves no improvement in that respect because it would still be necessary to establish whether the competitor was in fact equally efficient. Although it could be argued that this would be avoided if the concessionaires were to comply beforehand with subsection (2) of the proposed new clause, this too is objectionable to the Government because it is tantamount to prior approval of pricing by the Director General. Thirdly, the attractive-sounding term "equally efficient" is almost impossible to define. But whatever it means, the basic principle that equally efficient competitors should be required to charge the same prices is objectionable, because it takes no account of differences in costs. We do not require an efficient low cost, but slow, sea ferry to charge the same high fares as an efficient fast, but high cost, airline. Different modes with differing attributes and cost structures must be allowed to reflect them in their prices.

Both the amendments would make it a duty not to pursue an anti-competitive practice within the meaning of the Competition Act 1980, and breach of that duty would render the offender liable to pay damages. The effect of imposing unconditional prohibitions would be to exclude the necessity for the Monopolies and Mergers Commission to consider whether the anti-competitive practice has been pursued and whether it operates or might be expected to operate against the public interest. This essential element of the investigative process would be eliminated by these proposed amendments and this would be a radical and unacceptable change in the whole bais of our competition law.

As regards the right of the competitor to receive damages—I am not sure whether it was mentioned—the Competition Act does not provide such a right unless the investigation culminated in the Secretary of State making a formal order and that order has been breached. If the culmination of an investigation is merely the securing of undertakings from the offending firm, breach of those undertakings does not give rise to a liability to pay damages. The position where a complaint has been made under European Community legislation is somewhat uncertain and it has not yet been fully tested in the courts.

I appreciate the concern that the injured party should be able to secure compensation, but, as I have indicated in my brief remarks, the law in this area is highly complex and any change should be made only as part of a general review of competition law and after very careful consideration of all the implications. I believe it would be quite wrong to introduce a radically new principle of competition law into a Bill concerned with one particular project, without regard to its implications for the whole structure of competition law across the board. The noble Lord's concern should not be pursued in the context of this Bill.

The Government believe fully that national and Community laws provide appropriate procedures for dealing with predatory pricing. The Select Committee agreed with that. Accordingly, I hope that the noble Lord, Lord Northbourne, and others, will be prepared to withdraw the amendment.

Lord Underhill

Perhaps I may intervene before the noble Lord, Lord Northbourne, indicates what he proposes to do. In the Transport Bill the Government insisted that local public transport companies should not engage in anything which could be termed to be against competition. During the debates on the Airports Bill there was considerable discussion about predatory pricing in connection with Stansted. Why should the Government now take a different view on this point? If the Government do not like the wording of the amendment, they ought to say that they agree with the principle and will bring forward an amendment of their own. Surely everyone agrees that there should not be predatory pricing. The amendment does not say that there should be equal pricing. I cannot see the word "equal", to which the Minister referred in his speech. As my noble friend Lord Carmichael said, we prefer the amendment of the noble Lord, Lord Northbourne, to ours because it is equal-handed. It deals not only with the concessionaires but with the ferries as well.

Lord Brabazon of Tara

I did not say that I did not agree with the principle of the amendment, that we should seek to avoid predatory pricing. What I said was that I believed that we already have the mechanism to do this in both national and Community law.

Lord Northbourne

With great respect to the Minister, I do not feel that he has addressed himself to the problem of timing, about which the harbour board and the ferries have been extremely anxious. It is a fact that a matter of months, if not a year or so, could be quite long enough to cause great financial distress and possible bankruptcy. I cannot see why it is not possible to accept the principle of subsection (3), which suggests that any pricing policy could obtain the whitewashing, the approval, of the Director General of Fair Trading before it was put into action so as to avoid the necessity of legal action at a later date.

Lord Brabazon of Tara

I said that these things can happen quite quickly. Action can be taken quite quickly. I also said that often the very fact of launching an investigation is sufficient to persuade the offender to stop the practice being complained of.

Lord Northbourne

I am not entirely convinced by this assurance. I shall make further inquiries and I reserve the right to bring this back at Report stage. With that in mind, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

The Deputy Chairman of Committees (Lord Murton of Lindisfarne)

Strictly speaking, the Question, That Clause 2 shall stand part of the Bill, should have been put after Amendment No. 16. However, I understand that, largely through a printer's error on the top of page 4, it was not so put. In the circumstances I shall put the Question now, That Clause 2 shall stand part of the Bill.

Clause 2 agreed to.

Clause 3 agreed to.

6.45 p.m.

Lord Ennals moved Amendment No. 19: After Clause 3, insert the following new clause:

("Compensation to Dover Harbour Board

.—(1) If at any time the Concessionaires shall enter into liquidation or commit any act of bankruptcy or agree any composition, accommodation or moratorium with any one or more of their creditors or have a receiver appointed of any of their assets or revenues, the Secretary of State shall pay to the Harbour Board compensation determined as provided in subsection (2) below.

(2) The compensation payable under subsection (1) above shall be such sum as shall be agreed by the Secretary of State and the Harbour Board or in default of agreement determined by arbitration as being reasonable compensation.

(3) The matters to be considered in arriving at that sum shall include—

1. (a) the total sums expended by the Harbour Board in redundancy and other payments to employees and former employees in meeting or attempting to meet competition from the Concessionaires during any period when the Concessionaires were not able to meet their financial commitments without additional or extended credit; and
2. (b) the written down value at the default date of all capital expenditure incurred by the Harbour Board in the provision of terminal and other facilities which are in direct competition with those of the Concessionaires for cross-Channel traffic (less the proceeds of any disposals of the assets in question).

(3) In this section— the default date" means the first date upon which there occurs any of the events mentioned in subsection (1) above in relation to the Concessionaires; the Harbour Board "means Dover Harbour Board; the written down value of all capital expenditure" means the original capital cost as shown in the accounts prepared and published by the Harbour Board in accordance with the Statutory Harbour Undertakings (Accounts etc.) Regulations 1983, less the cumulative total of depreciation of that capital expenditure as shall have been shown in the last of those accounts to have been so prepared and published before the default date.").

The noble Lord said: I believe it is the Committee's wish to take Amendments Nos. 148 and 151 at the same time. I move Amendment No. 19 and want to speak to Amendment No. 148. Amendment No. 151 is not one to which I have given my support so I shall not comment on it, though I have no doubt that the noble Lord, Lord Mulley, will wish to do so.

It is common ground that the Channel Tunnel will introduce into the cross-Channel transport industry massive additional capacity. The Government have announced that they consider that this capacity will be cheaper, faster and more efficient than the existing facilities. Eurotunnel makes similar claims and says: In short, this project is capable of taking a greater flow of traffic more quickly, securely, dependably and cheaply than any other". Those words come from the CTG memorandum to the House of Commons Select Committee on Transport of 15th November 1985. If that view is correct then in due course the more expensive, slower and less efficient ferries will dissappear.

I find it curious that, despite their belief that in every important economic respect the tunnel will be superior to the ferries, the Government are also of the view that the tunnel and the ferries can and will co-exist. While admitting that there will be an impact—that is a modest little word—on the size and capacity of the remaining ferry fleet, the Government stated in the White Paper: It is not likely to be such as to create insoluble problems for the ferry industry. It is expected that the total ferry capacity, once the link is open, will be slightly less than it is today and will increase again in later years". There is no published evidence to support this remarkable view. I move this amendment because I have a great interest in Dover. I was Member of Parliament for Dover from 1964 until 1970 and I had a good deal of contact with Dover during the election. The evidence that there will be hardly any impact on Dover as a port is not accepted. In fact at the time of the election all three candidates boldly proclaimed their total opposition to the tunnel, despite whatever their parties' views were. I reckon that you could not stand as a candidate in Dover without making such a declaration. I was glad that I was not a candidate.

There is at least a chance that the tunnel will not prove to be superior to the ferries, or, if in some aspects superior, not profitable at market prices. We discussed those issues in the previous amendment. In those circumstances the Promoters of the Bill will have made an ill-judged decision in seeking to establish a fixed link. What then would be the position of the Dover Harbour Board, which, having carried the traffic during the construction period of the tunnel and invested accordingly, finds that the services have beaten the Channel Tunnel in fair competition? Fair competition implies freedom of entry and exit to industry but the key element here is that the tunnel, once built, cannot leave the market as there is no alternative use for the capital. It is quite different therefore from the ferries. In these circumstances an injudicious oversupply of capacity will have been promoted by the Government.

In the port industry the Government have provided funds for some time to buy out existing labour capacity resulting from the workings of the national dock labour scheme; and, more widely, in coal, steel and agriculture of the United Kingdom and Europe, which recognised that excess capacity exists, the Government have actively involved themselves in bringing demand and supply back into equilibrium by buying out some of the excess capacity or subsidising the continued over-capacity. I ask the Minister whether it is unreasonable to ask the Government to do the same for the Port of Dover if it finds itself in a similar position as a result of the Government's bad judgment? That is, if it is proved that it is bad judgment, and I draw no conclusions on that.

I want to say a few words about the impact on Dover itself. The harbour board admittedly employs only about 1,000 people, but if you take ferry operators, shore staff, Dover-based United Kingdom crew, freight agents, etc., there are about 10,000 people involved. By 1993 this could rise, in the view of the Dover Harbour Board, to 12,000. Directly and indirectly the cross-Channel industry accounts for an estimated 43 per cent. of local business. That was the figure estimated in the late 1960s when I was Member of Parliament, and it seems to be the same today.

If Eurotunnel succeed in meeting their minimum targets, they will need to take at least 60 per cent. of Dover's traffic, and of course that means revenue. This will lead to an equivalent reduction in costs and, inevitably, manpower. Thus as a first and immediate consequence of the tunnel some 6,000 or more jobs will be lost. The longer-term future depends on the relative success or not of the ferries and the tunnel.

There arises therefore—and this is the purpose of the new clause—the question of compensation. The new clause deals with the need of the ferry, hovercraft and harbour operators to receive compensation in circumstances where they properly require to write down, or write off, the value of assets in their accounts as a result of the proposed opening of the tunnel system. They would be required to establish that need to the reasonable satisfaction of the Secretary of State. Having established that need it would be the Secretary of State's duty to compensate them.

The House of Lords Select Committee disposed of the ferries' and ports' petition in the same way as it dealt with other various aspects of compensation. It said that it did not consider the Bill's scheme to be unfair, and accordingly did not think that the compensation provisions asked for were warranted.

There are, however, two facets to the proposed amendment. The Government considered the first one, which is that the Government's intervention in the promotion of the Hybrid Bill justifies the payment of compensation, although of course the committee disagreed with that. They did not, however, address the second, which is that if no provision is made then there is no incentive for the ferries to provide sufficient capacity to cater for demand up to the time the tunnel opens.

The Committee may be aware that Townsend Thoresen are currently introducing two jumbo ferries on the Dover-Calais route. While these ferries are intended to compete with the tunnel, further investment by any of the ferry operators in this sector must from here on be questionable. They must satisfy themselves regarding the commercial régime which will exist when the tunnel opens—that is, a pricing policy in order to force the ferries out of business. This is the subject of a further amendment for consideration by the Committee.

Secondly, they must have regard to the fact that fleet reductions after the tunnel opens are absolutely inevitable, even on the Government's figures set out in the White Paper. Additional tonnage will merely compound the problem. All the evidence is that the only effective competition to the tunnel will be provided by a limited number of large ferries operating on the Dover-Calais route, and only then in circumstances which forbid the use of the tunnel's otherwise dominant position.

I would submit therefore that the case for compensation, both as set out in Amendment No. 19 and also in the different circumstances as set out in Amendment No. 148, is profoundly important not only to protect the interests that already exist in Dover but also to ensure that there is adequate investment until the time when the tunnel is operating. Moreover, if things go wrong with the tunnel there will be some compensation to ensure that facilities are then made available by the ferry operators from Dover to deal with what will inevitably be, by one means or another, an increasing demand to travel from Britain to Europe. I beg to move.

Lord Mulley

I was not aware that it was the desire of the Committee to take Amendment No. 151 in my name along with the other two amendments of my noble friend Lord Ennals, but I am prepared to do so and discuss the three together. Obviously the detail varies between the Dover Harbour Board problems and the losses that may be incurred by the operators on the one hand, and my amendment which deals with the costs that will be incurred by redundancy payments. As well as there being obsolete equipment, one expects that there will unhappily be a great reduction in the numbers employed both on the ferries themselves and in their supporting services if, as is expected, a substantial amount of the cross-Channel traffic is taken by the tunnel. On the other hand if it does not take a lot of the traffic then it will not be a success.

The Select Committee rather disappointingly did not seem to understand that there is a special problem. They said that they could not see any unique feature as to why there should be special consideration for the ferries and the harbour authorities in these circumstances. My noble friend has made the point that this is quite unique in the sense that it is very much in the national interest as regards exports and tourism—both of which are of great importance to us—that there should be an adequate cross-Channel facility up until the very day that the tunnel becomes operational.

However, clearly if the ferry operators take the advice that the Select Committee proffered; namely, that they should look at these matters like any sensible entrepreneur, and if they see that their market is going to decline, they will not wait until it happens but will begin to cut their resources and begin to lay off, or not replace, jobs, and not replace ferries and so forth. Although the Government say that it is not their business to make traffic forecasts, obviously the ferry operators have had to make traffic forecasts. We are all looking a hit into the crystal ball and we do not know exactly how things will be in six years or more from now, but they do not see such an enormous growth in cross-Channel traffic arising from the building of the tunnel such as to maintain the same level of ferry operation after the tunnel is built as before.

It will be a national disaster if, in order to satisfy their shareholders—just as one understands that Eurotunnel will be concerned to satisfy theirs—they begin already to cut back as the six years go by. It will not be just in the year, or perhaps two or three years, before the tunnel is due to open. Not only adequate provision for our own people who want to go as tourists to the continent but more importantly, as has been stressed throughout, the freight situation will become extremely serious, as indeed will be the possibility of foreign visitors. We all know that invisible exports are extremely important as well as our actual trade in exports.

We cannot expect the ferry operators, or the port operators, to keep full capacity, or indeed to increase their capacity to meet the demand in the next few years, unless somebody is to help them at the end of the time with regard to the redundancy monies that they will quite properly have to pay to their staff, and for some loss arising in respect of obsolete capacity, which they will have kept on in the national interest until such time as the tunnel has taken a substantial part of the business.

A further unique situation is that the ferries in this country are the only ones which are privately owned. Sealink, prior to being sold by British Rail to a private operator, was publicly owned. The French, Belgians and Dutch have government support and are not wholly dependent on the shares of private enterprise. Despite the great belief of the present Government that everything should be privately owned, they will be put in a real dilemma as to what they should do.

While there may be arguments about the particular drafting, or the particular way in which help should be calculated, I hope that the principle will be recognised in a way that it was not, I am sorry to say, by our Select Committee. Although the Government recognise that there might be a problem, so far as I can understand the matter they make no proposals which will encourage the ferry companies to carry out their function, in the national interests, of providing a satisfactory cross-Channel service, as I am sure they desire to do. If British ferries do not operate there certainly will not be sufficient foreign ferries willing to pick up the load.

7 p.m.

Lord Tordoff

I put my name to Amendment No. 19 but not to Amendments Nos. 148 and 151. Although there have been two brave tries by the noble Lords, Lord Ennals and Lord Mulley, Amendments Nos. 148 and 151 seem to me to be special pleading of a very high order. I understand the fact that people in Dover are worried and that they have tried to get some money out of the Government. However, I do not see my way to supporting that issue.

Amendment No. 19 is different. It deals with a situation where the concessionaires may have gone into liquidation or committed an act of bankruptcy. In that situation it is right to suppose that the concessionaires have been performing in such a way as to provide unfair competition, that the situation has got out of hand and that the harbour board and others will have been subjected to competition which is grossly unfair. In those circumstances, it would be right to make some provision for compensation for the harbour board. I do not necessarily go along with every word of Amendment No. 19, but I think that there is a much better case for that amendment than for Amendments Nos. 148 or 151.

Lord Brabazon of Tara

The new clause in Amendment No. 19, proposed by the noble Lord, Lord Ennals, and supported by the noble Lord, Lord Tordoff, requires the Secretary of State to compensate the Dover Harbour Board—though the principle is equally applicable to the ferry operators—for any loss of business resulting from competition from the fixed link if at any time Eurotunnel is obliged, in order to carry on trading, to write off or reschedule any of its debts. This proposal therefore accepts that if Eurotunnel can fully pay its way it will have justified its place in the market, and therefore the existing operators should accept any losses they incur as a result of such competition. On the other hand, it is argued that if events were to demonstrate that Eurotunnel cannot fully pay its way, that will show that it should not have been allowed to proceed with the project in the first place, and therefore the Government should pay compensation for any damage that Eurotunnel's entry to the market has inflicted on the existing operators.

Amendments Nos. 148 and 151 in Schedule 7 go even further. They provide unconditionally that, even if Eurotunnel can fully pay its way, the Government should compensate the existing operators for assets which have become obsolete, and for payments to employees made redundant as a result of the diversion of traffic to the fixed link.

This extraordinary proposition is based mainly on the argument that the introduction of a large quantity of additional capacity into the cross-Channel market is unfair competition per se.

These two proposals are not new. The Government rejected these and other compensation proposals when they were advanced before the Select Committee and also earlier in another place. The Government do not believe existing operators have a right to be protected against legitimate competition, and the role of the Bill is simply to provide the legal framework to enable Eurotunnel to compete. The decisions whether to invest in the fixed link rest entirely with the private sector. If those decisions prove mistaken the Government will not compensate the investors. Nor should the Government be under any obligation to compensate the existing operators. Mistaken investment decisions occur from time to time in every sector of the economy. They are a fact of commercial life and there is no right of compensation against them.

The Select Committees in both Houses have accepted these arguments. As the noble Lord said, the committee of this House concluded in paragraph 78 of its special report that the situation facing the ferry and port operators is neither unique nor unfair. The existing operators have at least six years to adjust their investment plans to take account of the opening of the tunnel in, 1993. The noble Lord, Lord Ennals, referred to the fact that one operator has recently put two new jumbo ferries on to the route. I understand that they are to compete directly with the link. The committee agreed that the operators have difficult choices to make, but it did not consider the Bill's scheme to be unfair or that the compensation provisions asked for were warranted. I hope that the Committee will endorse those conclusions, unless the noble Lord is prepared to withdraw his amendment.

Lord Tordoff

The noble Lord does not appear to have distinguished between Amendment No. 19 and the other two amendments in the way I sought to do. I accept what he says about Amendments Nos. 148 and 151 but he must recognise that the situation is different as regards Amendment No. 19.

Lord Ennals

I should like to elaborate on that point. It was a helpful intervention by the noble Lord, Lord Tordoff. The Minister replied only to Amendment No. 148, as opposed to Amendment No. 19 which is immediately before the Committee. I shall read the words again: If at any time the Concessionaires shall enter into liquidation or commit any act of bankruptcy or agree any composition, accommodation or moratorium with any one or more of their creditors or have a receiver appointed …". Therefore, it is only under circumstances of a total failure of the Channel Tunnel. At no stage did I suggest that 1 thought that that would happen, that I wanted it to happen, or anything at all. However, if there is such total confidence in the profitability of Eurotunnel—and therefore in the minds of those who decide and especially at this moment in the minds of the Government—and if there is no doubt whatever that this project will succeed, I do not understand why they should not feel that a guarantee such as that contained in Amendment No. 19 (I am not arguing at the moment about Amendment No. 148) is not absolutely proper and totally fair to the ferry operators and the Dover Harbour Board.

Lord Tordoff

I should like to reinforce that point. The noble Lord, in referring to Amendments Nos. 148 and 151, rightly said that normal competition must be allowed to exist and therefore ferry operators should be prepared to work in those circumstances. It is a presupposition of Amendment No. 19 that fair competition has not existed and that the Bill is based on a wrong premise. In those circumstances, I suggest that the Government have a responsibility and therefore that compensation should be paid in the case of liquidation or bankruptcy.

Lord Brabazon of Tara

I do not think I can add very much more than I said in my original reply. I can assure noble Lords that when they read what I have said they will see that I did take into account Amendment No. 19. I am fully aware of the difference between this amendment and the latter two amendments. I am not saying one way or the other whether Eurotunnel is going to be a success: I have said that on several occasions this evening. I am not prepared to give investment advice on that issue: nor would it be proper for me to do so. It is a question for the market to decide. I really have nothing further that I can say on this at the moment.

Lord Ennals

I must admit that I was disappointed by the original reply and I am no more reassured by the reply the Minister has just given. I shall not go over the arguments again, but I shall go over his speech. He has just said that he gave certain assurances or said some things that should be read carefully. I shall read them carefully and I shall not press the amendment at this stage—or, for that matter, when we reach Amendment No. I48—but if I am not happy about what I have read in the Minister's reply I want to reserve the right to return to this subject at the Report stage. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Hesketh

Before moving that the House do resume, I would suggest that we should resume the Committee stage of this Bill at 8.15. I beg to move that the House do now resume.

Moved accordingly, and, on Question, Motion agreed to.

House resumed.