HL Deb 11 December 1989 vol 513 cc1127-35

2.58 p.m

Lord Shepherd rose to move, That this House takes note of the report of the European Communities Committee on Transport Infrastructure (21st Report, Session 1988–89, HL Paper 84).

The noble Lord said: My Lords, some weeks ago your Lordships justifiably indulged in self-congratulation at the way in which the scrutiny committees of your Lordships' House deal with European economic matters. There is no doubt that the quality of the reports is attributable to the Members of this House who sit on those committees. Increasingly the work of those committees has become more onerous. There is the flow of legislation and proposals from the EC and also their complexity. So the House is quite right in thanking noble Lords who sit in these committees. I wish personally to thank those of my colleagues who have sat with me in sub-committee B.

Whatever those committees do, however, they would be of little consequence if it were not for the organisations and individuals who give evidence and advice to them. The quality is quite outstanding. I can say without any fear of contradiction that I have yet to find any of the evidence given which can in any way be alleged as self-pleading. Gratitude must go to the witnesses whose names are set out in Appendix 2 to this report.

There are also the specialist advisers. They give great help and assistance to these committees. I wish to thank Professor Williams of Southampton University, who has acted as special adviser to this inquiry. There are also the clerks of your Lordships' House. It is a matter of great wonder to me how they manage to clerk not just one committee but often two, dealing with highly complex matters, often under very great pressure in terms of time and complexity, while at the same time meeting the requirements of the individual members of the committee. I should like especially to thank Simon Burton for his outstanding service to sub-committee B. I think that we should also show our appreciation to the government business managers for the way that they arrange these opportunities from time to time which enable us to debate the issues that arise from such reports.

To manufacturers, industrialists and traders the transport infrastructure is a most essential part of their life. There is a direct requirement for a high quality, correct line of transport infrastructure if industry and trade are to succeed. The infrastructure must embrace not only road and rail; it must also include ports and shipping, airports and air space and rivers and canals. It is interesting to know that within the Community some 40 per cent. of the cross-border trade is through inland waterways.

In terms of the United Kingdom it is right to reflect that much of our maritime importance and industrial power stemmed from the wisdom of the entrepreneurs of the day in building the canals and the railway lines to our main western ports. We would never have succeeded if we had not had a strategic political view in the establishment of coaling stations. In our development of trade through the establishment of coaling stations we achieved more than any other country in Europe.

Therefore today we have a similar situation, except that we are looking in a different direction. We need a high quality infrastructure. We need ports and we need all the means by which we can efficiently, reliably and at the minimum cost transfer our goods within the market place. I suggest that it follows, therefore, that we in the United Kingdom should through our Government be the leaders in bringing about infrastructure development in the Community and that we should perhaps be doing more than we are doing today in this respect.

Sub-committee B carried out an inquiry upon which the report is based. It is limited to land surface infrastructure. The reason for this is that the proposal which was made by the Commission concentrated on those methods of transport. The report is based solely upon the evidence which was put before the committee. It is natural, therefore, that the witnesses predominantly came from the United Kingdom. However, we were able to take evidence in Geneva from the road organisations and from the Community of European Railways.

I think it is understandable that the early stages of the committee's considerations were perhaps influenced by United Kingdom interests. We concentrated on how we should develop our base in order to obtain the benefits of 1992. This can best be described if one looks at a firm like ICI, which has some 25 per cent. of its business in the United Kingdom and 25 per cent. in Western Europe, mainly in the EC. As a manufacturing company its main concern is that many of its major factories are situated in the North of England at a great distance from the centre of consumption.

The company says that this situation can only be overcome by a transport infrastructure which is actually better than average, situated near the centre of Europe. It also says that present indications suggest that our disadvantage may be magnified by a slower rate of improvement than in other parts of Western Europe. One view was common throughout our evidence: inadequate infrastructure is clearly seen where congestion arises.

The CBI's assessment is that the cost to the nation of such congestion is of the order of £15 billion a year. It states that our transport system must be improved if industry throughout the United Kingdom is to be able to compete with the geographic periphery of the European Community. There is a danger that British business will not realise the full potential of the benefits to be derived from the single market and the completion of the Channel Tunnel.

We cannot rely upon opinions given in evidence. The committee also looked at some of the statistics. If one looks at the infrastructure investment from 1982 to 1985 as a percentage of gross domestic profits, it will be seen that in West Germany 0.79 per cent. was invested in roads; in Belgium the figure was 0.67 per cent.; in France it was 0.65 per cent.; and in the United Kingdom it was 0.40 per cent. Therefore, we are at the bottom of the league of all the major industrial countries within the Community.

As regards rail, in Belgium 0.29 per cent. of GDP was invested; in Italy the figure was 0.27 per cent.; in West Germany it was 0.26 per cent.; and in the United Kingdom it was 0.09 per cent. Those are indeed alarming figures and there are expectations that the disparity will increase. Anyone who has been in industry will know that the cost of congestion is unsupportable. However, there is also the question of reliability. If an industrialist cannot deliver his goods according to contract, the likelihood of a repeat order quickly disappears. Therefore, just as costs may be an important consideration, I suggest that the importance of reliability is perhaps even greater. I fear that unless we can correct the situation we shall inevitably see investment moving from the United Kingdom to the Continent.

I do not believe that anyone would question the urgent need for increased investment and for it to be sustained over the foreseeable future. I am sure that all of us would welcome the recent government announcements about investment into transport. The fact that we welcome it is indicative that it is a change of policy. But what is needed more than anything else is for this investment to be seen over a longer period than at present.

In paragraph 126 the committee says: There is a need for a more positive and concerted approach to solving transport problems in the United Kingdom. The Committee were concerned at the evidence given by the Department of Transport, which did not show the Department taking such an approach. There has been a persistent lack of realism in assessing the scale of potential transport problems and in strategic planning for Community needs. Nor has there been any inclination to use transport planning in a positive way to maximise opportunities", as one now sees in France.

This report is about the Community. Its Commission has made proposals for Community economic developments with a single market. I think it is right to say that throughout the Community a great deal more has been done in removing the trade barriers than in developing the infrastructure by which trade and industry can benefit. Funding within the Community has decreased as a percentage of GDP from 1.5 per cent. in 1975 to 0.9 per cent. in 1985. I understand that the figure has yet to fall further. Congestion, increased costs and loss of reliability are being reported throughout the Community. The Commission itself has expressed alarm, which, as noble Lords will see from the report, is shared by the committee.

The Commission has brought forward a number of proposals in this regard, and it is the more recent one which we are now considering. The committee was alarmed, as I said earlier, about the inadequacies of ground level investment within the Community. The failure to invest may be a material factor in the slow growth of Community GDP and the varying performances of national economies. Europe's transport network is not receiving the priority that it requires. In paragraph 118 we say: There is an urgent need for an integrated approach to transport planning in the Community which should also cover links to countries beyond its external frontiers".

We then had in mind the EFTA countries but now with the political developments within Eastern Europe it may well be that we shall have to look even further East in the very near future.

The committee believes that the Commission itself has a major role to play. We looked at some of the proposals on whether some structural change should be made within the Community. One of the proposals was for the establishment of a European infrastructure agency, either separate from or within the Commission. Initially that was very attractive, but after careful consideration we came to the view that there was in fact little to commend a European infrastructure agency provided steps were taken to strengthen the Commission's role. We say: The Committee see no merit in an Agency confined solely to infrastructure and isolated from the decision-making machinery at the real centres of power.… An Agency might provide the impetus to break the political deadlock and to raise awareness of the importance of transport issues but there is no reason why the Commission could not do this, given adequate resources. These resources should not, for the moment, be dissipated to an additional institution".

A second proposal for structural change was carefully considered. This was for the establishment of a transport infrastructure fund. Again we found this initially interesting. It might raise again the political profile and might well strengthen the Commission's role. It certainly would be a recognition of the long-term nature of investment and might even be the means by which joint ventures between public and private capital could be brought about. In paragraph 128 the committee concluded that it could not support, the Commission's proposal for a separate budget heading under its control, exclusively for transport infrastructure. Most Community funding for transport infrastructure at present comes from the Structural Funds and the Committee recommend that this should continue, but be increased in recognition of the priority of transport infrastructure. The establishment of a new fund might raise transport's political profile and strengthen the Commission's role, but might lead to opportunities for confusion in policies and investment programmes". Furthermore, such a proposal would have little chance in the present political climate at the Council of Ministers.

We went on to say in paragraph 129: Community finance should be available specifically for transport projects and should be guaranteed over the long term. Allocations over two years, such as that recently agreed by the Council, are out of phase with what is needed for long term planning of major projects. In deciding which programmes to fund from the Structural Funds, the Commission should ensure that attention is paid to all the transport needs of each region, not only arterial motorways".

The committee believes that the Commission has an important role. However, it seemed to us that we need to identify more clearly the role of the Commission and the role of national governments. There seems to be a conflict of purpose between Ministers and the Commission. Some of us may feel that the Commission has been emasculated as a consequence.

In paragraph 121 we set out what we believe the Commission should now do. We say: The Commission should develop a policy framework for Europe's transport networks, based not only on Member States' plans but also on its own proposals where necessary and where it has adequate competence to do so. This would represent a development of the Commission's role which is currently limited to the coordination of national plans. The Commission provides continuity through periods of national political and economic change and can link together in a strategic way the developments in Member States so that the needs of the Community as a whole are met. It is a unique position to promote the greater integration of Europe's transport infrastrucutre so that those with political power take the appropriate decisions. It should continue to work closely with national governments to discover where European interest dictates that the network should be improved but must pay more attention to the problems faced by regional local authorities in providing for continual growth in road traffic within their boundaries".

From that we believe that the Commission requires some changes within it; some strengthening. We believe that the staff that is available in this field is gravely short and needs to be strengthened, particularly with professional engineers and the like. The commissioner is likely to be appointed for four years. We feel that taking into account the importance of road transport and the need to bring long-term requirements to fruition four years is too short. We feel that future appointments should be for a longer period. One could perhaps say that of Secretaries of State. In six years as chairman of the National Bus Company, I saw four Secretaries of State. One had the feeling that those Secretaries of State were on their way up or on their way out. There seemed to be no sense of continuity; that is one of the missing elements today.

Perhaps the most important part of the report relates to the Council of Ministers which provides the political thrust and eventually agrees the funding. In paragraph 124 we say: The Council of Ministers should adopt a more corporate attitude to transport in Europe. It has so far failed to implement the Commission's proposal to any great extent, or to agree constructive policies for Community investment. This is indicative of a lack of political will to carry out a major objective of the Treaty. The five year plan originally proposed by the Commission was far too short; the two year plan agreed by the Ministers is patently inadequate". It cannot be emphasised too strongly that an expanding, competetive market in transport services depends upon an adequate infrastructure co-ordinated across the Community and beyond its frontiers. That is the responsibility of the Ministers.

One good example of what I call the Community approach is that of the community of the European railways whose chairman is Sir Robert Reid. The introduction of high-speed passenger trains throughout the Community is for the foreseeable future: so, too, are faster freight operations. There, we have an integrated approach towards services and a Community-wide marketing system.

The Channel Tunnel provides a real opportunity for British Rail to link into a major new development within the Community. I only hope that British Rail will be provided with the investment so that it can play its part in what is called the renaissance of rail within Europe.

The report covers many other matters, all important. There is traffic management in which this country, without question, leads the world in knowledge and experience. There is the problem of planning procedures and of the long delays in bringing projects to fruition. There is also the question of border controls.

In placing the report before the House, it would be wrong not to say something about the Channel ports and the Channel Tunnel. None of us should underestimate the importance of maintaining the viability of our Channel ports and our ferry operations. Road and rail connections with our ports need further development. We cannot become totally dependent upon the tunnel. In paragraph 138 we say: The Channel Tunnel should be a catalyst to economic growth and the regeneration of industry in the United Kingdom as a whole. The Committee urge the Government to carry out a specific study of its regional impact despite their present reluctance to do so".

There is a marked contrast between expectation and action by the French with regard to the tunnel. The committee believes that the impact and the consequences of the increase in passenger and freight traffic will be far greater than the department had in mind when it gave evidence to the committee. We have perhaps a last opportunity to become part of the great European industrial scene. Transport is crucial to whether we succeed. I hope that the Minister will be able to deal with a range of the matters contained in the report, some of which I have referred to and some other noble Lords may refer to. I hope that the report has been a useful contribution to the developing debate on transport.

Moved, That this House takes note of the report of the European Communities Committee on Transport Infrastructure (21st Report, Session 1988–89, HL Paper 84). —(Lord Shepherd.)

3.26 p.m.

Lord Nugent of Guildford

My Lords, I am happy to be the first noble Lord to congratulate the noble Lord, Lord Shepherd, on the report and on his authoritative speech commending it to your Lordships. It is a report of great importance and interest. He and his committee obviously worked hard and covered a huge range of business in putting together cogent findings. The message that I received from what he said and what I have read is that although large resources are being directed into infrastructure by all member states, the total still falls far short of what is needed to meet the ever-growing need.

That ominous message goes for us in the United Kingdom as much as, or even more than, for other EC members. As the noble Lord said, we start much further behind the others. We are an offshore island of the EC and therefore our transport needs are that much greater and more expensive. My noble friend who is to answer what will obviously be a string of complaints may take credit, if I may give it to him, for the fact that the Government have raised expenditure on roads over the past 10 years by 60 per cent. in real terms and for the even better news that the ongoing road programme is to be doubled.

Those are substantial commitments. My noble friend must use his utmost influence to see that that increased programme is implemented year by year in subsequent public expenditure programmes to ensure that we receive the benefits we so badly need.

I go along with the noble Lord, Lord Shepherd, in arguing that transport has been a Cinderella ministry. The noble Lord made an interesting point about our history of coaling stations. We were a world leader. God bless my soul, how different is the scene today! Our transport needs normally receive the lowest priority. An interesting contrast can be made with Italy which I know well; it illustrates the weakness of our Department of Transport. In Italy, the car is king. The Italians have built the finest motorways of any country over probably the most difficult country in terms of mountains. They have built tunnels through the mountains and viaducts over the valleys. They have constructed a motorway system which has enabled them to pull the country together to make it one country for the first time since the Romans. At the same time they have made themselves prosperous: their GDP is now greater than ours. That is largely due to the massive improvements in their transport system.

In contrast, we in Britain—and I give one single example—always give housing a greater priority than roads. There were plans to build an inner London ring road. The whole line was secured, but because the building of the road would cause a good deal of housing to be lost the scheme was dropped by the GLC. The line has been lost, and it never will be built.

In terms of London's traffic, if we had that inner ring road today, what a difference it would make to the whole traffic movement of London. The old adage, "You can't have your cake and eat it", should be rephrased. Today "you can't have your house and reach it",because there will not be a road to it. That amuses us; it is a joke.

We lag behind everybody; we do not have the perspective of some of our neighbours in Europe. The present prospect is better with a senior Minister as Secretary of State in the Department of Transport. I hope that he will not follow the same course as the noble Lord, Lord Shepherd; I hope that he is still rising and will remain high up, looking after an important department. He has a greatly increased road programme.

The report indicates the urgency and the measure of need if Britain is not to lose out in the bright prospects of 1992 and the unified European market. We are all conscious that our manufacturing industry is not 100 per cent. competitive with some of the bright boys in Europe. But unless we have effective transport links, industry just does not have a hope of competing because the costs will be that much increased. That is a point which was cogently made by the noble Lord, Lord Shepherd. We have already lost far too much of the European market not to have considerable anxieties about this matter.

In this context, the completion of the Channel Tunnel —which the noble Lord, Lord Shepherd, mentioned —and the fast rail link to King's Cross which will open the way for fast, economic rail transport for our manufactured goods from industries in the Midlands and the North to European markets, is a top priority. I say to my noble friend that it is not enough for the Government to leave this vital matter to British Rail, either with or without private capital, to find solutions to routes and construction.

The building of this new fast rail link is a piece of transport infrastructure which is absolutely vital to the industrial life of our nation. Her Majesty's Government must accept absolute responsibility for getting the link built on time and somehow finding a way through all the problems of planning, public inquiries and so on. I am only saying what the noble Lord, Lord Sheperd, has already said, but I say it against the background of any influence that I may have. I am absolutely certain of the importance of this matter.

The excellent report indicates the inexorable growth of road traffic which will lead to even more acute congestion. Our much accelerated road programme will give some relief and we must use all other possible aids to try to keep traffic moving. Traffic engineering is not included. It is a minor matter, but it is worth my mentioning it now. There is a need for greater use of traffic engineering. It is extensively used in Italy and a good deal in France and Germany. The traffic engineer is a qualified engineer who has added the science of managing and moving vehicles on the road to his other engineering qualifications. His skills provide for the best design of roads and junctions and therefore, after construction, for the best traffic management to obtain the maximum capacity and safety.

In cities in the United States where I have looked at traffic engineering, it is normal to have a traffic commissioner responsible for the whole traffic management of a city. He works closely with the local authority and with the police, but he is responsible for all traffic lights and their phasing; for all parking arrangements; for all direction signs and so on. The whole traffic light system will be connected to his headquarters and usually co-ordinated completely by him.

Considering the numbers of vehicles in America —many times ours—the traffic management and movement in that country are strikingly better than ours. In Britain, our very few traffic engineers have a minor role to play and it is rare to find a local authority with a traffic engineer filling a senior post controlling traffic management. Usually it is the highway engineer who builds the roads and takes charge of traffic management, with very limited success.

The great metropolis of London has a traffic set-up which must surely be unique in all the world. There are two units of traffic engineering, one under the Metropolitan Police and New Scotland Yard, well equipped with television screens showing every important road junction in London and controlling their management. The other one is located in Smith Square and comes directly under the Department of Transport. It employs a number of professional traffic engineers who study specific problems in London and advise on improvements.

The Under-Secretary of State for Transport has overall responsibility, but the last Minister Mr. Bottomley, who has now gone to Northern Ireland, was extremely good at trying to make the best of this. Implementation of the recommendations from those two bodies can only be secured by the London boroughs agreeing to it. They are the highway authorities. Each London borough takes a different view of what should be done on its own patch. So this shatteringly fragmented structure for a huge city is a desperate handicap to co-ordinated traffic management, which could reduce some of our worst congestion. If we solve a traffic problem in one place, it has a knock-on effect in another. Overall management is the only way in which we can make sense of it.

The ideal solution would be one single traffic authority for the whole city. I know the difficulty of persuading all the London boroughs and the Metropolitan Police that there should be such a solution. But significant improvement in traffic movement in our capital city —which matters to the industry and the commerce of the whole country—will not be achieved until such an independent, overall authority is set up.

Similar problems exist in other cities and towns throughout the country. My own local borough, Guildford, has the most dreadful traffic congestion. I know Perugia in Italy well. It is built on a mountain and the authorities have built tunnels all over the place in order to get the traffic moving. Nobody has ever thought of building a tunnel in Guildford, although it is all on hills. A traffic engineer would immediately say, "This is the proper design". Yes, it costs money, but what does the congestion cost now?

I feel strongly about the problem of the traffic engineer. Some 30 years ago I had the privilege of finding private finance to set up the first post-graduate school of traffic engineers in Birmingham University. I thought it was doing very well, but in the last two or three years it has been closed down altogether. This is a terrible record at a time when we desperately want better traffic management which would relieve congestion and so reduce transport costs.

I shall conclude my comments on the excellent report of the noble Lord and his presentation of it. Traffic engineering seems small, but it has a big contribution to make in terms of design, with all the new roads and improvements to be made, and a far bigger contribution in terms of the management of traffic, in order to make use of the roads we have.

I put it to my noble friend that this matter should be given more attention by the Department of Transport in order to try to secure better movement of our road transport, a reduction of congestion, and so a reduction of the heavy costs of transport to industry. This is perhaps a small personal point which I have over-emphasised in the total sweep of this very big and important report introduced by the noble Lord, Lord Shepherd. I warmly support his general contention that transport infrastructure is important throughout Europe, but to no country more than our own. I hope that my noble friend will be able to take the recommendations on board.