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Channel Tunnel Rail Link (Supplementary Provisions) Bill

My Lords, we understand why it is necessary to confirm that the Secretary of State is empowered to fund the continuing operation of the Channel Tunnel Rail Link so that trains may run after construction and to remove any confusion which may exist, and to which the Minister referred, as to whether the state has the power to finance domestic operations as well as international trains. I believe it has been suggested that lawyers have found issues to raise which may be expensive to resolve without this legislation. As we understand it, there are four separate businesses: the property business, with which we need not concern ourselves; the high-speed link itself, which is an infrastructure business; Eurostar, which is an unincorporated business owned by the three Governments; and the domestic trains, where the Secretary of State has already purchased 40 per cent of their capacity and which are due to commence operations shortly. High Speed 1 will own the infrastructure, so my first question is who might that be? That is, who will the Government sell it to? It could be sold to Network Rail, which could raise the money by selling bonds, enjoying as it does the advantage of those bonds being backed by the Government and probably able to borrow money more cheaply than anybody else. It could be bought by Eurotunnel, which has the incentive to tackle both its own costs and those on the high-speed line itself, which are too high. It could be bought by SNCF because we know that certain continental operators have a taste, shall we say, for British assets. That was reflected recently in the acquisition of both Cheltenham Rail and EWS by Deutsche Bahn. And of course it could be acquired by a body such as Macquarie or Ferrovial. They would probably require higher returns and might or might not pay more. Will the Minister confirm whether my interpretation that these bodies form the target market is correct? At present, the charges for using the Channel Tunnel Rail Link are something over £2,000 per train, and I believe that that is somewhere close to the market price, the point at which you get more people using the service and therefore more revenue. If you charge more, fewer people will use it and there will be less revenue. Are these charges likely to be increased, and who would give consent to any increases that might be introduced? Alternatively, will there be no cap, and will there be a right of appeal about the charges being levied? If there is an appeal, who will it be made to? I turn to freight and open access passenger operators. What charges will they be subject to, and will they be open to appeal? At the moment on British Rail, an open access freight operator pays only marginal costs, and the same is true for an open access passenger operator. Who would hear an appeal against the level of charges, and would the charges be subject to European law? Is it the intention to sell the debt attached to the high-speed line with the assets themselves, or would the removal of the guarantee by the Government, which has been given to the operator of High Speed 1, offer it more freedom? If the Government were to offer some sort of cover for the debt, would it make the operator more or less free? What effect do the Government think this will have on the price realised from the sale? What underlies this Bill is the fact that the Government want as much money as they can get. The words are slightly more elegant than that, but basically they are out to get the biggest bang for their buck that they can. Will the Government commit themselves to a review of the restrictions imposed by the Intergovernmental Commission on the Channel Tunnel? Why are these restrictions drawn in such an onerous fashion? For example, the latest intercity express of German railways can go through tunnels in the Alps which are much longer than the Channel Tunnel but it cannot come through the Channel Tunnel itself. These restrictions, I believe, originate in a treaty, but treaties may be rescinded by the consent of both parties. How close is the intergovernmental commission to being a restraint on trade? If the Swiss can allow trains to go through their tunnels, or the Danes and the Swedes can allow trains to go over their bridges, is this intergovernmental commission a restraint on trade? If so, is it bordering on the illegal? How do the present financial arrangements fit in with the review of state aid for infrastructure which I understand the European Union is currently considering? There are many more questions but the basic one is whether it is the intention of government to see that the Channel Tunnel Rail Link is used to the maximum extent possible so that more people benefit and carbon dioxide emissions from aircraft are reduced to the minimum. This is an asset which the taxpayers of this country have purchased and I think that given a vote—which I suppose they are every five years—the taxpayers would say, ““The most important thing is that more of us are able to afford to go on these trains and to use them—and, by the way, to reduce the carbon footprint””. Does this desirable aim—which I believe most people would think is good—conflict with the Government’s obvious desire to secure the highest sale price? Is this the basic reason for paragraph 11 of the Explanatory Notes—which I recognise are not part of the Bill—which states that the purpose of Clause 2, "““is to ensure that all access contracts in relation to the CTRL should be outside regulation by the ORR under the 1993 Act””?" We on these Benches remain suspicious of any legislation which gives a regulatory oversight to the Secretary of State. That is not independent oversight but regulatory oversight—in this case to the vendor of the assets. We remember the recent history of the railways and wish to see nothing enacted which could lead to assets which have been largely financed by the state being placed in other hands. This could lead to a rundown in the condition of the assets—as occurred with Railtrack, with its slack standards and maintenance holidays—and a lading of the system with an immense amount of gearing in the form of debt raised against the optimistic hope of future revenue streams. I turn now to the issue of the extension of the high-speed line to many other parts. The noble Lord, Lord Hanningfield, mentioned the platforms at Waterloo; I cast my eyes somewhere above that and think of all the people in the north of England who paid the taxes to build this line and do not have any access to it. I realise that ““hypothecation”” is not a word that is accepted by the Government, but they could do a great deal to satisfy many people in this country if they could find it in themselves to announce at the same time that they are at least going to plan an extension of the high-speed line to go elsewhere. Will the Government say what attitude they would adopt towards open access operators seeking to enter the domestic market? They were obviously very dismayed, as was GNER and indeed was I, by the entry of Grand Central on to the east coast main line. But if they wish to exclude the possibility of an open access operator coming into the domestic market, would it not be more honest to put a clause in the Bill that precluded it, rather than relying on some arm-twisting of the Rail Regulator in the form of a lunchtime directive passed by the Secretary of State or some shenanigans behind the arras while nothing appears in writing, which chairmen and chief officers of nationalised industries have often been subject to? We want to know the Government’s real intentions in presenting the Bill, and why the overriding duty of the Rail Regulator to exercise his functions should differ from those that apply to Network Rail as a whole.