PUBLIC SESSION

MINUTES OF ORAL EVIDENCE

taken before

HIGH SPEED RAIL COMMITTEE

On the

HIGH SPEED RAIL (LONDON – WEST MIDLANDS) BILL

Thursday 28 January 2016

In Committee Room 5

PRESENT:

Mr Robert Syms (Chair) Sir Henry Bellingham Sir Peter Bottomley Mr David Crausby Mr Mark Hendrick

_____________

IN ATTENDANCE:

Mr Timothy Mould QC, Lead Counsel, Department for Transport Ms Jacqueline Lean, Counsel, Department for Transport

Mr Simon Bird QC Mr Simon Ives

Witnesses:

The Rt Hon Mrs Cheryl Gillan MP

Ms Maggie Simpson Professor Andrew McNaughton, Technical Director, HS2 Ltd

_____________

IN PUBLIC SESSION

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INDEX

Subject Page

The Rt Hon Mrs Cheryl Gillan, MP

Submissions by Mrs Gillan 3

Response from Mr Mould 25

Management Consortium Bid Ltd, Freightliner Ltd and others

Submissions by Mr Bird 32

Ms Simpson, examined by Mr Bird 33

Professor McNaughton, examined by Mr Mould 48

Further evidence from Ms Simpson 53

Response from Mr Mould 54

Closing submissions by Mr Bird 56

DB Schenker Rail (UK) Limited and others

Submissions by Mr Bird 57

Ms Ives, examined by Mr Bird 58

Response from Mr Mould 65

Further evidence from Mr Ives 72

Response from Mr Mould 75

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(at 09.30)

1. CHAIR: Order, order. Welcome to the HS2 Select Committee. We start off this

Thursday with the Rt Hon Mrs Cheryl Gillan, who will give her thoughts on the impact

on her constituency.

The Rt Hon Mrs Cheryl Gillan MP

2. MRS GILLAN: Thank you very much, Chairman. It comes as no surprise, I am

sure, to everybody on the Committee, at least those here at the moment, that I am here to

make yet another appeal for a better outcome for Chesham and Amersham and the

AONB and my constituents who continue to live with this project.

3. I think you know that it has been a tough six years for everyone. I know you have

been on this Committee for nearly two years, which is a life sentence in many ways, but

the six years since this project was first announced in 2009 have been pretty long ones.

One thing I would like to start off with is an optimistic note of saying that at least we

have achieved some mitigation, which was greater than that which was envisaged back

in 2010. But, as I am sure you are all aware, I am not satisfied we have done our best

yet and neither are my constituents. I think that this House has to think very seriously

about discharging its duty to protect the environment in the Chilterns from the ravages

of what is, in effect, the largest infrastructure project that we have ever seen in this

country. I am really grateful for the additional tunnelling – I can’t emphasise that

enough – but I am still fighting for better protection for the area.

4. The Chilterns Conservation Board, which was statutorily set up, has asked me to

remind you that this is an internationally important landscape. Eighty per cent of the

world’s chalk landscapes and habitats are in Southern England and this AONB has the

highest level of protection which is afforded to this type of landscape in the UK.

5. I would particularly like to thank the Clerk and everybody in the House of

Commons here and the Committee who have worked so hard over the past two years

and who have gone that extra mile. Some of the changes and recommendations which

have been made from this Committee have been positive. However, I still maintain that

it’s not enough to say it’s okay to damage a little bit of the AONB and, as I said in the

debate in this House recently, I’m not trying to save the world; I am just trying to save a

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little bit of it which is really precious.

6. Just to remind you, there are 8.8 kilometres of the AONB that is still not protected.

As you can see from the first slide – we appear to have moved on to the next slide but

perhaps we can go back to A20591 – of everybody who wrote in on this, overall

minimising the impact of the proposed route through the Chilterns is the single greatest

issue of concern for respondents to the HS2 Environmental Statement. I think it is

important to remember that.

7. Moving on to the next slide, what are we going to do today? I want to back what

David Lidington said and I shall try not to duplicate it because I appreciate that trying to

keep the attention of the Committee which has been sitting on this for nearly two years

is always a challenge, but I do need to talk through the process shambles; I need to look

at some of the changes that I think are still necessary as far as the constituency is

concerned and I want to pick up some of the points from my PRDs, petition response

documents, that came from HS2. I understand that it is hard when an MP is doing a

brain dump on six years of working for their constituents for this Committee, so I do

have a little aide memoire at the end, which I am going to give you all, which gives you

my key asks from today. I have to say they are not exclusive. There are other asks and

there are more detailed asks but I will not be covering them today because I appreciate I

am only allowed up to about an hour and I will try and stick to that. However, I hope

that that list will be helpful to you.

8. Basically, there are four main themes which are the major points of my petition

today: first, a further extension to the Chilterns tunnel, which will be of no surprise to

you; a firm commitment that there will be some improvements, again, to the Need to

Sell scheme; the setting up of an AONB HS2 mitigation review panel, and an

independent regulatory body to regularly review and monitor progress during

construction and hold HS2 to account. Those are the major asks and there are lots of

minor asks now threaded through my petition.

9. In slide three you can see that this has been a very, very long journey. You have

been to the constituency yourselves and have seen just how peaceful and tranquil it is.

You have also seen the strength of feeling that comes right across the community,

whether from environmental groups, parish councils, local authorities or local action

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groups that have sprung up. I think it bears repeating that HS2 in my neck of the woods

has changed some of the people’s lives for ever. There has been psychological,

financial and, I think, physical damage to many of my constituents’ livelihoods, lives

and properties. I cannot stress enough and it is no exaggeration to say that some of my

constituents have died fighting this project. It is a huge, huge ask of a community that

will get no benefit from this project. You can see the Misbourne Valley transport

corridor as it exists; you can see what HS1 and the M20 transport corridor looks like,

and that is what is going to happen. Those quotes there are recent quotes taken from

constituents. I think that shows the concerns there are.

10. I know that HS2 always tries to play down and underestimate the effects on the

Chilterns – that’s how it seems to me and people in my constituency – and we have

often felt that what we were saying was ignored and not listened to and, indeed, that has

turned out to be the case in many instances. I know that HS2’s legal counsel always

tries to reassure you as the Committee and hopefully others beyond by saying, ‘It will be

fine eventually. No one complains about HS1’, but we have just seen a Eurostar report

on HS1 and I think it was very telling to say that the costs of HS1 far outweigh its

quantified benefits. I fear that this project has been overhyped right from the beginning

and suffered from being part of a political process, people trying to outdo each other.

The sacrificial lamb will always be my constituency. Because it has no stops, it has no

gain. It has all the interference from this project but no benefits.

11. If we move on to the next slide you will see that this process really has been

shambolic, I think by anybody’s standards. It has been hallmarked by the unfairness of

this Hybrid Bill process despite the best efforts of the House and the substandard

handling, I think, of the HS2 projects in its communications. There must be much better

ways to implement a major infrastructure plan. Trying to interact with HS2 – I think the

officials will bear me out – has often been like wading through treacle. It is a bit like

drawing teeth without an anaesthetic. Encounters with officials, and ministers, indeed,

as far as I am concerned, have been of such poor quality that I retain little trust and

certainly the people in the Chilterns retain little or in some cases no trust whatsoever.

The recent Ombudsman’s report, for example, actually put that in writing. They found

maladministration and said that overall HS2 Limited’s actions fell below the reasonable

standards that we would expect.

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12. I have many concerns but I want to just highlight a few for you and the Committee

today which I think you would understand. There has been a tick-box nature to the

community forums. The consultations and the public engagement – I have been to some

of them – have adopted hardly any meaningful local solutions and I think that a well- run

process wouldn’t have operated by setting up, not just in my area but talking to people

along the line, the sort of resistance that came from communities and the way in which

they felt they were treated.

13. We always get told about how great the public engagement is in terms of quantity

but we don’t actually get the qualitative analysis of it. That, coupled with the complex

volumes of technical information, often with omissions, often presented in a confusing

manner, and the consultation periods being very short to meet some political timetable,

has left people with huge challenges to grasp the information and decipher it. I have

some really dedicated, intelligent, professional constituents who do this for a living and

they have found this process difficult to engage with. The process itself, as you know, is

quasi- legal and in an obscure language. My constituents have had to pay for the

privilege of having their opinions taken into account. Many constituents have needed

help from my office, my staff and from me, from local authorities, community

champions and voluntary groups – all of which has put a huge burden on us locally – to

manage to get through, with persistence, the wherewithal, the whole of the petitioning

process. HS2, of course has access to a fantastic and magnificent legal team sitting

alongside me and we know how expensive they are, but my constituents don’t have

access to any of that. The locus challenges has meant that even when AP4 came

through, many of my constituents who were told they could have a say have not had a

say and in fact I just want to bring up one constituent. I won’t use his name now but I

would hope, Chairman, that you would talk to me afterwards. He arrived on his date on

time. He was refused to be seen. I would be grateful if before you finish your business

you could consider giving him a hearing. At least it would show that our Committee of

MPs that is examining this was perhaps being generous in spirit towards my constituents

in a way that sometimes this process has not been.

14. The information when it is finally dragged out of HS2 is sometimes useful and

sometimes not but I have to mention specifically my tunnelling groups who have found

it virtually impossible to obtain transparent and meaningful figures from HS2. That did

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happen to me but I can deal with that. I think that for them that has been very

depressing. You only have to look at some of the reports that have come out in the

course of the process so far, whether from the Environmental Audit Committee, the

House of Lords Economics Affairs Committee, the National Audit Office, the Public

Accounts Committee or the Ombudsman’s report I have just referred to, to see the level

of criticism that is being directed at this project. That is not to mention the errors. We

have had traffic calculation errors, waste figures wrong, maps not showing haul roads,

and people being told that they are in the Need to Sell scheme and being accepted and

then having that acceptance revoked. You have heard from David Lidington the

mistake of instead of two to three weeks, 203 weeks, which caused panic throughout our

area.

15. Not even you in this Committee or the House of Commons has the full facts and

figures. I don’t know whether you have seen all the major project authority reports sent

to this project yet. Perhaps you could indicate if you have seen all of them, but I don’t

believe you have because in fact the Secretary of State blocked those, so even the House

has not had the full information on the risks associated with this project. We still have

environmental issues outstanding. There is the court case in Geneva on the Aarhus

Convention and, to be truthful, it is a sort of Orwellian project. I feel this is not the way

in this century to be doing an infrastructure project. It is not the way to treat people; it is

not the way to make environmental decisions and it is a process which is not fit for

purpose.

16. I have written to the Procedures Select Committee and I hope that a new system

will be considered. One solution that I have been mulling over in my mind, because I

hope I would have a contribution to make, is even starting this process with a genuine

public inquiry away from this House, away from the decision-making so that you have a

clear set of facts established with people being able to give evidence in a less

threatening manner than we conduct our ways here and also ensuring that MPs in this

House are fully appraised of all the facts. I really can’t see why all the MPO reports

could not be put before a Committee of this House.

17. Moving on, I think you will see that there is more that needs to be done and it is a

difficult process. On slide five you will see that I have just tried to put this in context

for you. Alison Doggett who I think you are familiar with, is a landscape historian.

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She’s an expert in the Chilterns. This is actually a map from 1620 which is overlaid

with the HS2 route. It clearly demonstrates that the decisions which you make on this

Committee and which this House makes will damage an area that has changed almost

imperceptibly over 400 years. Generation of governments, local authorities and

landowners have actually preserved basically the same structures, the same fields and

ditches and hedges and the irony should not be lost on the outside world that this project

will be damaging what is effectively the wider Chequers Estate.

18. I think it is not responsible government to fail to protect this area to the highest

level technically feasible. I think we are right at the end of this process and I very much

hope that you will look at this landscape and consider the damage that you are doing,

which is irreparable, and put as much right in this House as you can because, of course,

this has to go to the House of Lords, which will also have a view on these matters.

19. I now want to go into more detail, and on the next slide you will see that I shall

start to respond to the PRD which was sent to me. HS2 sweepingly wrote in my PRD at

paragraph 5, page 69, ‘The promoter does not agree that the proposed scheme will have

a major visual impact on the Chilterns AONB and should be lowered further’. I

couldn’t disagree more. You saw on the earlier slide the comparison and here you see

some of the issues. Here we have a vent shaft and we have some gantries. You also

there have a wonderful Grade II listed barn and a Saxon lane in my constituency. I want

to be satisfied that the vent shafts, the autotransformer stations and the other railway

furniture do not unnecessarily blight this area.

20. I asked in my petition for a few simple protections, if you recall. I don’t know

whether you have re-read it recently. I just wanted the maximum height elevations to be

specified for the vent shafts and the designs agreed with the district council following

public consultation. I think that is a pretty important request. It seemed to be ignored. I

received a lot of explanation on lighting design. I was delighted to receive that. Indeed,

I raised lighting, I think, in my petition, but it is equally important to ensure sympathetic

design. I know that we have a design panel, I think, of 45 designers, but I want a

Chilterns AONB mitigation review panel – a long name, but I want local people looking

at what we can do to mitigate it to ensure that these sort of design mistakes don’t –

21. SIR HENRY BELLINGHAM: May I just interrupt, Cheryl?

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22. MRS GILLAN: Of course.

23. SIR HENRY BELLINGHAM: You want this mitigation review panel, so would

it be funded by local authorities?

24. MRS GILLAN: No, I think that HS2 should fund it. It is being imposed on my

community and on my local authority.

25. SIR HENRY BELLINGHAM: I understand that.

26. MRS GILLAN: I think that the risks need to be borne by the project promoter.

27. SIR HENRY BELLINGHAM: So, who would actually sit on the panel? Would it

be local electorate representatives and other people?

28. MRS GILLAN: I think everybody from the local authorities to the parish councils

and key representatives from the community, yes, and, for example, from the Chilterns

Conservation Group who have that level of expertise about the environment locally to

be able to contribute.

29. SIR HENRY BELLINGHAM: It might help us if after this meeting you could

send the Committee an information memorandum on that proposal?

30. MRS GILLAN: I think we can do that. Would you mind giving me a week to

prepare that?

31. SIR HENRY BELLINGHAM: Of course. It does not have to be very long; it just

needs to be succinct and with the detail that we need.

32. MRS GILLAN: I am perfectly prepared to do that and I am grateful for your

interest in it because, just to illustrate, my parish councils, whether in Chalfont St Peter,

Chalfont St Giles, Amersham, Little Missenden or Great Missenden, where the vent

shafts are located, are really concerned about the visual impact and the effects on the

water table and the construction of those shafts. I think that Martin Wells is going out to

Little Missenden on 12 February engaging with Professor Payne – that’s right, he’s

nodding at me. He knows that Little Missenden and Great Missenden have been

pursuing the issues of the aquafer, the water table and the River Misbourne because of

the distance from the vent shaft. I think it is going to be excavated approximately 20

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metres below the river bed, which is about 150 metres away. They are concerned that

there is nothing preventing the river emptying into the vent shaft and they want to

discuss these matters in detail. These local people have the expertise, the knowledge

and the history because they have had infrastructure projects or projects there that have

affected this environment before and they need to be listened to and taken into

consideration. So, I would love this Committee to direct HS2 to give an assurance that

any of the water problems arising from the vent shaft excavations will be dealt with and

certainly that dirty water is not pumped back into the fragile ecosystem of the River

Misbourne, which I know is causing a great deal of concern.

33. On the 20th I think you heard from Councillor Mary Phillips about Chalfont

St Giles and the access route along there by Bottom House Farm. I don’t know whether

you remember going along there. Did you see this barn? The concern is that it is a

Grade II listed granary barn. It is going to be severely affected but there is also loss of

pasture land there and hedges. I really need renewed, legally enforceable assurances,

that those losses will be accounted for and prevented wherever possible. I would also

like you to give instructions to HS2 for HS2 to give me a legally binding undertaking

that it will provide maximum height specifications for the vent shaft buildings in

collaboration with the local groups in that area as well. The gantries worry people too –

this is further along the route, obviously, when it comes out of tunnel, but the type of

gantries that are being used are really industrial. I am terribly worried that we will get

one of those chic urban designers who will think that having an industrial gantry like

this will be wonderful and such a contrast in the countryside. I am afraid that urban chic

has no place in our countryside. We prefer Saxon chic. I am concerned about it because

we do not have legally enforceable binding –

34. SIR PETER BOTTOMLEY: They were controversial invaders, weren’t they?

35. MRS GILLAN: Yes, they were but they had a certain style about them which I

can’t say HS2 has.

36. SIR PETER BOTTOMLEY: But was there anything else?

37. MRS GILLAN: Listen, I’m a Celt. Be careful, Peter. Moving on now and

talking of movements of population I want next to look at traffic. We are very worried

that part of the constituency will turn into one great traffic jam. HS2 originally said

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there would be very little impact on local traffic and everybody locally believed

differently, particularly one Jim Conboy of the Chesham Society with whom I think you

are familiar. I have to say that his dogged determination on Freedom of Information

requests turned up that HS2’s figures were significantly wrong in assessing the potential

queues at the roundabout approaching Great Missenden. I am very worried about Great

Missenden. I have talked to a lot of constituents there and I am not sure whether it has

come across to this Committee as strongly as it has come across to me but this main

roundabout by Great Missenden has gone up from three to 97. That was the catalogue

of the error. The impact of thousands of HGV and LGV movements will really have an

effect on these small roads. You saw in the coach how difficult it was to get up and

down some of the roads in the area. I don’t know whether you have had a chance to

look at the study that was done by Oxford Economics in October 2013, just to get the

scale of it. They did a study entitled ‘The Construction Impacts of HS2 in

Buckinghamshire’, which quantified the impact on Bucks businesses from HS2

construction traffic at £43.7 million per annum. I remain concerned and many of my

constituents, I am sorry, have lost faith in the calculations that were put out there. I

would really like this Committee to ask HS2 or compel HS2 to revisit their figures

locally for these traffic movements. We think they may have underestimated the traffic

increases, particularly on the A413. I am not sure how much they’ve taken into

consideration the fact that many of those HGVs are going to be very heavy vehicles,

loaded with spoil and moving very slowly. It would be very much appreciated if we

could have a detailed report about the accuracy of that travel data. I think that David

Lidington has asked for the same thing. I had to duplicate there because I want to

reinforce the importance of that to our locality.

38. In my PRD, HS2 claimed that the promoter is currently in discussion with the

BCC as local highways authority in respect of construction traffic effects on junctions.

Again, it is not just effects on junctions; it is effect on the shops, schools, local amenities

such as the Roald Dahl Museum in the area of Great Missenden. I am very concerned

about it so I would reinforce that there is an even greater necessity, in my view, for this

work to be revisited. I was also pretty worried by what Mr Mould said when I was

sitting in here the other day because I have been talking to my county council and to

Martin Tett and I have to say that he and his team have done absolutely sterling work for

Buckinghamshire; I don’t think anybody would deny that. Mr Mould said, and I think,

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Mr Mould, I have your words right – we were talking about the spoil road, the haul road

– ‘There is no difference to the Bill Scheme’. My understanding and everybody locally

and the local press’s understanding is that a deal was done and there was going to be

movement on this haul road. So, I think we need to clarify that because we need a

formal, legally binding assurance that there will be some movement on this haul road

unless Mr Mould tells me he was mistaken because that has caused great consternation.

Again, this illustrates the lack of confidence that people can have in what they think

they have understood is the deal and where they think they are on whether they have

been accepted for a Need to Sell scheme or about this haul road because the ground

seems to move under them.

39. I have also been contacted by Isabel Derby, the leader of Chiltern District Council,

and Councillor Linda Smith, both of whom have worked on this, and the CDC has

worked really hard on this project. They’re concerned about traffic at Chalfont St Peter

and they have actually expressed to me a preference for a temporary haul road from the

rear of the Chesham Lane vent shaft site down to the A413. I understand that the

Highway Authority, Bucks County Council, is supporting this. The key point – I don’t

know whether you remember, Chairman, when you were there – is that this road goes

past two schools, a care home, a retirement village, the Epilepsy Society that I am very

proud to be patron of and is a national charity, and in fact is round the corner from the

Chiltern Open Air Museum that I am also a patron of in an area which has been

earmarked for a great deal of development. It is a unique area with very narrow roads

and vulnerable people living nearby who are going to be affected. The council feels that

the current mitigation is not enough. I hope that a workable solution is going to be

drawn up. I would ask you to insist that HS2 looks at this and reaches some agreement

because I think it will be putting vulnerable people in danger.

40. I have plenty of practical and sensible asks in my petition, but HS2 did not seem

to be prepared to deviate. They kept on referring me to the Code of Construction

Practice and at that point the undrafted, and uncited by me, traffic management plans

that were only published on 20 January this year. These say they will include the

necessary controls, but all of that is tempered by ‘reasonable practicability’ and there

will be further curtailment to that if there are cost or delay indications to the project.

There is no detail in there as to what sanctions there would be if HS2 failed to comply

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with the TMPs, the traffic management plans, and this recently published route-wide

draft TMP is not clear whether this has been drafted with or without local authorities.

Certainly, talking to my local authorities I am not sure they have had any major input

into these traffic management plans. It is a lengthy document but light on commitments,

published very late in the day. Again, I have not had time to read it in sufficient detail

but it does not seem to deal at all with the local specific impact, which is what concerns

people most.

41. So, in reality when you start to read that Code of Construction Practice, HS2 has

really broad powers. They can alter the hours between 8 and 5 pm. There are so many

caveats that they can virtually operate it when they want to. Many constituents have

raised ‘rat-run’ problems and the local roads being impassable. To be fair, when you

read the Code of Construction Practice, and I am sure you have, it practically gives HS2

carte blanche. Now, I think one of the things that can provide a solution and for you to

look at as a Committee is to include the Code of Construction Practice and the traffic

management plans and have them incorporated in the Bill. I also think you need to have

an independent regulator so that the nominated undertaker is accountable for the

breaches and any disputes could be settled by the courts.

42. I am still worried that the complaint commissioner that they have proposed is not

sufficient. This complaints commissioner, as far as I am concerned, will only deal with

complaints up to the value of £7,500 and I think that the commissioner will again be too

close to HS2.

43. Moving on I would like a commitment for a Park and Ride scheme. I still think

that that is a sensible option. The TMP contains a number of suggestions and proposals

but there is nothing to compel HS2 or their contractors to operate those schemes and it

would seem perfectly sensible to put people into Park and Ride schemes so that you

reduce the number of vehicle movements.

44. Something else which surprised me is that I raised the issue in my petition about

the blue light services and the promoter responded in my PRD, ‘The promoter does not

consider it necessary to fund an air ambulance’. If the traffic management plans cannot

guarantee emergency response times in the area, why should the people in my

constituency and people using the roads and facilities in Buckinghamshire take the risk?

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I think that that risk should be passed on to HS2. If they cannot guarantee emergency

response times in the traffic management plans they need to bear that risk and

responsibility for the safety of my constituents. What alarmed me, Chairman, is that my

office contacted South Central Ambulance Service this week who confirmed that they

have never had any direct contact with HS2 Limited regarding the impact on their

service. I really hope that the promoter can assure me that they will undertake

immediately those conversations with the blue light services to offer reassurance to my

constituents and beyond because this project will have an impact, as you will know, on

the access to Stoke Mandeville, I think back into Wycombe and also to Amersham. We

need those undertakings.

45. The next slide revisits South Heath and Potter Row. The problems continue. This

is where it comes above ground. I think that you need to understand that this actually

still comes up in the village. The tunnel extension that you so generously gave us is

actually still in the middle of the village and HS2’s words say that it is still ‘severely

adversely affected’. My constituents in that area have raised a number of issues with

me, starting with noise. There are still real concerns about noise. David Lidington went

to the sound lab. I had been to the sound lab about three years earlier but I was told that

there was no specific sound volume that I could listen to for Chesham and Amersham,

which disappointed me, but there are real concerns about the noise. The big issue is that

HS2 has not taken into account peak noise and instead has based noise levels on average

noise levels over a period of hours. There is no provision for redress in the event that

noise levels go above HS2’s estimates. I think that HS2 should provide the local

authorities with the funding for them to monitor the noise limits and give them the

powers of enforcement if HS2 breach those limits.

46. If HS2 is so sure that this is okay, they again should bear the risk and not pass it

on to our local authorities that are so badly squeezed by the potential local government

settlement. The noise policy also requires the promoter to take all reasonable steps not

to exceed the noise level set. Constituents are concerned that HS2 has not taken all

reasonable steps, for example, whether they require noise barriers, etc. Again, this is

why an independent regulator would be so important, Mr Chairman, because a body that

could look independently at whether all reasonable steps had been taken would be good.

There is still an issue over what is called ‘the boom’. A constituent is concerned that no

15

assurance has yet come from the promoter that if a tunnel boom happens at the portal it

will be eliminated. So, I would be grateful for assistance in getting some assurances on

that.

47. Pylons remain an issue. He is not in his place but Mr Clifton-Brown helpfully

suggested on 19 January that given this affects an AONB there had been some precedent

for burying electricity lines but we are still in the position where we don’t know whether

it will be one large pylon, whether it will be replaced with two, or whether will be the

same size. Again, I want somebody to work with the local people to come up with a

solution they can understand at this stage before it passes out of this House and goes

outwith our control. We have the wherewithal here to make the promoter deliver these

things to my constituents and I think it is no more than they deserve.

48. South Heath would still like to see the parts that are affected but the whole of

South Heath would like to be confirmed in the NTS scheme. Currently the residents

have been told they will have a period of three months from the announcement of AP4

when they can claim under the old criteria following the rules applying to those above

the tunnels which will apply to South Heath. I am worried because although the

additional tunnelling has given some relief, the blight continues and it’s not fair that the

residents take the hit. I know, Mr Syms, you made the point on 19 January that more

tunnelling should mean less compensation. The trouble is that the tunnelling is not

enough. The blight is still firmly associated with that community and it comes out in the

middle of that community. The Leigh Parish Council is also very worried about the

corridor of blight. That blight goes up through South Heath, Potter Row, Kings Ash and

leads up to the Leigh. I just feel that the broad negative impact on those properties can’t

be emphasised enough. You should be aware of it and that extra tunnelling would have

the benefit of getting rid of that.

49. Slide nine revisits what is wonderfully called a temporary sustainable placement

area. I call it a spoil dump and all I will say on that is that David Lidington made the

points that I would have made and I agree with him and I hope that you will take that

into consideration.

50. Turning to my main ask, the tunnel, ‘Onwards and Under’ is the title of the next

slide. I met with Minister Robert Goodwill yesterday and we discussed the fact that if

16

you as a Committee were to recommend the additional tunnelling to the end of the

AONB most of these problems, of course, would go away and the need to compensate

many of my constituents would be eliminated. In my PRD, HS2 justified the failure to

extend the tunnel by saying that the section of the HS2 route which is above the ground

is along the most developed section of this part of the AONB crossing the existing

transport corridors of the A413 and the Marylebone to Aylesbury line. I have to say that

the most important part of that statement is that it is in fact a part of the classified

AONB. So, the fact that it has been breached at all does not mean that you should do it

again since it’s got the classification. The tunnel originally was to come up in the

middle of Old Amersham. It was then moved to Mantles Wood, a bit of ancient

woodland, as you know, that was absolutely stunningly beautiful. I think that many of

you did the long march across Mantles Wood. Where it is now emerging also seems to

be an arbitrary decision. There seems to be no logic as to where that tunnel actually has

ended in all those three instances.

51. I know you are familiar with the tunnelling options and I know you have spoken

to David Lidington about this. The optimum position as far as I am concerned, would

be the TBO tunnel but the fallback positions are the REPA tunnel to Leather Lane or

even moving the tunnel any distance from the centre of South Heath would be

appreciated. In fact, I think HS2 did a SIFT analysis on the T3i tunnel which showed it

was far better with respect to the environment on a qualitative basis than the AP4

solution that we have at the moment. There was frustration felt by my constituents

because even though they provided really detailed plans and asked for feedback from

HS2, the lack of detailed tunnelling figures provided by HS2, even when instructed to

by this Committee caused a lot of problems. And, when they produced a report, it

wasn’t the view of the various tunnel groups in my constituency, nor in line with the

best practice industry methods for valuing tunnels. I really feel you should bear that in

mind. Why it did not go even to where the land falls away naturally is a mystery to me,

but I am no engineer or tunnelling expert.

52. There is one final point on the long tunnel which I want to raise because the

tunnelling groups feel passionately about this, which is that there has been a failure to

assess the value of the AONB. F-Tech, I believe, have already explained to the

Committee in an early appearance that they can undertake such work and they carried

17

out work for HS2 running alongside the AONB but they have not done the work going

through the AONB. I think that if such a valuation had been carried out and factored in,

there would be a different point of view on this long tunnel.

53. What I don’t understand is that this is accepted methodology by the DfT and the

work has been carried out for the Thames Water tunnel, so why not for this one. I just

hope that the Committee will see the importance of such a study. It would give comfort

if they asked the promoter to commission such a study from F-Tech because I think that

should be looked at and factored into the decision making before we go past the point of

no return.

54. As to the fallback tunnel, REPA and our tunnelling group said there was no extra

cost. HS2 said it was £39 million. I just thought I would put that in context for you so

that you remember it. It would save South Heath, Potter Row, which is 328 houses in

the local community, from noise and blight and would protect another mile of the

AONB. To put it in perspective, £39 million is less than the annual salary bill of HS2 at

the moment because in the question that I asked, they pay £45 million a year in salaries

to the people that are employed on HS2. It has probably gone up since my question was

answered. So, if we put it in perspective, I think that is a small price to pay to save 328

houses and another mile of the AONB.

55. I have to say if there is going to be no mechanism whereby we can try and get this

extra tunnelling, then even an extra 100 yards would make a difference in this

community. I think it is also important to address before this Committee the additional

provision because I know that nobody wants a further additional provision but as far as I

am concerned, why does it have to be done by an additional provision? The Hybrid Bill

timetable and the Government’s year – they have been telling us to get on with this

project – should not get in the way. Why can’t it be done by a Transport and Works

Order? I think, unless I am mistaken, that HS2 agreed on recommendation by this

Committee to go down that route in relation to the moving of waste sidings belonging to

FCC on 10 December. So, if it can be done for that, why can’t we do it by a Transport

and Works Order for additional tunnelling at South Heath and Potter Row? I just leave

that with you. I would like that question answered.

56. I just cannot believe that my government, who said it was going to be the most

18

environmentally friendly government ever, is prepared to have nearly 9 kilometres of a

nationally and internationally recognised environmentally protected area so badly

damaged when we have the technology, the capability and the financial wherewithal to

fully protect it. After all, we have just had a windfall of £130 million from Google. I

am sure that people would like that £130 million spent on protecting the environment. It

was money that the Chancellor didn’t even know he was getting in, so that might be a

very good use for those funds.

57. Talking of funds, if I can move on to compensation, I still think we are not there.

This is the next slide. We are hugely appreciative of the Committee’s recent report on

the Need to Sell scheme but I am concerned that the DfT won’t implement your

recommendations and I hope that you will pursue this matter and ensure that those

changes are made. Fair compensation, or the lack of it, has been a terrible burden for

people to bear on the route, particularly those who are elderly and vulnerable.

58. I have never forgotten on the Floor of the House in July 2013 that the Prime

Minister told me that the Government was committed to a very generous and fair

compensation scheme – his words, not mine. Through this Committee I would like to

tell him and you that I am afraid I have never had my constituents say that this scheme

was very generous or fair. Those words have never been used to describe the

compensation scheme to me or anybody that works with me. I have some outstanding

cases with which you are familiar. These are just currently a couple that are on the

books at the moment. You heard from Gilbert and Sally Nockles on Tuesday and their

neighbour, Rosemary Wigzell. I want to extend my support to their application. I think

they have been through strange, unnecessary and cruel processes through the course of

this. This is, of course, the couple who were told that they were on the Need to Sell

scheme but were removed two days later.

59. SIR PETER BOTTOMLEY: We have made our views clear.

60. MRS GILLAN: I know. That’s what I can’t understand, Sir Peter. You have

made your views clear but we have still not reached a settlement. That is extraordinary

to me. I think that the Committee also has before it a copy of the Secretary of State’s

letter that was sent to me which contained some provisions which I understand were the

latest provisions on the Need to Sell scheme but were not the provisions under which the

19

Nockles had originally applied. I am waiting for a response from the Secretary of State

because I have raised that back with him. He has not given me the courtesy of a

response to date.

61. Sarah Raffety has been in protracted communication. I think she is in negotiations

with you, Mr Mould, at the moment, she tells me.

62. MR MOULD (DfT): She will receive a further letter from us over the next

couple of days, possibly at the beginning of next week.

63. MRS GILLAN: Super. I am really pleased about that.

64. MR MOULD (DfT): All I have said, Mrs Gillan, is that she will receive a letter.

65. MRS GILLAN: Okay, but if it is not satisfactorily resolved you know she’s

coming before this Committee again on 3 February and I hope you will come to a fair

agreement but Mrs Raffety has asked me to raise the point, and I think this is very fair,

that she has been able to get –

66. SIR PETER BOTTOMLEY: Is this the Corbyn approach?

67. MRS GILLAN: No, this is not the Corbyn approach. These are individual

constituents with issues which, if they can’t raise them themselves would like me to

raise with you.

68. SIR PETER BOTTOMLEY: I was making a bad joke.

69. MRS GILLAN: I know you were but you have to understand, Sir Peter, that I

have lived with this for six years and so have my constituents.

70. SIR PETER BOTTOMLEY: Indeed.

71. MRS GILLAN: It is not a joke to any of us. This is a tough gig. In 23 years in

this House, and I know you have had more experience than me, I have never had such a

contentious or more painful issue to deal with, with such a large number of people.

72. SIR PETER BOTTOMLEY: We respect taking up the point for constituents.

That was not challenged.

20

73. MRS GILLAN: Thank you. Mrs Raffety wanted me to say that she has been

fortunate enough to be in a position to be able to afford to employ a barrister to

represent her who has been able to assist her and negotiate even though at the moment

she has not received a satisfactory offer. She shares a concern for the many other

people, and I share this with her, who are not in a position to employ a barrister or

negotiate the Need to Sell scheme who find themselves in the unenviable position of

having no choice but to accept an inferior offer. I have had many complex cases and it

is perhaps a forum for another committee but I think you should know and be left in no

uncertain doubt of the inequitable nature of this process. I have had constituents who

have been frightened to draw their plight to the attention of this Committee or to speak

out in public because they think it will affect their chances of selling their houses. They

are reluctant to even approach the local authorities in case it prejudices their position

and didn’t want to appear before this Committee while a house was on the market. One

of my constituents said that because the hearings are public he was concerned he would

shoot himself in the foot.

74. So, even the very mechanism we have given to those people they are not able to

access and they are frightened that it would prejudice their positions. I do not accept the

department’s argument that the compensation offers for HS2 are discretionary and that

they are already going above and beyond for those who are affected. When the state

imposes such a burden of disruption and financial loss on individuals through no fault of

their own, I think it is the state who has to pay in a democracy. Put simply, that has not

really been happening. Considering the far more generous compensation scheme that is

being proposed for Heathrow, the compensation offered here is not really compensation

at all. In many instances it has been less than the real value of the property.

75. Slide 12 is the independent regulatory body. The PRD said that the nominated

undertaker would put in place appropriate monitoring practices. That fills me with real

dread because I’ve looked at this quite carefully. I may be wrong and I stand to be

corrected but I think there are few and little ways of holding HS2 or its contractors to

account and of ensuring that the impacts of HS2, particularly as set out in the

Environmental Statements, are not exceeded. Currently, and forgive me for this, the

EMR, the Environmental Minimum Requirements, the Code of Construction Practice,

the CoCP, and the Local Environmental Management Plans, the LEMPs, together with

21

the assurances and undertakings given by HS2 during the Hybrid Bill process will be

made contractually binding on any nominated undertaker appointed after Royal Assent.

But the contractual relationship is between the nominated undertaker and the contractor

who is engaged to carry out the works. Stay with me on this. The monitoring and

enforcement will be carried out by those bodies tasked with the construction work and I

think there are several problems with this approach. EMRs and the CoCP are caveated

by reasonable practicability, that phrase again, and I think that is further tempered by the

requirement that a mitigation measure need not be implemented if it adds unreasonable

cost to the project or unreasonable delays to the construction programme. That gives the

nominated undertaker in charge of monitoring itself a get out of jail free card.

Presumably, I think it would be quite easy to say that almost anything could cause

delays to the project and add cost and is not reasonably practical.

76. So, the next problem is around the enforceability of those assurances, the EMRs

and the CoCP. If I have read my PRD correctly, the remedy is firstly to report it to the

nominated undertaker, then if not satisfied to the Secretary of State for Transport and, if

I’m satisfied by the Secretary of State for Transport’s response – I had to read this twice

– to the Speaker of the House of Commons or to the Chairman of Committees in the

House of Lords. The SoS also stated that insofar as the Environmental Minimum

Requirements are not directly enforceable against any person appointed as the

nominated undertaker, the Secretary of State will take such steps as he considers

reasonable and necessary to secure compliance with those requirements. Well,

Mr Syms, he may not think it reasonable or necessary to take action and the whole of

the way that this is drafted for accountability and enforceability seems to be really all at

sea.

77. I asked my local authorities if they had been involved in drafting the LEMPs, the

Local Environmental Plans, and they said that they had been told that these would not

be finalised for council and community engagement until early autumn 2016 because it

will be for the contractors to check and agree their final contents. So, even the work is

being done without local input and by the very people who will be judge and jury on this

project.

78. I think this really reinforces the need for an independent claims or construction

commissioner and not one that can only cover claims up to £7,500. There are lots of

22

other exclusions that really should be taken into consideration. It is not for the bigger

picture, what is being proposed. It will not have the remit to cover the scale of different

issues relating to the environmental impacts and is simply not sufficient.

79. At the very least I am keen to ensure that this commissioner will be completely

independent. It took me nine months to get the Residents Commissioner to come and

see me. I think I was the first MP that she saw and although she is doing a reasonable

job, she is not actually independent. She reports to the Chairman of HS2 Limited, she is

paid for by HS2 Limited and she sits in their offices. I think that we need a truly

independent ombudsman with wide powers and sanctions to hold HS2 and its

contractors to account, reporting to Parliament. I think also that the habitat mitigation

element in the PRD which stated that the LEMPs will not include matters around the

detailed design of habitat mitigation, which will be dealt with by other means is

extraordinary. For this reason it cannot be right for the Speaker’s office to have to deal

with issues surrounding the construction of HS2 as it will not have any of the relevant

expertise to assess whether something has been done properly, particularly

environmentally.

80. All of this needs to go to an independent regulator reporting to Parliament and

whoever the nominated undertakers are, they will not be able to back out of their

environmental and other commitments. I think it should be a panel body and should

include people from a variety of different backgrounds. Sir Henry is not in his place but

I actually think it should have people with various disciplines and expertise who would,

during the construction period, report biannually on compliance with EMRs and the

CoCP and should be empowered to order action to be taken to remedy where there is no

compliance.

81. One constituent this week even raised the need for a safety regulator and feels that

it has not been emphasised strongly enough because constituents need that reassurance

that their safety and comfort will be taken seriously in both construction and operation.

Even if the Committee cannot bring about such a change within their remit, it would

certainly be helpful for the Committee to make a recommendation for consideration at

future stages of the Bill.

82. I am almost there, and Sir Peter is still with me, I hope. I really would like to

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reiterate my request in slide 13 for an AONB HS2 mitigation panel. My local

authorities have been led to believe that such a panel would be set up for the AONB but

it transpires that they will have a design panel, again which strikes horror in my heart,

which will have a lesser remit. It will only be able to look at design-specific issues and I

don’t see where the local input is really going to come.

83. Mr Strachan, I think it was, on 20 January said that a panel wouldn't be necessary

given the current mitigation and good collaboration in the Chilterns, but I actually think

that the designation of the AONB really warrants and deserves this focus. The Colne

Valley has such a committee. They have a mitigation panel and £3.3 million worth of

additional funds to go alongside it. It seems extremely surprising to me – I don’t want

to take it away from them; they should have it because I am very supportive of

protecting the Colne Valley – that if such a panel has been approved for the Colne

Valley, then it is inequitable that a statutorily protected landscape should not have that

courtesy afforded to it. I don’t see what the difference is and I think that that should be

rectified.

84. On the next slide – I am just piling up a few points – if we are not going to have a

tunnel I think you should consider making a recommendation that the speed of this HS2

vehicle should be reduced to that of a TGV, which is 300 kilometres per hour. It would

still be a high speed line but the environmental impacts would be much less. That was

recommended by the Environmental Audit Committee and has been ignored, as far as I

know, by HS2. I could be wrong but I have not been able to find it in wading through

the documents.

85. On trees I have to say I have worked closely with the Woodland Trust, as I have

done for years. Penn Woods, in my constituency, over 20 years ago was the first

significant wood that was saved by the Woodland Trust. I worked on that campaign

with many passionate people locally. I know that 2 million trees are proposed to be

planted but they do not replace ancient woodland, as I think we have long established in

debates in this House. However, there is a problem over their maintenance and care,

how that will be paid for by the promoter and over what period of time. I think we need

to have a proper strategy for tree maintenance. The Committee should urge HS2 to give

an undertaking that it will maintain the trees and cover the cost of this over a period of

at least 10 years.

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86. The Committee also knows, and I mentioned it earlier, my concern about the

River Misbourne. It is a fragile, sensitive chalk stream. I want to move back down the

line to Chalfont St Giles because the people there are very worried and concerned that

this stream will be irreversibly damaged. The area directly above the tunnel is prone to

flooding and I am worried that this area will be damaged during the boring process. I

have been informed by constituents in the group Misbourne River Action, that

preventative mitigation is available to combat those issues and it would be helpful to

have confirmation from HS2 that they will accept liability for any damage caused to this

area and will, of course, remedy any damage that is caused.

87. My last slide is a repeat of my first slide and is to reinforce what I am asking for.

I want that tunnel really to the end of the AONB but, in the end, any movement away

from the centre of South Heath and Potter Row would be appreciated and would save a

lot of aggravation. I definitely want the Need to Sell scheme improved and you need to

ensure that you put the boot in, Mr Chairman, because it’s not good enough. We should

be ashamed by the way we have treated people. I want the AONB to have its own

mitigation review panel because I think it is important and is the least that anybody

could do to protect this area. I am very worried that once the caravan has moved on,

once the spotlight and the focus is taken off HS2 when the legislation has gone through

this place that there will not be a mechanism for allowing this project and its operators

to be held to account. So, I think an independent regulatory body, regularly to review

and monitor this process, is essential. You can divide and rule. You could have lots of

committees looking at it, the Transport Select Committee, the Public Procedures

Committee and the National Audit Office. You could have the PAC doing little bits

here and there. We need somebody that is accessible immediately by people affected on

that day by something that is happening who have the clout, the capability and the

resource to be able to respond to it and hold those people to account.

88. HS2 has a very poor track record of implementing recommendations made by this

House or Members of this House and others and I would like to reserve my right to

appear before this Committee or any other Committee in this House or in the House of

Lords to follow up on these events.

89. I leave you with this thought. We have a horror in this House of Henry VIII

powers but I have felt that this project has been a bit like Henry VIII. It has had powers

25

that have far exceeded any of the capabilities of Members of this House or of our

citizens who have found it very hard to hold back the tide or even to fight to get their

voices heard as this huge, gargantuan project rolls on.

90. Thank you so much for your attention. I hope I have stayed within my hour. As I

say, as a little aide memoire I have a page and a half with all the points that I have tried

to put in there because I know it is complex. It is hard to think that six years’ work

comes down to an hour before this Committee, but that’s the way of life, isn’t it?

91. CHAIR: Henry had to go and ask a Question in Transport Questions and Geoffrey

has a meeting with a Minister, so clearly they will have been disappointed to have

missed you but you did very well, given you have a cold, to get through quite a lot.

Mr Mould, some of the matters can be picked up by written answer on some of the more

detailed things. Are there any comments you wish to take?

92. MR MOULD QC (DfT): What I will do, if you don’t mind, is just respond

briefly on this slide, because these are Mrs Gillan’s principal points, I think, for today. I

might just begin by saying that I don’t recall from my admittedly partial and hazy

memory of my Tudor history studies that Henry VIII was disposed to expose his

proposed Bills to nearly two years of scrutiny by a Committee of his Parliaments, but

there it is. That is perhaps the least of my points today.

93. More tunnelling: there is more tunnelling. AP4 extends the Chiltern Tunnel,

which was proposed under the Bill in response to the recommendation of this

Committee having heard the evidence of both parties – I say both parties; the Promoter

and those many petitioners who appeared in support of extending the tunnel in the

hearings before you.

94. You will recall that the basis upon which we argued the case was that, as one

extended the tunnel further to the north, the law of diminishing returns set in. That is to

say that the cost of extending the tunnel would be realised by considerably diminishing

environmental returns, and that that was, like it or not, an important consideration in

relation to a scheme and economy where resources are limited and there may need to be

spent in a prudent way. We’ve never said that there will not be environmental impacts

on the AONB. What we have said is that those impacts would be relatively localised,

and I’ll just leave you with two thoughts. The first that extending the tunnel throughout

26

the AONB, which still remains the main request of those who promote the case for a

tunnel, does not come without either temporary or permanent effects, significant effects,

on the AONB.

95. The construction of such a tunnel would require very substantial traffic

movements through the AONB. It would require the creation of an enduring and large

construction site just at the northern border of the AONB, and in terms of the permanent

effects, you would effectively substitute a viaduct for a kilometre long intervention gap

as a permanent feature. There has been a constant denial by petitioners of those

inescapable facts. There are others as well, but I just mentioned those two. I would

respectfully suggest that the Committee has, having heard the cases for and against, has

got the balance right here in the recommendation that it made back in the middle of last

year. The second point...

96. MRS GILLAN: May I take up a point?

97. MR MOULD QC (DfT): Well, can I respond?

98. MRS GILLAN: Just on that tunnel, because...

99. CHAIR: I think we have to have a response then you can come back at the end.

100. MRS GILLAN: But on that particular point, just before I come back. The HS2

zone sift actually came up with greater environmental benefits than AP4.

101. MR MOULD QC (DfT): I have not said that the REPA tunnel would not provide

some additional environmental benefit. Our case has been that it would, but the cost of

achieving that environmental benefit, in our judgement, is disproportionate to the gain

that one would get. That is a controversial point. You and those who are with you

disagree with us on that, but we have made that case and the Committee has heard the

arguments and no doubt will reflect on that in making its final report. Improved NTS,

the Committee has reported to the Secretary of State its recommendations in relation to

the NTS in the early months of its operation, and, as the Committee knows, the

Secretary of State is considering his response to that and I have indicated, as the

Committee knows from the other sources, that the response of the Secretary of State is

imminent.

27

102. I also remind the Committee that the Secretary of State is himself consulting on

the NTS in the consultation on compensation schemes for the phase 2A proposal, and

there is an opportunity there for the public, including the public who live in Ms Gillan’s

constituency, to participate in that consultation with a view to persuading the Secretary

of State, if they wish to do so, to make further changes to the NTS scheme. That is

another route that is available to them. Meanwhile, the Committee has standing a

number of cases which it has heard and we have either reported back or where decisions

are imminent, but the further point to make on this is to remind ourselves that the NTS

operates under the aegis of a scheme which involves an independent panel.

103. But whereas I emphasised the other day in response to another petition, where,

ultimately, the Secretary of State is responsible in decisions in relation to his own

scheme and he is answerable for those decisions, both for parliament but also if he –

because this is a scheme which requires him to exercise a reviewable discretion to the

courts in principle as well. So there is a transparent and clear judicial and parliamentary

scrutiny of the operation of that scheme. The AONB Panel, there was a debate about

this when Bucks County appeared before you in one of your recent sittings. What I can

say is that, following that debate, the project has been in further discussion with the

intended members of the Panel which comprises of the county and district level

councils, Natural England and the Chilterns Conservation Board, and we are hopeful

that we will agree a joint statement on this question before the Committee completes its

work and that will include the question of appropriate funding in relation to that panel.

104. So there will be a report back on that, ideally, whilst the Committee is still seized

of this matter. So far as the independent regulatory body is concerned, there is a – it is

the Secretary of State’s stated intention, to which he has committed, that he will appoint

an independent person to receive complaints and concerns about the construction of the

project, that person being the construction commissioner, and as Information Paper G3

makes absolutely clear, not only will that person be an independent appointment, but

that person will operate independently of the nominated undertaker and independently

of his contractors and independently of the project and will report in relation to any

complaint that is received about the construction of the project, report that on an

independent basis to the project and to the Secretary of State and it will be for the

project and for the Secretary of State to consider what action should be taken in

28

response to that report.

105. That is one part of a panoply of compliance and enforcement regimes that applies

to this project, which are explained in Information Paper E1 and in other information

papers, and, in effect, that which Ms Gillan has asked for is that which the Secretary of

State will provide. There will be an independent body in the form of the commissioner

who will fulfil that function, and the Committee will no doubt want to reflect on this

point: ultimately, responsibility for regulating the performance of the construction of

this project will rest with the Secretary of State. It will rest with him with the

contractual liabilities that are placed on the nominated undertaker and his contractors. It

will rest with him in relation to the statutory duty which the nominated undertaker has to

exercise all reasonable care and skill in the construction of the project, and it will rest

with him through the undertaking that I gave on behalf of the Secretary of State in

opening these committee’s proceedings back on 1 July 2014.

106. The Committee will reflect, I have no doubt, on whether it is in the final analysis

more appropriate that a minister of the government, answerable to parliament, and a

democratically minister of that, should be responsible for regulating and securing

compliance with the statutory and extra-statutory commitments under which this project

will be constructed, or whether it should be an appointed official who undertakes that

role. The Secretary of State’s view is that he, answerable to parliament and answerable

and judicially reviewable in his actions, should be responsible for that, rather than some

independently appointed official. One or two other points, if I may, just for detail,

because I’m conscious that we’re on the record and that people will – I should correct

that. This will take no more than a few minutes.

107. First of all, the haul road. The position is as I stated it. We do not propose, under

the Bill, to shift the haul road from the route that you saw, but we have agreed with

Buckinghamshire County Council is that they will take forward an initiative at their

responsibility of looking to whether we can shift the haul road further to the north. It is

set out in the letter that was negotiated with them in glance of their petition, and I am

told that the final version of that letter is going is intended to be sent out to them today,

but I remind – through you, I remind Ms Gillan’s constituents that if that happens, we

think that the inescapable consequence of moving to the north will be that we will have

to reinstate Thrift Hill as a construction route for systems fit out for the railway. So,

29

again, none of these things comes without consequential impacts of their own.

108. There were just a couple of other points. Noise; there is a system, agreed with

Chiltern District Council as the lead authority on noise, there is a system for future

monitoring of the operation of the railway to ensure that we comply, as far as we can,

with the design objectives set out in Information Paper E20 and it is the system that is

now in the public domain and is explained in Information Paper F4. Oh, yes. Two

more things. Traffic management plan; the traffic management plan that Ms Gillan

refers to is the route-wide traffic management plan which provides the framework

against which local plans will be developed, and its publication follows consultation on

a draft with the highway subgroup of local highway authorities, which itself forms part

of the planning forum about which you have heard.

109. The final point is in relation to the 300 kilometres per hour speed matter that was

considered by another committee at this house. The reason why that committee invited

the Secretary of State to consider limited the speed of the railway was nothing to do

with localised environmental impacts. It was to do with the trade-off between speed and

emissions for as long as coal- fired sources of power were being deployed. So it was a

very different point. Not a matter before this committee, a matter which forms part of

the public consideration of this bill before the House.

110. MRS GILLAN: Chair, can I respond to Mr Mould? First of all, can I say I

welcome these reassurances of the AONB and the HS2 Mitigation Review Panel, which

is, I hope, in effect going to be constituted, but as Sir Henry has asked me to provide my

ideas and my constituents ideas on the composition of that panel, I will provide the

Committee that next week, but I am reassured that it’s on its way, which is slightly

better than the design panel that we were left with. I do have to say, coming back on the

tunnelling provisions, as I said in my rude intervention before letting Mr Mould get to

the end of his points, the assessment by HS2 did show greater environmental gain from

the REPA tunnel, and of course, you get rid of the issues with the vent shaft and the

viaduct as well, but it will be an argument that goes on forever. As I say, the emergence

of the tunnel at the AP4 point is still an arbitrary point and does not make sense to the

tunnelling experts that have advised me over the years.

111. The consulting on the NTS scheme, I’m sure my constituents will be pleased to

30

know that they are able to input into another consultation, yet another consultation on

the compensation scheme that is five years old, effectively, as far as my constituents are

concerned, but in phase 2, the people that are about to subjected to this monster have no

experience of how the NTS scheme has operated or even the exceptional hardship

scheme in its initial phases. So I think we need to make sure that the experiences that

the people have had on the London to Birmingham route need to be really taken into

consideration. The haul road; I am grateful for the clarification from Mr Mould. The

impression that is being given though is that it – every suggestion locally comes with an

implied threat, and now Thrift Hill has been brought into play.

112. What I do hope is, what was agreed out in the corridor with members of the Bucks

County Council is that the local solutions would be taken clearly onboard and be

considered, because it always seems to me as if a barrier is put in the way for when local

solutions are brought up. The noise; Mr Mould referred to operating. I am concerned

with noise during the construction phase, so that still remains out with. I hear that the

TMP report that was issued on 20 January is premature to the points that I am making. I

very much hope that our local transport and highways authority will be taken into

account as Mr Mould has described.

113. Finally on the regulatory body; the construction complaints commissioner that Mr

Mould read out is not the same as what I am proposing, and indeed, in my PRD, as I

say, the – for environmental minimum requirements, the report to be nominated

undertaker, the first step is to report any breach to the nominated undertaker, and the

nominated undertaker will implement the necessary corrective actions, then it goes to

the Secretary of State, then it goes to the Department of Transport, and then it reports to

parliament and then, if parliament is unsatisfied with the Department of Transport, it

goes to the Speaker and to the House of Lords Select Committee and Chairman of

Committees in the House of Lords, under standing order 130. I’m sorry, it ends up with

the Speaker of the House, this particular procedure, which, for me, is really quite

baffling.

114. CHAIR: You know and I know that whoever is Undersecretary of State for

Transport, when this is being built, is going to spend endless hours doing adjournment

notes every time something gets breached up and down the line, so it’s going to be a joy

of a job to have.

31

115. MRS GILLAN: Can I just finally say, I accept everything that Mr Mould has put.

He is a very highly paid, sophisticated legal operator that I have watched with

admiration throughout this process.

116. MR MOULD QC (DfT): That’s partly right.

117. MRS GILLAN: And a bit of trepidation, I can’t possibly compete with him, but

you can, Chairman. This committee has powers to go further, and that is the most

important point of all. I always expect sophisticated arguments back from Mr Mould,

but you have the power to bring about some of the smaller asks and to oversee some of

the bigger asks that I have tried to outline today. So I hope that some of my asks have

not fallen on deaf ears.

118. CHAIR: Thank you very much. Thank you very much for coming, and we have

other petitioners to see this morning, so thank you and thank you for your contribution

and suggestions over the period we have been sitting. Right, we now move on to the

next petitioner, which is 405, Management Consortium Bid Ltd, Freightliner Ltd and

others, represented by Bircham Dyson Bell. Hello.

Management Consortium Bid Ltd, Freightliner Ltd and others

119. MR BIRD QC: Hello.

120. CHAIR: Okay.

121. MR BIRD QC: Petition numbers 401, 405, 407 and 1774.

122. CHAIR: Yeah. Could you tell us who those petitioners are?

123. MR BIRD QC: Yes. They are the Rail Freight Group, the Freight Transport

Association, DB Schenker and Freightliner.

124. CHAIR: Okay.

125. MR BIRD QC: DB Schenker have, as it were, an individual issue which is not

raised in common with the others under 401, and that’s going to follow sequentially and

is separate.

126. CHAIR: Okay.

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127. SIR PETER BOTTOMLEY: Do you understand, Mr Mould?

128. MR MOULD QC (DfT): I do, thank you, yes

129. CHAIR: All right.

130. MR MOULD QC (DfT): Yes, because I’m a highly sophisticated legal operator.

131. MR BIRD QC: And highly paid, I think.

132. MR MOULD QC (DfT): No, no, that’s wrong.

133. MR BIRD QC: So just for clarity, if I may, the individual matters affecting the

individuals petitioners which are seen in their petitions are either the subject of

discussions and likely to reach agreement or have already been dealt with relevant

assurances, and the focus of the evidence from the two principle outstanding common

issues is, firstly, access to the freed up capacity for rail freight after HS2 phase 1, and

secondly, the use of rail freight to support construction of HS2 as part of the project.

That second element is not part of the Freight Transport Association petition for the

record, if I could make that known. If it would help, I have five very brief points to

make by way of summary and I’m going to turn to call Ms Maggie Simpson, who is the

executive director of the Rail Freight Group, in order to address the evidence.

134. The five brief points are, firstly, both in the case for HS2 and in the supporting

environmental statement, significant stress is laid on the benefits of HS2 in terms of

increased capacity for use of rail freight. Those include the economic benefits,

supporting growth and the environmental, for example, the removal of lorries from the

nation’s roads. HS2 will deliver transformational change to the rail network. A new

timetable in particular will be required for the West Coast Main Line, and it presents the

opportunity for a clean sheet review of timetabling. That is recognised in HS2’s own

indicative timetabling work, and for reference that is P1539 slide 15, paragraphs 5.1.1

and 5.1.2.

135. Thirdly, to secure the stated rail freight benefits of HS2, investors in this sector

require early certainty that opportunities for growth in exist in what is and will remain a

highly competitive environment, and that opportunities for Rail Freight Group are not

squeezed out by passenger services. The indicative timetabling work undertaken by

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HS2 provides no confidence in this respect. Fourthly, whilst petitioners understand the

Bill does not seek to interfere with the existing regulatory framework, it is essential,

given the scale of the change which HS2 will effect, that there is commitment within the

Bill to the principles, which the Secretary of State has stressed will be applied to

capacity, and it’s important they are followed through within the operation of the

regulatory framework.

136. We have set out in the presentation one way of providing for that by a minor

amendment of the Bill, which commits the Secretary of State to issue guidance of the

principles to be applied in the use of capacity released by HS2.

137. SIR PETER BOTTOMLEY: That’s on 2056(10).

138. MR BIRD QC: Indeed it is, Sir Peter. That is less than the commitment which

was originally sought, but does respect the approach of the Bill, and it goes further than

the power to issue guidance, which the Secretary of State presently has, and requires

there to be a commitment to issue guidance to deal with that issue. That’s a brief

summary of the position on the capacity issue. The separate issue, which is the use of

rail freight to support construction, there is at present an apparent and unhelpful

mismatch between the Promoter’s stated intent and practical arrangements which are

being put in place, and this needs to be addressed by stronger assurances than those

which have been offered to date. So I hope that crystallises in summary the two

principal points for the joint petition.

139. For more, I’m just to turn to Ms Maggie Simpson, whom I said is the executive

director of the Rail Freight Group, to address you by reference to the presentation. I

think we’ve lost one screen right, but I hope you people can see the screen left. Ms

Simpson, if you could turn first, please, to slide 2 where have identified that HS2 is a

once- in-a-lifetime opportunity for rail freight. If you could just distil the message you

draw from the quotations that you’ve set out here and how it bears on the case which the

Petitioners are presenting.

140. MS SIMPSON: Thank you very much. We recognise the High Speed 2

represents a once-in-a- lifetime opportunity for the UK railways and in particular for the

rail freight sector, who has the potential to transform the opportunity to growth and to

provide new opportunities for rail freight to run additional services. We know that

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government and High Speed 2 recognise this. It’s demonstrated in the quotes which we

have on the slide in front of you, and also presented in more detail in High Speed 2’s

evidence in P153501 and subsequent pages, a number of strong statements relating to

how High Speed 2 could in theory help support growth of rail freight.

141. These benefits will not be delivered by chance, and we’re concerned that the

existing processes which exist and indeed the work which has been done to date around

these issues is not sufficient to provide the necessary assurance to those in the rail

freight sector, both the operators, the customers and those investing, that the right

outcome will be delivered for us in the future. We come to this committee today not

seeking major changes or significant requirements. We’re not looking for interventions

which will cost a huge amount of money, but asking the Committee to steer High Speed

2 and the department and the Secretary of State towards additional guidance which can

help build the confidence necessary to make sure that these benefits are delivered in

reality.

142. If I can go onto the next slide, please. By way of illustration, and I appreciate this

is not as pretty perhaps as the bluebell woods we saw on the previous Petitioner’s slides,

but some examples of the kind of rail freight that we see moving today on the West

Coast Main Line. Deep sea, intermodal, Minis and their other automotive building

materials, serving construction sites in London and elsewhere, domestic intermodal for

Tesco, supermarket goods and such- like. If we could have the next slide, please.

143. MR CLIFTON-BROWN: Can I just stop you?

144. MS SIMPSON: Of course.

145. MR CLIFTON-BROWN: I’m not quite sure what your ask here is. Are you

really suggesting that these forms of what are called bulk and large freight should go

onto HS2, or are we talking about small, high value freight?

146. MS SIMPSON: I’m absolutely not asking for any freight to run on High Speed 2.

We have agreed an assurance with High Speed 2 that it will be built with sufficient

gauge, should that be required in the future. We are asking about the use of the released

capacity on the existing rail network, principally the West Coast Main Line, which High

Speed 2 will create, and our concerns around the impact of High Speed 2 services on the

35

West Coast and around the processes for the reallocation of that capacity, which form a

fairly important part of the business case for High Speed 2.

147. MR BIRD QC: And then slide 4, you said that in context, identifying how vital

the West Coast Main Line is for rail freight.

148. MS SIMPSON: I did so. We estimate that of intermodal trains, that is coming

from the nation’s deep sea ports, particularly with imported and exported goods, around

95% of those travel at some point in their journey on the West Coast Main Line. It’s

entirely surprising, given that it serves several of Britain’s largest conurbations that that

would be the case. We estimate today that we’re short – or 950,000 containers per year

would otherwise go on the road network, just based on the existing traffic that we’ve

got. In terms of the projections of growth, the chart on the left is based on existing and

agreed industry forecasts produced by Network Rail and endorsed by government, and it

shows the scale of the opportunity that we have to grow rail freight if the conditions are

right.

149. Could I have the next slide, please?

150. MR HENDRICK: Do those figures relate at all to the inclusion of phase 2 of HS2

or is this just looking at phase 1?

151. MS SIMPSON: Those are what we’d call an unconstrained forecast. So they

show potential of the railway to include more rail freight if the conditions are right to do

that, but you are quite right that, in terms of the planning of rail freight, we need to look

at it holistically. So in terms of the phasing of High Speed 2, obviously some of the

benefits won’t be delivered until we get the released capacity as far as Manchester at the

end of the...

152. MR HENDRICK: So in order to release capacity on the West Coast Main Line,

he presumes there is, running that far north, rather than just to Birmingham –

153. MS SIMPSON: Well, some will want to go to Birmingham, undoubtedly. There

are a number of major distribution centres in and around the Birmingham area, and

some will wish to continue on to Manchester, to Liverpool, and indeed up to the Central

Belt of Scotland. Part of the point that we’re trying to make today is that you have to

36

plan this on a holistic basis, and if you salami slice the capacity up into little pieces, you

will end up without rail freight being able to run because of the necessity to plan it on a

holistic basis. So the kinds of trains that we have run from Felixstowe, then they come

down the Great Eastern Main Line around London, then they come in from the ports at

London. They may have come from Southampton. They may be coming from the

quarries in the Midlands down to London, and they will be running on a number of rail

routes, but the central core of that journey will be the West Coast Main Line, which is

why it’s so critical for us.

154. MR BIRD QC: Then if we go to slide 5, where you address growth. You pick up

in part of those sorts of issues, because you identify the 2012 trade market study base

and then look forward to 2033, looking at two sections of the route, in terms of growth

projections.

155. MS SIMPSON: Indeed. The purpose of this slide is not to get drawn out into the

details of specific numbers of the past, but to illustrate that, if we want to sustain growth

and take more lorries off the roads, then we need have more paths on the West Coast

Main Line. High Speed 2 is an opportunity to do that, but I think it’s also worth

highlighting that, as well as track capacity, if we wish to have sustained growth in rail

freight and to keep more lorries off the road and to match economic growth in the

country, we also need investment, and that investment needs to be in rolling stock and

equipment and in terminals. For example, if you took High Speed 2’s indicative

timetable, P15349, page 41 of that, for example, suggests that, in order to fit on the

network, class 92 or other suitable electric tractions is likely to be required in the future.

156. Now, we have some serious reservations about that work. We’ll come onto that

later, but nonetheless, an illustration of the kind of investment that is likely to be

necessary by my members in the rail freight sector, an electric locomotive costs today

about £4 million. If you are going to make that sort of investment, you need to have

reasonable assurance that you will be able to use them, and that you have to have that

confidence now to be able to plan the kind of investments that you need to make over

the coming decade. Next slide, please.

157. MR BIRD QC: Then in slide 6 you produce three letters from various customers

of the rail freight, and perhaps you could just summarise who are the sector investors,

37

where are they investing, what they need in terms of investment and what the future

holds in terms of HS2 unless there is a degree of certainty?

158. MS SIMPSON: Yes, thank you. We have three letters on the screen in front of

you now. We have some other similar ones that have come in from a range of people

who have been investing in the network. Malcolm Rail are a logistics company. They

are a road and rail logistics operator. They have a great number of lorries and they also

use rail, and they have been investing in the rail offering over a number of years for the

retail sector. VTG are a wagon manufacture. They are a German company. They make

wagons all the way across Europe, including for the UK market, and Prologis are an

American business. They are warehouse developers and they have been investing in the

major railing facility at Daventry, which handles a lot of goods. We also have letters

from a shipping line and from some other logistics businesses.

159. These are all private sector businesses. They don’t have to invest in frail freight.

They don’t actually have to invest in the UK. Prologis, for example, builds a lot of

warehouses in China, and when they are going to their boards to seek investment

authority, they wish to have confidence that rail freight will deliver for them in the

future, and the kind of investments these people are making are long lead time. It takes

a number of years to design, test, get approval and then build a new wagon, even with

new streamlined planning processes, and I make no reference to the comparison to this.

Getting planning permission for a new terminal can still take two to three years and

costs many millions of pounds, and that’s before the early work which would need to be

done before you could begin to submit your application.

160. So if we are looking at investment needed to deliver growth in the 2020s, people

need to be thinking about those plans today and they need to be factoring that into their

forward investment plans, not just for the UK or for the UK rail, but necessarily on the

global basis on which they operate. You would be right to say, well, look, these people

are investing. They have been investing, so what has changed? Why are we here today

to ask for additional support? We are aware that the capacity on the West Coast Main

Line is becoming more congested than it ever has been before. The ability of these

people to find new rail pass for new services is becoming more difficult.

161. They can’t always get them at the times of day that they wish to have them. They

38

can’t always match them up with their customer needs, and so people are beginning to

be concerned about the future of capacity and they view High Speed 2 as an opportunity

to help address that, and they believe that the commitment of government to using High

Speed 2 to help rail freight is important and they see this process as a litmus test of that

commitment. Can we get that commitment today to help them form their plans in the

future? Waiting for assurance until High Speed 2 is near open in the mid-2020s will

delays investment, possibly preclude investment and by the time we get there, some of

these people may well have walked away from the market. Could I have the next slide,

please?

162. MR BIRD QC: And you then I think turn to deal with some of the difficulties

facing rail freight growth.

163. MS SIMPSON: Certainly. I think it’s important to recognise that the rail freight

sector is not like the majority of the passenger businesses. So passenger services are

specified by government and they are underpinned in contracts, and whilst there is

plenty of entrepreneurial flair in the way that those franchises are operated, they are

backed by government. They generally change their timetables relatively infrequently

and their service specifications are often specified, in some detail in some cases, by

government. We see already reports that the West Coast Main Line franchise renewal

may well slip because of uncertainties around how High Speed 2, and particularly the

construction phase 1, will be managed, but government will back the franchises and

seek to protect them in so doing.

164. The freight market is different to that. We operate on a commercial, open access

basis. It is good that we do. Our customers like that. We are not asking for the kind of

protection that some of the passenger franchises have, but our businesses are different.

We run our services when our customers want them. Our customers change their minds,

shockingly. Many of the businesses are seasonal. We close down for Chinese New

Year. We have more construction traffic when the sun shines and the markets change

quickly as well. Who would have thought of the success of automotive construction in

the UK in the last decade? We are now moving somewhere in the order of 12% to 15%

of finished automotives in the UK with an opportunity for more. We need to know that

we’ve got the strategic...

39

165. SIR PETER BOTTOMLEY: Can I interrupt you for a second?

166. MS SIMPSON: Of course.

167. SIR PETER BOTTOMLEY: Sorry, I want to declare I am honorary president of

the British International Freight Association, which is not relevant to this, but it’s on the

record.

168. MS SIMPSON: A very good colleague of ours.

169. SIR PETER BOTTOMLEY: The near doubling of rail freight over the last 20

years or so, besides growth in the economy, what have been the main associated reasons

for that?

170. MS SIMPSON: I think you have to take different markets slightly separately.

The two sectors that I would highlight that have grown particularly strongly are

intermodal, and that has grown very strongly as a consequence of investment in that

market, so government has invested in the network for rail freight, principally to allow

modern sized shipping containers to be conveyed, but the private sector markets have

invested in the efficient locomotives, new wagons and multiple terminals that allow

choice in the markets. So around Birmingham today there are three or four different

terminals one can access as opposed to perhaps the single one that was there at

privatisation, offering choice, and of course, we have seen, as you rightly say, a

common growth in that market.

171. So we’ve seen rail freight grow as the economy has grown, but we have also seen

our market share increase over that time, and the same with the movements of

construction materials, though that does move very much with the economy as

infrastructure development goes up and down. We’ve seen a generalised trend towards

rail taking a greater share of that market.

172. MR BIRD QC: And I think in the second bullets on this slide, you address the

issue of certainty and how important that is to effectively the rail freight business.

173. MS SIMPSON: Yes, indeed. I cannot sit here today and say that in 2026 there

will need to be three trains precisely between this port and this terminal, but

nonetheless, we know with market share growth, there will be a need for strategic paths,

40

and that we need to have confidence of that now so that people can make the necessary

plans in their businesses to support that.

174. MR BIRD QC: Then I think if we turn to the next slide, slide 8, you give some

examples of some of the difficulties which are facing rail freight growth and some

detailed examples. Perhaps you could just outline in general terms the consequences of

those and how they have arisen.

175. MS SIMPSON: Yes. We’ve put down some very detailed examples here and I

won’t bore you with the details, because, in essence, the details are relevant. The point

is that what we see is that if you are trying to run rail freight with strategic paths end-to-

end on a holistic basis, it is very easy for that capacity to be interfered with by small

changes in the timetables of other operators, and that can lead to a position where it’s

very hard to secure growth. So on the middle and main line today, for example, there

are no more end-to-end freight paths available. The ones that we think might be

available we find to be breached by often small passenger movements crossing over the

path at one particular point.

176. That is not to be rude about the passenger operators. They, like us, are seeking

growth. It is a congested network, but the process that we have today, in terms of

planning and operating our timetable, raises these challenges all the time.

177. MR HENDRICK: Would you therefore have to have, well in advance, contractual

agreements on what levels of capacity you might need in the future?

178. MS SIMPSON: Well, I would love to think that we could get that, and indeed in

our petition we asked for something sort of suggesting that, but we recognise that people

don’t want to tie up the networks through contractual paths, and so what we are looking

for is to get more clarity and guidance around the fact that some strategic capacity will

be earmarked for freight on the network and that, when we get to the point where

timetables are planned in advance of High Speed 2 opening, that that strategic provision

can then be translated into this specific pass on the network.

179. MR HENDRICK: Prior to that, I mean, the big names you have mentioned who

are going to invest, presumably if they’re going to put some serious money in there, in

advance enough to have obviously rolling stock ready, presumably they’d want some

41

sort of guarantee that they are going to get a share of that capacity.

180. MS SIMPSON: Yes, they certainly want confidence that the processes will

deliver them that capacity, and the stronger that that confidence is, the better and the

more likely it is that we will get the investment.

181. MR HENDRICK: Right. Okay.

182. MR BIRD QC: And then if we go onto the next slide, slide 9, just to put the

concerns in some context, you mentioned a little earlier concerns about HS2’s own

indicative timetabling work, and we’ll come in due course to timetabling and policy, but

perhaps if you could just outline these concerns?

183. MS SIMPSON: Yes, I mean High Speed 2 estimated, as part of their evidence to

you, P15349, their indicative timetable done a couple of years ago. I think there’s a lot

of detail in there. We’re fairly concerned about the implications of that timetable,

because, for example, north of Preston it would suggest that, in order to run essentially

at all, freight would have to have different traction to that which it uses today, and even

with that different traction, the length of train, the amount of payload you could get on

the train, would be less than we can get today. So in order for rail freight to be efficient,

for it to compete effectively with road, we need each train to be laden to the maximum

possible extent that the network and the traction can take, and reducing that removes our

efficiency.

184. So High Speed 2’s own indicative timetable leaves us in a position, on some parts

of the West Coast Main Line, after High Speed 2 opens, with capacity that is less good

than we can achieve today. The same points further south, there are some references on

the same page 38 of the same evidence demonstrating trade-offs between running speed

and capacity on the network. A timetable which struggles to provide any comfort that

rail freight will be able to enjoy even the same level of capacity as it gets today on some

parts of the West Coast Main Line. Now, I absolutely understand that this is only

indicative work. It is not a timetable. It is a long way from being a time table, but if

High Speed 2 were committed to what we saw on slide 1, you might have thought that

their indicative timetable could provide at least the bare minimum of comfort that rail

freight would not be adversely affected by their proposals.

42

185. High Speed 2 have also sent us some other information in their evidence packs. A

presentation at 15355, I appreciate my eyesight is failing and I’m holding out not getting

glasses, but it’s particularly difficult to read, but I think – a complex diagram, but with a

magnifying glass you can identify in those slides that they show seven off-peak

passenger services per hour. Today there are five off-peak passenger services per hour

on the slow lines in the bottom end of the West Coast. Rail freight runs on the slow

line. It doesn’t go fast enough for the fast lines. So again, a presentation which, whilst

complex, and, I accept, only indicative, does not show additional capacity for freight.

186. So what we see is a lack of holistic planning for freight across these pieces of

work. They are indicative, we understand that, but they do not give the comfort to

investors and to operators and to customers that High Speed 2’s work to date

demonstrates support for the kind of phrases we saw on our original slide. Now, within

their evidence, I know that High Speed 2 have provided information to the Committee

on the planning process forward from here around control period 6, 153355(6) and

following pages. We understand that process and the rail freight community is involved

in the kind of planning that goes on around control periods.

187. For the record, control period 6, where the planning is underway now, runs from

2019 until 2024, so the work that’s being done now does not get us to the opening of

High Speed 2 phase 1. It gets us to a few years short of that. The planning for the

control period, which will cover the opening of High Speed 1, will probably start in

around 2020. So we’re not even going to start the planning for the relevant time period

for quite a number of years yet.

188. MR BIRD QC: And what is the implication of that for what you are seeking?

189. MS SIMPSON: The implication for that is that if we went down those timescales,

the kind of decisions about how capacity will be allocated on the West Coast post-High

Speed 2 wouldn’t begin to be looked at for another five or six years hence.

190. MR BIRD QC: And consequences for reimbursement?

191. MS SIMPSON: That people will be looking now at what they need to do in the

next decade and that those plans will go back, or go away, and we will not get the

growth that is promised. High Speed 2 also highlight that Network Rail are doing some

43

work. They have a capacity plus study. It is a good study and we are optimistic that the

results of that will be better prepared perhaps than the indicative timetable that we have

seen, but to be clear, that work is providing some options. It looks at different ways in

which that capacity could be used and different options that exist. There is no clarity on

which of those options government may favour or may be looking to pursue.

192. It is entirely possible at the end of that work that the option that is selected is as

bad for freight as some of the options that we have seen in this presentation so far. It’s

possible that they will be better, but we have no clarity or guidance of that, and that

work is also unfinished.

193. MR BIRD QC: So that I think brings us to slide 10, which is the suggested

solution. If we could have the slide up.

194. MS SIMPSON: So the solution that we put to the Committee today is a light

touch solution. I think there are things we could have asked for that would be more

stringent than this, and what we are really looking for is to get some early assurance in

guidance from the Secretary of State on how the allocation of the capacity released by

High Speed 2 would be handled. We recognise that the timetabling process is ultimately

a matter for the Office of Rail Regulation. They are independent. We value that

independence, and we recognise that any guidance can only be that. It can only be

guidance, but nonetheless, having guidance which sets out – and the example there is

taken from the strategic case. There are other ways that it could be done, but

nonetheless, sets out that there is an expectation that capacity for the growing rail freight

network will be properly met in the way that the capacity is handed out.

195. That guidance has to be produced, it has to be relevant to High Speed 2, and it has

to be produced in a timely fashion. High Speed 2 has since resubmitted these slides

come back reminding us that the Secretary of State already has the authority to issue

guidance to the Secretary of State and indeed does so, and this is true...

196. MR BIRD QC: To the ORR.

197. MS SIMPSON: Sorry, to the ORR. My apologies. They have submitted the most

current guidance which has some good sentences and paragraphs in it on rail freight, but

it is not specific to High Speed 2. It does not cover High Speed 2, and there is no

44

requirement on the existing process for it to do so, and we believe that, if we do not

strengthen that provision, there is every opportunity for any future guidance between

now and the opening of High Speed 2 to equally not cover High Speed 2. So that is our

ask. We think it is easy to achieve. It is not costly to achieve and it will help to build

the confidence in those people who are looking to grow rail freight and to make the

necessary private sector assessment to do exactly that, and to make plans for using the

release capacity and the capacity on the West Coast in the future through the fairly

simple means of additional guidance.

198. MR BIRD QC: That is our petition on that issue. We have got to deal with the

issue of support for construction, which is discreet. I don’t know whether Mr Mould

wants to respond to that.

199. SIR PETER BOTTOMLEY: I think we ought to have that now.

200. MR BIRD QC: Very well. Have that now. So next slide, please, and the issue

here, Ms Simpson, is simply there is a mismatch between the stated intentions and what

is actually happening in practice, and I think it may help the Committee if you’d just

outline what is happening in the real world as far as the use of rail freight to support

construction.

201. MS SIMPSON: I’m pleased to, and as you said earlier, for the record, this isn’t

part of the petition of the Freight Transport Association. It is for Rail Freight Group,

Freightliner and DB Schenker. So we have been in extensive discussions with High

Speed 2 in recent weeks around this topic and we had hoped we could reach an

assurance before today, but we have been unable to do so. We recognise that High

Speed 2 does not wish to compromise their procurement approach, and particularly that

we all wish not to compromise their position in procurement law by doing something

that would adversely affect that. We absolutely understand that, but nonetheless, we

believe there is a space where the effective planning of how rail freight could be used in

construction could have been done, could have been made in a way that would still be

compliant with all those requirements.

202. As we sit here today, there is very, very little of a comprehensive plan of how rail

freight could be used. Those people who are looking to bid for contracts have scant

little evidence on how rail freight could be used in construction. We have been asking

45

for that plan to be done and to be done in a timely fashion, i.e. ahead of the letting of

those contracts, and it is around those points that we have not been able to agree. Again,

we come back to planning. If you wish to order wagons in order to move the excavated

spoil, you will need two years for that, from the order for those wagons to be available.

The operators will need train drivers perhaps, potentially. It takes six months to train a

rail freight driver, and further time for them to have the necessary experience.

203. We’re talking about long lead planning items, and we’re talking about a resource

around the construction which can be best managed by looking at the construction of the

route as a whole, and as the construction will be done in seven contract areas, a lack of

alignment between those seven areas will mean the allocation of those resources may

not be done as efficiently as you might like. Now, we understand that High Speed 2

have reached an assurance with TfL to study the use of rail freight in the construction of

Euston, and that that will be done by May. So High Speed 2 have been able to agree

some progress with some petitioners in certain areas to do that. That does not cover the

entire route by any stretch of the imagination, and there are many issues we’ve heard

from the last petitioner around the kind of issues that HGV traffic is causing to people

along the line of route.

204. We cannot solve all of that. We could make some progress, and we would

therefore ask that this committee bring pressure to bear on High Speed 2 to properly

plan for the proper use of rail freight ahead of the contracts being let. If they don’t wish

to speak to us in the doing of that, fine, but please can it be done properly?

205. MR HENDRICK: Can I just ask a question?

206. CHAIR: Just before you go into – was that the separate DB Schenker point or are

they still coming on after you?

207. MR BIRD QC: They are still coming on afterwards.

208. CHAIR: Okay.

209. MR BIRD QC: They are separate.

210. CHAIR: All right.

46

211. MR HENDRICK: Well, I was going to ask, obviously the situation with Euston is

one which we are very aware of. We did visit, and we’re very keen to, because of the

density of the population there and the likely traffic movements that HGVs would cause

in the removal of spoil, obviously rail seems to us to be a very obvious benefit, if rail

can remove as much of the spoil as possible. I think all of us have made that point very

strongly with HS2. The question I have specifically is in releasing the capacity. Is there

a reluctance perhaps on behalf of operators who operate passenger traffic to give

capacity because of the speeds that the freight travels at?

212. Because I would imagine, where you’ve got high speed line by the West Coast

Main Line, that if you’re moving around vehicles of construction materials, that it would

be very easy without proper planning to get passenger traffic delayed because freight

traffic is on the line at the same time. How much would you use off-peak hours, maybe

the earlier morning hours, before people go to work and how much would you use time

during the day when passenger traffic is most prevalent?

213. MS SIMPSON: Well, generally speaking, freight doesn’t run in passenger peaks,

so if you take a train out of Euston in the morning you will see that the freight train is

waiting at Willesden and Wembley for pass on once the passenger peak has happened.

There would be very expectation that construction trains would not run in the passenger

peaks.

214. MR HENDRICK: So what hours would those be?

215. MS SIMPSON: You can define peak in a number of ways, but generally from

around about 9:00, 9:30 through to, perhaps, 3:00, 3:30 and then again sometimes in the

evening. Of course, when you are working at somewhere like Euston where there is a

lot of surrounding residential properties, the opportunities to work through the night are

diminished. That is not true of every rail freight site. There are sites that can load at

night, but I imagine that Euston would not be one of those, although whether

discharging points elsewhere could operate later, I don’t know, but certainly when we

talk about construction trains, the number of trains – because a train can move a lot of

stuff, we’re talking about a handful of trains. We’re not talking about four trains an

hour. We’re maybe talking about five or six trains a day at the most, so...

216. MR HENDRICK: How long are those trains, out of interest?

47

217. MS SIMPSON: I don’t know offhand is the answer to that, because it will depend

on the sites that are being used as to how many wagons you can get in. I think around

Euston some of the sites are constrained, but there are also issues around how you

stockpile. Can you take – stuff them onto a stockpile and then onto rail? So there are

ways where you can try and manage it to the best effect. It’s exactly that kind of

planning that needs to be done, and given there’s an option to the contractors – the

contractors may well have other ways of doing it. They may have cleverer ways of it

doing it. They may have different things that they wish to explore, but if they’re not

being given at least the option of looking at rail freight, history would suggest that they

won’t.

218. SIR HENRY BELLINGHAM: Well, it’s been partly answered, Chairman, , but

we have heard from HS2 on a number of occasions how they want to use the trace for

shifting quite a lot of the spoil, and that obviously is going to presumably help your

industry. What sort of conversations have been taking place between HS2 and the Rail

Freight Group about these possibilities? Because obviously they’re going to need your

members, their assistance, I would imagine, to actually fulfil these ambitions.

219. MS SIMPSON: Well, very little conversation. I mean, High Speed 2 quite

reasonably to a point say that procurement law places certain constraints on what they

can say to people who may eventually bid us for that work, and that’s why we think it’s

important they devise a proper plan. My members have approached High Speed 2 with

a number of different options. It’s fair to say they have not made very much progress.

220. SIR HENRY BELLINGHAM: It’s probably more of a matter for the department

actually than HS2, to be honest. The Minister needs to look at this as maybe one of his

responsibilities.

221. CHAIR: Do you have any questions for the witness or are you just going to...?

222. MR MOULD QC (DfT): No, I don’t.

223. CHAIR: Okay, thank you. Mr Mould.

224. MR MOULD QC (DfT): What I will do, if I may, is just ask Professor

McNaughton to come and deal with a couple of points. Just in relation to the question

48

of capacity release, if you can put up P15394, page 5. Professor McNaughton, we have

seen in the slides that were put up by the Petitioners the statements of policy by the

Secretary of State about capacity release and the opportunities that capacity release on

the West Coast Main Line provides inter alia for freight – rail freight use. We saw those

earlier, didn’t we? What I would like you to do please is just to help us a little bit with

the practicalities of realising that policy aspiration, along with the other demands and

needs that the Secretary of State has in mind to realise through the use of the capacity

release that HS2 will deliver on the West Coast Main Line.

225. PROFESSOR MCNAUGHTON: Okay, thank you. Good morning. I find myself

in the happy position of not disagreeing with almost everything the Petitioner has just

represented, so I hope to be brief.

226. SIR PETER BOTTOMLEY: So you’re supposed to disagree when you actually

agree?

227. PROFESSOR MCNAUGHTON: Agree.

228. MS SIMPSON: Good, on that note –

229. PROFESSOR MCNAUGHTON: Agree. I am agreeing. Let’s go on a positive

note. So to keep ourselves focussed this morning, we look to bring you back to some of

the slides that I used in giving evidence to you before the summer break on the subject

of the allocation of capacity on the West Coast Main Line, which is a subject for the

Secretary of State rather than for High Speed 2. I put up this slide to pick out and just

remind you – and I’m sorry if this is a bit of a revision –that, really, the two middle

paragraphs there, the design and redesign timetable changes on the Great Britain

Network is a routine process, is driven by need and the desire for overall benefit to the

country from that strategic asset.

230. The Petitioners made the very real point that the opening of High Speed 2 enables

the repurposing of the West Coast Main Line, and I think I covered that point when I

spoke to you before the summer recess. So the intention has always been of the

Secretary of State to use the industry normal processes, but recognise that this is a very

big change and some changes – most changes are rather smaller. So I think that’s

probably enough on that slide. If I can go to the next one, please, number six. I did

49

briefly explain to you this, without going into every word in this heavily worded slide,

the starting point of how capacity is allocated is the long-term planning process, called

here now rail’s long term planning process, is the industry’s long-term planning process,

which Network Rail has a responsibility under its operating license to lead, but it

involves operators, both passenger and freight, it involves local authorities, businesses,

etcetera.

231. So it is an inclusive process and it starts a long way out, and that leads inexorably

through to the point of the Secretary of State making proposals for the use, having

received the industry’s view, proposals for the use of capacity, particularly where there

is competing need for it, and then leads into specifications and eventually a train path

planning process. So that is the normal process. It is against that background that in

order to support the Bill before you – and as the petitioner pointed out – HS2 did with

the co-operation of the industry produce an indicative timetable. And it was designed to

demonstrate that the economic benefits of High Speed 2 that we rely on for the business

case, were reasonably deliverable and we weren’t over promising effectively, with

particular reference to the time between 2026 and 2033 when the first stage of High

Speed 2 – the stage that’s before you today, or at least these many months of your sitting

– is in operation and before the second stage comes in to operation. And there were

particularly concerns about the capacity of the West Coast Main Line north of Litchfield

or Handsacre where some of our trains will join an already busy and growing West

Coast Main Line.

232. Now, petitioners pointed out that when we showed the results of that to the

passenger and freight industry they found some holes to pick in our work. I’m not

particularly surprised. It was an indicative timetable and all of us intend or try to

foretell the future, we know that we will be wrong in some respect or other. One of the

things we were trying to point out to the industry and to Network Rail was that

irrespective of High Speed 2, the growth of passenger and rail freight north of phase 1 of

High Speed 2 would give challenges anyway, which, again, the normal industry

investment and enhancement process would have to deal with, including the volume of

traffic heading towards Scotland whether it be passenger or freight, irrespective of High

Speed 2. So I’m not surprised by that point.

233. If I can please come on to the next slides, slide 7, and this is the last one I’m going

50

to refer to, if I may? The petitioner mentioned the Capacity Plus Working Group which

is another classically named industry operation, which was set up as a result of the

Department of Transport and Secretary of State, if you prefer, recognising that the

coming of HS2 enabled this dramatic change to the West Coast Main Line and that we

should indeed, the industry should start earlier than normal in its planning process to

propose how best the capacity is used. The petitioner said that work is not completed.

That is absolutely correct. It is in progress. It is led by Network Rail for the

Department of Transport and many of us in the industry look forward to seeing its

recommendations. They are the best placed people to recommend to the Department

how capacity is used when someone like us, High Speed 2, who’s interest, of course, is

in High Speed 2 alone. The rail freight community is engaged in that, along with the

passenger community and others. And all of us hope that will come out with

recommendations to the Secretary of State which are coherent and achievable. That is

ongoing. That will come out for consultation and that is intended to feed into plans for

Control Period 6.

234. Now, Control Period 6 starts in 2019. And the purpose for that is to identify is

there complementary investment needed of High Speed 2 – or even possibly on the

West Coast Main Line south of High Speed 2 – to realise the best value for re-using that

route. And that will come to its natural conclusion and hopefully will be in the time that

those who invest in either passenger or freight operation will be able to realise the

opportunities post the opening of High Speed 2. Sorry, that ended up slightly more

wordier than I intended it to be. But, it is to say the Secretary of State has recognised

this is a very big change. The Secretary of State has asked the industry to recommend

how the West Coast Main Line is best used and that work is under way.

235. MR MOULD QC (DfT): Thank you.

236. SIR HENRY BELLINGHAM: I’ve got a very quick follow up, I didn’t want to –

237. PROFESSOR MCNAUGHTON: Sure.

238. SIR HENRY BELLINGHAM: – interrupt your flow of the question.

239. PROFESSOR MCNAUGHTON: Ah, I apologise.

51

240. SIR HENRY BELLINGHAM: But, what we heard from the witness earlier was

that there is going to be a problem in terms of the capacity of freight in the meantime

until the route further north is completed. I think it was on A20569 where they point out

that until the line is open to Crewe there will be limitations on freight capacity. What’s

your view on that, Professor?

241. PROFESSOR MCNAUGHTON: Put simply, the sooner that High Speed 2 is

open, the sooner that capacity starts to release. The first stage, as you remind us, is to

Litchfield. And that releases capacity south of Litchfield. The next stage to Crewe,

you’re aware that was to have been – in the months you’ve been sitting, the Secretary of

State has made a route decision for the so-called 2A stage to Crewe and asked High

Speed 2 to accelerate the creation of a separate Bill to bring that forward as soon as

possible – because of the opportunity of extending High Speed 2 further north as

quickly as possible. So, we can only agree with the petitioner that the sooner that High

Speed 2 is open the better.

242. SIR HENRY BELLINGHAM: But if there are delays, and we hope there won’t

be, then it could have a detrimental impact on the freight paths.

243. PROFESSOR MCNAUGHTON: Okay. I’ll answer that correctly. We showed

with the – or the intention of the indicative timetable was to show that in Phase 1, when

High Speed 2 largely replaces existing long-distance trains, although there are some

extra ones, how the published increase in necessary freight paths and the published

increase in necessary passenger paths might be achieved north of Litchfield, inevitably

with some operational compromises, like the exact timing of a passenger train in an

hour. But, that we took the forecast from the Network Rail long term work for the

growth of freight, added in the extra traffic from High Speed 2 and the other known

aspirations at the time for other passenger train increases – we are not alone in this – and

demonstrated that there were reasonable ways of doing it. We didn’t hide the fact that it

would be an intensively used piece of railway. And actually made the point that the

sooner High Speed 2 skipped over that section the better for everybody.

244. CHAIR: Right. Mr Mould?

245. MR MOULD QC (DfT): Thank you. The other point raised in the presentation,

we’ll just deal very quickly, if we put up P15353(3), this is the third page of a letter

52

from HS2 to Ms Simpson on 11 November of last year, so 11 November 2015. And it’s

the sub heading: ‘Use of rail freights for construction. The promoter’s approach to the

transportation of excavated materials to reduce reliance on road transport routes where

reasonably practicable. HS2 recognises the critical role freight will play in the

construction of the proposed scheme and will engage with the freight industry both

through well-established statutory regulatory and administrative processes and with the

individual operators. We therefore propose to offer the following assurance. The

promoter will engage with the Rail Freight Group and the Freight Transport Association

and their members regarding the transportation of excavated materials with a view to

maximising as far as reasonably practicable the use of rail freight to support the

construction of the proposed regime. And I think the point that was made today was

really focussing on timing of this process. First of all, we have to, to some degree, to

prioritise our resources at this stage in terms of forward planning, Professor, don’t we?

And where have we prioritised taking forward the objective that is set out in that

paragraph as things stand at the moment?

246. PROFESSOR MCNAUGHTON: HS2 Ltd is in the process of recruiting its

construction team and in the coming year or so will be tendering for the principle

engineering consultants that will refine our work. And that’s particularly all the way

along the route. The focus is Euston. We’ve listened very carefully to the views

expressed in this Committee and by petitioners that the biggest single opportunity for

spoil by rail, in terms of a confined geographical area, was the Euston area. And we

have prioritised our resource accordingly. So, our team is working through getting

much more accurate construction planning schedules so that we can approach the supply

industry, particularly the rail freight industry and the Rail Freight Group with reasonably

accurate numbers for exactly what spoil we’re moving from what site at what time in the

Euston area. And that’s building on all the work you have heard just before and after

Christmas about Euston. That’s prioritising our resources where we think it will have

the biggest effect on people we effect with the construction of High Speed 2. We look

forward to working with the Rail Freight Group very shortly when we have sufficient

accurate data to have a meaningful dialogue.

247. MR MOULD QC (DfT): And just to remind the Committee, there is a date in

relation to the Euston work. We’ve given an assurance to the London authorities and

53

the local authority of Camden to report back following a review of rail importation /

exportation opportunities at Euston by May of this year. So, there’s a timeline there.

248. PROFESSOR MCNAUGHTON: Perhaps the final point to make is at some point

in the process quite early on these days all the procurement rules kick in about

engagement with potential suppliers. But in the early stage of development, it’s

completely possible to work with umbrella organisations and it’s possible to work in a

pre-competitive environment to make sure that our proposals when they come to the

market are ones which rail freight operators will find attractive. And that’s what we

intend to do.

249. MR MOULD QC (DfT): The only other thing I need to respond on briefly is the

proposed amendment to the Bill but I’ll deal with that after.

250. CHAIR: Okay, shall we –

251. MR MOULD QC (DfT): Yes.

252. MR BIRD QC: My next question is just to ask Ms Simpson to respond on a

couple of points, that may be the easiest way of dealing with it.

253. SIR PETER BOTTOMLEY: Just before you do that. Is the position of the

promoters and Prof McNaughton that the suggestion put forward by the petitioners for

the new clause 37-5 is unnecessary?

254. MR MOULD QC (DfT): That’s what I’m going to deal with in a moment.

255. SIR PETER BOTTOMLEY: Okay.

256. MR MOULD QC (DfT): But that’s essentially our position, yes.

257. CHAIR: Okay. Well, I think then it should be you Professor, then –

258. MS SIMPSON: Just two points. Professor McNaughton’s quite right in

demonstrating the complexity of timetable planning. I put to you that if you were sitting

in a boardroom in Berlin or in Chicago looking at your future investment programmes,

that complexity would make you thing you won’t bother. And if HS2 therefore wish to

realise these freight benefits, we need a piece of clear guidance early on which gives the

54

comfort to those investors quite patently and clearly now that those benefits will

manifest themselves through that process.

259. Just in terms of the points Professor McNaughton made around the timescales.

We are aware of the May deadline with TfL. After this proposed assurance had been

offered to us we went back building on that and saying to High Speed 2: ‘We recognise

your constraints, so if you are completing a Euston study in May, we would accept an

assurance for a route wide study by November’. That was put back to us with May ‘17.

May ’17 is after the principle contracts are let, so by that point the route wide study isn’t

part of something that a contractor can take into account. So, we do understand the

constraints. We have tried to work around those to find the wording of an assurance that

gives some forward sight of when a route wide study, not just for Euston, would be

there and we’ve not been able to reach a point of agreement on that.

260. CHAIR: Mr Mould?

261. MR MOULD QC (DfT): Thank you. If we then just put up please A2056(10),

which I think is the proposal for the? Sir Peter foreshadowed the response on this.

Presently, as Mr Bird has indicated, there is a power in the Secretary of State, under the

general railway’s legislation, to issue guidance to the Office of Railway Regulation on

the matters that are set out on this slide. That power is available to the Secretary of

State in order to reflect in guidance, in revised guidance, the matters that are set out on

the second half of this slide. That is to say in particular, guidance which reflects the

high level principles that as a matter of strategic policy the Government has stated

already that it intends to apply following the release of capacity for HS2.

262. The current guidance is dated July 2012 and clearly at the time when that was

issued the Government wasn’t in a position to reflect those principles in guidance. The

Government, at a point, will become able to do so. My understanding is that the

Secretary of State is expecting to exercise that power at an appropriate point in order to

reflect the principles that he has already stated in the strategic case. If the Bill were to

include this clause, it would come into effect no earlier than, on current programme, the

end of this year. And I would have thought practically, the more sensible approach

would be for the department and for the petitioners to continue to engage on the timing

of further guidance which the Secretary of State might issue. And that process should

55

take process in advance of any prospect of any clause under the Bill.

263. So, in other words, what I’m saying is: I question whether in fact this is not really

going to achieve the practical purpose that the petitioners want because the whole basis

for the case was: investors need to know as soon as can reasonably be achieved about

intentions about user capacity and so forth. Well, surely the sensible thing is to

contemplate the deployment of the existing powers that the Secretary of State has to

issue guidance and for the petitioners to make their case to the Secretary of State that the

timing of that guidance to reflect these principles, that are set out in the strategic case,

should be considered, amongst other things, having regard to investment decisions.

Bear in mind, investment decisions no doubt for the freight industry but for the

passenger services, investment decisions are also important. So, that’s just a little flesh

on the bone of the basic proposition but there isn’t actually any need for this clause and

the notion that the need is realised by converting what is a power into a duty, if you like,

doesn’t really give any practical advantage to the industry.

264. SIR PETER BOTTOMLEY: So first of all, it doesn’t go far. Secondly, it’s not

needed. And thirdly, if it’s put in, were the Secretary of State not to have done it, he’d

be required to do it when the Bill becomes an Act?

265. MR MOULD QC (DfT): Yes. So –

266. SIR PETER BOTTOMLEY: So, we’ve got a free hand?

267. MR MOULD QC (DfT): Well, what I would have said, well, I would have

thought that you’ll be conscious of the thought that if your persuaded with the notion

that this new clause isn’t necessary, generally speaking, Parliament should confine itself

to legislating where there’s a need to do it, rather than where there isn’t.

268. SIR PETER BOTTOMLEY: That would take all the fun out of it.

269. MR HENDRICK: Irrespective of whether this clause is added or not, isn’t the

Simpson point that really there needs to be more urgency in the discussions in order to

get that confidence to the investors that they’re going to get a fair piece of the cake

when this actually happens? That’s what it’s about.

270. MR MOULD QC (DfT): Indeed so. I agree with you. And of course, that is

56

precisely why I say that in a sense this could have an unintended consequence – because

if you say there’ll be a duty imposed but it won’t actually come into effect until a year’s

time, that actually could have the effect where there are all sorts of competing priorities

dare say. Well, we could leave it until that come, you know, whereas surely the sensible

thing is to say: There’s an existing power. Here is the guidance, the current guidance

issued under that power. As I say, it’s dated 2012, so it doesn’t deal with principles that

were promulgated in 2013, but the Secretary of State’s –

271. MR HENDRICK: No, we accept that point.

272. MR MOULD QC (DfT): Yes.

273. MR HENDRICK: But the other side of it is: You mentioned, when you spoke

earlier, that at an appropriate time in the future the Secretary of State will – blah, blah,

blah. Now, don’t you feel there’s something in common or new, having heard what

you’ve heard today, to advise the Secretary of State or give some urgency to the issue

that’s been raised?

274. MR MOULD QC (DfT): You know when I used those words like that, they’re

code for saying I can’t give you a precise date.

275. MR HENDRICK: If you could say, well, we’re going to approach the Secretary

of State with a view to: blah, blah, blah, that might be a bit more –

276. MR MOULD QC (DfT): The message I think, if that helps you, I’ve no doubt at

all that the message that has come out of today’s hearing on what is to a very large

degree common cause between ourselves and the petitioners, the message that has come

out of today’s hearing, that clearly the industry would be assisted by knowing what the

Secretary of State’s intentions are as regards promulgating revised guidance under his

existing powers and in particular a timescale within which that guidance might be

achieved because that would then give some, take matters further forward in terms of

the key point as you, if I may say so, you rightly say, is at the heart of the petition that

has been presented to you today.

277. CHAIR: Okay, brief final comments?

278. MR BIRD QC: Very brief. I think from all you’ve heard it’s clear that there must

57

be guidance. The mechanics as to how that is provided and timescale is what we would

seek the guidance from the Committee on. There’s no reason why, for example, the

Secretary of State couldn’t undertake to issue guidance at an early stage. Clearly, what

we’re suggesting here is a clause, an amendment to the Bill, which will focus the minds

hopefully to get that guidance but it is critical that we have guidance.

279. CHAIR: Okay. Thank you very much for your contribution.

DB Schenker Rail (UK) Limited and others

280. CHAIR: We now have DB Schenker Rail?

281. MR BIRD QC: This is a very much more site-specific an issue and concerns the

Willesden Euroterminal site which I think you’ve heard evidence on before in terms of

how it’s essential to use. DB Schenker are the owners of the Willesden Euroterminal

Site.

282. SIR PETER BOTTOMLEY: Is this the one that’s going to transport the tunnel?

283. MR BIRD QC: Yes. Can I just make, again, five brief points? Just to summarise

the position. And then I’m going to call Mr Simon Ives to give evidence. He is the

property director of DB Schenker.

284. The Willesden Euroterminal tunnel is configured as a multi-purpose rail freight

terminal. And currently has a throughput of some 1. 25 million tonnes per annum.

There is no other facility of equivalent scale in northwest London. And land for such

facilities is rarely available. The Euroterminal is thus a scarce and valuable facility –

285. MR CLIFTON-BROWN: Sorry to stop you. It doesn’t mean a lot unless I’ve

seen a map so I know what we’re talking about.

286. MR BIRD QC: Alright. If we could take up the DB Schenker’s slide. We go,

within that, please, 20583. It has an aerial photograph of the Euroterminal site. And

just of down to the right is the Willesden Junction Station.

287. MR MOULD QC (DfT): Perhaps, if I can just, to try and remind the Committee,

if you’ll forgive me Simon?

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288. MR BIRD QC: Of course.

289. MR MOULD QC (DfT): You’ll recall, not long ago, you heard a petition from

Double 4, who were occupiers of certain plots within this site. And Mr Smart gave

evidence to you as regards the usage for which the project would require to use this site,

for construction purposes; the importation of materials from tunnel construction going

eastwards into Euston, and westwards out, in towards, in the Northolt tunnel. I hope

that may refresh your memory a little bit. Yes.

290. MR BIRD QC: Apologies. And indeed as I indicated DB Schenker has a lease of

the site, with 103 years remaining. It’s currently in the process of bringing forward a

number of, it calls, Super Terminals, of which Willesden is proposed to be the third.

They will provide for occupation by a number of rail freight related companies each

sharing common infrastructure. HS2, as we understand it, require the depot for the

purposes of a work site related to Old Oak Common and associated tunnelling and that

use is consistent with its current and indeed proposed future use by DB Schenker. And

there’s no evidence that HS2’s requirements could not be met by the acquisition of

temporary rights rather than compulsory acquisition. DB Schenker has offered

alternatives of a lease or a management arrangement but both have been rejected and we

say there’s no compelling case in the public interest to justify the extent of the rights

being sought in the Bill. Indeed, the public interest lies firmly in favour of temporary

possession only during the period of the works, that return to DB Schenker on

completion of Phase 1 or 2024, whichever is the earlier. And that’s consistent with

HS2’s Information Paper C4 on land acquisition policy. That’s a brief summary. I’d

better turn then to Mr Simon Ives and ask him to give evidence by reference to the

slides, just explaining the site: how it’s used; how important it is to rail freight; how

important it is to DB Schenker; and why it is they need it back after the works.

291. MR IVES: If you could go back to slide 2, please? Yes, my company

DB Schenker is the largest single provider of rail freights services in the UK. We’re a

subsidiary of Deutsche Bahn in Germany. We employ about 3,000 people in the UK,

3,200 people, and generally move about 70 million tonnes of product per annum by rail.

Rail freight is changing. I’ll come on to that in a few moments. But, basically, we are

seeing significant shortfall in capacity in all our market sectors in London and the

southeast. In that context, our 103-year lease on the Willesden Euroterminal site is a

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key plank in the future growth of our business. Sir Peter made the point a moment ago

about the reference to Channel Tunnel. Yes. the site is protected for, safeguarded,

under the ring fencing deed of November ’97 as a core asset within the Channel Tunnel

operating framework. Perhaps go on to the next slide, if we might?

292. Mr Bird touched on this earlier. The blue line delineates the boundary of our

lease. The single access to the site is to the bottom right hand corner of the site, up

Channel Gate Road, of the A4000, Old Oak Lane. And, as Mr Bird pointed out,

Willesden Junction Station is just off this slide, the top right hand side.

293. The site currently has two long-term tenants, being Network Rail, where they use

the site for their virtual quarry. That lease expires in 2019. And to Tarmac. There lease

expires in 2023. And I’m officially advised that HS2 is in separate discussion with

Tarmac about the possibility of retaining that facility on the site, even during the HS2

construction programme. Next slide, please?

294. As Mr Bird pointed out a moment ago, this is a multi-purpose rail freight terminal.

Its current primary use is to support the construction industry in the northwest of

London. And its main activity at the moment is the importation of aggregates and the

export of spoil from various building sites around the capital. There is no other facility

of a similar size in this quadrant of London.

295. And I mentioned the two principal leases to Tarmac and Network Rail a few

moments ago. There are nine other occupiers on the site. Some of whom are active in

rail freight. Others are just carrying out other activities on the site. An important point

to note about this that all those nine are on leases that can be terminated at short notice.

We, I, being cognisant of the need a) to protect the site for the Channel Tunnel use,

potentially, and b) since 2012, of the interest in the site from High Speed 2, have sought

to keep the site as flexible as possible. And in that context we have never let, or we

have not let, any new leases that don’t have six-month termination provisions in them.

So, all the nine occupiers, those nine occupiers, can be taken out of the site on service of

six months’ notice. An important point to stress is that like almost all UK rail freight

sites, Willesden Euroterminal is open access. That means any freight operator can bring

any train in and use the site at any time provided there is space. It’s our site but our

terms of reference, as governed by the ORR require us to make that space available on

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terms equivalent to those which we charge ourselves. We cannot operate a punitive

charging regime for third parties. We cannot put artificial restrictions on the use of the

site by third parties. It is truly open access. So, the entire freight community can use

Willesden Euroterminal. Next slide?

296. This slide simply illustrates the trains running in and out of Willesden at the

moment. Not all of those trains operate every day but typically there are about five

trains a day, running in and out of Willesden at the moment. As Mr Bird commented a

few moments ago, the average annual volume of traffic running out of that terminal

presently is about 1 and a quarter million tonnes. And as Ms Simpson commented

earlier, the CO2 emissions emitted by our rail freight our roughly one quarter those of

road traffic movements. Notwithstanding the fact we’re taking all those trucks off the

road as well. Next slide, if I may?

297. The current situation at Willesden is not necessarily representative of where we

see the site in terms of our company’s long-term future or the long-term future of the

industry as a whole. Our market is changing. And Professor McNaughton alluded to

the need of timetables to change on a regular basis; or to respond to need. Government

targets suggest a 100% growth in rail freight activity by 2034. And as Ms Simpson’s

slides indicated our markets are changing. As recently as 10 days ago, we hauled our

first train for General Motors from Ellesmere Port down to Barking and then from

Barking on to Germany. We took Vauxhall cars manufactured in Ellesmere Port into

Germany and we brought Vauxhall cars manufactured in Russelsheim into the UK. It’s

the first time we’ve done that in many, many years. And our new facility at Barking,

which I’ll touch on in a moment, has enabled that to happen.

298. More pertinently, in the context of High Speed 2, as discussed a few minutes ago,

the Mineral Products Association did record substantial annual growth in the year to

September last year of 8. 5% in a single year but its average annual growth of 3. 7%

per annum until 2018 and then 2. 3% until 2023. It has no projections beyond that save

that it says that it thinks activity will continue to increase roughly in line with GDP.

More pertinently too, London’s growth requires substantial additional construction

activity. The Mayor’s office suggests 50,000 new homes per annum, or 45 to 50,000

new homes per annum and 600 new schools. This site falls within the Old Oak

Common and Park Royal Development Corporation area where 25,000 new homes and

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55,000 jobs are proposed. How are the construction materials proposed to be delivered

to this site without some sort of rail freight activity?

299. In addition to the construction activity, more infrastructure is likely to be required

in London. Projects in the pipeline include Thames Tideway Tunnel, Crossrail 2 – all

these activities are core users of rail freight as evidence by rail freight’s support and my

company’s own involvement in the construction of Olympic Park and the removal of the

spoil from that, and the activity we undertook for Crossrail in East London last year or

in 2013.

300. MR BIRD QC: Now, you mentioned, just pausing, you mentioned Old Oak and

Park Royal Development Corporation there. As I understand it, they’re in the process of

developing a local plan to provide a framework for development in that area. Is there

any reference to the Willesden Euroterminal?

301. MR IVES: As recently as 6 January, OPDC or Old Oak and Park Royal

Development Corporation, OPDC issued a draft local plan. This has not yet been put

out to consultation. It was supposed to have come out this month but in fact will come

out in February, the Corporation’s website now states. But it does make specific

reference to Willesden Euroterminal and it says that the site is a: ‘Key strategic asset in

the context of rail freight movement specifically for the sort of uses we are currently

putting through the site: The export of waste and building spoils and the import of

construction materials too’. So, in that context, our current activity and our proposed

future activity is entirely in accordance with OPDC’s emerging draft framework.

302. MR BIRD QC: Sorry, I interrupted you. You were about to move to slide 7.

303. MR IVES: Right. Ms Simpson indicated earlier that the rail freight industry is

investing, not only in new railing stock but in new facilities. DB Schenker is no

different to the rest of the industry. I mentioned a moment ago that we recently opened

a terminal at Barking, specifically to service the Channel Tunnel market. And we have

agreements in place with property developers to operate proposed terminals at Radlett,

which was granted planning permission late last year or in September. Sorry, early last

year. And at Colnbrook which is currently the subject of a planning appeal, due to be

determined in April.

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304. Government targets and the environmental imperative demand a more efficient

carriage of construction materials and other types of freight. Projected growth in

population and increasing congestion, proposed new building activities in London pose

unique problems for this environment. In response, we are working with other

stakeholders, principally the aggregates companies, to develop three, what we’ve termed

super depots. As Mr Bird commented a few moments ago, that at Beau is currently the

subject of several planning applications to London Legacy Development Corporation

and I myself met David Goldstone, Chief Executive of LLDC about the application as

recently as November. That at Cricklewood is the subject of ongoing debate with the

London Borough of Barnet and is required to support the development of the Brent

Cross development, Brent Cross Cricklewood scheme, which is not only the extent of

the shopping centre but the creation of about 5,000 new homes. An existing rail

terminal has to be re- located to make way for that new development so we’re going to

make more efficient use of the one that we under-use at the moment in Cricklewood and

turn it into our super terminal.

305. The principle of the super terminal, I should perhaps explain, is that the traditional

model of aggregates distribution into a city like London is that an occupier, be it

CEMEX or Lafarge or London Concrete, takes a lease on a specific site and then only

that occupier’s traffic runs into that site. The super terminal proposal, as evidenced by

the planning applications at Beau, is that four occupiers will share the same site. And

four occupiers will use the same piece of rail infrastructure. It allows us to improve

efficiency. It reduces cost. It reduces the environmental impact of the necessary impact

of moving construction materials out of London. Incidentally, we have a similar scheme

proposed in Birmingham on the Washwood Heaths upside site to which CEMEX will

have to be relocated as a consequence of HS2. The super depots will probably carry in

the region of 2 million tonnes per annum each. Each of our trains carries a payload

equivalent to 60 to 75 8-wheel Heavy Goods Vehicles. And each of those super depots

will be built in a flexible manner so that other forms of traffic can be carried when the

super – if the aggregates market should tail off. Traditionally, the aggregates market has

followed the property market. When the property market is buoyant, the aggregates

market is buoyant. When the property market is depressed, the aggregates market tends

to follow. If we build these terminals in a flexible format, we will be able to move

containerised traffic into them as well. Next slide, please.

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306. This simply gives you the location of the three proposed sites at the moment. In

particular, we haven’t overlaid because it became far too confusing but the proposed

development of large scale residential activity in London, there is something like 100

proposed tower blocks for the city at the moment, with, ironically, a strong bias to the

east and west of the centre of London. So, the terminals we’re proposing will service

that construction market pretty adequately, we think. Next slide, please.

307. We’ve had ongoing discussions with HS2 since December 2012 about a number

of property holdings and specifically in the context of Willesden. I think it’s fair to say

that we’ve reached some sort of understanding with HS2 over the four major pieces of

real estate that it’s asked us for. The fifth, Willesden, is the only one where we seem to

be struggling. HS2 has not been entirely consistent in saying that it wants to purchase

the site outright. We had a meeting with them in November 2019, when Mr Morris of

HS2 said that he would recommend that they would only take the site on a temporary

basis. Subsequently, HS2 has changed its stance back to an outright acquisition of this

piece of land. Our concerns are that if HS2 acquires the site, it will clear the site of all

the current tenants and displace all the businesses. Well, I suppose it will for at least the

seven years of its construction period. And more pertinent, it will then seek to recover

best value by selling the site on the open market at the end of the construction period.

Quite simply, the rail freight industry will not be able to afford to buy it back. We

cannot compete on a level basis with builders of warehouses or car show rooms or

industrial premises. We will lose the site to rail freight if it is bought compulsorily from

us. As Mr Bird commented a few moments ago and I illustrated, the OPDC has

identified the site within the last three weeks, or the document was presented to its

Board in the last three weeks, as a potential long-term rail freight location. Why then

can we not keep it, please?

308. We have offered HS2 two alternative proposals. One was a straight forward lease

of the site for a limited number of years. The other was a management agreement by

which we might manage the site on its behalf. It has rejected both of those. And

moreover, it was only on 3 December did it say to us that it might want the site for 15

years, not seven as originally proposed. The grounds it gave for that was that it now

envisages constructing Euston over an extended period and that it would need Willesden

as a builders’ yard, in effect, to support the construction of Euston. If I tell you that the

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first phase, you’ll be familiar with the site of Granby Terrace, which is also our land,

that’s only four acres. If that can be sufficient for a builders’ yard to construct Euston,

why on earth would HS2 want 20 acres over a 15-year period? We are at a loss to

understand why HS2 will not rent this site to us or at least give us an assurance that it

will only take the site temporarily, and then we can have it back please after the

construction period.

309. There is no viable alternative, even if there were, 20 acres in northwest London at

prevailing industrial rates in Park Royal are £2.5 million an acre. The land alone will

cost £50 million. The connectivity into the railway line and the signalling into the

railway line and the planning processes we would have to go through; I would estimate

would push the cost of an equivalent replacement to well over £100 million. We’re

offering to rent it to HS2 for a period of seven or even part of it for a bit longer, if it

needs it. If I argue the cost of equivalent reinstatement as the basis of compensation

from HS2, it’s going to cost the taxpayer a nine figure sum. We’re prepared to rent it

for a great deal less than that.

310. So, in summary, unless Mr Bird?

311. MR BIRD QC: No I think you’ve turned to the changes required which you’ve

set out on the slide and effectively speak for themselves.

312. MR IVES: And we ask the Committee, would you please ask HS2 to reconsider

its stance on this matter?

313. MR CLIFTON-BROWN: Can I ask you? You’re clearly an expert at running

these sites more efficiently than virtually anybody else. Have you examined HS2’s

operations and have you worked out what you think the area they need to have to

operate those operations?

314. MR IVES: We don’t dispute they will want the majority of the site for the main

part of the seven-year construction period. They haven’t explained their proposal in

detail to us and as you will be aware, they’re still going through the first stages of the

procurement process. But we think it likely they will want the majority of the site for

the seven years – or most of the seven years. I reiterate my statement that we don’t

think they will need anything like the whole of the site for the following seven years and

65

we’re at a loss to understand why they say they do.

315. CHAIR: Okay. Mr Mould?

316. MR MOULD QC (DfT): Thank you. If we could just put up P15390(1), just to

have the site in front of us. As Mr Smart explained when he gave evidence to you in

response to the Double 4 petitioner, this site is required as a main construction site, but

more specifically, as a main railhead for HS2, to serve rail-based importation and

exportation of materials from the works in the Victoria Road area. But also, looking

forward, to support rail based importation and exportation in relation to Euston. And

it’s important to understand that the figure of seven years has been put to you. That

figure is very likely to be an under-estimate of the duration of the length of time that we

will require use of these rail based facilities because our planning at the moment has got

to embrace the likely use of these facilities for as long as we are constructing the works

under the Bill at Euston, which, as you’ll recall, for the second B1 phase of works at

Euston, are likely to extend us into the early 2030s.

317. So, I think that whilst I’m not saying that we guarantee that we will continue to

use these sidings and this site in its entirety for that length of time – our current

planning, in order to discharge the construction of the works under this Bill, this site and

these sidings, are an important resource to the project. Now, I stress these sidings

because the implication is that this is no more than a work site, albeit a very important

one. This is actually a very good example of what the rail freight industry in their

previous petition they were urging upon you, which is the project should look to

maximise the rail-based importation and exportation of materials so as to provide a more

sustainable construction arrangement. But more particularly, to support commercially

the rail freight industry in this country. This site is key to that. And it’s key to that

throughout the construction of HS2. Now, it may very well be that DB Schenker will

play a part in that process as one of the providers. We’re the customer, they’re the

providers. There are others who are the providers. But this is going to be a rail freight,

HS2 works here will support the rail freight market in this country throughout the whole

of the process of constructing the Phase 1 railway. So, there’s actually something of a

false premise here on which this petition is based because it’s based, as you saw, from

the heading of slide 9, ‘HS2 plans to take the site from the rail freight market but has no

plan to return it’. Not at all. HS2 intends that –

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318. SIR PETER BOTTOMLEY: No. The first line, just to – it says: ‘CPO the entire

Willesden site’.

319. MR MOULD QC (DfT): Yes, but ‘CPO it’ – take, there’s an important point

there. I was going to come to that next. But, the first point I make: HS2 is actually

looking to use this site in a way that is completely consistent with its continuing

function as an important part of the rail freight market. Admittedly, it’s for a particular

type of rail freight. It’s the importation and exportation of materials to serve HS2 but

that’s rail freight; that’s the rail freight –

320. SIR PETER BOTTOMLEY: Which agrees with that final point on that page 9,

that page, yes, 9, 2058(9)

321. MR MOULD QC (DfT): Yes, but they don’t question that we have to use this

site. This isn’t a case about finding an alternative. This is a case about the terms upon

which we take this facility. And the next point on that point –

322. SIR PETER BOTTOMLEY: Yes, but plainly the question is whether you need to

buy it or whether you don’t.

323. MR MOULD QC (DfT): Yes.

324. SIR PETER BOTTOMLEY: And whether you would return it to them; or

whether you wouldn’t. It’s not actually whether it continues to be a freight area because

they want it to be a freight area; you want it to be a freight area. That’s not the issue.

325. MR MOULD QC (DfT): Well, it’s the context in which that issue should be

considered. And I’m going to come to that now because they have a long leasehold

interest in this land. The freehold rests with Network Rail which is the custodian, the

strategic railway authority for this country. And under the terms of the Protective

Provisions Agreement that we have Network Rail, we will not acquire the freehold

interest in this land. So, the freehold will remain, come what may, throughout and after

this process has been completed, remain with Network Rail and it will be for them to

decide, ultimately, what the future of these lands should be, once HS2 has quit them.

So, the notion that the effect of HS2 is to remove this as a rail freight facility is again

wrong. It will remain – the opportunity to retain it in that use will remain not only

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during the works which HS2 are proposing, but also thereafter.

326. MR CLIFTON-BROWN: Is that actually correct, Mr Mould? First of all, what is

the length of lease that –

327. MR MOULD QC (DfT): 900 years or so, I think.

328. SIR PETER BOTTOMLEY: 900 years.

329. MR CLIFTON-BROWN: So, they have a valuable asset here, approaching

freehold. Surely, they have a fundamental right to expect that they will get their land

back at the end of this process?

330. MR MOULD QC (DfT): No, there’s no fundamental right. I’m not sure where

that right would be rooted. The position is that we require these lands for upwards of 17

years, on the basis that I put to you. We require to clear this site. I’ll come back. We’re

going to retain the key strategic infrastructure operation here which is the Lafarge

Tarmac facility. That will be retained. We’ve given assurances to that effect. We’re

going to relocate, in conjunction with Network Rail, Network Rail’s virtual quarry and

ballast cleaning expert. The other short term uses which are there whilst the land is not

actually required for rail uses, those are going to go, but that’s consistent with the

historic and continuing use of this site in any event. You’ve heard about that already.

331. MR CLIFTON-BROWN: Surely a fair thing to do would be for DB Schenker to

grant you a sub- lease for 17 years so that they get it back again in 17 years?

332. MR MOULD QC (DfT): Well no, because we need to clear the site. We need to

reconfigure it fundamentally. So, the site will be changed radically from its current

layout. The duration of use, the need for the site and the terms upon which we will be

dealing with it under the Network Rail arrangements I’ve mentioned, all support the

exercise of compulsory purchase powers in relation to this site. That is perfectly

consistent with our stated policy on land acquisition, which is: where we need to take –

and to change – lands for work site use for a long period of time that we will exercise

compulsory purchase rather than employing our Schedule 15 powers. So, this is

completely consistent with that purpose.

333. But there’s the added public interest, safeguard, that the land freehold will remain

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with Network Rail under the terms of the Protective Provisions Agreement and it will be

for them to decide at the end of the process, no doubt in conjunction with the Secretary

of State, what its future use should be.

334. MR HENDRICK: If that’s the case then why was the initial approach to DB

Schenker for seven years rather than the much longer period that you’re talking about

now?

335. MR MOULD QC (DfT): I can’t answer that question. What I’m telling you is

what I am told. And the Bill makes clear, I mean bear in mind that AP3, which

promotes the revised Euston Scheme, was the first time that the Bill sought powers to

carry out works that would endure up to 2033, so, at the time when the Hybrid Bill was

deposited, it was expected that the Bill would have been delivered, the project would

have been delivered by 2026. Now, we’re talking about a major component, Euston

Station, were the Bill authorises and contemplates work going on on the second phase of

Euston up to 2033.

336. MR HENDRICK: So are you saying that’s there’s no alternative but acquisition?

337. MR MOULD QC (DfT): Am I saying what? Sorry?

338. MR HENDRICK: There’s no alternative other than acquisition?

339. MR MOULD QC (DfT): I’m saying that our approach here is that everything

points to us retaining the power to acquire this land compulsorily. Those are the powers

that we seek under this Bill and that the alternative which is put forward, which is some

form of temporary occupation, whilst we have the power to do that under the Bill

because Schedule 15 is unrestricted. It gives us the power to occupy any of the lands for

which we have compulsory acquisition powers, to occupy those temporarily. As stated

in our policy, in C4, this site ticks all of the boxes which suggest that we indicate that as

a matter of policy, it is in the public interest that we acquire it rather than use it.

340. SIR PETER BOTTOMLEY: You’re making a choice essentially to use it. The

government or promoters are making a choice.

341. MR MOULD QC (DfT): Yes.

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342. SIR PETER BOTTOMLEY: And are you instructing us as to why each of the

alternatives put forward by the petitioners would some way frustrate the purposes of the

Act or the Bill?

343. MR MOULD QC (DfT): Yes, I am. The first point is that the degree of change

and the length of time means that the Secretary of State does not think it is likely to be

economic for him to exercise temporary powers here rather than to exercise compulsory

purchase powers is the first point.

344. SIR PETER BOTTOMLEY: So the costs would be the same? Sorry. Is that:

there’s no cost saving by agreeing to one of the alternatives put forward by the

petitioners?

345. MR MOULD QC (DfT): There’s much more likely to be an increase in costs,

that’s the concern here. You’ve heard about the economic consideration that we have in

relation to major and substantially enduring construction sites. But then there are the

more strategic questions that I’ve put forward; that this is a site which is presently in

multi-occupation. Given how central it is. I mean this is arguably the most important

work site and rail-based and rail head that we have in this project. And the Secretary of

State has – his position at that moment is that he would wish to take this land, subject to

the arrangements with Network Rail, to clear it physically and to clear it of title, so that

he then has it available for the vital role that it would play in the construction of HS2

and then its restoration, following completion of the HS2 works, that is something that

then the fundamental public interest point that is made by these petitioners that it should

remain thereafter as a vital, strategic rail resource. But that is something that will be

subject to the custodianship of Network Rail that will retain the freehold and therefore

the Committee need have no immediate concerns about that.

346. SIR PETER BOTTOMLEY: On the face of it we’re being asked –

347. MR MOULD QC (DfT): They will get their compensation for the loss of their

leasehold.

348. SIR PETER BOTTOMLEY: One issue which they may want to come back on, is

whether the cost to the project/Government would be higher if what they ask for is

granted.

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349. MR MOULD QC (DfT): Yes.

350. SIR PETER BOTTOMLEY: Or if we block the promoter’s getting what they’re

after in the Bill. The second is whether in effect we’re being asked to provide some

kind of bonus to Network Rail, who’d rather not have been in this long lease? It seems

to me to be the two presenting issues.

351. MR MOULD QC (DfT): There’s much more likely to be an increase in cost the

Secretary of State take this land subject to the arrangements so that he then has it

available it’s restoration following the completion

352. MR CLIFTON-BROWN: Can I come in on the back of that? I’ve listened

carefully to what the petitioners have had to say and I’ve listened carefully to your

eloquence, Mr Mould. This is the first time, from what I’ve heard, I believe this Bill is

oppressive to a property owner, a valuable – his long lease. I think that they should be

given the opportunity to negotiate with HS2 as to whether they wish to grant you a 17-

year lease if that’s what it takes and have their property transformed. We all accept that

is necessary but that would be their choice – to have it back at the end of the 17 years,

albeit transformed and negotiate with you a price that might be equivalent – whether its

leased or whether its compulsory purchased – but I do think these property owners

should be given that choice.

353. MR MOULD QC (DfT): Well, if we give them that choice, with respect, we find

ourselves in a position where we are in what is arguably the most vital construction site

for this railway, we find ourselves at the risk of having to negotiate terms with a

landowner who may or may not be willing to enter into terms with us. That is the risk

that is presented by that.

354. MR CLIFTON-BROWN: But you have the whip hand if they don’t, because you

can compulsorily acquire it. But, what I’m simply saying to you is that I think you

ought to enter into negotiations with them to give them the choice.

355. MR MOULD QC (DfT): We have negotiated with them and we’ve indicated that

following those negotiations we would wish, that the Secretary of State intends, as

things stand, to exercise his powers of compulsory acquisition. So, if all you’re saying

is that we should have another go, then so be it. I don’t hold out much hope.

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356. MR CLIFTON-BROWN: No. I say to you I think that, at the moment, the way

it’s being presented to me, I think it is oppressive what this Bill is trying to do to these

property owners. I make that on the public record and I think you should negotiate in

good faith as to whether they should have a lease or whether it should be compulsorily

acquired.

357. MR MOULD QC (DfT): May I just remind you? If that is the Committee’s wish,

so be it. But may I just remind you, the Committee, that we explained in considerable

detail during the course of previous sittings why, if there was to be a choice between

outright acquisition and temporary occupation, that choice should be confined to the

exercise of the alternative powers that are under the Bill. That is to say: outright

acquisition under Clause 4 or temporary occupation under Clause Schedule 15. But the

one thing that was inimical to the Secretary of State’s judgment of the public interest

was if temporary occupation was considered to be appropriate that that should take place

under the terms of the lease. The Bill provides a mechanism under the Schedule 15 to

enable occupation under statute, for which there is compensation, under the same

Schedule, which covers any loss that is referable to that occupation. And therefore,

there is no need for leasehold, separate leases, to be entered into. And the policy reason

why that is something to be avoided is particularly in a case like this, where you have

multiple occupancy, if the Secretary of State is driven to negotiating leases or under

leases or sub-under leases –

358. MR CLIFTON-BROWN: But the petitioners made it clear that they can give

notice within six months to all the lessees as I understand it on the site.

359. MR MOULD QC (DfT): But, we then have to deal with the situation of Lafarge

who are to remain on the site on are basis. We have to deal with Network Rail who

themselves have an under- lease of these premises. If we are to continue negotiations for

temporary occupation for as long as 17 years, then that should be on the basis that we

will take occupation under the term of Schedule 15, on appropriate terms. And if you

remember, that was an arrangement that the Committee found acceptable in relation to

other petitioners in the vicinity of Birmingham Interchange Station, for example, where

the paradigm that we have followed is we have been willing, in appropriate cases, far

less intensive and far less enduring works than we’re dealing with here, in terms of

timescale, I might add. We’ve been willing to give assurances about temporary use but

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that is on terms as to the level of compensation that will be payable so that the public

purse is not exposed to a degree of compensation liability that is out of proportion,

which would flow from compulsory acquisition. And other terms as to occupation but

expressly on the basis that to start taking leasehold titles, particularly on a multiple

occupancy and a multiple let, premises such as this, is to create unnecessary complexity,

unnecessary risk and unnecessary liabilities in what is a very, very large and complex

project in its own right. That is why Schedule 15 is in there.

360. MR CLIFTON-BROWN: I hear what you say Mr Mould. But as far as I’m

concerned and I can’t speak for the rest of the Committee, I think you should negotiate

in good faith with these petitioners, using compulsory purchase as the last resort, not the

first resort. And that there would be an equivalence of a financial agreement that would

not put either HS2 or the petitioners at a disadvantage financially as to which option

would be pursued. And I would say to the petitioners, if they can’t negotiate this matter

in good faith, they have the opportunity to petition the House of Lords afterwards.

361. MR MOULD QC (DfT): The only thing I would say in response to that is I would

certainly not accept that the negotiations that have taken place hitherto have been

anything other than in good faith.

362. MR CLIFTON-BROWN: No, I’m not saying that.

363. MR MOULD QC (DfT): No, I know.

364. MR CLIFTON-BROWN: I’m saying that prospectively going –

365. MR MOULD QC (DfT): I ought to have that on the record.

366. SIR PETER BOTTOMLEY: One thing where the petitioners may be able to help,

one of the points made by Mr Mould, quite properly – and possibly – is that the

alternative to taking over the lease completely and extinguishing it, the alternative

would be more expensive to the public purse with no gain. Do you think that’s right?

367. MR IVES: There are two points I think that really we need to address. Firstly,

comparative costs and secondly, alternatives. And that embraces the ability to clear the

site and make it available to HS2.

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368. SIR PETER BOTTOMLEY: I know we’re interrupting Mr Mould, who hasn’t

finished speaking.

369. MR IVES: Of course, I appreciate that.

370. SIR PETER BOTTOMLEY: But, help us in –

371. MR MOULD QC (DfT): Yes, well –

372. SIR PETER BOTTOMLEY: No, I wasn’t inviting you to come back yet. Try to

– it will be helpful for us –

373. MR MOULD QC (DfT): No, no, of course.

374. MR CLIFTON-BROWN: But, that was why I say as part of the negotiations there

is no reason why an equivalent cost couldn’t be arrived at and that would be up to the

two negotiators to arrive at.

375. SIR PETER BOTTOMLEY: Could you just rehearse this?

376. MR IVES: I think there are a number of issues arising from Mr Mould’s point of

view –

377. SIR PETER BOTTOMLEY: Could you keep your voice up a bit?

378. MR IVES: The rents that we achieve on the sites we’ve let are broadly

comparable with market rents and in this context the likely annual rent would be

probably around 3% of the total cost of replacement of the Willesden site, possibly a

little less than that. So, even to take it for seventeen years –

379. SIR PETER BOTTOMLEY: Is less than two thirds?

380. MR IVES: Yes, well, it’s 54%, yes.

381. SIR PETER BOTTOMLEY: Yes.

382. MR IVES: So, it would only be half the cost of the acquisition of the site. Or the

cost of equivalent reinstatement of the site. And the point that Mr Mould makes is that

want to substantially re-model the site but we have no problem with that because the

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changes they will make to it, to make it more efficient for their own purposes, could

well suit us in the long run as well.

383. MR HENDRICK: As a matter, how much is it likely to appreciate over the period

concerned?

384. MR IVES: Appreciate?

385. MR HENDRICK: Yes. Or depreciate.

386. MR IVES: I think that’s finger in the air somehow, I can’t –

387. MR HENDRICK: Over 17 years.

388. MR IVES: If I were able to predict property inflation I’d be very, very wealthy. I

genuinely don’t know. Property tends to have an eight-year cycle and it rises for five

and dips for three and so on. As a profession, I’ve worked through four of those now.

389. SIR PETER BOTTOMLEY: I think the sense we get is that actually buying out

your interest would cost significantly more than having the use of the site for a period,

even up to 25 years, let’s say 20 years, even more than 15 or 17. And the second issue,

which I think’s been cleared quite easily is that you don’t actually mind what happens to

the site, if it’s there for railways and assuming you’d have it back for railways, it’s not

going to be a loss. It might be a gain.

390. MR BIRD QC: And that’s not just in the private interest of the company. It’s in

the long-term public interest for the reasons we’ve explained. And my learned friend

referred to the fact that ultimately it will be Network Rail that decides but again, that

introduces a level of uncertainty which isn’t there at the moment. We know at the

moment that it is a long term resource for rail freight for the next 100 years.

391. SIR PETER BOTTOMLEY: We may have been a bit unfair on the promoters but

I don’t think it’s clear to us either that the costs of the alternatives are greater or that the

effect on the ground is adverse to the public or private interest. Although it is the

private interest here which were supposed to be considering when a petition comes up.

392. MR BIRD QC: I appreciate it is but obviously you need to weigh the competing

public interests. And we see there is no obvious competing public interest in support of

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the promoter’s case. Certainly not one which overrides the –

393. SIR PETER BOTTOMLEY: Perhaps we’d better let the promoter – we have

interrupted him.

394. MR MOULD QC (DfT): Obviously, I’m responsive to the debate and I’m

responsive to the mood of the Committee which is clear. What I’m going to suggest is

this. I think in the light of the debate that’s taken place, the Committee is not persuaded

that there isn’t room for further negotiation here on the question whether outright

acquisition is actually justified and whether the Secretary of State should think again

about this case and whether occupation, for the purpose of the works, is achievable and

is justifiable in the public interest. I put it that way not because I ignore the private

interest but because ultimately the Secretary of State has to make a judgment on that

basis as well.

395. So, I therefore would say this: There is the opportunity for as I think Mr Clifton-

Brown said for this matter to return if necessary to the second House. There is no

question of the need for any AP here. It’s a question of whether to exercise powers

under Clause 4 or powers under Schedule 15. And so I therefore, I’m willing to accept

effectively the direction of the Committee that there should be further discussion of this

between the parties with a view to achieving a mutually acceptable outcome. I just want

to make just in order to ensure that expectations are understood, I think there would be,

there is, I know, considerable resistance, on the part of the Secretary of State, to enter

into some sort of lease. I think that if there is to be, this process that I’ve just outlined, I

think the Secretary of State would expect to focus on the choice between outright

acquisition and the exercise of powers under Schedule 15. No doubt subject to any such

bespoke assurances or conditions that may be put forward for consideration, but not to

consider entering into some form of direct leasehold, private leasehold arrangement with

the petitioners. So, on that basis, I leave the matter with the Committee.

396. MR CLIFTON-BROWN: At the risk of prolonging this matter, can I just ask the

petitioners one final question? There was a little bit in our discussion of, I thought,

perhaps distance of opinion, on how to deal with these sub-lease holders. Could you

just tell us what the difficulty with giving sub- lease holders notice is and what might

cause a problem with HS2?

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397. MR IVES: There are two sub- lease holders who’s leases expire after 2017,

Tarmac and Network Rail, to which Mr Mould referred. He said that HS2 were giving

assurances to Tarmac. And Network Rail, I think, can be dealt with by other means.

The remaining sub-tenants, of which there are nine, all are on leases that can be

terminated on six months’ notice.

398. MR CLIFTON-BROWN: Okay.

399. CHAIR: Okay?

400. SIR PETER BOTTOMLEY: I think just to sum up for my colleagues, first of all,

it was very helpful the way the promoters have responded. Secondly, I don’t think that

we would want to direct how something was done. One point is that the amount of

money to the public purse, to achieve something. And the second, I think we can

understand this, the promoters need to have sufficient control to be able to achieve what

they want without spending all their time having to get involved in long arguments with

people. And I suspect those are things which the petitioners could help resolve. So, I

think it’s right that we shouldn’t try to determine this issue and that there is scope in the

Upper House and between the petitioners and the promoters – and Government – to find

a way forward which protects the public interest; allows the purpose of the Bill to be

achieved; that doesn’t trample unnecessarily on private interests post-construction.

401. CHAIR: I think that there’s enough doubt here that further discussions ought to

take place. I think clearly that given that the Lords will take some while to deal with the

issues, and it’s something that they can deal with, then I think you could discuss things

and then see how things pan out there. But, I think it’s been a useful discussion.

402. MR BIRD QC: Thank you very much for your –

403. CHAIR: Order, order. That’s the end of today. If you could clear the room,

please and let us clear our thoughts.