Transport Committee
Oral evidence: Strategic transport objectives, HC 84
Wednesday 29 November 2023
Ordered by the House of Commons to be published on 29 November 2023.
Members present: Iain Stewart (Chair); Jack Brereton; Sara Britcliffe; Paul Howell; Grahame Morris; Gavin Newlands: Greg Smith.
Questions 1–67
Witnesses
I: Sir John Armitt CBE, Chair, National Infrastructure Commission; and Lord Hendy CBE, Chair, Union Connectivity Review.
II: Professor Jillian Anable, Chair in Transport and Energy, University of Leeds; Professor Stephen Glaister, Emeritus Professor of Transport and Infrastructure, Imperial College London; and Jonathan Spruce, Policy Fellow, Institution of Civil Engineers.
Written evidence from witnesses:
– Institution of Civil Engineers
Witnesses: Sir John Armitt CBE and Lord Hendy CBE.
Q1 Chair: Welcome to today’s session of the Transport Select Committee. This is the first session of our strategic transport objectives inquiry. Our aim is to look not just at transport across the different modes but at how well the objectives sit alongside other Government policies on economic growth, energy provision, health, environmental outcomes and so on. That is the context of today’s inquiry. Before we get into our questions, I invite our witnesses to state their name and organisation for the purposes of our records.
Sir John Armitt: I am John Armitt, chairman of the National Infrastructure Commission.
Lord Hendy: I am Peter Hendy, chair of Network Rail and the author of some work for a previous Prime Minister on the connectivity of the United Kingdom.
Q2 Chair: Thank you. Welcome to both of you, and we are very grateful for your time and evidence this morning. Given the broad objectives of our inquiry, how well do you think the Government have a clear strategic plan for transport?
Sir John Armitt: Our concern as the NIC would be that it is difficult to see the vision. There are clearly different strategies with different aspects to them, but combining that into a clear vision is what we would see as lacking. It is one which needs to be integrated across modes. It would be one that actually took into account the road needs, the rail needs and others potentially, such as aviation, but primarily road and rail, and to look at those and think about how you could prepare them in a long-term strategy that recognises the interface between them and the challenges that each faces. It would be to bring that together in a long-term plan that has a series of investments and projects that can achieve a long-term vision. At the moment, we see separate plans and proposals for road and for rail. They tend to finish up as a series of projects, and it is difficult to see how they quite come together in achieving a long-term vision.
Q3 Chair: Thank you. Lord Hendy.
Lord Hendy: Where I would start is by saying that transport is not an end in itself mostly; it is a means to an end. Better transport connectivity produces growth, jobs, housing, social cohesion and sustainability. Therefore, the series of projects that John refers to are to an end—the Government’s greater objectives.
Sometimes I struggle to see the connection between the individual projects that people advocate and the wider aims. You can interpret infrastructure projects into more connectivity, faster connectivity or more reliable connectivity, but very often in the translation from the means to an end— I look at it from the Network Rail angle—we get a whole series of infrastructure projects. Network Rail is fundamentally an infrastructure company. Sometimes, in the eight and a half years I have been there, we have struggled to understand what it is that these things are actually supposed to deliver.
When I was first appointed in 2015, I was asked to review a huge list of railway enhancements. They were a massive jumble. Some of them were better engineering of infrastructure that needed renewal. Quite a lot of them looked as though they had some wider economic, political and social objectives, but they were not spelled out. I am not sure that we are in a much better place today than we were then.
The other thing, in relation to the whole of the United Kingdom, is that the work that I did, which finished two years ago, was on the premise, which I think was justified, that in the process of considering transport investment and infrastructure, the connectivity of the four nations of the United Kingdom had been rather missed. You can see the work that was published. I believe that the Government are going to respond to it very shortly. There were some obvious things about better economic growth across national boundaries, which have been missed in the structure of how transport is organised in the United Kingdom.
Q4 Chair: Thank you. Wearing my previous hat as a Minister in the Scotland Office, I remember discussing the connectivity review with you. The answer as to when the Government were going to respond two years ago was “Soon.”
Lord Hendy: I believe it is now “Shortly.”
Q5 Chair: That is an improvement, but we wait with bated breath. Sir John, last month, the National Infrastructure Commission published your second national infrastructure review. Your previous one was in 2018. Have things got better in those five years? Is it at a standstill or have we gone backwards? What is your sense of progress in these matters?
Sir John Armitt: I would say that there has not been a great deal of change in that period. The challenges that I outlined just now are still there. We have seen the Government produce a decarbonisation plan for transport. We have seen a strategy that talked about the role of buses in transport. A couple of years ago, we saw the production of the integrated rail plan or programme. We were heavily involved in that, and we produced a national needs assessment as input to it.
Clearly, that now ought to be re-examined in the light of the decision on HS2. We would argue that rather than just carrying on with the cancellation and the list of projects that have been proposed—some in rail, some in road and elsewhere—to use the money that might be saved from HS2, that needs to be properly examined now and turned into a new integrated rail plan so that we know exactly what we are trying to achieve. From our perspective, that has always been economic growth, ensuring that we are decarbonising at the same time and increasing the resilience of our infrastructure. Those three core themes sit through everything that we do.
Outside the strategic intercity transport networks, of course, there are the urban networks. There, we have argued for some time that that needs to be dealt with on a much more devolved basis. The best people to understand what is going to work for their particular city—there will not be a common solution for every city—should be the local government in those cities. What we would like to see is much longer-term devolution of financial support to cities, to put in place the most appropriate transport infrastructure to enable the cities to work effectively.
The two things need to be knitted together at the end of the day, but it is best dealt with at local level. We need to move away from constant competition. Competitions simply generate, “Well, that’s a nicer idea than that one,” or, “We think there’s better value for money for that one,” but it does not fit into a strategic whole if you are just divvying up the money based on competition. Again, we think there needs to be a much more strategic approach.
Q6 Chair: Certainly, one of the areas we want to explore in this inquiry is the appropriate balance of decision making at a strategic UK-wide level and what is appropriate at the devolved level, whether that is the devolved Administrations or mayoral authorities, and what is at an individual town and city level. We will certainly be exploring that area.
Lord Hendy, in the rail sector, what assumptions are you making with the GBR transition team on what the Government’s long-term plan is for transport?
Lord Hendy: Quite a lot of work has been done on the basis of a long-term plan. In particular, we have managed to get agreement across Government for their strategic aims for the rail industry. I’ll send it to you, if you like. I believe it is a public document. That is extraordinarily helpful because it ought to be the framework under which Government spending on rail, which is a very large sum of money, could be most wisely spent. In time, it ought to translate into a plan that has a list of projects, large and small, with various costs and benefits, and they can then be prioritised. I don’t think that has been the course of events in recent times. The list that I referred to, which I was asked to review in 2015, has morphed into various lists that have been either published or not published, of which the latest is the list in Network North. That is fairly substantially different from the previous work on the integrated rail plan for the north and the midlands.
It would be an advantage if you worked from the top and from what the Government’s strategic aims were for the economy, worked out what the railway was best placed to do and then worked out what investment was needed. By the way, the other point that is obvious in an integrated railway is that infrastructure investment, by its nature, is expensive and long term. There are other things you ought to be able to do with the train service, with the available train staff and rolling stock. Infrastructure investment ought to be the last resort. If you looked at it as an integrated railway, you would do a lot more with the basic timetable and train planning before you got on to infrastructure enhancements. I think that is a weakness of the urrent system. If you ask Network Rail, it is largely an infrastructure company, so it is likely to recommend infrastructure investment. That is not the best way to spend public money, which is one of the best reasons for having an integrated railway.
Chair: Thank you. I will return with some further questions later on in this session, but I pass to my colleagues.
Q7 Greg Smith: Thank you, Chair, and good morning to you both. On some of the points I want to explore, you have teased out your concerns in answer to the Chair’s questioning. You have both proposed changes to the Government’s strategic transport approach. You have outlined your concerns and you started to say what those changes need to be in the evidence you have just given.
Can you go into some more detail, so that this Committee can consider and make recommendations to the Government as to precisely what needs to change, and how that would resolve problems in the existing system? Perhaps we can start with you, Sir John. You were very clear in a previous answer about your view on the devolution of transport. However, when it goes beyond a city, a town or a region, of course transport involves lots more areas. If you take the catastrophe of HS2, that essentially pitted cities against towns, villages and the countryside in between those villages. Can you explore a little bit about how balance can be demonstrated? If power rests with London, Birmingham, Manchester, Leeds and other great cities of the United Kingdom, how would the rest of the country that will be affected by that get their say?
Sir John Armitt: I would argue that you should probably go back one stage further and understand what the country’s industrial strategy is. In a sense, transport then becomes part of delivering that industrial strategy. In our most recent national infrastructure assessment, we made reference to the need for more spatial planning, for example, particularly as we look at the challenges of decarbonisation and the potential for hydrogen and carbon capture storage. You cannot spread that all over the country. You have to say which are the key areas where it is going to be most effective.
That, in itself, will generate some economic growth. It will generate jobs and so forth. Therefore, you then need to ask how transport plays its part in delivering the Government’s overall nationwide objectives. To do that, you have to say, “What are our modes of transport? How do they relate to one another? Do we plan them in isolation? Do we look at how they interrelate?” For example, trans-modal between rail freight and road can be a key aspect. I would argue that it is very difficult to look at these things in isolation. You would look to the Government and to the Department for Transport, as representing the Government, to have their head around the challenges of how we reflect the different modes, one with another, and reflect the modes relative to the activity in our ports, and which ports we see as most likely to generate growth. How easily can we get goods and services in and out of those ports and what role does aviation have to play domestically? It is largely international, but there is a domestic role as well. How do you connect up to that?
As we have seen, going back to looking at Heathrow and the possibility of a third runway, one of the smallest elements of that, but one that was seen as critical by most people, was the fact that if you came from the west country, you went into London and then came back out again on the train to get to Heathrow. It would be a relatively straightforward connection from the west to Heathrow, which again would have joined up those two forms of transport. You ought to start by looking at these things as a joined-up series of transport networks. At the end of the day, the Department can be the only organisation which takes overall responsibility for looking at how those can best be integrated.
In the specifics, it is talking to Highways England, Network Rail and the aviation industry about their solutions and proposals, and bringing it all together in a cohesive whole.
Greg Smith: I recognise everything you say, but by definition any Government have only a limited amount of time to deliver something. The nature of democracy is that that lends itself to single projects to be looked at at any one time, as opposed to the wider strategic approach. We have seen that within a single Government, greenlighting HS2 and then chopping various bits off at different points. Likewise the third runway, which you reference. While it is not a Government decision—it is a decision for the airport whether they seek to build another runway—the debate has been framed within, “Does Heathrow need a third runway?”, when a lot of people would say that in order to make it a competitor to Schiphol or whatever it needs six and not just three. I am not proposing that, but within the confines of politics, how could the grand strategic objective that tries to look at all parts of the country at once actually be delivered? We are only ever going to get into debates, both within this bubble and out in the country, about single projects.
Sir John Armitt: It is a very good question and one that, at times, I can get quite depressed about. As you say, how do you fit a 25-year view of the world into the inevitable pressures that an individual Government face in their five-year cycle?
If I go back, with respect, to the work I did in 2013, which recommended the creation of a National Infrastructure Commission, in that I said that the commission should report to Parliament and not to the Government, and that the commission, through reporting to Parliament, should stand more chance of getting nationally significant projects agreed on a cross-party basis by a vote. At the end of the day, the vote would probably throw out some of the proposals, or elements of the proposals, but ideally you would arrive at an agreement across the parties to major, significant projects in whatever sector.
Perhaps not surprisingly, when the commission was created, the Government at the time took the view, “Actually, we’d rather the commission reported to us and then we’ll make the decisions.” That is understandable in a political sense, but it creates the very difficulty that you describe, because you have not been able to bind in more of a consensual approach. I was in a discussion about this only last night. We were talking about the need for consensus. I said, “Well, there are two consensuses in this debate. There is the consensus between the political parties, but the other consensus is the one between Government and the people.” Of course, that is equally critical.
None of those is easy. I believe it can only be taken forward with a very open, frank and honest debate. At the end of the day, it is for the people to decide where they would like the preferences to sit, how they see the money being spent and how much they feel is a reasonable amount for them to be spending, whether it is on their energy bill or on their transport system. I don’t have an instant solution. I totally recognise the challenge that you make, but my response would be that we have to find ways to build greater consensus, both politically and with our citizens.
Q8 Greg Smith: Thank you. Exam question set. Lord Hendy?
Lord Hendy: It is a real issue. Everything that Network Rail has in a physical sense is a very long-term piece of infrastructure. If you build a new railway, it will last at least 120 years. The oldest asset on our railway is currently 198 years old. It is probably completely written down. In fact, if you think it is an asset, you are completely mistaken. It is a huge set of liabilities, but they seem to work most of the time.
The only thing I can say is that you need the consensus that John talks about. Quite often, the planning period for some of these projects is greater than the span of one electoral cycle. The model that I am most familiar with, which seems to work fairly well on a regional basis but is hard to replicate on a national basis, is the model I worked with over the 16 years that I was at Transport for London. The Mayor is obliged by law to have a spatial development and economic strategy—a London plan that lasts for 30 years. Underneath that he has several other strategies, but then you get a transport strategy that sets out the work that is needed, both infrastructure and other work, to deliver the London plan. You can then turn that into a business plan. You can turn it into a series of actions and policies, including infrastructure. You set them out and look at the economic case for doing them. You rank them and invite the political leader of the day to make the choice about what they are going to instigate.
That is much harder to replicate on a national basis. The interesting thing is that we are now at the end of 2023 and the mayoral system in London has been running for nearly 25 years. That process, certainly until recently, has produced more investment in transport in London, and consequently more economic and spatial development than any previous system of political management.
It is revised regularly. That is not to say that today’s list is the list that a future Mayor would wish to do. When I described to your Chair how we were looking at this in regard to Great British Railways, in my head we could envisage at least something similar, which is a plan for the railway that has a series of infrastructure and other investments for which you could look at the business case. The Government of the day, when they had some money to invest, could choose which to do, either economically or politically, in accordance with their strategy.
The inevitability is that when you have chosen, you would like that project to be executed. You need some consistency over a long period of time to achieve it, if it is a big project. That is quite a long way from where we are currently. The result of where we are currently is that some of the projects we have had the misfortune to deliver, one or two of which have been delivered very badly, were initiated very badly.
There is one other really important point that I want to make on this. The absence of that list, whether or not it is completely subscribed to by all political parties, obviates the opportunity to get third-party investment in it. When I left Transport for London in 2015, virtually everything on our business plan would have had some element of private sector investment. We talked to developers, and they could see the benefit of better transport, and they could translate it into profit from development, either commercial or housing. The absence of not a generally agreed list but a prioritised list of things that the Government would like to do, at least in my sector of the transport industry, means that when something is instigated, it produces windfall benefits to people who have either correctly speculated that it is going to be built or that it then starts. Of course, the most obvious current example is the skyline of Birmingham, which is full of building because people anticipated HS2 arriving.
HS2 itself doesn’t have a penny of private money in it. We ought to think that is a disgrace, actually. At least Crossrail, however difficult it was to deliver, had some elements of private funding because it was well known that it was a project to be funded. It was, in fact, only the private sector that got it over the line. That was quite a good test.
Q9 Greg Smith: That is a very fair point. Something I have talked about before in the Chamber of the House of Commons is the need for a private sector test. If there is no private money being offered up to something, the chances are that the politician’s finger in the air saying, “That sounds like a good idea,” probably isn’t a good idea. I am not saying that the private sector has to fund everything, but it should at least be a test in national infrastructure.
I am aware that the clock is ticking, so this is my last question, which is for you both. Sir John, I would be grateful for your view on that private sector test as well. Is the fundamental problem with the way infrastructure in the United Kingdom is planned that concepts are floated on single projects? Let’s take the Oxford-Cambridge arc as an idea. None of the detailed planning for it happens until after there has been nigh on a decade’s worth of row in public over it, and then it becomes deeply controversial in the way that, let’s say, East West Rail has become as you get to the other side of Milton Keynes out towards Cambridge, where it is a wholly different construction project, bringing an old railway back to life from Oxfordshire through to Milton Keynes. Without doing the full detailed planning as much as you can, you are always going to run into problems as rows develop after a concept has been given the green light.
Sir John Armitt: That has always been a challenge. If I go back 30 years at least, to when I was a contractor, we used to say that the average bypass seemed to take 14 years, 12 years of which were talking about it, planning it and developing it, and then two years to build it. You have this enormous lead-in time.
We have to beware all the time of going too quickly at the front end. I would argue that we make some of the decisions too quickly and without proper consideration. I define projects as why, what and how. The why is the most important question. Why do we think this is the right thing to do? Do we really talk it through? Do we look at the alternatives? Do we look at even the likely out-turn cost at that stage? Does that fit into a sensible economic proposal? The why question is absolutely fundamental.
Once you have decided that something is absolutely essential and is going to have the potential to deliver your key criteria, which are always likely to be economic opportunity and economic growth—because without jobs, where do we go?—you then move to the what. The what tends to be rushed as well. We all love the how; that is the fun bit. “How are we going to build it? What resources do we need?” But the “what it is” that we are going to build also requires very careful consideration. To go back to the Olympics, the first question was, “Do we need to build anything at all or can we use existing facilities or temporary facilities,” and finally, “Do we need to build something which is going to be permanent and what is the legacy of that permanence?”
It is the willingness to draw breath and not grab at the first figure, which of course tends to happen. The first figure that is quoted becomes the figure, and then everything is measured against it. If you have arrived at that first figure without proper consideration or understanding of the detailed proposal that you are going to develop, you are likely to get it wrong. There is always going to be risk. You have to have a contingency for the risk. It is again driven in part by the five-year cycle. Are there many Brownie points for the Secretary of State if he spends all his time talking about the “why”, rather than the actual, physical thing that is going to be delivered at the end of the day? There are inevitably pressures. In the private sector, the pressure could come from the board to get on with things. The private sector is not perfect, but it is probably better at controlling cost.
Q10 Jack Brereton: We have heard about the need to better reflect the economic needs of the country when thinking about infrastructure investment. Do you think that the Government are best placed to do that?
Sir John Armitt: At any point in time you will have a division between what is seen as being the public sector’s responsibility to deliver and what elements of our infrastructure, both economic and social, should be delivered by the private sector. Of course, we have both. The health system in this country is largely a combination of public health and the provision of public hospitals and all the services to go with them. There is also the ability to provide an alternative through the private healthcare system.
To go back to the railways, they were fundamentally paid for by private sector investors, many of whom went bust. Many lines failed to be economic in terms of the volume of traffic that they generated and so on. That is why, in a sense, when we come along to Beeching and Serpell, and you say, “Well, I want a really economic railway,” it needs to be about a third of the size of the one that we have. You only really have a strong business case for the commuter lines and the intercity lines. The rest are a nice to have, and we feel that it fits into reducing our car usage to have a railway as an alternative, but we still have the brutal truth that only about 10% of journeys made over 10 miles actually take place on the railway. The numbers bounce around, but fundamentally we are still a car-driven society.
Q11 Jack Brereton: How do you think it could better reflect economic needs, the need of passengers and the need of industry? Is there a better mechanism that we could have to ensure that, when we are planning infrastructure investment, it is not pie in the sky or just what some mandarin in Whitehall thinks is best, but actually reflects the genuine needs that will make economic growth and deliver the improvements and enhancements that passengers and freight need?
Sir John Armitt: As Peter said, you have to keep any plan under review. We have recommended that every five years the NIC should take a fresh look and make sure that the priorities you decided on five years ago are still valid and that the circumstances have not changed. A lot of this is driven by behavioural matters. There is no doubt whatsoever that if you reduce the cost of travelling by train or by bus, or anything else, you will drive up passenger usage. We saw it particularly in London years ago when the tube fares were slashed. There was immediately a significant increase in take-up. You see it on the trains today. If I go to Manchester first thing in the morning, I pay four or five times the amount that I would pay to come back at lunchtime. The train coming back at lunchtime is absolutely packed from Manchester because people are taking advantage of that opportunity for a much cheaper way of travelling. They are getting on the train. They may not make the journey at all, of course, so you might not create that economic activity at all without that cheap fare. On the other hand, they might choose to get in the car, with the consequences of travelling by car. These are difficult options.
Lord Hendy: I wonder whether you could look at your question in a different way. The railway is a national system, but it is clear that quite a lot of dissatisfaction about transport investment has been created by the view from either Westminster or the Government Departments involved. It is quite clear that transport is a regional and local activity. John referred to the influence, for example, of the Metro Mayors. I think you can see in the devolved Administrations of Scotland and Wales a real desire to see transport serve on a regional basis.
It is also a question of choice. I have been a board member of Transport for the North, though I am not any more. Lord McLoughlin chairs it very well. One of his issues with a body that looks at transport across the whole of northern England is that in the end you have to prioritise something. Everybody’s first priority in the 19 local authorities that form Transport for the North cannot be attended to at once in the same priority. You need a system of prioritisation and you need a system of appraisal. Then, you have to have some decisions taken about what to do. There must be a role for powerful urban Mayors and there must be a role for regional authorities as well. There must be a role for central Government because, in the end, they wind up paying for it.
Q12 Jack Brereton: In terms of the role of Government, just to talk a bit more about that, do you think Government should be controlling? Is it realistic to expect them to be controlling in that sense over transport strategies and policies?
Lord Hendy: It is public money. I constantly meet people in my daily life who lament the fact that the Government are so involved in running the railway, but we are spending a huge amount of public money. There is no question but that we ought to be publicly accountable. I cannot see that there is much question that, in the end, the Government ought to decide where they put their money. The question is what things they are choosing from to do it and what the rationale for doing it is. That is really what I suspect you are looking at and what we are arguing about.
Q13 Jack Brereton: What more could be done? Earlier, you talked about the fact that we have had many different publications, many of them piecemeal and some not published, in terms of those longer-term strategies for infrastructure investment. What could be done to improve that process so that we actually have not just better decision making but more transparency around decisions that have been made?
Lord Hendy: If you go back to what I was remarking on as the process in London, the contrast between the previous decades when reports were periodically published full of diagrammed schemes and projects, virtually none of which were done—I have shelves full of them at home—and when we started on a process that had a rational, long-term spatial and economic development plan for London, which threw up a transport plan, the difference by inspection is that over the first 20 years or so we actually managed to deliver a far greater proportion of what that plan contained. The reason for that was that the process was that you put forward things that sought to deliver the Mayor’s economic and spatial development strategy, assessed them against the reasonable criteria that John described earlier, and then the Mayor of the day took the decision to put them into effect.
That process has survived through three very different politically coloured Mayors. Interestingly, each of them has produced a transport strategy and they are not much different from each other. That is because your aspiration for economic and spatial development for London is not much different. I suspect the same might be true of railway investment if we ever got to the stage of having a coherent set of plans and reviewing them regularly.
Q14 Jack Brereton: Do you think that model has been much more effective in terms of meeting those strategic objectives and the development of infrastructure in the capital than we have seen more broadly through the model that has been used throughout the rest of the country?
Lord Hendy: Yes, absolutely. It is about periodically producing a random, one-off plan, its going through a political life and then another one turning up. The integrated rail plan for the north and midlands is quite a good document. Now we have Network North, which is significantly different. There is a whole swathe of projects that we have not developed because in many cases the Government told us not to because it was not their priority. The inevitable result of that is slowing down some things that you and many other people who represent people locally and regionally would like to see. It is not a very efficient way of doing business.
Q15 Jack Brereton: Do you feel that we should move towards more of a model like that operated with TfL?
Lord Hendy: I do. One’s aspiration for a railway plan that is available publicly, reviewed from time to time and sets out the benefits that are sought to be achieved by the investments, projects and service improvements in it, is not a bad place to be.
The other reason why I think it is really important, which is what I went back to before, is that it is only by publishing those things that you can seek to get private investment in the projects. Without it, it is always funded by Government because there is no other money coming in. People are not sure whether the thing in question is ever going to happen.
Q16 Jack Brereton: In terms of that point about private investment, at the moment there is very little incentive for the private sector to invest in infrastructure in this country. You mentioned greater longer-term certainty about what plans are coming forward. What else could be done to encourage more private investment in infrastructure in this country? Sir John might want to come in on that as well.
Lord Hendy: Let me just say quickly that if people cannot see what is likely to happen they cannot even choose whether or not they might put in some money to raise it up the list. The one thing I would say for the record is that we are not talking about 100% funding. It is not realistic to suppose that with much lower land values outside London you could ever get to that stage. Your colleague is right that, if you cannot see anybody on the horizon who sees any economic benefit from a project they might invest in, it is worth asking whether it is the right thing to do.
Sir John Armitt: I would start by picking up Lord Hendy’s point about London as a model. Most places around the country would look at London. In fact, when we visit regional cities they say, “If only we had a transport system like London.” Asking what makes London a successful transport system, how it has arrived at that and what is behind it would be a good starting point. Many people would say that London is a mini state within the UK and somewhat separate, so if that works, it raises the question, “In that case, what can we copy?” It would be the approach that Peter has described in London applied in a much wider context across the country.
Private sector investment, at the end of the day, is pretty straightforward. “Is there going to be a reasonably, not absolutely, certain market for my product?”—whatever it might be, whether it is in energy, water, transport or anything else. “To what extent am I going to be able to make a return as a consequence of the costs I have borne, which I can then recover through some sort of recovery system?” I was the chairman of the business that created the second Severn crossing. You don’t get much simpler than that—putting a bridge in the middle of a motorway—and in fact you can be pretty confident that you are going to get a reasonably steady income stream. You can forecast how many years it is going to take to recover. It was 10 years sooner than we expected.
Q17 Jack Brereton: We looked internationally as well at how other countries are doing this. Obviously, in many other countries private investment in infrastructure is the norm. Have we looked at how other countries are doing it, to see how that might be applied here in the UK?
Sir John Armitt: You say it is the norm. I am not sure that it is the norm, particularly in rail. On roads, recently there are some road schemes in America with variable tolling, where literally how much you pay is decided by the minute, according to the intensity of the traffic. European companies have invested in stretches of road like that in America. Of course, in America you already have the well-established principle of tolling anyway. France has put in place its tolling system on its motorways, which causes some diversion on to local roads. You are always going to get that. At the end of the day, it works pretty effectively. You have a choice as to which way to go.
Road charging in this country is something we have been long against, politically. I have personally advocated it for a very long time. Many people say, “Yes, it’s rational,” but on the other hand it is very difficult to get through the political barrier.
Q18 Jack Brereton: You are not a politician, so it is easier for you to say that.
Sir John Armitt: I am not a politician. That is what people have said to me: “John, you are politically naive on this subject.”
Lord Hendy: Can I mention a different international comparison? One of the things that is obvious is that countries that have a consistent list of transport infrastructure projects always deliver them more cheaply. We have this terrible problem, which is particularly evident in railway electrification. It is the feast and famine approach. If the Railway Industry Association were here—they might come and speak to you; I don’t know—they would tell you of the economic consequences to the massive supply industry of this feast and famine approach. If you look at the approach of some European countries over high-speed rail and electrification, or tramways and light rail in cities, you will see that they run a long-term programme. The people who do it get an expert in to do it. It becomes cheaper, de-risked and it delivers, much to the benefit of either the national supply industry or sometimes European ones.
Jack Brereton: Thank you. We could go on all day, but I will hand back to the Chair.
Q19 Chair: I want to ask a supplementary on that before I turn to Sara. In recent years the Government have made some changes to the Green Book in how investment projects are appraised. Is that a step in the right direction, but there is still much more to do? I am thinking along the lines of how we try to quantify the benefits of a piece of transport infrastructure investment that might not come into the P&L account of any transport body. If, for example, an intervention improves air quality, the gain is for the Health Department because there are fewer people with respiratory conditions—
Lord Hendy: It is very clear—
Q20 Chair: Is what has been done a good step in the right direction, although there is more to be done on it?
Lord Hendy: Yes. All I would say is that, having done that, you need a consistent process where promoters of projects have the time and the space to make a proper business case for their project. One of the difficulties of things like the integrated rail plan for the north of England was that it was a massive series of individual projects which were described as having huge benefit, individually and collectively, but there wasn’t the space in the time proposed for anybody to produce a decent business case. Outside major conurbations in particular, you need wider economic appraisal to find the full justification for Government spending the money.
Q21 Sara Britcliffe: Lord Hendy, can the transport system be seen to have a guiding mind, in a sense?
Lord Hendy: The nearest you will get is the Government, through the Department for Transport’s control over both investment and operating expenditure. In respect of the railway, it is pretty obvious that it does not currently have a guiding mind. That was the subject of the Shapps-Williams review, which suggested that the railway would better serve the wider objectives of the country if it did.
Q22 Sara Britcliffe: Would you say that the DFT has too little control of the system at this moment in time, or does it have too much power in a sense?
Lord Hendy: Curiously, as far as the railway goes, it actually has both. The Department is busy specifying the length of trains, when they run, how often they run and where they stop. That is an odd thing. It is probably the most Government-controlled railway outside North Korea. In other respects, there isn’t a guiding mind because we are fragmented. We are Network Rail. We are a public corporation responsible to the Secretary of State. Elsewhere in his Department, people are making decisions that affect the use of the infrastructure. We are getting better at co-ordinating that, but previously it was very unco-ordinated. Even as we sit here, I think the sentiment in the work that Keith Williams did suggested it could be better still, cost the public purse less and deliver more benefits.
Q23 Sara Britcliffe: How would you compare the power that the DFT currently has over the system with the power that the Treasury currently has over the system?
Lord Hendy: The Treasury pay for it in the end because they are the custodians of public money, and that’s absolutely right. I think you would have to ask the Treasury and the Department to reveal to you the inner workings of how things get approved. As I said before, on a macro basis it is obviously right that Government should have a lot of control over the spend of public money.
If there was one benefit of integration of the railway system, it is that what you want is the best possible railway outcome for minimum public funding. With the division that currently exists between the Treasury, who have in effect taken control of the railway revenue, and the Department, who are responsible for the cost, I don’t think I have ever met anybody who thinks that is the best way of running a railway. You certainly would not run a commercial business in that fashion.
Q24 Sara Britcliffe: Sir John, do you have any comments?
Sir John Armitt: I agree with Lord Hendy. I was chief executive of Network Rail when it came out of the decline of Railtrack. When I was carrying out that role, I used to say to Ministers and the Secretary of State, “Look, stay out of the kitchen. I’m trying to run this organisation and, as long as I do, you can always stand up in Parliament and blame me. The more you get involved and the more you tell me what I should be doing, I’m sorry, but you’re the one who is going to have to be responsible and answer the questions, so please try and stay out.”
At the time I recommended that we had what I called a virtually vertically integrated railway. A lot of my time, and the same for Peter’s, would be spent in discussions with the train operating companies trying to reconnect wheel and rail. Most railwaymen would say that making that division was a mistake at privatisation. You could see the rationale behind it, but it separates the two organisations that are going to look at their challenges together on a daily basis and working out how best to make sure that we are delivering the outcomes the passenger is looking for. I totally support the guiding mind concept, but on a day-to-day basis that should not be in the Department for Transport. It should be in an organisation that is responsible for running the railway.
Q25 Sara Britcliffe: Do you believe that the institutional architecture of the public bodies is currently functioning well—for example, Network Rail?
Sir John Armitt: I think Network Rail has continued to do the very best it can. It does a good job on a day-to-day basis. One thing you can say about the railway is that at the end of the day everybody in it, whether they are working for Network Rail or a train operating company, has a desire and a belief that they are there to run as good a rail service as they possibly can. That starts with the guys who are maintaining the tracks or selling the tickets right the way through to the people on the board.
There is an enormous amount of public service ethos in the way the railway works. The challenge organisationally is to say, “How do we capture that determination to run a good railway and how best can we do that organisationally?” As Lord Hendy said, that is what the Williams review was seeking to address.
Lord Hendy: The real issue with this is that what the public want and what you imagine politicians should want are the right outcomes. When I ran Transport for London, which was a multimodal urban transport authority, what the Mayor was interested in, whoever the Mayor was, were the transport outcomes that delivered the economic, political and social objectives that he had for the city. That is why the railway is suboptimal.
We are all delivering some element of those outcomes, but when they come together they do not always come together in a way that any of you in particular, or the public in general, feel is the right outcome. You actually want to hold somebody responsible for the efficient operation of the modes of transport that they came to work on this morning. All too often it is something to do with us, something to do with the train company or it is some matter to do with us both and there has in the past been a big argument about that, sometimes in public. People hate that, and they are right to hate it. What you should be looking for is the outcome, which is the safe, efficient and frequent service of public transport. A structure that delivers that must be inherently better, and probably far more economical, than one that balkanises it so that nobody in themselves is responsible for the delivery of people to Waterloo this morning.
Q26 Sara Britcliffe: We touched on private investment. What are the advantages and disadvantages of more focus on private investment in the planning and infrastructure side of the transport system?
Lord Hendy: One of the things is that it concentrates everybody’s mind. Whether you believe in public or private delivery, certainly of public transport, the presence of private investment concentrates the mind and forces delivery. Very often, it concentrates the mind and stops people altering what has to be delivered.
If you go back and look at Crossrail, not everything was a success and, in the end, it cost more and took longer than anybody supposed, but one of the successes was that the concentration of the elements of the private sector investment that were put in forced it to address the issue that it was planned to do and not a multitude of other things as well.
Q27 Sara Britcliffe: Do you believe that there are any disadvantages?
Lord Hendy: Not if it is structured correctly. It depends on people properly understanding what is to be delivered.
Q28 Sara Britcliffe: Would you say that Crossrail was a good example?
Lord Hendy: Yes, I think it is a good example. There were very few scope changes in the life of the project. It was helpfully driven by some of the private sector investment. They said, “We’ve put our money in. Now where’s the result?” It was not perfect, but now that it is there, it has been achieved quite well.
Q29 Sara Britcliffe: Sir John?
Sir John Armitt: One of the challenges is that the private sector can be more dogmatic and, if you like, deliberately irrational at times. They say, “Look, that is the budget we agreed. That is the amount of money which is going to enable us to make a return on this. Don’t give me 15 reasons as to why you would like to improve it a bit here and improve it a bit there and, by the way, that might increase the cost by 10%, but won’t it be wonderful because we will have that much better a solution?” The private sector will say, “Look, I’m sorry, but that’s what we can afford and we are not prepared to go further than that. If you want to try to make these improvements, then go away, clever chappie. You’re the clever engineer. Find a solution which will deliver what you think is going to be so much better, but can we do it within the budget we have allocated?” That pressure always exists in the private sector, quite naturally because of the nature of the two organisations. It exists to a greater degree in the private sector than it can in the public sector.
The public sector, at the end of the day, is probably more inclined to say, “Yes, that sounds like a really good argument. Yes, it would be nice to do that. Yes, let’s find a bit more money to do that.” That is the difference between the two. As I said earlier, the private sector is not perfect. The private sector has its blow-outs on its contracts where it has got things wrong, but in an underlying, behavioural approach the private sector brings more discipline on a consistent basis to controlling scope and cost.
Q30 Grahame Morris: Good morning, gentlemen. You are both acknowledged experts, probably world-leading experts, which is why you are giving evidence to the Select Committee today.
Lord Hendy, I was fascinated by what you were saying about outcomes, spatial strategies and linking a strategy to outcomes. But there are alternatives, notwithstanding the guiding mind and the need for some strategic thought to determine priorities. I understand what you said about the integrated rail plan for the north and how Network Rail differs from that.
You are a Cross Bencher, aren’t you, Lord Hendy? You are not a politician with a large P. My question is this. My party has given this a great deal of thought. I don’t know if you are familiar with this. The Labour party produced a document called “GB Rail: Labour’s plan for a nationally integrated, publicly owned railway”. Are you familiar with it?
Lord Hendy: I am.
Q31 Grahame Morris: In your opinion, would it work?
Lord Hendy: Interestingly, much of it is not very different from the report that Keith Williams produced. If I refer to the Shapps-Williams report more than the Labour party’s previous report, it is only that it is the latest and it was produced by a Government who are still in power. You will forgive me for that. By and large, I think it set out the same objectives. If there were one large difference, it is about the ownership of the train operating companies.
Q32 Grahame Morris: In your answer to my colleague a little earlier you gave the example of what was happening in London and the experience of the involvement of a number of Mayors over a 20-year period.
The Labour party document, “GB Rail”, anticipates the move towards devolved budgets, and elected Mayors having a greater say in the priorities for the regions. Do you think that is a good thing? The structure that the Labour party is proposing is a supervisory board which includes representatives from the regions. No disrespect to my colleague, Gavin Newlands, but Scotland already has a devolved budget. They have a control period with a devolved budget where they can determine their priorities. Shouldn’t that also be the case for the regions? Would your experience of London suggest that that produces the outputs that local people want?
Lord Hendy: Simply, yes. Mass transit in an urban environment is an essential part of making a city work. You can make a very strong case for a Mayor, whatever their political colour, having sufficient control over that. John’s infrastructure commission work advocates that. Indeed, Governments of all political persuasions over the last 20 years have facilitated greater mayoral control over transport. Mayor Burnham in Manchester is now using powers to take over the bus service that were created in the life of, if not this Government, certainly the last one. As a bus person, I am watching it with great interest. It looks as if it is working pretty well, actually. Vernon Everitt, who used to work for me, is now the Transport Commissioner of Manchester. He sends me the results on a weekly basis because I am interested, and they are very good. Actually, that is what you would expect because a consistent approach to transport planning in a dense urban environment is likely to produce some results. The thrust of the Labour party document that you refer to is very consistent with an approach that gives more powers to Mayors, which is what this Government and previous Governments have done.
The only thing I would say in respect of the railway is that the geographical spread of the railway is no respecter of urban boundaries. One of the things that we had to cope with in London was that, if the Mayor desired to have greater control over the London suburban network, we and he had to recognise that many of the trains and passengers had to cross the boundary seamlessly. It should not be balkanised so that the boundary is a barrier to travel. I think we demonstrated, with an adult approach from Transport for London, the train companies and the Department, that you can actually produce greater control over the railways in an urban environment without balkanising them.
When it comes to Manchester, and indeed Birmingham, people in the Great British Railways transition team have had some very good discussions with both the Mayors and their people about what more might be done, and the Government have supported us doing that. One of the considerations is how you can give better railway transport within Manchester and Birmingham without disadvantaging medium and long-distance travel. It is an intricate activity. It demands some knowledge of the railway and some adult behaviour on both sides, but I think we proved in London that you can do it. I think we could prove in Manchester, Birmingham and other places that it is possible to do it too.
Q33 Grahame Morris: I am grateful for that. I think Andy McDonald deserves a great deal of credit for being so forward-thinking in anticipating some of the developments and producing a document that is widely regarded as an excellent blueprint.
I will move on briefly to mention the issues around multimodal consistency. Sir John, earlier in your answers you mentioned the need to have a kind of consistent approach between highways and rail, as well as buses. I served for nine months on the HS2 hybrid Bill Committee before it was wound up. As part of our deliberations considering objections from petitioners, we looked, in a number of site visits, at HS1—High Speed 1. We saw the motorway developments running in parallel with HS1 and the economic and connectivity benefits that had brought. Do you have any particular thoughts on how we can better integrate different modes of transport? Are Government doing enough to achieve those ends?
Sir John Armitt: Fundamentally, you need ease of access, exchange and transfer. The interesting thing about HS1, of course, is that it has been as successful domestically as it is internationally. It took half an hour off every train journey into London from any part of Kent, whether you are as far up as Gravesend or down in Ramsgate and Canterbury. Interestingly, even despite the higher fares, those trains are very popular.
When we were developing it, there were debates about where the interconnection should be. At the time, it seemed to us that a very obvious connection would be at Ebbsfleet because it was close to the M25, so people would come round the M25, park up and get on at Ebbsfleet. Interestingly, that has not been as successful as we theoretically assumed it would be. When I was down there a couple of weeks ago, there were not very many cars in Ebbsfleet car park. Equally, Ashford has struggled on the international side. Both have been very successful domestically, but it has not been so easy on the international side.
Stratford was pushed through by the Government at the time. We argued why would we put another station five minutes from the terminus at St Pancras. The Government insisted that we did at the time and, of course, it has never been an international station, but it has been a very successful enabler of growth and a key feature in advocating why London was the right place to hold the Olympics. You cannot always foresee where your benefits are going to come from, but the connectivity of Stratford and the fact that people can now get down to Canary Wharf without going into London and back out again has been enabled by considering interconnectivity between systems and modes. You always need to look at that.
Perhaps I could come back on the bus issue and franchising. For 10 years, until recently, I was chairman of National Express. We run the buses in the midlands, and we still run them on a private basis. I would argue that National Express runs them very successfully. Again, there is very strong collaboration between Transport for the West Midlands and what NEX does. You do not have to franchise in order to get that level of oversight, if a private sector operator is willing to sit down with the authority and say, “Right, what are the routes? Where are the fare challenges? How can we better increase the ridership?” We all have the same objective, which is to improve connectivity within an area to enable people to use that system well. It does not have to be totally in a franchised approach. You can have the benefit of a private sector operator constantly looking at how to increase ridership in order to improve performance, alongside working in a very open and frank way with the transport authority and saying, “How do we get this right together?” There are different ways in which you can solve the same problem.
Grahame Morris: The Committee wrote a report on that. Our experience in the north-east might be different from yours in the midlands, but I am conscious of the time.
Chair: Thank you, Grahame. We will move to Gavin for our final set of questions for this panel. We could go on all morning, but we have a second panel.
Q34 Gavin Newlands: We could, Chair, but I am No. 1 at PMQs, so we will move on swiftly with the final questions to this panel.
Invariably, as always happens, we have touched on devolution throughout most of the questions that have been asked this morning. I want to drill down a little into that in terms of transport powers and responsibilities being exercised at the right level of government. There are different areas and different levels of responsibility; for instance, Transport East would say there is concern that devolution will vary by authority, running the risk of a two or three-tier level of funding and powers. If you had a blank sheet of paper—starting with you, Sir John—and you were to design the transport system, where would you set the powers and responsibilities and at what level of government? What would you do if you had a blank sheet of paper?
Sir John Armitt: You return to a point which has been made by Lord Hendy a couple of times or more, which is that at the end of the day this is largely public money. Therefore, the final decision about what system you are going to have can only be made by Government because they are responsible for the allocation of what, fundamentally, is taxation money which the public have paid, or have contributed with their fares. One way or another, the public pay and large infrastructure investment comes from Government, so it is not surprising to say that at the end of the day the Government should have the final say in how that money is allocated.
It is one thing to talk about strategic infrastructure. It is another to say, “Right, that’s our strategic network which we propose to put in place.” That needs to be driven by Government. There needs to be a long-term programme which is driven by Government with a proper understanding of what the likely cost is going to be, and control of that cost. I can go on all day about how best to control the cost.
When it comes to the cities, arguably if you have elected people to represent the people in those cities, you should give them the opportunity to work out with the people in the city the best transport system that people would like to have in that city. By and large, in my experience, when you talk to the public in cities, people want a fair allocation of space to different modes. They want the opportunity to walk or cycle, use their car occasionally and have a good public transport system.
The city should have a responsibility for developing that. The city should also be prepared to find ways to support its cost and to talk to its investors and the people in its city, as Peter described when it came to Crossrail, about what contribution they would be prepared to make towards that. The balance is going to have to come through from public money. To the extent that that cannot be raised through local taxation, the Government are going to have to put the money into it and the Government need to put it in on a regular basis.
I would argue that it needs to be similar to the regulated utilities. Every five years, you know you are going to be sitting down and getting a debate; you are going to get an allocation of funding that enables you to go forward for the next five years. You will have planned on a 10 or 15-year basis, as TfL does when it seeks contributions from central Government. Birmingham, Manchester, Leeds or whoever it might be could do the same. They know there is going to be a regular cycle. They know that they are going to be challenged regularly on how they are going to spend it, but it should be their responsibility to work out what is best for their particular city, and they will vary.
Q35 Gavin Newlands: Nobody would argue with the fact that having a devolved and integrated transport network is far easier to do within a city. London is the obvious example. I am not talking about Scotland here, but about devolving to bigger regions of England rather than cities. Do you think that is far less effective? Would you still seek to devolve transport responsibility to regional areas, or would you concentrate on cities?
Sir John Armitt: You have various levels of authority in the UK. There are county-wide levels of authority. There are combined authorities. There are several different types. We also have the subnational transport bodies themselves, who have a good understanding of their particular region and what is required.
At the end of the day, you can draw the lines wherever you choose. The critical thing is the level of accountability that people have to a population, whether it is on a regional basis or at city or town level. Those people should be accountable for the decisions that are made about their neighbourhood, at whatever scale you draw that. Clearly, when you are talking about the longer transport networks between cities across the country, that is a national challenge.
Q36 Gavin Newlands: You mentioned a couple of the various bodies. A hotch-potch of different and disparate bodies is currently responsible. Is that ideal? I mentioned a blank sheet of paper. What changes would you make to that?
Sir John Armitt: You cannot do it all from the centre. There has to be a breakdown at some point between a central and a more local—
Lord Hendy: And you shouldn’t do it all from the centre. In the course of the work that I did on connectivity of the United Kingdom, I dealt with Transport Scotland, Transport for Wales and the Northern Ireland Executive. The Scottish Government were rather reluctant to engage with me, but we got there in the end. It is pretty clear that a lot of that regional approach has been very successful. If you look at the Scottish railway, there has been a pretty consistent investment plan over a long period of time, and there have been some really good results from that.
The question you ask about the structure of England is more difficult. It is very easy, and we have all identified it already this morning, to see what the powers of Metro Mayors ought to be. You should ask Lord McLoughlin, since he chairs it, but I think Transport for the North is a bit more difficult. The real question is not how much power you have, but what your ability is to prioritise what you want to do and decide on the best things to do and to do them. Transport Scotland and Transport for Wales have had to make some choices about what to do. You might not have thought they were very difficult choices, but they have made them and that is where they have spent their money. I think TfN has a bigger struggle in trying to assess the relative priorities between Liverpool, Manchester, Leeds, Hull, Newcastle, Sheffield and the big conurbations. There are great areas of that part of the United Kingdom that are also seeking some investment but will probably never, by the nature of the density of population, justify much being spent. That is a much wider question than transport; it is a question about the effective nature of regional government in England, which is quite hard.
There are some good examples. The wider transport industry has got on well in Cornwall with the settlement that they have from the Government. Cornwall has a pretty good multimodal transport network as a consequence, with a relatively small amount of investment, but it is harder to see in provincial England.
Q37 Gavin Newlands: I am conscious that we are behind time, so this is my last question. You mentioned your review. There are different issues with different levels of government in the UK. I met you during the process to discuss the UCR.
Co-ordinated policy across the different Governments in the UK has clearly thrown up some issues. The Government still have not responded to the review. Have you been made aware of when, or if, they might respond to that in terms of the problems that are there? I don’t think the Scottish Government had any issues with you. I think the issues were political in that the UK Government announced the idea without any consultation whatsoever. In terms of the relationship between Governments, which is also the issue with a co-ordinated transport policy, how do you envisage that being fixed?
Lord Hendy: If you concentrate on results, there have been some quite good ones. At the top of my list, having looked at it, are seemingly domestic issues, such as the state of the A75 between Stranraer and the M6 motorway. If it is a domestic issue for the south-west of Scotland, it is a national issue for Northern Ireland. The result of looking at it has been that the Scottish Government are in discussions with the Westminster Government about a programme of improvement to the A75, which will be good for local communities in southern Scotland and especially good for the economy of Northern Ireland, where the state of that road is an embarrassment.
The one thing that you can say about the devolved transport networks, which have otherwise been very successful, is that it has not always been the case that cross-border transport has been prioritised, because the causes and the effects are in different places. In particular, the Welsh border is ancient and various parts of the railway and road network cross it repeatedly, which has meant, for example, that the economic connectivity of north Wales with the Merseyside and Manchester region has not been exploited as well as it should have been. The Government made a recent announcement in the Network North document about the proposed electrification of the north Wales main line, which goes quite some way to addressing that issue, just as the work that the Welsh Government asked Lord Burns to do in south Wales has done.
Some results are happening already. I think that is very pleasing because there is no doubt that the devolution to the devolved Administrations has been successful, but you also need to connect the various parts of the United Kingdom together for the economic benefit of the United Kingdom as a whole and the people affected in the regions as well.
Gavin Newlands: My comment would be that that should be done in a consensual way and not in a top-down manner. With that, I hand back to the Chair.
Chair: Thank you, Gavin. I would love to continue this discussion, but the clock is against us, and we have a second panel to hear from this morning. For now, I thank you both very much indeed for your time and your vast experience, which will certainly be influential in our inquiry. Thank you again for your time.
Examination of witnesses
Witnesses: Professor Anable, Professor Glaister and Jonathan Spruce.
Q38 Chair: Welcome to our second panel. For the purposes of our records, could I ask each of you in turn to introduce yourself and your organisation, please?
Professor Anable: Good morning, everyone. I am Professor Jillian Anable. I work at the Institute for Transport Studies at the University of Leeds. My official title is Professor of Transport and Energy. I focus on trying to understand the impacts of individual policies and packages of policies over the short term and long term, and how they potentially meet societal objectives. Lots of measurement is involved, both of the trends around mobility and how we may actually account for various types of impact. In particular, I focus on decarbonisation. I have worked a lot with regard to various pathways to decarbonisation from the sector, various scenarios of how we might get there and assessments of whether we are on track.
Professor Glaister: Good morning. I am Stephen Glaister, Professor Emeritus of Transport and Infrastructure at Imperial College. I was at one stage the chair of the Office of Rail and Road. I was a member of the advisory panel to the Oakervee review for HS2.
Jonathan Spruce: My name is Jonathan Spruce. I am the trustee for policy and external affairs at the Institution of Civil Engineers. The institution has about 98,000 members globally. We not only accredit the profession but use the knowledge of our members to improve people’s lives. I am a director at Hydrock, which is one of the UK’s leading sustainability and infrastructure consultancies.
Q39 Chair: Thank you. Welcome all, and thank you for your patience while we had, I hope, an interesting discussion with our first panel.
I will start with some very high-level questions. What do you understand to be the Government’s strategic transport objectives, and how well are those being articulated?
Professor Anable: I couldn’t begin to recite them to you. That is due to the fact that there is a total mosaic of different documents and variously labelled priority outcomes, objectives, aims, focus themes, and so on. Not only are they spread out across a number of different documents—it is perfectly understandable that there would be mode-specific detailed documentation with its own priorities—but it is not clear what the priorities are that are aligned to a consistent set of Government outcomes and what the Department’s role is in delivering those outcomes. As it stands, the disparate sets of plans that exist are not only changing very quickly, often without any particular announcement or justification for those changes, but if we were to try to take them as a whole at any one point in time, they would not add up to an integrated transport policy.
In my view, there is certainly no clear set of strategic aims. What there is lacks some alignment with Government policy, which would include some key defining challenges and objectives around issues such as decarbonisation, inequality and fairness in particular, and issues around health and wellbeing. Those are issues that are sorely lacking at the moment.
Q40 Chair: Thank you. Professor Glaister.
Professor Glaister: I agree. I wouldn’t know where to go and look to find a simple statement of what the objectives are. I would therefore go to the place where Government objectives are encapsulated in the appraisal of projects and how you make decisions about projects, presumably to meet the objectives. That place is the Treasury Green Book, which has recently been revised. I believe that document, and the procedures described in it, are a jolly good place to start. They are very useful. They are operational in helping Ministers to make decisions. If it is used properly, it provides a conduit towards consistency in making decisions on projects to meet the objectives. That is where I would look.
Q41 Chair: Thank you. Jonathan.
Jonathan Spruce: Exactly the same as my fellow panellists; there isn’t one solitary place. There are disparate strategies, not only in the Transport Department but across Government Departments. The analogy I would use is that it is a bit like a jigsaw. What we have is a framework—the pieces around the outside—from different Government strategies, whether that be net zero, levelling up or decarbonisation, and a whole pile of bits in the middle. What we don’t have is the picture on the box. We do not have clarity over the key objectives. What are the strategic objectives—the “why” that Sir John talked about? Because we do not have the picture on the box, those pieces are all in a pile and we do not know what our ultimate aim is.
Q42 Chair: That is a very good analogy. Drawing on what the first panel said and our discussion, we touched on areas where there have been some moves in reforming the Green Book appraisal process and the devolution of powers and funding within England. We have had the introduction of control periods for rail and now road. Are those all heading in the right direction, and we just need to develop them, or is there still something missing in how the picture is set?
Professor Anable: To pick up something that Stephen said about the Green Book being a good place to start, I think there is a real danger in that. Many of the issues that we currently face in the transport sector have come about as a result of the failure of our appraisal process and the fact that it is not currently fit for purpose. Although ostensibly, yes, the appraisal process that we have should be covering the objectives as they are stated, wherever they may be stated, the issue is the role that it plays in decision making.
Appraisal is not something that should decide what the options are. We need to do the optioneering before we get to that point. We need to spend a lot more time thinking about what the problems are and what the different options are for tackling those problems before we even get to the point of comparing them through an appraisal process. The appraisal process, as it stands, places far too much emphasis on individual user benefits that are not measurable afterwards for a long-term monitoring programme.
There is a whole series of other types of benefits, both the wider economic benefits around land use, value, uplift and so on that are not taken into consideration well enough, as well as other priorities that need to set the framework for developing the options in the first place, such as our decarbonisation targets and what that means for the amount of traffic that we can accommodate in the system that sets the framework for what the system needs to accommodate and can accommodate. I disagree that we have the whole framework, let alone the picture in the middle.
Q43 Chair: Professor Glaister.
Professor Glaister: To clarify, the Green Book procedures, which I give weight to, have the four-case model in them. There is the economic case, which is one of them. There is the financial case, the commercial case and, overall, the strategic case. It is all part of a piece.
To answer your question, I think we have quite a few processes in place that would be very helpful if they were more consistently used. We have the national policy statement, which is a really important document. I know that you have commented on the current draft, but the extant operation goes back to 2015, I believe.
In principle, that should say what the big picture objectives are and give some context for the planning decisions that have to go ahead. We have the system that I was involved with in Rail and Road, which I would advocate as a very good exemplar of how things should work; namely, the five-year cycle for the railways and for the roads of the Government saying what they want—the high-level output specification. The Government say how much money they are willing to pay for that programme of work. Crucially, the independent regulator adjudicates whether those two things are consistent or not, in public. Everything that the regulator does is transparent, so the public can see what is going on. When that process has been determined, the outcome for the five-year period is not completely fixed in law, but there is a strong element of guarantee that that programme will be delivered over a five-year period. That is what I think needs to happen much more on a national scale. Of course, five years is not enough, but it is a lot better than the non-transparent year-by-year fluctuations that happened at one time.
My feeling about the broader picture is that our strategic planning fails to put in place a method of governance that stretches beyond the four or five-year parliamentary term so that we can deliver a programme of work in a sensible way over a longer horizon. Secondly, the decisions that are made on projects do not put the budget up against the options. Decisions are made to put particular schemes in terms of an overall strategy, without a consideration of whether the money is available. If you don’t have a consideration of what the money is likely to be, you cannot sensibly choose between the projects. You do not know which ones to put in and which ones to leave out.
A particular example of that is the 2020 national infrastructure strategy of the Treasury. It is a long list of projects, including HS2 and lots of rail schemes in the north, but never any consideration of whether there would be enough public funds available to deliver them. As we later discovered, there wasn’t the money and particular schemes got dropped out on a whim. That is not good strategic planning, but it is because there is no systematic way of making choices in relation to the money that is going to be available.
Q44 Chair: Jonathan, what do you say, and then I will hand over to Gavin?
Jonathan Spruce: I would agree, Chair. You are right that they are definitely different and are definitely making a difference, but they are processes and tools. To go back to the discussion in the previous session about the why, what and how, I would probably add who and when to the list as well.
The Green Book appraisal reforms help you make the decision on what. As an institution, some of the work that our members do is the how. The who goes back to the devolution. The when is often the control periods and the budget available. All of the things you have articulated are definitely improving the process, but without the why—going back to Lord Hendy and the overall 30-year plan—what are the key strategic social, economic and environmental objectives? They are not even transport objectives that we are trying to do. What does the picture on the front of the box look like? All of those tools and processes cannot be as effective as they probably should be, even if they are the best tools and processes going. You have to go back to why you are doing it and follow that through.
Chair: I have lots more questions that I want to ask, but for now I will hand over to colleagues.
Q45 Gavin Newlands: Thank you, Chair. We have already mentioned this in the first panel, as you guys have in answer to the first question about where you would find these strategic transport objectives and how difficult that is. There is a whole series and array of disconnected and sometimes competing objectives across the system. Jillian, are the objectives, such as they are, the right ones? If not, what would you change?
Professor Anable: I have already mentioned that I don’t think they are. There is a lack of overarching key defining challenges. I mentioned decarbonisation. That has been watered down into the concept of sustainable transport, which can mean just about anything to anyone. That has been a concept—
Q46 Gavin Newlands: Sorry. If I can interrupt you there, I was going to develop that and go on to a national transport strategy, which obviously the Institution of Civil Engineers has recommended, such as we have in Scotland. There is one in Wales. In most developed countries, you would have an overarching transport strategy and then you would develop the modal strategies from that. If that is where you were going to head, how do you envisage that it would work?
Professor Anable: First of all, we need the tier above that, as I mentioned earlier, which is something akin to the national performance framework in Scotland, with the key outcomes. We would start by defining what the transport system is. That is something that we do not take a step back and think about, but we have a situation, as you mentioned in the questions for this inquiry, where we have to think about the linkages between other parts of the infrastructure system, such as digital, energy and so on. What, now, are we defining as the transport system and what is the most effective way of designing that transport system in an integrated way to meet those outcomes? What can the transport system achieve against those outcomes?
I completely agree with the fact that we need one overarching plan to start with, but we need to take a broad view of what the transport system is. We then need to take account of our overarching governmental aims and key challenges.
Q47 Gavin Newlands: Thank you. Professor Glaister, would you agree? Do we need an overarching strategy? How do you see that working? Beneath that, what would you change about the Government’s current objectives?
Professor Glaister: I would not presume to comment on the overall high-level objectives. It is for Ministers and Parliament to state those. At a personal level, I have no problem with what I perceive to be the objectives. It is the implementation that is not working at all well in England. I don’t know how well things work in Scotland.
For me, to make things work better it has to come to the Secretary of State for Transport, and the Government more generally, to resolve that and have a strategy. Therefore, it involves the Treasury providing the appropriate funding. I think the failing, and there is lots of failing in the English system, is the failure of Secretaries of State generally—I am not referring to any particular one—to produce a consistent picture of how they are going to meet their objectives and to demonstrate that the schemes being approved are good value for money in the very broad sense and are strategically contributing towards meeting those objectives and then delivering those schemes. That is what does not happen. In my mind, it is not a problem about objectives; it is delivery and decision making.
Q48 Gavin Newlands: Jonathan, before we dig into the overarching strategy, which you guys recommend, are there any current strategic transport objectives that you would like to see changed?
Jonathan Spruce: I go back to the point that Jillian and Stephen alluded to. They sit beneath us as wider objectives. Transport can play a role in improving people’s lives. The challenges for the world and the UK these days are very similar: net zero, climate adaptation, reducing inequality. With any transport objectives or infrastructure objectives that flow from that, the question is how this intervention is achieving or addressing the challenges that we set out.
If we have a transport objective to get more people on to public transport, that is a great transport objective, but where does it link back to the big picture? How is it achieving that big picture? We know it does. More people on public transport should reduce carbon emissions. It should reduce congestion and improve connectivity. That link is not always made.
Going back to the analogy, when you place those pieces in the jigsaw, how are you making the big picture? How do you convey that picture? It is not set out, and until we make that link, I think the set of transport objectives that we have are almost set in sand. They are weaker because they do not have firm embeddedness in where we are trying to get to as a country.
Professor Glaister: I don’t see getting more people on public transport as being an objective in itself.
Jonathan Spruce: That is the current objective that is set, though, Stephen.
Professor Glaister: I know, but there are high-level objectives, and you need to evidence that getting more people on to public transport is a good way of meeting some higher-level objective. That is what the appraisal is all about. It is not an objective in itself. Getting more people on to public transport, if it is too expensive, may not be the right thing to do. People so often drop into that.
Jonathan Spruce: Absolutely, but that was the point Mr Newlands was asking. That is one of the current transport objectives, but unless it is embedded and set against what you are trying to do as a wider objective—because transport is a wider thing—it is weaker, and it is set in sand. It has no real foundation. Therefore, how can it be judged? How can you credibly judge what interventions you develop from it?
Q49 Gavin Newlands: On interventions, it is always handy when we do not need to be here. In terms of your recommendation for an overarching strategy, how would that work with all the various and disparate documents and objectives that we currently have? Would we have a bonfire of at least some of them? How would you see it working?
Jonathan Spruce: A bonfire of policies sounds very grand and potentially has its advantages, but a number of current documents have the strands that we are looking for. We talked before about some of the devolved nations’ work. The Well-being of Future Generations (Wales) Act, which embeds principles of wellbeing in how the Welsh Government will invest their devolved funding, is a really good principle to take. Can we apply that to England? The Scottish Government have the national performance framework. There are elements of what I am trying to say that exist in other policies, particularly in the devolved nations, that we can take to England. Maybe the first step towards it is to get the English system aligned more with what is happening in Wales, Scotland and Northern Ireland, and then build on top of that a national transport strategy. Trying to take everything away would leave a vacuum. Uncertainty and even more prevarication are not what we need at this moment in time.
Q50 Gavin Newlands: If you could get the UK Government for England to align with the Scottish and Welsh Governments across a number of policy areas, that would be fantastic, in my view. Professor Glaister, do you want to come in?
Professor Glaister: I have two suggestions that might help. One of them is in relation to the national policy statement, which is an incredibly important document. As we all know, it is in draft. It then goes to Parliament—not to the Government—is debated in Parliament and, hopefully, approved by Parliament as a whole. It has the status of an agreed policy document and, hopefully, will apply for some years.
I would expect to see such a policy statement being consistent, bringing together all the piles of documents you refer to and providing clear guidance for what is going to happen next and what happens at planning inquiries and so on. At the moment, we do not have that. It took years to get the first document approved. We now have a document that I know this Committee has commented on in draft, but I do not see clarity in that draft myself. It is an enormously long document, with chapters about this, that and the other thing, but you do not get clarity in it. I hope that Parliament, in processing it, will do what it can to make the document much more single-minded, if that is the right word, and much clearer in resolving the issues.
The other thing that might help would be to make the National Infrastructure Commission a fully independent body. What we are missing in all of this is the power of a well-informed independent commentator who can say, “Look, there are problems. There are inconsistencies here.” Maybe the Office for Budget Responsibility is an example of the kind of thing that could be useful. The NIC does really good work. I think its assessments are enormously useful. It does not have the full independence that I would like to see, or, to put it another way, the full independence that might be helpful.
Q51 Gavin Newlands: As the SNP politician in the room, I will leave the open goal of full independence being helpful.
My last question relates to something Jonathan started to refer to. If an overarching strategy were to come in, what tensions do you see in the current system that would have to be resolved before it could be implemented? I am talking about all the various documents and competing parts—the DFT, local transport authorities and so on. What would have to be addressed before you could implement a national strategy? Or are we overthinking it?
Professor Anable: What I feel very conscious of in this discussion is timescale—how long it takes. The length of time that it takes to develop one strategy, let alone to align all subsequent strategies—rip them up, or whatever the term might be—is a prospect that I do not think we can afford even to contemplate.
What we need, and it is unequivocal, is one overarching strategy. What has not come through, although I am sure that the sentiment is probably there, is not only that this document needs to set out some objectives, but that those objectives need to be incredibly ambitious. The ambition for the transport sector—its transformative potential across all kinds of different sectors—is lacking. Once that is set out, it will inevitably mean that very many other documents that sit underneath it are highlighted and exposed as being not ambitious enough.
Q52 Gavin Newlands: Would one example be the Scottish objective of reducing car kilometres by 20% by the end of the decade, and then the rest of your transport strategy being reflective of that? Obviously, that is a very difficult target to meet.
Professor Anable: I think that’s right. As I have said in other submissions to the Committee, a traffic reduction target that is evidence-based is something that we absolutely need with respect to meeting our carbon emissions targets and in the context of the fact that we cannot meet our congestion targets either by trying to accommodate traffic. However, I am with Stephen in that that is not so much a strategic objective. The strategic objective may be congestion or decarbonisation. What the plan needs to contain is what the evidence suggests will be required in various elements of the transport system in order to meet those objectives. It may then set out targets—maybe mode-specific or integrated targets—across modes, to meet those objectives.
Q53 Gavin Newlands: I agree. Politicians always struggle with what is actually strategic and what is not. Do you have any last comments on this before we move on?
Jonathan Spruce: I have to be careful because of where I am, but the more difficult bit might be the Whitehall silos. In some of the devolved nations and the devolved subnational transport bodies, their transport plans start with a very clear why. What is the economic and social reasoning behind what we are trying to do? Very often in Whitehall, because you have Government Departments, it’s energy and net zero, it’s business, it’s communities and it’s transport, so straightaway that siloed approach leads you to siloed strategies. Then you go into modes in the Transport Department.
At the devolved level—at local level and devolved Government level—there is much more awareness in their existing plans of the role of transport in the wider context. They start from trying to paint a picture of their area. It might be that we learn from the devolved nations and Administrations about how that type of plan can be articulated. Then you reflect that back; you do a reconnaissance of the individual modal strategies and say, “Does this now fit with what our big plan is?”
Q54 Gavin Newlands: Professor Glaister.
Professor Glaister: There are two things. When coming to a proposal, with objectives and proposals for meeting those objectives, such as reducing traffic by 20%, you have, of course, to use the best evidence. Jillian used the word. So many of the proposals that are around the place are not properly based on the available evidence. They are wish lists.
Secondly, it is not enough just to have an objective like that. You have to say what you are going to do to meet it. It is no good just saying, “We’re going to win the war.” You have to say, “Our strategy is to do this, that and the other thing to win the war.” So often people say, “We are going to reduce carbon emissions by this and reduce traffic by that,” But how? They won’t say what realistic measures they are going to impose to achieve that. Maybe the answer is a dramatic change in motoring taxation or whatever it may be, or rationing, but that is not articulated. Without that articulation, it is not a strategy. It is just a wish list. It is aspiration.
Gavin Newlands: That is fair. On the shock news that politicians create policy without evidence, I hand back to the Chair.
Chair: Paul, I will come to you first and then Grahame.
Q55 Paul Howell: There is a line of questioning, for want of a better phrase, that you have just opened up by some of your answers. It is all about improving co-ordination and alignment between the different sectors. Jonathan, you touched on the different Departments—energy, planning, skills and so on—and the co-ordination of those. The theme I am going to follow is about co-ordination across different directions. Would you like to elaborate on how you think it could be improved and moved into a different space?
Jonathan Spruce: John Armitt asked, “Where is the vision? Where is the big vision?” You will know yourself, Mr Howell, from local authority and combined authority level that you understand the area, the challenges and what you need to do. You develop strategies and plans based on holistic change to people’s lives. When we get to national level, we automatically go straight into the idea of silos. We say, “It’s a transport strategy,” or, “It’s a net zero strategy.” Actually, all of those are about achieving a difference. I am sure that you guys and everybody sitting in Parliament, in this building, are about making a difference to people’s lives. Transport makes a difference to people’s lives. Where do we articulate that? Where do we set out the big picture on the front of the jigsaw?
That is the bit that is missing. Whether that is across Government, with the Treasury, or in a new Department is a difficult one to answer. Mr Smith asked this question: what institutional change could be made? Until that big, strategic vision is set out, any transport strategy that flows from it will be weaker.
I will pick up on a couple of points from previous discussions. If you have the big picture of what you are trying to do, three things come from that. First, when things go awry or change, you can always ask yourself, “Are we still achieving that big picture? Are we still delivering what we are trying to do?” Secondly, the opportunity comes because you create certainty for other investment, as we have talked about before. Thirdly, it allows industry like ours, as the Institution of Civil Engineers, and our members to gear up the skills required to deliver it.
In your own backyard, there is the really good example of improvements at Darlington station. It has taken a long time to battle through various things, but the vision of what that was trying to do and how it was trying to open up investment in the area, connectivity and what it would bring in terms of additional investment, was always held. Whenever the project ran into a bit of sand or there were issues, there was a set of objectives, set very clearly by local leaders at the start, that said what it was trying to do. If we can replicate that clarity of vision at national level, it will help everything flow down.
Q56 Paul Howell: I would like to develop that a stage further as regards the regional impact. A counter-position is what has happened with the Leamside line further north. That is not all within the gift of Durham County Council, Northumberland County Council, Newcastle City Council, Sunderland City Council or whatever, so it falls through the gaps. There hasn’t been an articulated vision strong enough to come into this place to drive it forward. Is that a support to the argument that you are making about the different positions of different things?
Jonathan Spruce: Absolutely. That example is a really good one. I know that Mr Morris is aware of it as well. That particular scheme has so many benefits that articulating them would take the whole day, so I do not want to take them up. It does not have one overriding benefit that, “This is the thing that it drives,” so it does not necessarily have a home or a driver, but it has a wide range of benefits. It opens up new communities. It relieves pressure on the east coast main line. It potentially frees up paths into Newcastle, because of changes to the network. It has so many benefits, but it is about articulating those in a vision. There is no vision to say what we want.
To go back to Jillian’s point, if that vision is about decarbonisation, regional inequalities and changing people’s lives—giving people access to opportunity—you take a project like the Leamside line and go tick, tick, tick, tick, tick. Hopefully, through the Green Book approach and the reforms to the strategic case, you can then see why that is a really worthwhile investment, but you don’t have that. Therefore, you are back into quite a siloed view of the world.
Professor Glaister: Your question started to be—
Q57 Paul Howell: Can I give you a bit more to build on, to take it to another level? This is an easy example, so I will use it as a structure to build around. The Leamside line is a train line, but when you develop a platform in that space you also have freight and the problems that come from multimodal co-ordination. I don’t know whether you can develop that argument at the same time. Have I thrown you somewhat?
Professor Glaister: In terms of analysis, I don’t understand the difficulty, if it is all within the transport field. If the question is about—
Q58 Paul Howell: On Jonathan’s point, I think that the argument was more about getting the co-ordination of the case put forward, because of the different structures of government that sit there to create the case in the first place.
Professor Glaister: It is about the relationship with local government. I don’t know whether I can help on that. Jillian?
Professor Anable: I certainly don’t have any answers. I would start by saying that I agree absolutely that getting co-ordinated outcomes across whatever we are talking about will be much more likely if the strategic need is specified and so on. That is the first point. But we can only actually get integrated planning if we have integrated delivery processes and, to some extent—maybe a large extent—integrated funding processes as well. That may suggest some greater hard integration across different layers of decision making at the level of implementation.
Q59 Paul Howell: Can I throw one in there? In modal considerations, is it fair to say that when you are trying to consider things cross-modally it is very much a local decision, whereas national things tend to be big picture things like the east coast main line? The modal connections are all about the local and the places people live in.
Professor Anable: That is right in terms of what happens now, but it is wrong in terms of what should happen, in the sense that longer-distance travel is where we have a vacuum of integration, certainly of integrated delivery mechanisms. I am sorry for jumping around slightly. Long-distance travel is where most of the mileage happens. Most of the trips happen locally, but most of the distance is eaten up on the longer-distance journeys. That also equates to carbon, obviously. Some real thinking needs to happen about how we tackle journeys that happen cross-border.
Q60 Paul Howell: How would you suggest that we do that? How would you suggest that we structure the decision making or the proposals?
Professor Anable: We have some mechanisms by which certain bodies, such as the ORR, can be included as statutory bodies in various applications, and vice versa; more local bodies are also brought to the table to think about more strategic networks.
Professor Glaister: One thing we have to get right that we do not is accountability for the money. Earlier, we heard from Lord Hendy that most transport activity is actually local. The vast majority of movement is regional at the very least, not national. I believe that there is a strong argument for giving more genuine devolution of decision making over that to the competent authorities. At the moment we have moved in that direction without giving those authorities genuine control over the money. The decisions all come back to Westminster. You see that in the Network North document. They are all decisions made here, rather than in the Birminghams, Manchesters and Leedses of this world.
Until the money, including the ability of local authorities to raise the money on their own tax base—to spend their own money on these things—is properly devolved, it will never come right, in my view, unless you are willing to say, “Let’s keep the decisions all made in Westminster.” That is another way to go. It is the way we have done it traditionally, relying on Departments of State to do sensible calculations using Green Book principles. That is one way to do it, but if you really want to have devolution, and I think there is an argument for that, you have to devolve power over the money properly.
Q61 Paul Howell: This is purely because of something that you said earlier, Professor Glaister. You were talking about road schemes, where you have five-year pots of money. I seem to recall that in a fairly recent session one of our big challenges was understanding the control of the money that was in those pots because they were not being managed particularly well, or it did not appear that way. There was no clarity about what was going on. Do you think that that is a structure that could be improved? I am all for cost control and cost boxes. I am an accountant by history.
Professor Glaister: You heard from the previous witnesses about what happens in London. In the London region, the Mayor is accountable for a spatial development strategy, the Mayor’s transport strategy, and for the money. There is a coherent picture. One could argue that London should also have more control over and responsibility for its own money, but that is perhaps for another day. There is a model there, which seems to work reasonably well and could help in other regions, if that is an answer to your question.
Q62 Paul Howell: Jonathan, can I come to you?
Jonathan Spruce: It is quite interesting that we plan and strategise in a way that forgets how we use the network. We automatically go into modal strategy. In roads, and sometimes in rail, we get into ownership. Is it a National Highways road or a local road? We forget that, for the user, it is a road or a railway. It is a means to an end, which goes back to what we were saying before.
To take your example, you will say, “It’s the AI,” “It’s the A19,” “It’s the east coast main line,” “It’s the Leamside line,” or, “It’s the Durham coast line.” Straightaway, you are into, “Who goes on what? What do we do with each?” What we should be saying is, what are the connectivity needs on that corridor to achieve the goals that we are trying to reach, whether that be economic regeneration or net zero—whatever the big picture is? We have a connectivity need on that wide corridor. We have a set of assets. How do we achieve those needs in the most balanced, affordable, deliverable way? But we are straight into, “It’s the east coast main line,” or, “It’s the A1. They own that and they own that. They’ve got this and they’ve got that.” We jump three or four levels to that modal split and ownership split.
Because we do that, we end up missing the ability to deliver quite transformational projects across the north of England, one of which you described—the Leamside line. They could have a transformational effect on local, national and regional connectivity and, crucially, on people’s lives and on key objectives, if we set them and were clear about them.
Q63 Paul Howell: To draw the picture, if you like, from a north-east point of view, in my constituency I have two industrial parks, one at Newton Aycliffe and one at Sedgefield. The Sedgefield one is all about technology. The people going to work there have come from the universities of Newcastle. Part of our strategy should be to have a connection between the universities of Newcastle and those technology parks for jobs and economics. You would start from there, rather than working out whether it is a train, a bus, a car or a cycle.
Jonathan Spruce: Yes.
Q64 Grahame Morris: I have just a couple of points. You know what we are trying to do with this inquiry. We are evaluating strategic transport objectives. I want to aid my and the Committee’s understanding of current planning and appraisal processes. I really liked your picture of why and the guiding mind—how, what and who—with the regional element, but that is looking forward to an ideal. What is your view of the current planning and appraisal processes? Jillian, you mentioned carbon reduction and social, environmental and economic impacts. Does the process properly take all of those into account, particularly transport projects and the broader benefits that they bring? I note that we do not have a lot of time, so I have to push you for quick answers.
Professor Glaister: Properly is a strong word, but it does its best. If there is evidence of how it could be done better, the Green Book procedures are amended in due course. People make a judgment about what is useful to include.
To a point that came earlier, how do you get consistency across Departments of State—health, transport, education, training and so on? Of course, transport proposals have implications for those things. I don’t see the difficulty in principle. We have plenty of very competent officials across the board in all of the Departments who can operate the system very well.
Q65 Grahame Morris: Is there an established methodology?
Professor Glaister: There is. Yes, absolutely. In my view, it is about making the best use, in a competent way, of the available evidence. The problem comes because the budgets are fixed. A classic example is road safety. A small amount of money in road safety would save an immense amount of money in the health service, but the budgets do not allow that to happen. It is not the appraisal methods that are the problem; it is the budgeting being siloed. What you need is for Government as a whole to be more flexible, to use the evidence that is available to get a better outcome.
Jonathan Spruce: Yes. Can I follow on from that, Mr Morris? The tools are the best that we have at the moment and have developed a lot. The issue comes back down to value. We cannot really quantify or value an infrastructure investment. A transport infrastructure investment will have a Green Book appraisal and get a benefit-cost ratio—that sort of thing. Let’s take the example we were talking about. The Leamside line will be transformational for connectivity to so many people in those areas in being able to get a job, to access healthcare and to lead a more active lifestyle. We do not value that in the appraisal, so how can we articulate it?
Q66 Grahame Morris: Are we quantifying it as a cost—
Jonathan Spruce: We don’t quantify it, but we all know what the outcome is. That comes back to the big picture. How do we articulate that outcome to the individuals who would benefit from that particular investment outside the quantification? The Green Book does the quantification, as best it can. It is about the value of the investment. That is the bit that we really need to go—
Professor Glaister: On a point of information, the Green Book is not just the EqMat. It is the five business cases, including a strategic case, so your things would be articulated in the strategic case.
Professor Anable: Yes, but that relies on the strategic case actually being considered and given the effort and consideration that it deserves.
Professor Glaister: Correct.
Professor Anable: We know that time and again that has not been the case.
Professor Glaister: Correct. The Green Book is a perfectly good system. It is just not used properly.
Professor Anable: I disagree with the statement that it is a perfectly good system. As I mentioned before, and as Jonathan is alluding to, the benefits that are considered are not holistic—the wider transformational value. It can only capture incremental change. It doesn’t consider the spatial and social distribution of those impacts.
Professor Glaister: The Green Book does do that.
Professor Anable: It doesn’t do it at the level that is required, particularly when we are looking at these kinds of transformational projects over time, which are trying to capture a number of different changes over a larger area. It does not account for the cumulative impacts across different road schemes, or whatever schemes they might be. That is something that you brought up in your previous inquiry.
I go back to my earlier point. It has a role in the decision-making process, but, down the line, appraisal is not the decision-making mechanism that we need in order to bring forward transformational change. It is there as a check and a balance once we have brought through options that align with our strategic objectives.
Professor Glaister: Can I make a suggestion?
Chair: Briefly, please. I need to wrap up the session in a moment.
Professor Glaister: Get somebody to look at what the Green Book and its procedures actually say. To what extent does it or does it not deal with those issues?
Q67 Grahame Morris: You should do a check.
Professor Anable: Then we need a mechanism to have that taken on board in practice.
Professor Glaister: I agree with that.
Jonathan Spruce: It is still not the picture on the front of the box. That is the bit that is missing, I think.
Chair: I would love to continue this discussion now, but time is against us. As I said at the outset, this is just the overture for this inquiry. We will be having a good think about the different areas we want to focus on. You have given us a very good suggestion to do with the appraisal fit for purposeness, if I can put it that way, which we will certainly consider. We may well have other questions we want to come back to you on as the inquiry progresses. For now, I thank all three of you very much for your time and evidence this morning.