Select Committee on Agriculture Minutes of Evidence



Examination of witnesses (Questions 140 - 159)

THURSDAY 7 MARCH 2001

THE RT HON JOYCE QUIN and MR IVOR LLEWELYN

  140. It is bizarre sequencing, to be honest, because the precise planning brief on this site will certainly have a material effect on its value. If you are going to persuade the rest of the Government to give you a legislative slot, I would have thought that people would be interested in the value you are likely to achieve by its sale, because they might be prepared to consider the appropriate use of parliamentary time. If you have not done that first stage, it would be rather speculative. We have already had the speculation as to how much or how little you might get for that site as a going concern. I would have thought that, to strengthen your arguments with the Treasury and others, you would at least need a better basis of information on this. I am rather startled it has not happened.
  (Ms Quin) There certainly has not been a rejection by other departments of government of the need for the legislation. There has simply been a debate about the prioritisation of the Government's timetable. There has not been resistance to the idea of the legislation in itself.

  141. Can I move on to the discussion of capital investment on the site. When was the last time that the Authority submitted a programme of capital investment to MAFF?
  (Ms Quin) We are awaiting details of what the Authority is proposing to do in terms of capital investment.

  142. Yes, I understand that, because you said that earlier, but when was the last time they actually put in a programme of capital investment? I know they are due to do another one.
  (Ms Quin) They have not.

  143. They have never submitted a programme of capital investment on the site? Is that right?
  (Mr Llewelyn) No, not that I am aware of. There was obviously a major programme of capital investment when they moved to Nine Elms.

  144. That was 25 years ago. This is the typical British approach. "We have thrown a lot of money at this. Now let's see the place crumble before we do anything about it." Is that roughly the characterisation?
  (Ms Quin) It is certainly not my approach to it.

  145. But the Authority appear to have followed that path.
  (Ms Quin) I do not believe it is the Authority's approach either. Obviously, in recent years the Authority has had to look at various options for the future, both in terms of diversification and in terms of improvements to the site. I have to say, there was a great deal of uncertainty in the market as a result of the previous Government's policy of selling the site completely. If you have that threat hanging over you, you are not going to be producing a lot of programmes of capital investment, and while I am not aware of a programme coming forward during my time as Minister, and therefore it is rather difficult for me personally to answer your question, nonetheless, I assume that the reason why there was not such a programme was because the future of the market as a whole was so uncertain, and it is very difficult to plan for the future in those circumstances.

  146. The answer to my next question, which is "What is the process of approval of capital investments?" is presumably, "We have not had one yet so we will have to work that one out." What is the process that will follow when they eventually do put together a programme?
  (Ms Quin) We need to look at the overall costs of that, how that fits within MAFF's own capital ceilings, and if it does not fit within MAFF's capital ceilings, what negotiations we then need to pursue—and as Ivor Llewelyn has said, we have already had contacts about this—in terms of the financing formula for the market, and also in terms of the likely timetable of legislation.

  147. The Authority has said that it sees its difficulty in embarking on a programme of capital investment as a major problem. One would have to turn that back to the Authority and say if a bid has not been made, it is certainly a major area in which they need to scrutinise their own behaviour. It certainly appears to be a substantial problem in their perception.
  (Ms Quin) I have to say I think you are being rather uncharitable towards them, simply because I feel strongly that, given the fact that the previous policy was to sell the site entirely for possible wholesale redevelopment, it was very difficult for the Authority in those circumstances to even know that it had an assured future, and therefore planning in the kind of way that we hope it will be able to do now in submitting a programme to us was simply not much of an option.

  148. Effectively, they did not do it because they thought it would be a waste of time, because no-one really knew what was going to happen to the site.
  (Ms Quin) No, because they thought the site would be sold for development.

  149. It would help if one could say to the Market Authority that any capital investment programme that might be submitted would need to be placed in the context of the strategic future of the market, its relationship to other markets within London, and the Government's own intent. Of course, there are several unknowns in that equation, but you would want any capital programme of any size to be put together in the context of a strategic appraisal of what was attempted to be achieved. Otherwise, you would be talking about sinking money into the possible waste of investing in something which a new purchaser might say was totally inappropriate and was unhelpful for their goals.
  (Ms Quin) Yes, I think that is a fair point. In a way, there are three strands to this. There is the Authority's need for capital investment, there is the policy of selling it as a going concern, but there is also the overall view which is not primarily for MAFF, but which MAFF needs to be involved in in terms of a wider strategy for the future of London markets. The Minister did hold a meeting with representatives of other markets and has certainly expressed his interest in being involved in the development of such a strategy. But I have to say, that strategy has not developed to any significant extent at the present time.

Dr Turner

  150. Could I go back to the legislation question. You have reminded us that it remains government policy to dispose of assets as soon as parliamentary time can be found, and we were told by the Market Authority that in fact, the disposal of the assets has been government policy since 1990. Do you know when MAFF first asked for parliamentary time? Would that be kept secret from you?
  (Ms Quin) Obviously, it was under the previous administration, and there are others in this room who therefore may be in a better position to answer that question than I am. But I understand that it has been a feature of the Department's legislative priority for most of those years. I think that is fair to say, but because it is largely information under the previous government, I do not have absolute chapter and verse on that. That is my understanding of the position. Maybe I can be contradicted by others who might know better, but I see a shaking of heads, so I guess that is the situation.

  151. Perhaps you can tell us though when the last occasion was that it was sought.
  (Ms Quin) In the last session, but of course, the Government has had other priorities in MAFF.

  152. I was only seeking a short response.
  (Ms Quin) Obviously things like the Food Standards Agency Bill and Fur Farming and so on were ahead of that.

  153. In all those years has anybody even looked to see how long a Bill it would be, done any drafting, ready to go if you got the chance?
  (Mr Llewelyn) Apparently a first draft has been done.

  154. So you might not need too big a time slot to go in. Could I just ask how much money does matter? Mr Todd made the very sensible point that sometimes urgency depends upon what the gain might be, and if you have some feeling for the amount of money that can be released, it might change the Government's view of the urgency of legislating. It has been suggested that some of the urgency would depend upon that. Earlier in this parliament you were under pressure within the Department for your budget. Would you consider this a way of easing that pressure and therefore raise its priority?
  (Ms Quin) I suppose the answer to your question is, in terms of the financial implications for MAFF, there is possibly less urgency now than there was, because our baseline was adjusted in the last year's Comprehensive Spending Review, so that no longer did we have the baseline for capital spending reduced by some £44 million to take account of the expected receipts from the sale of Covent Garden. But that does not mean to say that we are not committed to selling the market, simply because what we are strongly committed to in MAFF is finding a way forward which allows the market to flourish in the future in a way that would free it from some of the constraints that it is at present under. That is the driver rather than a financial driver.

  155. One of the ways which has been suggested is diversification.
  (Ms Quin) Indeed.

  156. We have been told that there has in fact been a proposal which would allow diversification in front of Nick Brown since 15 November. In the memorandum we have received, it tells us that you are waiting for objections, based upon some ruling which sounds as though it is from ancient times to me, about how far away from each other markets should be. We have been told in evidence to the Committee that in fact you have been waiting for objections for two years, which pre-dates even that application. So it does sound as though you have been asking the Corporation what the problems were for some time. Can you confirm that you have in fact been waiting for two years?
  (Ms Quin) Not in relation to that particular application.

  157. The general question of objections.
  (Ms Quin) I understand that it is one year, not two years.

  158. Is there not a timescale for this? The objection is there in principle. Is there no timescale? Is there not going to be a cut-off? is it not sensible to have a timescale and say you want to move this process forward? Why do they not know when they have got to object by?
  (Ms Quin) On the particular request, further to the memorandum that we submitted to the Committee, the Minister has allowed the request with the proviso that face-to-face selling is not permitted.

  159. So a decision has been made?
  (Ms Quin) An interim decision has been made in order to allow the request to go ahead, but it is subject to that proviso. I know that this is something that the Committee itself has followed, the fact that these ancient statutes and requirements which you quite rightly refer to, which go back to the 14th century, do not cover the instance where we are talking about non-face-to-face selling, and since a lot of selling in the modern era is non-face-to-face, and of course, we have the phenomenon of electronic selling, the request has been able to go ahead on that basis. However, on the wider issue of the objections of the Corporation of London to face-to-face selling of that nature in Covent Garden Market, it is true that we are still awaiting a properly stated and reasoned case.


 
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