Select Committee on Transport, Local Government and the Regions Minutes of Evidence

Examination of Witnesses (Questions 20 - 39)



  20. To put it a different way, if motoring costs go down, what does that do to your projections, for example, in passenger modal shift?
  (Mr Rickett) The 10 Year Plan is based on an assumption that motoring costs will go down by 20 per cent, in real terms, over the ten-year period; and that is one of the reasons why traffic is forecast to continue to grow, over the ten-year period. We think it actually offers more value, I suppose, in the sense that you were using it, to concentrate on tackling congestion, pollution and the other adverse impacts of traffic, rather than on trying to force down overall traffic levels, because it is the harmful effects of traffic that surely matter.

  21. And you do not think that transport costs will have an effect on that, particularly on motoring?
  (Mr Rickett) Clearly, if we held general traffic costs level, instead of predicting a decrease, you would see less traffic growth and you would see lower emissions of CO2, for instance, but you would be imposing very significant costs on a lot of road users. If you can achieve the same outcome by more targeted measures then that should be a better policy, I would have thought.

Chris Grayling

  22. Can I start off with capital allocation, looking at the funding that has been set out within the 10 Year Plan. The figures for rail capital investment allocation, the £34.3 billion from the private sector, £14.7 billion from the public sector, does that figure, the £14.7 billion, include sums that are already being spent on Channel Tunnel Rail Link, phase one, and the West Coast Main Line?
  (Mr Rickett) Yes; and, in fact, the £14.7 billion of public investment in rail is the figure in the 10 Year Plan. That has been adjusted since, as you are aware, so I think the corresponding figure is now £18.5 billion.

  23. How much of that £18.5 billion has already been allocated to current projects?
  (Mr Rickett) I could not say, off the top of my head.

  24. Right; do you have a rough idea? Obviously, you did the numbers work when you were doing the Plan to establish the figures, and I wondered how much was available to new projects, how much was for projects already in development?
  (Mr Rickett) I do not know whether Richard Bowker will be able to give you better information on that, but I would not want to make up a number, off the top of my head.

  25. Would you be able to give the Committee a note on that, do you think?
  (Mr Rickett) We can do that, yes.

  26. When you were doing the planning for this document, you set in place the target of 50 per cent increase in the number of rail passenger kilometres; now what work did you do on cost capacity planning to set that figure, and does the projected increase in passenger numbers marry up with the projected increase in capacity?
  (Mr Rickett) What we did was to do an analysis, or a forecast, of passenger demand, and what that said was that economic growth, lower fares and road congestion — among other things, but those are the main drivers, I think our model suggested — would increase demand on the railways by 36 per cent, but that capacity constraints on the network would constrain that growth to 23 per cent. We estimated that, if we could remove those capacity constraints and improve service quality and capacity on the network, that might generate the additional demand above the 36 per cent to take it up to 50, I think 51 per cent is actually what the Background Analysis document says. Part of it was about providing the capacity and service quality improvements not just to meet the demand but to induce demand on the railways.

  27. But the capacity increase projected, which you said was, the capacity constraint was initially 23 per cent, the capacity increases set out in the Plan do represent a 51 per cent increase in capacity as well?
  (Mr Rickett) We believe that the provision made in the Plan would be sufficient to provide the capacity needed to meet 51 per cent, or 50 per cent.

  28. The reason I am asking the question is, if capacity goes up 35 per cent and passenger growth goes up 50 per cent, the rest of that is extra congestion. So I think it is quite important to understand whether there really is a 50 per cent increase in capacity to marry a 50 per cent increase in passenger growth?
  (Mr Rickett) Sorry; our aim was to meet demand without an increase in overcrowding.

  29. Right; so does the Plan deliver the capacity to do that?
  (Mr Rickett) The Plan made a provision that, at the time, we estimated was sufficient to do that. We always said, in the Plan, that the actual decisions about what was going to be invested in, and further detail, was going to be provided by other processes, and in the case of rail, by the Strategic Rail Authority's Strategic Plan, and, in the case of roads, for instance, by the Multi-Modal Studies, and, in the case of local authorities, by the Local Transport Plans, and so on. So it was a top-level Plan that set ten-year public spending figures, set the sorts of targets we thought could be met, illustrated what could be delivered and set a challenge for those who are responsible for delivery to meet those targets and to deliver what we were expecting.

  30. So did you do detailed work on the ability of the projects that you highlighted in the 10 Year Plan (a) to deliver that capacity increase, and (b), perhaps more importantly, to be practically completed within that ten-year period; so was there that extra level of work that said, "Here's our high-level Plan; can this actually be delivered, is this realistic?"?
  (Mr Rickett) It was based on an assessment of what would be needed to deliver that additional capacity, and that it could be delivered within the ten years.

  31. So you were absolutely certain the projects that you detailed there were deliverable within that time?
  (Mr Rickett) That was our assessment at the time.

  32. What assumptions did you make on fare levels, on the railways, in particular, but across the board, in public transport terms, in looking at the Plan?
  (Mr Rickett) If I remember rightly, the assumptions about rail fares were continuing the RPI-1 regime for the regulated fares, and we published, in the Background Analysis document, some sensitivities on what happens if you followed different fare paths.

  33. Are you still confident that RPI-1 per cent is deliverable and will deliver the finance that is required to put the SRA Plan into practice?
  (Mr Rickett) In terms of generating income, it is not just the fare path you need to look at but the number of passengers who are using the service. That was the assumption we made. I have got it now in front of me, it was RPI-1 for regulated fares, and RPI for the unregulated inter-urban fares. Well, as you know, the SRA are doing a review of fares policy, but that is the assumption that we set out in the 10 Year Plan.

  34. A final point, on Light Rail. The Plan appears to require some considerable financial input from congestion schemes, in order to deliver the full range of schemes that the Plan would aim for. Can you give us a sense of, in practical terms today, what the impact is likely to be on schemes that may be coming down the track; and, also, a sense of the contribution you believe is realistic for Light Rail to make, in all of this?
  (Mr Rickett) You have mixed up two questions there; one is about Light Rail and the other seemed to be about congestion charging, if I heard you right.

  35. My understanding is, you need the cash from congestion charging to pay for Light Rail; there is an assumption in there that the authorities who would be embarking upon congestion charging schemes will deliver those schemes. If that does not happen, what is the situation for Light Rail, how much of the ambition for Light Rail can be achieved?
  (Mr Rickett) We did not actually say, in the 10 Year Plan, that we were forming a necessary link between congestion charging revenue and Light Rail schemes. We were saying that, for Light Rail schemes, we would expect a contribution from the local authority, and part of that could be, if they chose, from congestion charging revenue. There is a separate issue about what happens if they do not generate that revenue, but there is not a sort of one-to-one correlation with Light Rail schemes. We have already approved nine Light Rail schemes and there are at least another four in the pipeline, and I think others over the horizon; so we think we are reasonably on track to meet our 10 Year Plan target of doubling Light Rail use over the period. I think we had a 27 per cent increase in Light Rail use, albeit from a low level.

  36. Doubling does not seem a very ambitious target, when you started with only the Manchester Metrolink and the Croydon Tramlink and the Birmingham system. If you were being ambitious, it would be much more than doubled?
  (Mr Rickett) We will be continually examining our targets to make sure they are ambitious.

Mr Stevenson

  37. Tell me, on targets, Mr Rickett, have you got a sort of line of progress to monitor the 10 Year Plan and how the objectives are being achieved in that period?
  (Mr Rickett) We have been trying to develop a baseline set of assumptions about the delivery of projects under the Plan, based on the assumptions we made in the Plan, so that we can compare what decisions are being made by local authorities and others and how they match up with what we were assuming in the Plan. Obviously, also, we will be using available statistical information, to monitor what is happening against our targets, such as the congestion target, the Light Rail target, the bus target, and so on. We have some purely internal sort of indicators about how we might want to make progress against those targets, but those are really performance indicators, they are not additional targets, they are just to give us a feel for where we might be departing from the Plan.

  38. "Target" is a word I have not used, I talked about objectives.
  (Mr Rickett) Sorry; yes.

  39. And it is that sort of—I understand what you are saying, but—
  (Mr Rickett) A very important distinction.

previous page contents next page

House of Commons home page Parliament home page House of Lords home page search page enquiries index

© Parliamentary copyright 2002
Prepared 11 March 2002