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Baroness Hamwee: My Lords, I shall not speak to Amendments Nos. 343 and 359 which are in this group. I shall speak to them at their place in the list. I support the noble Lord, Lord Sheppard, in his amendment. I inadequately attempted to speak to it at the previous stage. It is an important issue.
Dealing with London's congestion is not just a question of applying sticks; there will be the need to dangle carrots, too. Public transport must be improved, otherwise the incentive to leave the car at home will not be as great as it should be. The people of London will not support what is being done if life is made more difficult rather than public transport being made more attractive.
I am concerned about the Secretary of State's financial constraints under the Bill. I refer not only to the normal constraints which apply to local government but, as we discovered two days ago, the blanket power on the part of the Secretary of State to restrict expenditure on the exercise of any power. That is most extreme and, frankly, very worrying.
A great deal of faith is being put in the new authority and in the mayor to solve some intractable problems. The mayor, Transport for London and the authority need the tools to do the job and I warmly support the amendment.
Lord Berkeley: My Lords, I support the noble Lord, Lord Sheppard, in his amendment. I congratulate him on his work in delivering the London business community to support the congestion charge. That is fundamental to the policies which everyone hopes will be implemented if we get the right mayor. Even if we do not, we hope that they will be implemented.
However, I disagree with his views on workplace parking. I also believe that this is fundamental to the success of the scheme, but I suppose that those who run the business community have an interest to declare in having their parking preserved.
As was said by the noble Baroness, Lady Hamwee, it is most important that the public as well as the business community can see some benefits in the proposed improvements before charges are levied on them for workplace parking or congestion. It is essential that all those who live in London can see benefits in a better Underground, bus lanes, more provision for cycling and walking and a better quality of life. No doubt those issues will arise in the next few days when we discuss further amendments.
A method must be found to provide funding for the improvements. I am sure that my noble friend will be able to give us some comfort that a mechanism can be provided for that. If not, there will be a great deal of opposition to the implementation of the congestion charges, which would be a great shame. We must have them somehow and I hope that my noble friend will be able to put forward some solutions.
Lord Dixon-Smith: My Lords, I should like to express my support for my noble friend Lord Sheppard of Didgemere. His work on behalf of business and commerce in London is well known. Here, in the amendment, one sees the wisdom of business experience. The fact is that these charges will be introduced and people will expect instant results after their introduction. But the reality is that the arrival of a pool of money which would enable anything worth while to appear on the streets of London will take quite a long time to materialise.
The only way of overcoming that specific objection is to accept this amendment and permit the capitalisation of the projected revenue stream so that major expenditure, which will in fact be paid for by such revenue streams, can be undertaken pretty quickly and immediately. Without this provision, the poor people of London will feel that, once again, they are being required to pay, pay and pay and get nothing for it. I do not think that the latter is an acceptable proposition. This particular amendment would overcome that difficulty. If these charges are to be imposed, this amendment should be supported on behalf of the people of London. I am happy to do so.
Lord Whitty: My Lords, perhaps I may say, first, that I completely agree with the economics and, indeed, the politics of what the noble Lord, Lord Sheppard, put to us in the sense that, in order to resolve London's desperate transport problems, we need to move to a situation where both the rationing of road space and the provision of resources is generated through a road-user charging system. Once it is up and running, it will provide the resources and help ration in a sensible way the traffic within London to the benefit of Londoners.
However, the resources need to be provided for public transport alternatives and other infrastructure improvements. Therefore, we accept that up-front expenditure is necessary in order both for the road-user charging system to work and for it to be politically acceptable. I cannot entirely agree with the terms of the noble Lord's amendment as regards the explicit
However, the Bill already confers powers on TfL to borrow money within the normal finance rules. There are a number of options available to TfL to make transport improvements; for example, it can borrow through the system of credit approvals, it can enter into a PFI arrangement or even approach the Government for additional funding through the GLA transport grant.
TfL will be able to use credit approvals to secure funding by borrowing or through credit arrangements. Credit approvals may be allocated by the Secretary of State for the purposes of TfL or may be allocated by the mayor for such purposes. The mayor will also be able to make the case for additional funding through the GLA transport grant and TfL will be free to negotiate PFI deals on the basis of expected revenue from congestion charging to finance and operate charging systems, so long as the deals are off-balance sheet"--in other words, sufficient risk is transferred to the private sector--and the borrowing will not score as public expenditure, or need further credit approvals.
We will certainly look favourably at any of these means of raising money for up-front public transport improvements. We believe that the congestion charging proposition will prove to be a major benefit to the future quality of life in London and to its transportation system; and, indeed, to its economy and prosperity. We are therefore extremely anxious to acquire public approval for that system. It is unfortunate that one or two of the mayoral candidates have indicated that they do not favour that system. That is a rather short-term strategy to court immediately popularity while denying Londoners the long-term benefits of such a system.
I accept completely what the noble Lord, Lord Sheppard, says about the need to invest up front in order for that system to work and in order for it to be acceptable. I am not in a position to concede the precise mechanism which he proposes, but nevertheless, political imperatives are from time to time recognised by Secretaries of State and even Chancellors of the Exchequer. Therefore I believe that the noble Lord can rest assured that the Government recognise both the economic and political imperatives here. The mechanisms which already exist will be there to deliver, one might say, on top of the benefit in terms of up front public transport expenditure which John Prescott has already effectively bequeathed to the mayor. Over £5 billion is already in the pipeline and committed on public expenditure in London. That will itself go a considerable way towards providing the sort of up front expenditure which the noble Lord seeks. It will be demonstrable to the people of London well before a congestion charging scheme could come on stream.