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Lord Crickhowell: My Lords, the date of the original business plan, which, as the NAO report concludes, was updated as time went on, was April 1997. As the NAO report makes perfectly clear, it was reviewed by the Government and it continued to be reviewed by the Millennium Commission at regular intervals thereafter.
Lord Falconer of Thoroton: My Lords, will the noble Lord confirm that the grant of £449 million was approved by the Millennium Commission on the basis of the April 1997 business plan, which estimated the number of visitors at 12 million?
Lord Crickhowell: My Lords, I am not arguing about that at all. I merely point out that the scheme did not go ahead until the Government had a chance to drop the whole project. They could have abandoned it. As the noble and learned Lord told us, they reviewed the business plan thoroughly and went ahead with it. The way in which the noble and learned Lord, who was in it up to his neck, tries to avoid taking any responsibility for his actions is quite extraordinary.
The noble and learned Lord then came to the House in late July and told us that he was confident that the NMEC would deliver the project within its lifetime budget of £758 million. He stuck to that assertion, even when I reminded him that the company's annual report clearly identified the substantial risk of failure and despite the fact that he had just received a letter from the chairman of the company pointing out that the financial situation was deteriorating. Indeed, the Millennium Commission then produced a review which stated that it might run out of money in the space of two or three weeks.
By September, the cost had become £793 million. On 15th November David James told the Public Accounts Committee that, if one took account of the cost of the two sponsored zones not included in the original plan, the true cost was now £834 million. Is that the final cost?
I shall leave others to raise questions about a possible sale. I use the word "possible" because there is no contract, and the last time that the noble and learned Lord announced a sale, it fell through. However, I want to ask what is the current estimate of the total cost of dismantling the contents of the Dome and whether that total cost is included in the overall total. On this occasion is there to be, as there was to be with Nomura, an early payment of £105 million, with £53 million of it going to NMEC, and, if so, when? I hope that I can have an answer to those questions before the debate ends.
I conclude by saying that I thought I had a good deal of sympathy for the noble and learned Lord--at least I did before the debate began. He was told by his friend the Prime Minister to do a job that he did not ask for, that I suspect he did not want and for which he was in no way qualified. However, Ministers must accept responsibility for the way in which they carry out the jobs that they have been given.
The noble and learned Lord acknowledges that all has not gone well but says that he wishes to see the project through to the end. On the basis of what has happened so far, it is hard to see why that would be of benefit to anyone. Would it not be better if he added to his considerable reputation as a man of integrity by acknowledging failure and going, leaving it to others who may well be better qualified to clear up the mess?
Lord Sharman: My Lords, I welcome the opportunity to debate the situation at the Dome. I begin by declaring both an interest and a prejudice. My interest is that for many years I was the financial adviser to the London Docklands Development Corporation where this site was manifestly evident as a dereliction that needed to be addressed. My prejudice is that I was never a supporter of the Dome as a millennium commemoration vehicle. I believed that other things could have been done. Indeed, when I was chairman of a company before I retired, on two separate occasions we were asked to contribute financially to the Dome. We declined to do so on both occasions.
Having said that, I recognise that the Dome has many, many supporters, who must be somewhat disappointed at the nature of the media attention which it has attracted. I also recognise clearly the regenerative effect that the project has had on Greenwich and the surrounding area.
Before going further into an examination of the planning, management, operation and future of the Dome, which this Motion invites us to consider, I say at the outset that I do not intend to spend my time singling out any individual to whom to ascribe blame for the events that have taken place. I am content to wait for the conclusions of the PAC to do that. In any event, in my opinion the cast of culpable characters in this tragedy is so large that I would spend all my time trying to ascribe blame rather than, I hope, trying to establish one or two lessons that we might learn from what has occurred.
First, let us consider the planning. As the Minister said, we should always remember that this started as a private sector project. The intention was that it would be delivered by the private sector and bids were invited. I believe it is fair to say that at the end of the day it came down to a two-horse race--Birmingham against Greenwich. In the end, for sensible reasons Greenwich was selected. However, when the Government tried to sell the project to the private sector, there were no takers. The private sector considered that the risk outranked the reward. Here, I believe, is lesson number one for the Government. If the private sector does not want to run a commercial venture, what business do government have trying to run it? That is the prime lesson which comes from this and I believe that the Minister acknowledged that.
It seems to me that the only point in time at which a credible decision could have been made as to whether or not to proceed was at the time of the review by this Government. In the in-depth review to which the noble and learned Lord referred, were the costs evaluated of cancellation of the project at that point in time? Was an evaluation made of what it would have cost to call it off in April/May of 1997? If so, what were those costs?
Following the decision to create this as a non-departmental public body, we have what the NAO describes in its report as "complex organisational arrangements". In my experience, these are not complex; they are positively Byzantine--three bodies, three accounting officers and two Ministers, one of whom reports to himself. I have been lectured by members of legislatures about conflicts of interest in the profession to which I belong and I have to say that I am breathless as regards what went on here.
That leads me on to the execution because I believe that the execution of the project has inevitably been hampered by this complex arrangement. It may be large-scale and complex in terms of what goes in it, but this is a relatively simple, single-purpose project. And yet we end up with a scheme of arrangements which is breathtaking.
The construction phase was completed on time and, when I first looked at it, I thought on-budget too. I was quite encouraged by that. But then I looked again and read the report in more depth and it seems to me that there is what we might call in accounting terms a dangling debit of about £40 million. So that when you compare apples with apples or pears with pears, it looks to me--and I should be grateful if the Minister will confirm whether or not this is so--as though there is a construction overrun of about £40 million which is covered by contributions in kind and it is offset in that way.
Even so, to construct the project on time, reasonably close to budget is good. And it seems to me that a great deal of time and effort was spent on that, so much so that the people involved took their eye off the ball in terms of having to run what had been constructed.
I deal first with the lack of operational expertise. In that regard, again, I believe there is a very important lesson for us. This project was to plan, build and operate an asset, exactly the same as we have in many PFI and public-private partnership initiatives. I repeat, plan, build and operate. It is no good planning it and building it extremely well if you then forget to put in place the appropriate provisions for operation. When you look at the different skill-sets which are needed for each of those, it is incredibly important to
The Minister said that hindsight is a wonderful thing. It is wonderful, particularly when you are looking at forecasts. But if you look back to what was available at the time the business plan was constructed and look in particular at the consultants' reports that gave indications of the likely visitor numbers, the number that was selected for planning purposes was at the upper end of the parameter. In my experience, that is unusual to say the least. It is much more usual to have a greater degree of prudence.
It seems to me that you should be looking for the same degree of prudence in these forecasts as you would look for in a prospectus of a company issuing shares. In view of what was then available, particularly the lack of information with regard to the content of the Dome, there was no chance at that time that a sensible financial adviser would have signed off on that forecast had this been a public prospectus. In the future, we need to look for that degree of prudence in relation to such projects.
In terms of poor marketing, I was astonished to read that the marketing plan was initially based on the notion that the Dome would sell itself. I acknowledge that that was quickly overturned. But again, I fail to understand how anyone could construct a plan on the basis of something selling itself when it was not possible to sell it to the private sector in the first instance. It seems to me that that was naive at best.
As regards the weak financial management, yes, there is always a case for saying that with new, one-off projects, there are sometimes what I would describe as problems which arise by moving up the learning curve. But not tracking your liabilities and commitments on a major capital project is simply inexcusable. That should not have happened.
Before moving to the future, perhaps I may make one or two comments about the solvency issue because that has attracted a lot of attention. The PricewaterhouseCooper report commences its executive summary with the words, "The company is insolvent". It does not say that it might be or may be but that "the company is insolvent". In continuing to trade, the directors had to take account of the likelihood of future funds being available.
To me, the most worrying aspect of the whole solvency issue is not so much the failure to attract the visitors. It was known that that was happening and something was being done to try to address that matter. But there is the additional £30 million which was identified only by PriceWaterhouse at the time of its review. In my judgment, competent financial management should have had that on the agenda.
And so to the future. We understand that there is a preferred buyer and that the project involves the creation of what may loosely be described as an indoor science park. I have absolutely no doubt that in David James, we have a chairman of this entity who is well
However, I say from my experience of urban regeneration that a leverage of £1 billion on government expenditure, if I can describe it as that, of £600 million is not a very good leverage. We should be looking for much greater leverage in terms of the money that has been spent already. I hope that that will be pursued.
The Lord Bishop of Southwark: My Lords, we, too, on these Benches welcome this debate. The Dome lies in my diocese so I hope that your Lordships will forgive me if I share a few thoughts about its past, its present and its future.
The Dome was, of course, to be the statement of the millennium. The Minister has reminded us that millions of pounds of public money were spent on it. Businesses were sought as official sponsors. Advertising ran at a high level. The Queen would greet the new millennium under its roof; the Archbishop of Canterbury would pray it in. That all happened but with hardly the aplomb that was planned.
That is partly because of the power of the media. On 31st December it was not a good idea to keep newspaper editors, with their guests, standing in the drizzle at an Underground station so that they missed the Dome's opening party. After the debacle of that opening night the press never gave the Dome a chance. I feel that the media treatment of the Dome has ill served the public by seeking to persuade people that it was not worth visiting. I believe that those who have not visited the Dome have missed something significant. I have visited the Dome several times, usually in the company of children, who have never failed to enjoy it.
I first visited the Dome when it had just been completed. It was light, airy, a wonderful open space, a miracle of architectural grace. Then we spoiled it; we put things in it. Perhaps it is a perfect symbol of our times: we can do anything, we can build anything, we have the skills, the computing power and the imagination, but we do not know what it is for because we do not know what we are for and we do not know what we truly value.
When the other great dome of London, St Paul's Cathedral, was built it was an equal miracle of architecture. The cathedral is a wonderful open space, but the builders knew what it was for: the honour and worship of God. They also knew what to put in it: the finest music and art to lift hearts and souls to the wonder of heaven. There is nowhere near the same coherence of purpose in the contents of the Dome.
Of course, there are some magnificent zones, but overall the quality is pretty mixed. I believe that even the spirit zone was at its best during its creation, when people of all faiths worked together in a way that had never been seen in Britain before. In my view, even the result of their labours was worthy rather than
Surely that is the point. Now is the time to turn the legacy around and get things right for the future. So far I have been a little disappointed that the focus of the debate has been almost totally on the past rather than on the future. The Dome could still be a major flagship building. In that part of London we need a flagship use for that flagship building on its flagship site. After all, there has already been much gain in the locality. Industrial land has been decontaminated; we have new transport systems, new highways, a new pier, a riverside walk and 50 acres of new parkland. There are arguments about whether the site would be more valuable with or without the Dome, but I believe that that is a little like saying that land in Sydney would be more valuable without the Opera House. True, not everybody likes the Dome, but in 1900 not everybody liked the Eiffel Tower. I still experience a thrill when I see the Dome from either side of the river.
What of the future use of the Dome? The borough has always believed that the Legacy plc bid is the one worth pursuing. The leader of the council has said so publicly. What do the local people think? As a diocesan bishop I have the advantage of being able to consult clergy in every area to find out what the local people are saying. In Greenwich I hear that the local people are mostly concerned about what the future proposals may mean in relation to jobs and housing. We are told that the Legacy plc proposal may create about 10,000 new jobs, which would be a great gain.
We are told that a major advantage of the bid is that it would create better quality jobs. If so, perhaps lessons can be learned from what has happened previously at the Dome, where whatever else they have done or not done, the New Millennium Experience Company has made every effort to employ local people. A policy was worked out and well implemented between the borough and the company so that a local skills base could be developed to match the skills levels required at the Dome.
If the bid of Legacy plc is the preferred bid, I believe that it should be a condition of the bid that every effort must be made to put in programmes of skills training in collaboration with local universities and colleges, so that Greenwich people can gain maximum benefits from the developments.
New jobs would bring new prosperity and a need for new housing, and it is vital that a good proportion of those are affordable, particularly for local young people and key workers. I know that the borough is trying to insist that at least a quarter of available accommodation must be affordable housing. It is hoped that what is being proposed will add to the energy of regeneration not only in the Dome peninsula but throughout the Thames gateway.
However, that must not be at the expense of the local people or their environment. I am alarmed, for example, at Railtrack's plans for driving a new railway viaduct across the Borough market conservation zone, demolishing listed buildings as it goes and passing within yards of the most ancient cathedral church in London. South London needs regeneration but not at the expense of its communities and heritage.
That need not be the story of the Dome. Indeed, already badly polluted land has been cleaned up. Lasting improvements have been made to transport links. In the millennium year the Dome has provided much needed local employment and it has given millions of people something to remember. South London is proud of its Dome, but it will be prouder of it still if it can become a true sign of regeneration and hope for the future. There is no reason why it should not.
Lord Puttnam: My Lords, I am grateful to my noble and learned friend Lord Falconer for initiating this debate. I start by declaring a long-time interest, indeed a passionate enthusiasm for the Dome. I also remain unashamedly and unequivocally proud of my own contribution to a project which I believe, if treated constructively, could still come to be seen as a significant national asset.
Funded largely by lottery money, derided in the national media as "a disintegrating circus tent" and as "the joke of the century", it has an interior that is as unremarkable as the outside is remarkable; its costs have repeatedly spiralled out of control; its design has been praised and excoriated in roughly equal measure; there are constant rumours of insolvency; endless arguments about its future with some serious suggestions that it should be abandoned as a "romantic ruin" and, in short, it is a public laughing stock.
I refer of course, not to our Millennium Dome, but to the Sydney Opera House, or at least to the opera house as it was perceived in the mid-1960s. A generation later, it is widely acknowledged as one of the great architectural and artistic triumphs of the 20th century. Known locally as the "Eighth Wonder", it has become a potent symbol of Australian confidence and courage, the same confidence and courage that in recent years has brought about a brilliantly mounted Olympic Games, a thorough-going cultural renaissance and the ability to thrash us, and most other nations, at just about any sport you care to mention.
It is difficult, if not impossible, to imagine such a transformation taking place in this country, for the simple reason that in our national pastime we have developed a culture of blame, with quite devastating consequences to our collective self-confidence. Given the traditions of this House, it would be generous and accurate to acknowledge that everyone involved with this most challenging and complex modern day project threw every scrap of their energy into trying hard to make it a success. It is to their enormous credit that the Dome opened on time and almost on budget, albeit somewhat on its knees, the victim of a dozen mutually contradictory agendas.
The genuinely unique structure has been widely and rightly celebrated as one of the great architectural achievements of our time--one that can truly rival the grands projets so beloved of the French. Many of my generation spent years gazing across the Channel, bemoaning what we regarded as a national lack of vision. Now that we, thanks to revenues from the National Lottery, have finally realised some sense of national ambition, what do we do? We fall back on what we know best--our bizarre affection for self-flagellation.
Overseas cultural and business delegations visiting the Dome, especially from the "can do" culture of the United States, are truly amazed at the way in which we obsessively seek scapegoats for what they regard as a quite remarkable achievement. In my judgment, we may well come to be proud of the Dome in a number of ways. First, the project's contribution to London's future development will, unquestionably, come to be perceived as of immense and enduring significance. Here was a vast tract of land that had been left literally contaminated and dying, the victim of an age when industrial efficiency was measured by the sheer volume of polluting smoke that belched from our factory chimneys. Thanks to English Partnerships, 300 acres of land have been reclaimed, over a thousand homes will be built, a new primary school, a health centre and a hotel have been opened. It is forecast that, together with other developments, these projects will eventually create over 30,000 jobs. Much of the credit for this physical regeneration must go to my admirable acquaintance in another place, Michael Heseltine, who at an early stage had the energy, vision and imagination to understand the potential for this all but forgotten corner of south-east London.
Anyone in this Chamber who has visited it must admit that that once benighted peninsula has been utterly transformed. I sometimes wonder how many of the more critical voices on the Benches opposite and elsewhere have visited the Dome. I surmise that the answer is remarkably few. Your Lordships may have noticed that the most extraordinary polarisation exists between those who have visited the Dome, the vast majority of whom have enjoyed it immensely, and those who have yet to "find the time", defending their apathy or their ignorance by the sheer volume of their
There have undoubtedly been failures and disappointments. Some aspects of the Dome were hopelessly over ambitious, others not ambitious enough. The decision to accept approximately £160 million from the private sector removed any possibility of the contents having an overall coherence. But even that decision was just an unfortunate consequence of earlier public squabbling, which in turn led to an ill-fated mismatch between private and public objectives. An uncomfortable hybrid was created and the overall quality of the experience undoubtedly suffered accordingly.
However, some of the contents have unquestionably been triumphs. Consider Our Town Story, which has generated wonderfully imaginative grassroots activity in 250 communities across the country, engaging an incredible array of schools, youth groups and pensioners. For all of them, the Dome is now a part of their collective memory. Earlier this month the Dome's national programme produced a quite extraordinary Remembrance Day ceremony, involving thousands of children, which successfully reinterpreted that occasion in a way that made it relevant to children who knew nothing of either of the two great world wars. The Tesco SchoolNet 2000 project, associated with the Learning Zone, now holds the world record for the largest school internet site, with over 134,000 pupils having actively taken part.
In one very crucial respect, the Dome continues to represent a defining moment for this country. Do we wish to present ourselves as a nation that has the courage to take risks and the intelligence calmly to assess what went wrong, and even to learn from it, or do we simply wish to cut and run, preferring to avoid any possibility of risk or embarrassment? We should remember that this nation created the Industrial Revolution through daring and lengthy processes of trial and error.
The idea that "fitting up" a culprit, tearing down or even blowing up the Dome will somehow wipe the slate clean is simply fatuous. It represents either wilful stupidity or serious ignorance of the way in which, through the global media, we are perceived by other nations. As the right reverend Prelate has suggested, we must approach the future with the same boldness of conviction as we unquestionably displayed in the past. If not, we shall become mere spectators, condemned to stand by and watch as other nations, such as Australia, sail past us--young, energetic, confident nations
I do not know how long it will take for the Millennium Dome to find its justified place in history. But I do not for a moment apologise for my belief that the Dome will be remembered as one of the defining projects of our age. It is now entirely up to us either to roll up our sleeves, assess the damage and set out to make a success of it, or to carve its failure on the epitaph of a nation that has lost its way and could appear to have lost its will and its nerve. I find it very difficult to believe that that is what the party opposite wants. By their present actions, that is what they are in real danger of achieving.
Lord Marlesford: My Lords, it is not disputed that the Dome enterprise has been a financial disaster. It was almost admitted by the noble and learned Lord, Lord Falconer; it was brilliantly demonstrated by the forensic skills of my noble friend Lord Crickhowell. That it has been inexcusably badly managed has been demonstrated, equally skilfully, by the noble Lord, Lord Sharman.
I want to suggest why it went wrong. We all know that the word "hubris" means "an excess of ambition, pride--ultimately leading to the transgressor's ruin". It is a word that might have been invented for the conception and birth of the Dome. I do not disagree with the description of the building given by the noble Lord, Lord Puttnam. However, the construction of such a gigantic edifice, however splendid, without the slightest idea of what to put in it, is a folly worthy of any Greek tragedy. I remember that in the early days of its gestation we were told that what it was to contain was so exciting that it could not yet be revealed. I am reminded of the South Sea Bubble of 1720. Your Lordships will recall from your history books that this culminated in one particular investment prospectus for, "a company for carrying on an undertaking of great advantage but nobody to know what it is"--not so very different from the words of the Prime Minister about the Dome, that, "it will be the envy of the world".
The idea of celebration was fine. The idea of developing Greenwich was fine. Indeed, the idea of developing the River Thames through London would have been even finer. Before I come to the Dome itself, I should like to express my profound regret that so little has been done in recent years to make the beauty of the Thames available to the people. Indeed, far from developing it in such a way as to emulate the beauty of the Seine in Paris, we are at this moment allowing a fresh generation of utterly undistinguished buildings to be erected on both banks.
However, to return to the Dome, it is the ultimate and most costly victim of political correctness. The presentation, let alone the celebration, of Britain's history over the past 1,000 years was considered far too excluding, far too divisive; indeed, far too shameful to be allowed to be under starter's orders as a theme for what was to go into the Dome.
Instead, such is the arrogance of our ruling establishment--I direct this attack to the chattering classes of all three of the major political parties and of none--that they presumed to use our money (that is, the £628 million from all of us who take a flutter on the National Lottery) to reveal their vision of our future. Was it surprising that they could not come up with the goods?
I have of course been to the Dome. In January, along with several hundred other parliamentarians, I went by kind invitation of British Telecom. I was appalled at the vacuity of what I saw in the Dome. By far the best part of the day was the trip there by river; the general impression of the site, which is very good indeed; and the journey back by the new Jubilee Line. By far the most striking exhibit in the Dome was the purely commercial celebration in the De Beers Diamond Pavilion. Its contents were indeed thrilling, and they appear to have been the only things that anybody has made a serious attempt to take away.
The Black Adder film, to which we were subjected as the introduction to our heritage, was hugely embarrassing. It might just have justified an hour of TV viewing on a dull winter evening after supper. The money zone, with its tunnel of £1 million in £50 notes, was a vulgar gimmick. The talk zone, until one could escape from it, was a torture tunnel. The actor who cycled round the Dome dressed as a pastiche of an RAF pilot from the Battle of Britain might have been an amusing contribution at a village fete, but in the context of the Dome it was an insult to the recollection of "our finest hour". Much of the science section fell well short of what is now on view in the Science and Natural History Museums in South Kensington. Quite frankly, in some ways when I visited the Dome before they started putting in exhibits, I thought it was much more impressive than when up and running.
Those are the reasons it has not succeeded. Those are the reasons it failed every financial test set for it by this governing body. Like the game of Old Maid, the responsibility for the Dome has been shuffled from hand to hand and for the present has ended up in the hands of the noble and learned Lord, Lord Falconer. I wonder whether he is proud of it. We shall see
To illustrate what we should have had in the Dome, I refer to the tiny former Portuguese colony of Macao, a pimple on the coast of southern China. Before they left, the Portuguese created a small museum to illustrate the social, political and cultural history of Macao since earliest times. I visited it this year and it is superb. It relates the history of Macao to the history of the world at the same time, in that case over several millennia. It thus gives a perspective of great educational value to children of all ages, including myself. I strongly recommend those noble Lords, and particularly the noble and learned Lord, Lord Falconer, who are visiting Hong Kong or China to go to Macao and look at it.
It is not too late to do the same sort of thing in the Dome. Of course, it would be a year or two later than it might have been. But to illustrate Britain's role in the world from the time of the last invasion of these islands by Europeans from the mainland to the prospect--like it or not--of ever closer European Union would, I believe, draw millions. It would become an essential part of the educational programme for school children and students of all ages from all over the United Kingdom, and of course a "must" for tourists. In short, it could become as great an innovation and opportunity for the people of this country as has been the Open University, which is still flourishing after 30 years.
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