Examination of Witnesses (Questions 740-759)
RT HON PAUL BOATENG AND MR CLIVE MAXWELL
WEDNESDAY 6 MARCH 2002
740. I am going to try anyway even if it embarrasses you.
(Mr Boateng) I am not in the slightest bit embarrassed.
741. That is very clear. PFIs are normally assessed against Treasury guidance without taking into account social costs and congestion, the London Underground project does. Can I invite you to comment on that?
(Mr Boateng) You can invite me and I will decline, for exactly the same reason as I declined to answer the last question.
742. This is definitely a transport question which impinges on the Treasury's responsibility: did the Treasury advise Mr Byers in any way on the administration order for Railtrack? If so, what was the character of that advice?
(Mr Boateng) I am afraid, Mrs Dunwoody, I am not going to be able to assist the Committee in that regard because that is a matter which, quite frankly, does not fall within my area of responsibility within the Treasury.
743. Forgive me, Minister
(Mr Boateng) If I can finish
744.your Ministers decided which of you should come. The Select Committee, even though they are fully advised of the brilliance of your abilities and the fluency of your speech, did not specificallyand I know this was a want of something on our partask for you to appear. We asked for a Treasury Minister to give evidence and, with respect, that is not what you are giving.
(Mr Boateng) Mrs Dunwoody, what you asked and what I am afraid you have got is a minister who is only too happy to talk to you about taxation issues but is unable to assist you in relation to PFI and PPP. It is as simple as that. I understand, with the utmost respect, the Committee's concerns and I will convey them to the Chief Secretary but it is only fair to point out that you asked us to talk to you about
745.about the 10 Year Plan.
(Mr Boateng)the Transport Plan and taxation. That is the basis upon which we accepted your invitation.
746. What is what we are endeavouring to ask you about, Minister, with singular lack of success.
(Mr Boateng) I fear so.
Chairman: Mr Grayling, do you want to have a go?
747. Let me try and get the Minister into an area of considerable interest at the moment, which is charges for long distance travel. What is the Treasury actually pressing for? What does the Treasury want to see in terms of charging for inter-urban travel?
(Mr Boateng) What we have embarked upon is a consultation on road user charging in relation to road haulage. We have issued a consultation paper, it contains a number of options both in relation to distance and in relation to time, the industry have responded, we will reflect on that and we will come forward with a specific proposal. I should stress that this is related specifically to road haulage, it is not a general proposition, we are aware of the debate obviously about general vehicle charges and I think the position has been made clear that that is an area where there is a need for further research, that research is being undertaken, and in due course obviously it will be a matter that Government and indeed the Committee will want to consider.
748. Do you rule out, shall we say in the lifetime of this Parliament, the Treasury becoming involved with other departments in either consultation over or policy documents in the direction of the introduction of charging on a more general basis to all road users?
(Mr Boateng) The Government's position on inter-urban road charging is set out in the Transport 10 Year Plan. We highlighted the fact that further research was needed before any such inter-urban road user charge could be proposed. The Commission's recent report is a useful addition to that. It itself recognised there was a need for more work in the area, we think it is important that that work should continue in order that a fully informed decision can be made on what is required to deliver the better transport system that we all seek. But that is not going to happen in the short-term in terms of any such proposal. The 10 Year Plan does not envisage it occurring, and the assumptions are not there it will occur in the lifetime of that Plan, but clearly there is a debate, the Commission's contribution to it has been important, this Committee's contribution to it is going to be important, and we are going to need to do more work on it and we are happy to do that.
749. So you are not expecting any scheme to be proposed within the lifetime of this Plan?
(Mr Boateng) I did not say that. I do not know. I said that it is very clear from the Plan, and you will have sensed and read that that is the case, there is not an assumption that such road user charging will be introduced in the lifetime of the Plan. But the work is of value, the research is taking place. There will be undoubtedlyand this Committee will make a contribution to it, as will othersa national debate about the role that such a proposal might play in the delivery of a better transport system for all.
750. Two quick questions, I hope, about taxation. The first is, do you accept the principle that the price mechanism can play a part in changing people's travel habits?
(Mr Boateng) Undoubtedly it can.
751. It can. Is that a policy that your Department pursues?
(Mr Boateng) Our policy is to recognise the role that fiscal policy can play in changing behaviour for the good, to seek to utilise fiscal policy, to support the good and to drive out the bad, but to recognise that there is a real balance to be struck between, for instance, issues around the environment, issues around congestion and issues around social inclusion. If you take rural areas, for instance, a car there will be very important in terms of social inclusion and therefore we would not want to use a crude price mechanism to drive people out of their cars. But, undoubtedly, pricing plays a part.
752. Can you confirm that that strategy as you have qualified it is accepted by the DTLR?
(Mr Boateng) It is a given, and I would be very surprised if the role of pricing was not accepted by that Department. Indeed, there is every indication it is.
753. My last question is a more specific one and it relates to the fuel duty rebate for stage-carriage services for buses. Bearing in mind what you have just said, it is a very important element in helping to control costs and hopefully make it more attractive for people to use road public transport. My understanding is that the level of the fuel duty rebate has not been increased for a number of years and therefore has decreased in real terms, (a) can you confirm that (b) what do you think about it and (c) are you prepared to consider looking at that important element of the cost of road passenger transport sympathetically?
(Mr Boateng) I have no doubt in terms of arriving at a balanced interest in relation to public spending and the various desirable outcomes that you have outlined, that is a factor that the Chief Secretary and the Chancellor will take into account in terms of the up-coming Spending Review.
754. Forgive me for interrupting, Minister, but you have told us at some length that you are here to talk about taxation.
(Mr Boateng) Yes, indeed.
755. This is specifically taxation.
(Mr Boateng) It is a rebate and therefore part of a public spending scheme. It has implications for public spending. As I indicated earlier on, there are a number of issues which have to be balanced, one of them is revenue, another is the environment, congestion, and the important point you have raised, and which I accept, around social inclusion. How that balance is struck is obviously one of those matters that both the Chief Secretary and the Chancellor take into account both in relation to public spending decisions and in relation to decisions they have to make in terms of the Budget. But I hear what you say and undoubtedly that is a factor which will be taken into account.
756. Minister, with the greatest respect, if you could not hear what he was saying there would not be a lot of point in your being here.
(Mr Boateng) That is true.
Chairman: We shall try, because we are by nature optimistic, to continue with the questions.
757. Would it not be a good idea to give tax incentives to cyclists and walkers who use that means of transport to get to work?
(Mr Boateng) Yes. Indeed, if you look at the Transport Plan and the steps that have been taken in terms of encouraging good practice by employers in that regard, the role of that sort of incentive is recognisedfor instance, in relation to the specific concessions in relation to bike-to-work days and tax concessions around those days. So undoubtedly in terms of the judgements that have to be made in the budget-making process, that is one of them. There are some good examples, in terms of the travel plans and the fiscal policies that underpin them, of that happening.
758. How much is it worth?
(Mr Boateng) It is a modest sum. To give an example
759. No, I just want to know what it really costs.
(Mr Boateng) I will send you a memo with the exact figures.