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Lord Falconer of Thoroton: My Lords, I did not realise that the noble Lord had sat on that committee and I did not realise that it had left him so upset about the way in which it had performed or that it had failed to reach a decision. We believe that the right course in relation to entitlement cards is to have a proper debate; that is what we have encouraged. The consultation comes to an end on 31st January 2003. The right thing is for the Government to make a decision in the light of that debate.
Lord Newby: My Lords, I am grateful to the Minister for that Answer. Is he aware that during the course of the second judicial review on the PPP, the barrister for London Underground, John Howell QC, said that negotiations on the contracts had involved very considerable amounts of money, some £400 million since the beginning of the programme and £100 million since the selection of the preferred bidders? Will the Minister confirm that the figures quoted by the QC are correct? Will he acknowledge that spending such ridiculously large amounts on contracts that are not yet signed leads many people in London and beyond to believe that this is a fatally flawed project?
Lord McIntosh of Haringey: My Lords, I do not know how the QC reached his figures. I tried very hard to come to a global amount but failed. I gave the Answer in relation to external consultants for London Transport. One could add London Transport staff costs but some of those are not related to the PPP. Much of that amount relates to reorganisation and restructuring. Those costs would have been incurred anyway. There is an argument about whether one should include them. One could also include as part of the contracts the costs incurred by the bidders, which will have to be repaid by the taxpayer in due course. Again, that is normal commercial practice. What should and should not be included is not entirely set. I cannot therefore confirm or deny what the QC is quoted as saying.
Lord Barnett: My Lords, my noble friend told us previously that matters involving PPP or PFI are decided not on an off balance sheet basis but in terms of value for money. Would he care to publish figures showing the costs of PPP, including these enormous consultancy fees, in comparison with the proposals from the Mayor of London?
Lord McIntosh of Haringey: My Lords, I can certainly give the assurance that the costs of consultancy have been taken into account. When the calculation was made by Ernst & Young, external consultants, the PPP was found to be value for money to the tune of £2 billion.
Lord Marsh: My Lords, does the Minister agree that our experience of the Dome and other enormous projects, some having the potential for massive losses, suggests that expenditure on consultancy fees of less than 1 per cent of the total cost is a pretty good bargain?
Lord McIntosh of Haringey: Indeed, my Lords; the whole principle behind the PPP is a transfer of risk from the public to the private sector. That transfer of risk involves not only construction costs, as is always
Lord Saatchi: My Lords, does the Minister remember saying last week in the debate on the Pre-Budget ReportI believe I have it correctlythat all contingent liabilities above £100,000 are declared in the Red Book? I have been looking for the rail and Tube borrowings to which he referred, which are guaranteed by the Government, but I cannot find them. Can he tell me on what page they appear?
Lord McIntosh of Haringey: My Lords, I am sorry to sayI wish it were not sothat we have not reached a conclusion on the public/private partnership for London Underground. Therefore, there is no final figure.
Lord McIntosh of Haringey: My Lords, again, I wish that I could. We have virtually reached financial close. We are expecting the state aid approval from the European Commission any day now. Then the outstanding issue will be whether the Mayor chooses to appeal against the European Commission decision on state aid. If so, there will be another substantial delay.
Lord Sainsbury of Turville: My Lords, on the contrary. I thought that in 75 words I did extremely well to cover at least five or six different questions. I hope I was clear. I explained exactly the areas where the unit measures performance, the activities that it undertakes in that respect and how it will help to deliver policy in those areas. I thought the Answer extremely clear and that it conveyed exactly what the unit does.
Lord Razzall: My Lords, perhaps I can help the Minister. Does he recollect that Mr Peter Mandelson, missed by some in what was a short-lived appointment as Secretary of State for Trade and Industry, originated a report detailing the objectives and the benchmarks against which the Department of Trade and Industry would be measured? Can the Minister say when an up-to-date report will be available detailing achievement against such objectives and benchmarks?
Lord Sainsbury of Turville: My Lords, the strategy unit has already published the 2002 update of our productivity and competitiveness indicators. In the spring of next year we shall publish both where the resources are allocated within the DTI and the targets for the different parts of the department against which its performance can be measured.
Lord Hodgson of Astley Abbotts: My Lords, did the Minister see in The Times today the remarks of Sir Stephen Brown, the chief executive of British Trade International? They appeared under the heading:
Lord Sainsbury of Turville: My Lords, that is exactly the kind of issue on which it is necessary to have a clear grasp of the facts and figures. The unit can have most impact in exactly that kind of area. On the basis of the extraordinary figures produced in this context by the CBI and the Conservative Party, I would have thought that the strategy unit would be very useful.
Lord Jones: My Lords, does my noble friend know whether the strategy unit ever considers the prospects for Britain's hard-pressed manufacturing industries? Does it ever consider the prospects for the hard-pressed steel industry, particularly in Wales? Is the unit considering any such problems?
Lord Sainsbury of Turville: My Lords, we recently introduced a manufacturing strategy document that considers the impact that the policy areas under the control of the DTI have on manufacturing strategy. We have produced policy proposals for that.
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