Channel Tunnel Rail Link (Supplementary Provisions) Bill

I beg to move, That the Bill be now read a Second time. The channel tunnel rail link, or High Speed 1, is now open—on time and on budget. Passengers can now travel the 68 miles from St. Pancras to the tunnel at speeds of up to 186 mph. The journey from London to Paris can be made in two hours 15 minutes, and the one from London to Brussels in one hour 51 minutes. From December 2009, domestic journey times will be slashed for commuters living in Kent, with the arrival of a new fleet of trains. London and Continental Railways, or LCR—the company that built the rail link—estimates that the project will generate an additional £10 billion of private sector regeneration investment along its route. Management of construction has been a tremendous success. In part, that is down to the structure in place: the corporate and contracting structures and the roles played by all stakeholders—LCR, the Government and a range of other partners. However, managing a construction project is not the same as managing a railway. The Bill makes a small number of changes to support a restructuring and make sure that the future structure is as effective as the existing one. In 1996, London and Continental Railways won a contract to design, build and finance the channel tunnel rail link. That, however, was only the beginning of the story. The fact that the line runs from Kent to St. Pancras today is in no small part thanks to the efforts of Michael, now Lord, Heseltine. His focus on regeneration led to the rerouting of the original alignment under south London and enabled St. Pancras station to become the monument to British engineering that it now is. In 1996, LCR and the Government signed a number of deals, of which the most important is the development agreement; LCR acquired not only the UK arm of the Eurostar joint venture, but brownfield development land around King's Cross and Stratford. The first part of High Speed 1 opened in 2003 and the second section opened last week. The 1996 financing plan was to borrow against Eurostar revenues; it soon became clear, however, that those revenues would not give lenders enough security. Unwilling to see the project fail, my right hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott), then Deputy Prime Minister and Secretary of State for the Environment, Transport and the Regions, led a rescue bid in 1998. That comprehensive restructuring exercise secured the project's future; without my right hon. Friend's intervention we would not have celebrated the opening of St. Pancras earlier this month. My right hon. Friend's role was pivotal. Without his efforts, it is clear that High Speed 1 could not have been built. It stands today as an outstanding legacy to his political career. I hope that the House will recognise his achievement. The National Audit Office concluded that the restructuring was well thought out and helped to maintain private sector discipline over cost. The arrangements that were put in place have now proved their effectiveness, as the project was completed on time and within budget. As planned, the new railway is fully open and the Eurostar services moved successfully from Waterloo to St. Pancras International overnight last week. I take this opportunity to thank everyone who played a part in that. Government support will always be needed to fund major rail projects, but given the investment made by taxpayers, we now need to get the best possible return. In 2006, after speculation about the ownership of LCR, its shareholders decided that at that point they did not want to sell their interest in the company. However, as was announced to Parliament in March last year, the LCR board and the Secretary of State agreed to undertake a joint programme of work to evaluate potential restructuring options. The objective of that work was to identify and implement a future structure for the company that was affordable and maximised value for taxpayers. The work is not yet complete, but we have made significant progress. A separation of LCR's three different businesses is planned—the infrastructure, including the track and stations, the land interests and the UK stake in Eurostar. Ultimately, as the Secretary of State said last year, we anticipate that there will be an open, competitive process for any sale, to secure best value for the taxpayer. The Bill is the first step towards that. Outside the Bill, a number of regulatory approvals must be granted.