Clearly there are similarities, which is one reason why we turned to the ORR—it has a lot of expertise that it would be able to translate to the road side. However, I think that I have made it absolutely clear that the key benefit that the ORR will bring will be the ability to subject to real scrutiny the costs and the performance of the new company. That includes the asset management issues that the noble Lord has described. Its role will be to do that work and then to use it to advise the Secretary of State.
We are choosing that route because the Secretary of State remains at the heart of the system, as the Government are in effect providing all the funding. We think that that makes a fundamental difference in finding the appropriate structure. As I said in response to earlier amendments, those who have expertise in regulation consistently stress to us that the enforcement of a performance regime goes hand in hand with the ability to set that regime. That is a responsibility that we are putting on the Secretary of State, both because of the funding and because of the role that he plays in setting the road investment strategy. Since the policy and the RIS will be the Secretary of State’s and since he is providing the funding—pretty much wholly, in
this case—we believe that this should be his decision. Therefore, the monitor doing all that work acts, in effect, in an advisory role. That will be a very effective arrangement.
Let me move on to some of the other issues that have been raised, such as whether the ORR should be promoting multimodal choice or increasing links with rail. I would argue that these areas should be part of the Secretary of State’s responsibility and I suspect that we will see them reflected in the RIS when it comes forward. It is at the government level that we are committed to developing a comprehensive transport policy that covers the whole range of issues that we have discussed today. The draft documents on the company’s governance, which we published on 23 June, and the licence condition make it clear that the company must abide by a continued commitment to deliver sustainable development, for example. Again, there is clear language on road safety and clear language on working with communities and local authorities. So the roles will work out in such a way that the Secretary of State develops the policy, and the role of the monitor is to assess the efficiency and performance of the company running the network. That revolves around judging delivery and capacity, principally by reference to the objectives to be achieved by the company, as set out in the RIS. The amendments propose a very different approach, whereby the monitor’s role involves much broader speculation on whether or not the company is following the right policy, whereas I would argue that it is the Government’s responsibility to determine the right policy.
We should give the Government the right to decide what balance of different transport measures is needed. At the very beginning of this debate, the noble Lord, Lord Davies of Oldham, expressed real concern that we would set up a system that would take away flexibility from future Governments, which would be unacceptable in a democratic society. This matter also reads into that issue. It is important for the Government to set transport policy, and I am somewhat concerned with the notion that it would transfer over to the Office of Rail Regulation. That responsibility is appropriately with the Government, and the Government are rightly accountable to Parliament for their decisions on issues such as prioritisation and allocating resources.
I want to strike a note of caution on the efforts of these amendments to link decision-making on roads with that on rail. Cross-modal integration is an important part of a successful transport network, and the thought periodically passes one’s mind that here is the ORR acting as a regulator for one transport mode and a monitor for the other, and whether this is not an opportunity to integrate them. However, there are fundamental differences. I come back to the point that rail has a full system of price regulation. If we think through the consequences of bringing the two closer together, we could end up with the ORR’s road advice having to account for rail but not vice versa. There would be a one-sided thought process on modal thinking. However, forcing the ORR to take account of road matters when making decisions on rail matters would fundamentally change decision-making in the rail regulation regime. We are committed to introducing the new role of the monitor without disrupting the
ORR’s existing work. I think that noble Lords would agree that the rail structure is working well. To disrupt that and suddenly force plans such as CP4, CP5 and CP6 to be adjusted to deal with road issues would undermine a lot of the good work that we are trying to do here and, frankly, put all the ORR’s current activities in flux, including the price settlement. I do not think that it is anyone’s intention to make a disruptive change. However, I take on board the overall issue, which is that we need to integrate our transport thinking, but that should happen at the Secretary of State level rather than at the level of the monitor or regulator.
If we are considering increasing the enforcement powers of the monitor, as proposed by the amendment, we end up with many similar questions. The monitor has a valuable role to play in assessing the performance and efficiency of the new company. We expect that to mark a radical improvement in the transparency and accountability of the people running the strategic road network. However, this does not go so far as to give the monitor the responsibility for proposing changes to the legal regime around the company. Again, that is the responsibility of Parliament and the Secretary of State. It does not mean that the monitor cannot take a view on these issues, should it wish to do so, but formally making this a role of the monitor that is equal to that of advising on the RIS seems to go well beyond this point.
Looking at parts of Amendment 56, I should note that we think that the proposal to allow the Secretary of State to issue guidance to the ORR on road matters, mirroring the provisions in the rail sector, has value. At present, we expect the monitor and the Secretary of State to have a fairly detailed working relationship negotiated through other documents—not necessarily on the face of the Bill—which will set out what the monitor is expected to do in day-to-day terms and what is agreed to be a proportionate level of oversight for the new company. However, there are a lot of ways of doing this. It may be, in the light of developments to the Bill, that this is a more appropriate way to set out the relationship between the Secretary of State and the ORR. We will continue to look at that.
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I turn to more practically minded amendments. Amendment 58 asks the Government to confirm that they will provide the ORR with adequate funding. I assure your Lordships that, as with “Road User Focus”, we are fully committed to funding the ORR in its new responsibilities. That has to be on top of the funding received from the rail industry. The rail industry is not being asked to subsidise the work that the ORR does as a road monitor, and we made that explicit in our recent consultation. Clause 12 provides the legal powers to do this. However, I point out that it is not usual for government to make direct commitments in statute about specific levels of funding.
The noble Lord, Lord Berkeley, said that we could charge the road industry. Asking individual drivers or freight companies to contribute towards the monitor strikes me as very complex, and it is territory which, frankly, I simply do not want enter. I think that that process would be exceedingly difficult. It does not
seem inappropriate for this body to be funded by the Government, particularly since the purpose of this arrangement is to deliver a great deal of efficiency. Any Treasury appreciates efficiency in the delivery of infrastructure.
Lastly, I turn to access to information. I shall address the proposal to remove subsection (5), which would place restrictions on the ORR’s ability to ask for further information. The provisions in subsection (5) mirror those in Section 58 of the Railways Act 1993. It is important to ensure that the ORR has access to the information that it needs in order to exercise its functions, and we have provided the ORR with a strong power to require the strategic highways company to disclose data. However, that power stops short of compelling the company to disclose legally privileged documents, such as the advice of its own lawyers. As I said, this reflects Section 58 of the Railways Act. We think that it has worked well there and we intend it to continue.
In practice, we think that this provision is unlikely to limit the ORR’s ability to get the data it requires. The limit applies only to information that the company would not be compelled to disclose in court during civil proceedings. There should be few, if any, pieces of information relating to the efficiency of the company to which this protection would apply, particularly as we are designing the overall governance regime with full knowledge of the role that the ORR will play. We expect the company to engage appropriately with the ORR, and the Secretary of State has the powers, through the licence and other governance arrangements, to ensure that it does so.
The noble Lord, Lord Davies of Oldham, asked about how costs and benefits would be appraised, and he referred to the Green Book—taking his text, I understand, from that august document. The SHC will need to follow the Green Book under governance arrangements, and therefore I think that the issue he raised should already be covered.
On that basis, I hope that the noble Lord will feel happy to withdraw his amendment.