Borders Railway
Good morning. The first item of business this morning is a debate on motion S3M-1549, in the name of Jeremy Purvis, on transport.
Good morning. This morning's debate is not on whether there should be a Borders railway; rather, it is on how and when the project will be delivered. The case for the Borders railway has been well and consistently made in this Parliament over a number of years, going back to 2000. Members from all parties joined local people in the Borders in the campaign to push for the restoration of the Waverley line—not only as far as Galashiels and Tweedbank, but all the way to Carlisle.
The campaign continues, but its record in this Parliament has been patchy. Progress has not been easy. The original case was developed and a viable project sought, thus the Waverley railway partnership was created. The strongest and most viable case was for a railway to Tweedbank, serving Galashiels and the communities of Midlothian. When the Waverley Railway (Scotland) Bill was subsequently presented to Parliament, Parliament decided—rightly, in my opinion—that there should be an additional station in the Borders, in the community of Stow.
The campaign continues for an extension of the line to Hawick and all the way to Carlisle. Inevitably, that would require decisions at a United Kingdom level, but trends for investment in rail services in Scotland since devolution have, I regret, not been reflected in trends south of the border.
The context for today's debate on the construction of the Borders railway to Tweedbank is the bill that Parliament passed. The Liberal Democrat manifesto contained a desire to see progress on a feasibility study into extending the project to Hawick. That desire did not appear in the manifestos of other parties, but I am sure that there is cross-party support for the extension. We have argued that a feasibility study should be carried out.
The member is well aware that the bill that was presented to the Waverley Railway (Scotland) Bill Committee was for a line only as far as Galashiels. I wonder why his party's transport minister did not argue at the time for a line as far as Hawick.
I give credit to the member, who was the convener of the Waverley Railway (Scotland) Bill Committee, which scrutinised the bill. The committee had cross-party membership.
In the first part of my speech, to which I hope the member was listening, I indicated that the Waverley railway partnership was tasked with promoting a viable project. The viability was determined, and the cost benefit ratio was positive only if the construction went as far as Tweedbank. I am sure that that information formed part of the committee's considerations at preliminary stage. The member will recollect that fact, although she seems to have somehow forgotten it this morning.
Notwithstanding the fact that the bill that authorised the construction of the railway received royal assent only on 24 July 2006, the SNP seems to think that former transport ministers should have progressed illegally and started digging up my constituents' gardens to construct the railway before then.
As we all know, the bill had a troubled process leading up to and during its consideration by the bill committee. Presiding Officer, you will recall an SNP amendment during consideration stage that called for the sacking of the Waverley railway partnership as the sponsor of the bill. I have checked the voting record on that amendment, and it was supported by the Cabinet Secretary for Finance and Sustainable Growth, by the Minister for Enterprise, Energy and Tourism—who is in the chamber—and by the Minister for Transport, Infrastructure and Climate Change. They have to consider their record of support for the Waverley railway partnership's proposals and for the bill. Voting to sack the promoter is perhaps not the best indication of support.
Last week's statement on the Borders railway raised more questions than it answered, I regret to say.
The bill received royal assent in July 2006, and the diligence exercise was instructed in March 2007. Why did it take nine months to instruct a diligence exercise?
Immediately after royal assent, £30 million was given by the previous Scottish Government for the preconstruction process. When the scheme was transferred to Transport Scotland in March 2007, it was expected that the design process would start immediately after the first £30 million had been spent. Since May 2007, not one penny has been invested in the project by the Government. The design process has stalled. That accurately reflects who made progress.
Questions were raised by last week's statement. One welcome part was the capping of the local partners' contributions. I spoke to the leader of the Scottish Borders Council yesterday, to seek urgent clarification on a number of funding issues. Funding issues are of great concern to this Parliament. There is a move towards funding the line entirely through borrowing by a company on a non-profit model. The company has not even been set up yet and there is no timetable for its establishment.
I look forward to a timetable finally being published on the design process; I hope that that will happen within the next two weeks. The design process should have begun last June and run concurrently with the legal transfer of the scheme from the Waverley railway partnership to Transport Scotland. However, it was delayed by an extended due diligence process. Everything has been on hold for an eight-month review.
There are serious concerns about the funding model—concerns reflected in the comments of some Scottish National Party members in recent press reports. Last week, on "Good Morning Scotland", I did an interview with Christine Grahame, who no doubt will speak this morning. I have reviewed the transcript of that interview. I put it to her that the funding scheme was new, and her reply was, "No it's not." Gary Robertson suggested that the Government had chosen to experiment on a system that was not even in place yet. She replied, "It is."
I then said:
"There is no money in this three-year spending review for the Border railway; all the money for this project is going to be borrowed through a vehicle that has not even been set up yet."
Christine Grahame's response was:
"Indeed. Indeed. Far more prudent."
After this fundamental issue had been raised, the response from the SNP was:
"the actual nitty-gritty of the details are being worked out".
Well, £235 million-worth of nitty-gritty is something of a concern to my constituents. We are talking about a body that has not even been set up yet.
So far, the SNP has added confusion where there should have been clarity, and delay where there should have been progress. In the vote this afternoon, I hope that the Parliament will give a clear signal that up-front capital funding from the Scottish Government has to be urgently restored, so that there will be progress on the construction of the railway. Rather than a woolly sometime-sometime-never start, I hope that construction actually starts and is completed ahead of schedule. That will be brought about not through an organisation that has not even been set up and over which there are question marks, but through actual Government investment in the project.
I move,
That the Parliament reaffirms its commitment to reinstating the Borders railway and condemns the SNP government for cancelling government funding for the construction of the line and failing to commit to a start date for its construction; deplores the uncertainty that this has caused about the future of the project, and calls on the Scottish Government to commit direct funding for the capital costs of the Borders railway and to take forward the construction of the project without delay.
Thank you, Presiding Officer, for the opportunity to remind the previous Administration that it had eight years to decide what to do with the project. We are reiterating this Government's commitment to deliver the railway.
The leader of the Scottish Borders Council has welcomed my positive announcement and is delighted that the council has had confirmation that the project's construction will begin in this session of the Scottish Parliament.
Just for the record, during the passage of the bill through Parliament, did the minister vote to sack the Waverley railway partnership as promoter?
Mr Purvis is unable to recognise that we have an effective partnership with all the councils involved. I very much congratulate the Waverley railway partnership on its very valuable contribution to getting us where we are. We do, of course, have to move on to deliver. I am delighted that the relationship between the members of the Waverley railway partnership and this Government are so good and will be effective in ensuring that the project is delivered—on time and on budget.
Much has been made of finance. As I advised last week, we intend to deliver the scheme using a non-profit distributing model. That means that we will use expertise and innovation in the private sector to deliver this public infrastructure project. The NPD route will provide an opportunity to use a competitive process that is geared towards obtaining the best solutions from the construction and finance markets, while ensuring that any excessive profits will be reinvested for the good of the community.
Contrary to the views of certain members, NPD is not new. Three projects in Scotland have been developed using the NPD model already. Those projects are in the schools sector in the areas of Argyll and Bute Council, Aberdeen City Council and Falkirk Council. All three projects have reached financial close.
Does the minister agree that the NPD model is a form of public-private partnership?
The model is a method of ensuring that we do not pay the excess interest rates that too many projects with which Dr Murray's party has been associated have paid. The NPD model is a way of ensuring that the profits that are derived from financing the project are delivered for public benefit. I would have thought that Labour members would welcome that approach.
A project for NHS Tayside is currently being procured using an NPD model contract. Furthermore, Network Rail—which is owned by the Government on our behalf—is, in effect, an NPD structure delivering at UK level across the rail infrastructure. In short, NPD is a tried and tested approach that was used for years by the previous Administration, starting in 2005.
As I announced in my statement to Parliament last week, the capital costs are indicated to be in the range of £235 million to £295 million, with a contribution of £30 million from the councils—those are 2012 figures. The councils welcome the stability in relation to their funding contribution. We anticipate that the money will be paid back over 30 years. The final timescale will be agreed with the successful bidder.
Can the minister clarify how much of the capital costs he intends to borrow? Last week, on "Scotland at Ten", Derek Bateman said to Christine Grahame that Borderers will want to know where the money is coming from. Christine Grahame replied that the amount that the Government has said it will commit to the scheme is the same as the previous Government said it would commit, and that the additional costs will be met by the NPD mechanism, spread over a number of years. Will the NPD mechanism be used to cover the additional costs or all of the costs?
The people of the Borders are not the slightest bit interested in where the money is coming from; they are interested in the money being spent to deliver a railway for their benefit. Our plans will ensure that the railway is built on time and on budget.
In the current testing financial times, investors will move to high-quality investments—a flight to quality, as it were. People are already expressing considerable interest in providing funding via this excellent investment opportunity. We welcome that interest whole-heartedly. It will ensure that the Scottish taxpayer gets good value for money.
I take this opportunity to reiterate our support for the project. The Government will have spent at least £40 million on the project before procurement commences, using the funding that I am talking about. There has been no cancellation of Government funding; in fact, we will be putting more money into the project. When one borrows money and repays money, one puts more money in.
When the railway opens, it will connect the Borders to the national rail network for the first time in more than 30 years and will reduce CO2 emissions by nearly half a million tonnes.
This Government takes a pragmatic approach to procuring projects because we are focused on project delivery.
I move amendment S3M-1549.1.1, to insert after "inception":
"commends the 450,000 tonnes of CO2 saved by the project".
It is good to see so many Liberal Democrats here today. I hope that they know what they are doing at decision time.
Last June, the Minister for Transport, Infrastructure and Climate Change reaffirmed the Scottish Government's commitment to provide £115 million at 2002 prices towards the Borders rail project. Last week, the same minister tried to present as cause for celebration: the excision from the Government's budget of the earmarked amount that he had previously pledged to spend delivering the project; a delay of three years in the commencement of construction work; and the removal of the cap on the contribution from the taxpayer, coupled with the imposition of a cap on developer contributions, which, in the context of a delay of nine months plus three years, has sharply increased the estimated cost of the project.
Mr Stevenson has been generous in providing the chamber with vignettes from his wide-ranging experiences in a variety of occupations, but little in his previous life would have prepared him for talking such mince. Even though Christine Grahame has bravely attempted to put a bright red face on the removal of funding for the Borders rail project from the Government's spending plans, the minister has not, in truth, found many Borderers celebrating his announcement.
Will the member give way?
I think that you have had your shot, Stewart.
Mr McNulty, I must ask you not to refer to ministers or other members by their first name.
I apologise.
Christine Grahame was unwise to go on the radio to defend the Government's position—
On a point of order. Guidance issued by the Presiding Officer previously has always been that, on first reference, members' full names should be used. You have never ruled before that we should not use first names.
Well, I've ruled it now.
Stripped down to essentials, the SNP is saying that, for the next three years, no money will be forthcoming for a project that it eagerly embraced in opposition. Construction work will not start until 2011 at the earliest, and instead of funding the project along the same lines as every other rail project, the Government has come up with an experimental funding package that is untested and will require, according to the Government, extensive market soundings.
Budgets are where Governments make choices. The SNP Government has decided not to include the Borders rail project in its budget allocations for the next three years.
Did you oppose the budget that was passed a few weeks ago?
I should also ask members not to refer to each other as "you".
The SNP is not doing what it said it would do in its manifesto. People in the Borders were promised, not just by Christine Grahame but by others on the Government benches, that an SNP Government would prioritise a rail connection to Edinburgh. However, thanks to the SNP, no one will ride on a train from the Borders before 2014. Given the SNP's jettisoning of the project in this spending round and the higher priority that the SNP has apparently given to other commitments, the future of the project has been placed in doubt.
In relation to Des McNulty's amendment, while it might be appropriate for parliamentary committees to question ministers on the project, does he agree that it is appropriate for committees to decide their own work programme rather than be instructed by the chamber?
That is an interesting point from a Green convener who was put there by the SNP.
Whether the Borders rail project can progress now depends on the attitude of the banks to the funding package. The minister has been able to give the chamber no assurances that, in the short time before construction commences in 2011, the banks are willing to experiment with an untested funding mechanism. Similarly, he has been unable to clarify what impact the funding approach has on the project's business case.
The uncertainty and lack of clarity over the funding mechanism means that ministers have to accept their responsibilities. We want the issues to be tested by parliamentary committees, as they should be.
Fine.
Order.
We are talking about a substantial amount of public money. Ministers cannot proceed simply by subterfuge. The issues must be explored in detail. That is why Labour's amendment calls on ministers to appear before parliamentary committees to answer appropriate questions.
I move amendment S3M-1549.2, to leave out from "commit direct funding" to end and insert:
"reinstate earmarked funding for the capital costs of the Borders railway with a view to taking forward the construction of the project without delay, and believes that ministers should be asked to appear before the relevant parliamentary committees to answer urgent questions over the delivery of the project, its escalating costs and the implications of the proposed funding arrangements for future transport and infrastructure projects."
It is my pleasure to speak in this debate and re-establish a connection that I have had with the Borders rail project since I had the pleasure of introducing a committee debate on the subject on 1 June 2000, when the Parliament was sitting in Glasgow. It is interesting to read the Official Report of that debate and note who spoke in it. Some of the people are now history, but some are here today to speak once again on the same subject.
After all this time, it is tempting for me to say, "A plague on all your houses." However, there are concerns about the Borders rail project that must be expressed, and I take the opportunity to do so now.
One of our chief concerns about the project has been that the extremely modest funding that previous Administrations allocated to it may lead to council tax payers in the Borders being asked to contribute more. The Conservatives on Scottish Borders Council are fiercely opposed to that. The minister's insistence that the local authorities' contribution has been capped at £30 million is welcome, but the new funding mechanism that he has outlined has done little to allay our fears about the major funding gap of between £50 million and £110 million that appears to exist. We will return in the future to our concerns about the minister's insistence on novel funding methods for several transport projects.
The proposals that have been made progress the project in so far as they tell us how the Government intends to pursue it. The problem, of course, is that it appears that there will be further delays. How the Liberal Democrats and the Labour Party can complain about delays, given their record on long-term funding delays and on constructing major projects—
Will the member remind us which Government's actions led to the Beeching axe, which took away our railways in the Borders?
I cannot remember. It was a long time ago.
Sit down, please, Mr Hume.
The Borders rail project, which we have pursued for more than eight years—other members raised the issue in Parliament before I did—is worthy of pursuit. It is disappointing but not at all surprising that it has continued to suffer from delays. Such delays were par for the course when two Liberal Democrat ministers took care of transport.
There are concerns about the route. The railway will serve only a very small area of the Scottish Borders. Our view is still that the project would have been far more viable if the railway had continued on to Hawick in the first instance. John Lamont raised that issue last week when he replied to the Government's statement. Vast swathes of the eastern Borders—notably Berwickshire—will be unable to benefit from the railway. The Government should seriously consider improving the availability of services on the east coast main line for people who live in that part of the Borders.
There is disappointment about journey times. It appears that we are in danger of having a service that is even slower than the one that was cancelled by Beeching in the 1960s. Such issues should be taken into account.
People are concerned about the failure to get freight on to the railway. As far as I am aware, Liberal Democrat transport ministers were responsible for the headlong dive to provide a passenger service without including the opportunity to put freight on the railway.
It is important to realise that we are experiencing progress, however slow. However, the Liberal Democrats' motion either demonstrates a complete misunderstanding of the position of the project or is an attempt to misrepresent the position of the project for political reasons. Funding has not been cancelled, as far as I am aware. There are concerns about funding, but there is an opportunity for the project to be progressed. Let us take that opportunity and progress it.
I move amendment S3M-1549.1, to leave out from "reaffirms" to end and insert:
"notes the decision to progress the Borders railway taken by the Parliament on 14 June 2006; regrets the delay in construction and the substantial increases in costs since the project's inception, and calls on the Scottish Government to work with Transport Scotland and the relevant local authorities to ensure that the project is completed as quickly and cost effectively as possible."
We now move to back benchers' speeches. We have some time available for the debate, so I can be a bit flexible. However, speeches should be no more than five minutes, please.
I understand that the Borders railway won the Parliament's backing because it will deliver major economic and social development opportunities and because it represents one of the most sustainable public transport proposals in Scotland. In fact, the minister said last week that its cost benefit ratio has increased even further.
The Government's laudable aim of leading the way on tackling climate change must be backed up by action. Transport contributes significantly to climate change, and it is one of the fastest-growing sources of emissions. We can take a big stride forward in respect of carbon reduction by facilitating modal shift, but only if the country invests in high-quality public transport services. If our country is to meet its climate change responsibilities, the Government must deliver a number of key transport projects without delay.
In developing Scotland's transport network, it is important to break the link between economic growth and transport growth. Reducing carbon emissions without damaging economic performance will be critical in the future, when economic success will depend on attracting and retaining talent. The Borders railway project will facilitate economic growth without concomitant transport growth. The railway will bring significant modal shift benefits. It will reduce car dependence, and it is expected to cut car journeys by more than 700,000 a year, which will reduce emissions and reduce traffic levels on the A7 and the A68. The project will also improve safety for travellers, as rail travel is around 10 times safer than car travel. Much of the Borders is not currently served by efficient transport links, so the benefits of the railway should not be underestimated. It will facilitate new housing—including affordable housing—reduce congestion and address the predicted labour shortfall in the Lothians.
There is no doubt that the delivery of major transport projects needs broad support from the Government, local councils, the community and the private sector, and long lead-in periods. Successive Governments' certainty and willingness to press on with projects whose genesis was under a different regime are needed. At this stage of the development of the Borders railway project, it is not helpful to introduce uncertainty. Losing time through prevarication is damaging, because people lose confidence and investors think about going elsewhere. In the meantime, the opportunity to take early action to reduce emissions is lost, which makes it harder each year to contain damage. From what we heard last week, I believe that the Borders rail project is losing momentum. It risks stalling completely as a result of a lack of genuine commitment from the Government. We now have no start date and no clear funding mechanism.
Last week, the minister said that the non-profit distributing vehicle would operate as a private firm under Government control, which raises governance issues. The SNP's planned funding method is untested for transport projects in Scotland; so far, it has been used only to finance new schools. It appears that the proposed method would mean that a single company would build, finance and maintain the rail line. Do we need another layer of confusion? How does the proposal fit into an integrated transport network?
Last week, the minister said:
"NPD funding models are a cost-effective borrowing mechanism that avoid the high interest rates of private finance initiative funding and leave ownership of the asset in public hands".
However, finance experts have said that the incentives for private sector involvement remain unclear. Mr Stevenson also said:
"The details of our final approach will be developed by Transport Scotland, in conjunction with the financial partnerships unit and Partnerships UK, full account having been taken of market soundings and the need for a competitive procurement process."—[Official Report, 5 March 2008; c 6576.]
It sounds to me as though there is not a lot of certainty about the method, and that that is why we are facing a delay of at least two years.
Will the member take an intervention?
I am about to finish.
The Borders rail project should be allowed to progress without delay, and the people of the Borders are right to expect the Government to fund it properly. I say to Mr Stevenson: do not waver over the Waverley route. Let us get back on track and build it without delay.
There is a requirement in the Parliament's standing orders, which Mr Rumbles is familiar with, that motions that members lodge for members' business debates or for support should have titles. It would be interesting if the same requirement applied to motions that are lodged for the ordinary business of the Parliament. Members would then be given opportunities for light relief. For example, Mr Purvis's motion could be called the let's give the Borders Party more room to sabotage the Waverley line motion; the 40 years of Lib Dem inaction, true to form motion; or simply the bare-faced cheek motion.
Mr Purvis gave a history of the Borders rail line. I will give mine. In the 40 years of David Steel rising through the humble ranks to lordly status, not one piece of track was laid. In that time, the Scottish Borders continued to slide down the economic ratings. It still has the lowest household income in Scotland. In eight years of Lib Dem and Labour government—as members have said, we had Lib Dem transport ministers in that time—not one piece of track was laid, and the economic status of the Borders stayed exactly as it was: rock bottom. Indeed, in those eight dreary years, the Lib Dems and their Labour pals did not bring to the chamber one debate on the Borders railway.
Will the member take an intervention?
Not after the member had a go at me in the final minute of his speech.
In the first months of the first session of the Parliament, I secured the first debate on the Borders railway line. I established the cross-party group on Borders rail and assisted petitioners through the parliamentary process, from the Public Petitions Committee to the Rural Affairs Committee. That culminated in the unanimous vote in June 2000—which has been referred to—to build the line all the way to Carlisle.
The SNP led the way. We tried to get the line to go to Hawick, but there was no Lib Dem support for that. In those eight years, no feasibility study was commissioned to extend the line to Hawick. I know, because I kept asking about it. Indeed, efforts to include a station at Stow were blocked by Mr Purvis's predecessor, Ian Jenkins, who constantly told me to keep shtoom about Stow or the Borders would get no line at all. It took the Waverley Railway (Scotland) Bill Committee to remedy that wrong.
Will the member give way?
No. Jeremy Purvis had a go at me in his last minute and I could not intervene—silly man.
Six years after that vote, as the Conservative amendment states, Parliament voted unanimously to pass the Waverley Railway (Scotland) Bill in what was also a committee debate.
I am not going to allow Mr Purvis's deputy to deputise for him.
The problem for Mr Purvis is that I have been here from the start, and his party's record on urgency for and commitment to the railway is etched in my memory. If the past eight years have been an example of Lib Dem urgency, I would not want them near me if there was a fire, because I would be what the Lib Dems are now, politically speaking—toast.
Today, the former employee and self-proclaimed disciple of Lord Steel told the world, on "Good Morning Scotland", that Borderers are "appalled" at the delay, one year on from the previous completion date that was announced by his own party. However, at one time, the previous Administration was going to complete the railway by 2006—I know that because Nicol Stephen, the then Minister for Transport, told me so in 2004. Furthermore, Lib Dem councillors are in control of Scottish Borders Council, but are they shouting? Are they appalled? Councillor Jim Hume will, no doubt, tell us what his Conservative coalition partners are saying.
David Parker, who was elected by that coalition as council leader, is delighted. Jim Fullerton, Scottish Borders Council's executive member for roads and infrastructure, is delighted. For "appalled" read "delighted". The constituents who come to see me at my surgery in Tesco in Galashiels are pleased, but still wait like doubting Thomas for proof—track on the line. Who can blame them after 40 years of Lib Dem false promises and false dawns? They are dismayed by Mr Purvis's deliberate—and somewhat spiteful, I have to say—negativity, but what is new in that?
In his 2003 election material, Mr Purvis said:
"We will start construction of the Waverley Line."
Where is his wee bit of track? Is it OO gauge? Is it going round his living room? The document continued:
"In the next term of the Parliament Jeremy will give the area a strong voice and working with Liberal Democrats in the Parliament will … ensure the Waverley line is constructed".
Will the member give way?
I am in my last minute. [Laughter.]
Mindful of the need for Mr Purvis to get Penicuik votes, the document added:
"and campaign for a light rail serving Penicuik".
Penicuik should not hold its breath.
In a spirit of compassion and because spring is in the air and the sun is shining, I will settle for the title "bare-faced cheek".
Christine Grahame should be on the stage—there is one leaving in about five minutes.
To have this debate so soon after a ministerial statement is strange. Neither on the occasion of the ministerial statement nor again today did we receive from the minister, Stewart Stevenson, his usual Churchillian eloquence—or perhaps that should be Gladstonean verbosity. The whole Borders rail link story is turning into a bit of a soap opera. I am not a regular soap opera viewer—I am not a regular television viewer—but when I pop home and my wife is watching a soap opera, she rapidly explains to me what is going on at that juncture with a wee comment on whether it is a good fact or a bad fact. For those who are not regular viewers of the Borders rail link, here are some facts with the comments added.
The Borders rail link has been delayed from 2011 until 2013 at least, which is bad. The cost benefit ratio has improved to 1.32, which is good. The rail link will be procured through a non-profit distribution vehicle—nobody knows yet whether that is good or bad. Network Rail is a non-profit distribution vehicle, but it will not be involved. Speaking from my considerable experience, I think that that is good.
I hope that Network Rail will be one of the parties that will seek to be involved in the project, and it may take the lead. Of course, at this stage I cannot say who will take the lead, but I hope that Network Rail will be involved.
I think it will probably be the woman who makes the tea at Network Rail.
Apart from Network Rail, there are, in theory, other non-profit distributing bodies—for example, the Scottish futures trust, although it does not exist yet. The Scottish Government's consultation on that model closes tomorrow; therefore, it is passing strange that a detailed variation of that model should be proposed by the minister in this context. Does that cut across the Government-wide consultation on the broader model, is it a branch of that model, or is it a different model altogether?
At this stage, the viewing public are becoming confused, because there is no simple explanation for some of what is happening. Transport Scotland will become the undertaker, the procurer and the debt servicer. As I will touch on, it may also be involved in appointing an operator, but not from among the usual suspects. Viewers are confused, so let me explain the situation as simply as possible in soap opera terms. Instead of using his debit card to pay for the Borders rail link, the minister will use his credit card. He will not pay off the credit card debt "in a wanner", as they say in Castlemilk; he will just pay the minimum amount every month for 60 years.
I return to my point about the operation of the line, which is what I find rather interesting about the possible new model. We could be talking about not just a new model of procurement, but a new model of operation—and not just of the infrastructure, but of the trains themselves. Such a model is not entirely without precedent in the rest of the United Kingdom's heavy rail network, but I wonder why the minister is being so coy about it all. If the model really is a revolution in the procurement, the vertical integration and the future operation of Scotland's railways, there may be a great deal of support for it in the chamber. However, I suspect that the minister has something to hide and that this is a soap opera in which more good or bad facts have yet to emerge.
I speak from my long association with the Waverley Railway (Scotland) Bill Committee, of which I was the convener. That was the longest-running committee of the Parliament, as it met for something like three years. As I recall, the committee had piles of evidence that were 4ft high, and 5 o'clock starts on winter mornings to get to Galashiels to hear evidence were not the ideal start to the working week.
Having been the committee's convener, I remember the stances of its former members and their reactions to the proposals for the Borders railway. Des McNulty has lodged an amendment to Mr Purvis's motion, asking the Scottish Government to
"reinstate earmarked funding for the capital costs of the Borders railway with a view to taking forward the construction of the project without delay, and believes that ministers should be asked to appear before the relevant parliamentary committees to answer urgent questions over the delivery of the project, its escalating costs and the implications of the proposed funding arrangements for future transport and infrastructure projects."
That is the same Des McNulty who, during the preliminary stage debate on the bill, expressed his serious concern about the ability of the promoter and the Liberal Democrat minister to bring forward the project. For example, he highlighted increases in estimated costs, saying:
"In August 2002, the estimated cost of the railway was £73 million. By January 2003, it was £100 million; by March 2003, it was £126 million; by September 2003, it was £130 million, where it remained at that until September 2005, when it went up to £151 million. That does not seem to me to be evidence of firm cost appraisal and effective cost management by the promoter."——[Official Report, 28 September 2005; c 19527.]
I do not remember Des McNulty at that time calling ministers before a parliamentary committee to explain cost increases in the management of the project.
Actually, the member is wrong. Ministers were invited to appear before the Finance Committee, of which I was the convener, to discuss the mechanisms of transport infrastructure. To my recollection, specific questions were raised at that meeting about the Borders rail project.
However, does the member accept that, if the estimated cost at that time was £151 million and is now between £235 million and £295 million, the SNP has presided over the largest increase in costs so far?
I think that the member will find that the committee was not completely satisfied that the costs were robust. A Liberal minister repeatedly assured us that the costs were sound. As with everything else about this project, if there are any overruns, the involvement of Liberal ministers should be mentioned.
The Borders railway project has had a long history. First, it was going to be constructed in 2003; then, the timescale for its completion went to 2012. However, as I pointed out in my question to the minister after last week's statement on the project, Liberal Democrat ministers were already setting up the possibility that construction might not start until 2016 by lodging amendments that allowed the timescale to slip. Despite the protestations of the committee, which wanted the timescale to be brought forward, the Liberal Democrats, along with the Labour Party, voted to extend the timescale so that work would not begin until 2016.
Does not the member accept that the five-year timescale plus another five years for compulsory purchase to which she refers is consistent with the provisions of every such transport bill that has passed through the Parliament? As a member of the Airdrie-Bathgate Railway and Linked Improvements Bill Committee and the Edinburgh Tram (Line Two) Committee, I know that it was included in the Airdrie to Bathgate railway project and the Edinburgh tram project. Indeed, it was also included in the Edinburgh airport rail link project.
The committee was assured by the Liberal Democrat minister that he expected the project to be completed by 2012. If that was really the case, there was no reason to extend the timescale to 2016—unless, of course, there was no way that the project was ever going to be completed in the timescale that Jeremy Purvis has set out. Indeed, that has been borne out. Neither Mr Purvis nor his party has laid a single bit of track or allowed construction to go forward. [Interruption.]
You should be closing, Ms Marwick.
I am finishing, Presiding Officer. It is a pity that I was interrupted by Mr Purvis from a sedentary position.
I am confident that construction of the Borders railway will begin under this Government, because the SNP—unlike the Liberal Democrats and the Labour Party, which spent eight years fighting between themselves about whether the project should go ahead—has a long history of commitment to the project. Indeed, it was the in-fighting between those two parties that blighted the project in the first place.
History is being rewritten somewhat in this debate. Other members have covered some of this ground, but I would like to recap what happened in the past.
Interest in opening the line precedes the creation of this Parliament. In 1999, the then Secretary of State for Scotland, Donald Dewar, and the then Scottish industry minister, Gus Macdonald, launched the first feasibility study into reopening the Waverley line, the results of which were published in February 2000 by Sarah Boyack, who at that time had been Minister for Transport and the Environment for only nine months. The study concluded that a regular passenger service on the line could cover its operating costs.
As Alex Johnstone said, on 1 June 2000, the Parliament, which was sitting in Glasgow, debated a motion on the Borders rail link that had been lodged by the Rural Affairs Committee after receiving a petition via the Transport and the Environment Committee. Parliamentary time was requested because we all felt that the topic was sufficiently important to merit such a debate. I should mention in passing that when Mr Johnstone mentioned members who were history, he looked directly at me—that worried me slightly, as I am one of those who survived against the odds.
Parliament unanimously agreed to the motion, which recognised and endorsed
"the case for the establishment of a railway linking the Scottish Borders to the national network at Edinburgh and Carlisle and urges the Scottish Executive to consult with the Strategic Rail Authority and others to facilitate its establishment."
However, as much as I—and indeed many of us—would love the railway line to go all the way to Carlisle, I must accept that that might have to remain an aspiration. For a start, the track has been built over in some places, which might give rise to difficulties with compulsory purchase.
During that debate in 2000, Christine Grahame and Michael Russell vehemently demanded to know when the railway would be built. Eight years later, despite the fact that a minister with responsibility for transport has been in post for 10 months, we are asking the same question.
Members have implied that the previous Executive somehow procrastinated. That is not the case: the Waverley railway partnership was formed in summer 2001; technical assessments continued between the end of 2001 and the summer of 2003; and in September 2003 the Waverley Railway (Scotland) Bill was introduced, which, as Tricia Marwick pointed out, was a private bill, not an Executive bill. That was part of the problem. As the many members who served on bill committees well know, Parliament, not the Executive, had agreed a very cumbersome and long-winded process for dealing with private bills; in the case of the Waverley Railway (Scotland) Bill, that meant that consideration of the general principles was not completed for two years. The bill was eventually passed in June 2006 and received royal assent eight months before the dissolution of the second session of Parliament. As Jeremy Purvis said, the Executive in its last stages made some investment to try to bring the project forward.
I know that the minister is listening to the member's speech. I am sure that the member agrees that, given when the bill received royal assent, this Government, which has made zero investment in the line, has been in charge of the project for longer than the previous Government, which gave £30 million towards it.
I absolutely agree.
The non-profit distribution model for funding the project is actually, as Mr Neil would describe it, a form of PPP. Private contractors make a profit at subcontractor level; the private sector is represented on the board of the contracting organisation; and the funding is borrowed from the financial markets.
Argyll and Bute Council, Falkirk Council and Aberdeen City Council have used the same model to fund PFI schools projects, but it is still relatively new and there are some doubts about whether it will deliver as efficiently as conventional PPP in the operational phase. Moreover, organisations such as Unison that dislike PPP have said that the model is another form of PPP that, according to that union, retains "higher borrowing costs", ensures that private profit is taken out of public services at contractor level and results
"in the same profiteering and inflexibility inherent in PFI".
I do not share Unison's opposition to PPP, but the SNP has been opposed to PPP for years. One might well wonder why the SNP, after all that it has said about PPP in the past, now proposes to fund this project through some version of it. Obviously, one reason is that it is off balance sheet—for the moment. Of course, that might not remain the case. After all these years, why has the SNP performed such a U-turn on the funding of the project?
We move to winding-up speeches. I can allocate up to a minute extra on the original allocations, but that is a strict limit.
The Scottish Conservative position is that we must ensure that the project is completed as quickly and cost effectively as possible. To that extent, we welcome the £30 million cap on Scottish Borders Council, the City of Edinburgh Council and Midlothian Council that was announced previously, because we were concerned about that spending in the past. It is worth mentioning that, although the debate is about what has been called the Borders railway, there will be big benefits to the city of Edinburgh and to Midlothian, where four of the seven stations will be situated.
Where do we want to go with the project and what are our priorities? First, we want answers from the minister on timing. My colleagues Derek Brownlee and John Lamont raised the timing issues last week. However, given the history that Elaine Murray has just told us about—the eight years of dither and delay and the nine months that it took from royal assent for the Government to order the start of the due diligence process—it is important that we get more definitive timescales from the minister and the Government. To be specific, when will construction begin? I read the minister's statement last week, and he made it clear at least five times that construction would begin at some point
"before the end of the life of this Parliament."—[Official Report, 5 March 2008; c 6588.]
That is not exact enough. The people of the Borders and the Lothians—the people of Scotland—deserve something more concrete. We do not expect an exact day or week, but I am pretty sure that the minister, in his closing speech, will be able to tell us something more exact than that.
Another important question to which we need to know the answer is when construction is scheduled to finish. The critical date for the people of the Borders and Midlothian is the one when the trains will start to run, as opposed to when construction starts. However, given the project's history and circumstances, we need dates for when construction will start and when it is due to finish. That should be possible. The minister also mentioned in his statement that a critical path is in place. He stated that some items are part of it and others are not. If a critical path is in place, the minister must be able to give us an indication of when construction will start and finish.
The other priority on which we need to focus is funding for the railway. We have heard a little bit about the NPD model, which sounds fairly similar to a rebadged PPP model, but we would like more detail on it; I hope that the minister will be able to tell us that soon. As Derek Brownlee pointed out last week, there is a shortfall of £50 million to £100 million between what the Government said it was putting into the project and the total cost of between £235 million and £295 million that it announced. From where will that shortfall be made up and how will the gap be closed? Will the minister guarantee that using the proposed funding mechanism will not slow down the process? It has been far too slow for far too long. What is the total sum of money that the Government is physically committing? The minister said that the people of the Borders do not care too much about the functions, but the Scottish taxpayer does, so who will repay what and when will it be repaid?
Another issue that was raised last week is freight. We welcome the minister's statement that the Government would be delighted to have freight on the track. We take that as a positive signal, but we are looking for something a bit more concrete than that. How will the minister actively pursue the line's freight potential? If it is not pursued actively, it will probably not happen, which would be a loss to the Borders, the Lothians and Scotland as a whole.
We were treated to a bravura performance by Christine Grahame, who covered up her embarrassment on behalf of her party by trying to attack everybody and anybody for the delay that the minister who is sitting in front of her has announced.
Parliament is entitled to question ministers on the details of the funding proposal for the Borders railway and to seek independent corroboration on the approach's viability and its implications for other infrastructure projects. This is about not only the Borders railway, but the future transport budget and there are some serious questions to be asked about the financial mechanisms that the Government proposes. It is one thing to talk about costs increasing, but trying to create a scheme to transfer the method of payment from the debit card to the credit card—as Charlie Gordon accurately pointed out—has profound consequences not only for the Borders railway but for every other project that comes along in its wake. Parliament has a responsibility to examine that as a matter of urgency before we get to the strategic projects review so that we can clarify the position.
When SNP members were in opposition, they stridently opposed PPP and called for direct Government funding for new schools and similar projects. Now it seems—as Elaine Murray pointed out—that they want to extend the PPP model beyond schools and into rail projects, for which it has never previously been considered a viable funding mechanism. There are some serious questions about whether we could translate the futures trust model—even if we knew what it was—into a rail project. Let us be clear that, according to the consultation, that vehicle
"could design, build, finance, operate, manage and own the facilities created."
That is what the SNP says about the scheme that it is taking forward. A private railway of a new kind: is that what the SNP is offering us?
We have been offered no good reasons for departing from the decision that the Parliament made in 2006 to proceed with the Borders railway. SNP ministers have failed to take the process forward. As the decision was made in 2006, the soonest that construction could have started was 2008. However, the soonest that it will start is 2011. Mr Stevenson and his colleagues are responsible for that three-year delay. As Gavin Brown pointed out, the key issue for Borderers is not when construction starts but when the first train runs on the line. The earliest that that will happen is 2013 or 2014—ministers have not been able to tell us the year—even if the Government agrees to proceed with commissioning the project in 2011 in the next funding round.
The Borders have been sold a pup. Ministers should reinstate the financial commitment during this spending review period in line with what they said they would do in June last year. There are serious issues about whether the Borders railway can proceed under the model that ministers have now set out. Parliament must explore whether they have a realistic basis for that model—whether the banks will buy into the scheme and whether we have enough detail on it to progress it—because people need to know the answer to that question.
On that basis, I hope that members will endorse the Labour amendment, which emphasises the need for Parliament to exercise its scrutiny function with rigour and for its approval to be sought when significant changes are proposed to a project of the magnitude of the Borders railway. I ask for support for the amendment in my name.
The debate has been slightly more interesting than I thought it might be when I read the amendments. Although it has covered a reasonable range of topics in relation to the Borders rail link, it has brought little light to the subject and it has certainly brought some confusion and uncertainty. That came in particular from the previous speaker, who is being unhelpful by introducing a synthetic uncertainty that need not be present.
I will respond to one or two matters that arose during the debate. There is no stall in the decision-making process, whatever Mr Purvis asserts on the subject. The non-profit distributing vehicle is, of course, established as part of the bid process when the project is put together, and members should realise that that is when it takes.
The special-purpose vehicle is a model with which we are entirely familiar. The point of the model is that it reduces dramatically the interest rates at which Government can borrow. Any benefit from the resulting profits is delivered back to the public sector. The core interest rate over the life of a Scottish Water PFI project in the late 1990s was set at 8.5 per cent; the mezzanine finance rate for the project was set at 13.75 per cent. It is absolutely clear from the interest that has already been expressed that the interest rates via which we will be able to fund the Borders rail project are of an entirely different character. The high level of interest rates has always been the central objection to the way in which things were done in the past.
Last week, the minister announced costs of £235 million to £295 million. How much of that sum is budgeted for interest payments?
The member must put on his financial thinking hat. The figure that we announced refers to borrowing, which must be repaid over a period of time. The important point is that we have given certainty to the councils that are involved—certainty on the future of the railway, on the financial structure of the project and on the price. The financial model that we have chosen over the life of the project will deliver a cost-effective solution for the people of the Borders.
If the figure of between £235 million and £295 million refers to the capital cost of the Borders rail project, what is the total cost—capital cost plus interest repayments—over the 60 years of the project?
The member knows perfectly well that it is important for us to have a negotiation that delivers appropriate value for the public purse. We will, and we will be accountable to Parliament and the people of Scotland for that. No one will respect the concerns that Opposition members raise if they continue to introduce a synthetic uncertainty into the project; that is in no one's interest. Opposition members failed to address the issue during the recent debates on the budget.
Mr Johnstone raised the issue of journey times, which we have managed to reduce. I would also like to see freight on the railway. In the near future, I will speak at a major rail freight conference in London; I will also speak to the all-party parliamentary rail group at Westminster. I will not hesitate to take those key opportunities to raise the issue.
Reference was made to those who have supported the project since it began to be debated. I welcome the fact that Donald Dewar, Sarah Boyack and many others of different political persuasions accepted that the project was vital for the Borders. That is why some of the remarks that have been made today are distinctly unhelpful.
This year we have spent £14 million on land, site investigation and topical surveying. We started the outline design in 2007, without even waiting for the due diligence to be completed. The financial issue that has been raised is synthetic. I direct members to page 60 of the Liberal Democrat election manifesto, which states:
"I want to involve the private sector in financing and delivering priority transport facilities".
As we are into websites, I point out that the statement is available at www.nicolstephen.org.uk. Ms Grahame put her very substantial political finger on the nub of the issue. Under the Liberal Democrats, the Borders have been in the economic doldrums for years.
Charlie Gordon suggested that the minister had something to hide. He is correct—it is my humility.
All members who represent the Borders have welcomed Jeremy Purvis's Lib Dem debate on the Borders rail project. Christine Grahame was keen to quote Mr Parker, the ex-SNP Scottish Borders Council leader. I will give her another quotation from Mr Parker:
"Given her appalling conduct"
on the cross-party group on Borders rail
"it seems clear that she does not, in fact, support the reintroduction of the railway. She should resign from the cross party group immediately and allow other MSPs, who have supported the promoters all along, to do the job properly."
The minister suggested that people in the Borders are not interested in where the money comes from and did not clarify how much money he thinks will be needed. It is perhaps no coincidence that on this day, the ides of March, 2,052 years ago, in a similar forum in what is now Italy, a certain Caesar was stabbed in the back. The people of the Borders will feel that exactly the same thing has been done to them today—"Et tu, Brute?" I will translate that for members later.
Just last week, we debated a report on rural policy, which highlighted the difficulties associated with social exclusion in the south of Scotland and the problem of attracting young people to and keeping them in our area. There is a need for integrated public transport, which is a huge factor. Scottish Enterprise, which is now being dismantled by Jim Mather, says that a Borders railway would attract young people to and keep them in the area, provide better access to jobs and opportunities, boost tourism, create more inward investment and reduce road congestion.
Today's debate is disappointing because in 2006, during the previous session, the Waverley Railway (Scotland) Bill became law. The present Government has been in charge of the project for longer than any other Government. We were looking forward to the project being completed, not just started, by the end of this session, but now we are told that there is no specific scheduled start date for the project.
The project has been talked about since 2000. Being absolutely fair and objective, what percentage of the delay is attributable to the Liberal Democrats?
Higher!
No percentage whatever of the delay is attributable to the Liberal Democrats, who have always pushed the project forward. That is the view of the same independent councillor who stated that Christine Grahame is holding the project back.
Today no light has been shed on the final cost of the project or on the shape that funding will take. Last week, the minister stated in the chamber that he
"will not give an exact cost for the railway".—[Official Report, 5 March 2008; c 6576.]
He has repeated that statement today. It is hardly Stevenson's Rocket—more like a slow train never coming. That is not good enough. I agree with my colleague Jeremy Purvis that last week's statement raised far more questions than it answered.
Will the member give way?
I would like to make some progress. It is a pity that Mr Lamont did not get involved in the debate earlier.
The minister's statement was very disappointing, especially after he had taken a year out to review the project. The previous Executive committed £115 million to the development—the equivalent of £155 million now. We are now being told that the money to finance the cost of building the railway will be borrowed from an as yet unknown source, by an uncertain method, and paid back from the transport budget over 60 years.
As Jeremy Purvis mentioned, the minister's colleague Christine Grahame said on 6 March:
"the actual nitty gritty details are being worked out between Transport Scotland financial partnerships unit and Partnerships UK".
It is disappointing that the minister has not given us those details. Will he stand by the commitment that he gave in June and September 2007 to provide the Government funding of £155 million that has already been agreed for the project? Is he willing to state whether he will increase or decrease his portfolio's contribution to the project, given the uncertainty that now exists about the remainder of the project's costs, due to the SNP delay?
The member asked a specific question about funding. We are providing the funding, forby the £30 million that we have capped for the councils. That commitment has been widely welcomed. The project will go forward.
I look forward to the project not going forward but, as Gavin Brown mentioned, being completed. That is the issue that interests people.
I was disappointed by Alex Johnstone's knowledge of history. Today we have heard from both the Tories and Labour about how much they would love to see the railway back, but it was the Tories who started to wield the Beeching axe in the late 1950s, reducing the size of the railway network. The 1960s Labour Government said that it would backtrack on that policy but failed to do so.
By the same token, can we therefore claim that when the railway is built eventually, it will be the Liberal Democrats what done it? [Laughter.]
I thank the member for that.
The case for the Borders railway line has already been made and accepted. The Government has shunted that vital project on to a sideline; I plead for it to be put back on track. It is no coincidence that, despite frequent attempts, the SNP has gained no constituency seats in the south, nor is it ever likely to do so. I can see the timetable announcement in the Borders now: "SNP railway delayed".
I am happy to support the Lib Dem motion, of course, and look forward to some real certainty that the project will be finished.