The Treaty of Sandhurst

Last week the government concluded a new Treaty with France, called  the “treaty concerning the reinforcement of co-operation for the co-ordinated management of our shared border”. I have called it the Sandhurst treaty, in honour of the place where it was solemnized.

Parliament has recently submitted the EU Withdrawal Bill to intensive scrutiny. Hundreds of amendments have been debated, 45 votes taken on the ones most favoured by the Bill’s opponents, and 12 days of lengthy discussion on a Bill whose main purpose is to ensure continuity of law once we leave the EU in accordance with the instructions of the voters.

I have no problems with Parliament doing its job thoroughly. I want a strong Parliament. What I would now like is for those same Opposition MPs to be equally demanding when it comes  to  other things that are happening.

Lets take last week’s  new Treaty with France. It provides for the UK to send more money to the French government to reinforce the border, and for the UK to take more migrants from France. The government did not offer a Statement or debate to explain this, and are not proposing any Parliamentary process to examine and approve the new Treaty. So why did the Opposition, newly enamoured of the Parliamentary process, not seek an Urgent Question to find out what was going on? Why have they not proposed a debate in Opposition time  if the government does not propose a debate in its time on this matter? Why does the Opposition complain about the Executive needing to have powers to transfer EU laws already agreed into good UK law but have no problem with the government signing a new Treaty with obligations on the UK?

The Treaty of Sandhurst is a development of previous Treaty collaboration on the Anglo French border in France. The underlying principle that it is easiest to police that border for people leaving France in France, and for people leaving the UK in the UK is clearly a good one which we wish to uphold. I still find it odd that the newly active  Opposition forces in Parliament have nothing to say on this and allow the executive to do as they wish without comment or vote.




EU negotiations

There may be EU negotiations for most or even all of this year. Those who want me to write about this and nothing else for the rest of the year will be disappointed. I have not written about them recently as there were no formal negotiations underway over the Christmas and New Year period. The next  big event will be the March EU Council.

Some of you think I am not writing about it because I have changed my mind of what we should offer and how we should proceed. Let me assure you that is not the case. I remain strongly of the view that whilst the government would like a comprehensive free trade deal  the base case is leaving with the WTO option for trade with the rest of the EU, just as we do with the rest of the world today. This option would mean no extra payments to the EU. It means we would take back control of our laws, our borders and our trade negotiations from March 30 2019. I am happy for the government to go on negotiating to see if it can produce a better outcome than this. If it does then that is good news. If it does not, then under the government’s  rubric that no deal is better than bad deal it should politely decline the EU offer.

I do not see the need for any additional transitional period after March 2019 if we are simply leaving. I  read that we can be ready for trade under WTO rules by March 2019 if that is what happens. As the PM has said, if we do secure a better deal then there  might be some need for a variable implementation period for parts of that deal which can be settled when we know the deal. What we should want to avoid is negotiating a 2 year further transitional period after March 2019 which turns into a prolonged negotiation again. I don’t see how it is more likely we can do a good deal in 2020 if we have been unable to secure one in 2o17  and 2018. To try would simply extend the uncertainty further which  is a bad idea.

Time will tell what the government  wish to recommend. We do know that the government agrees we will not remain in the single market or customs union, that we do need to end the uncertainty as soon as possible, and that no deal is better than a bad deal. They also agree that we need to take back control of our borders and our laws and need to be able to enter our own new trade agreements on leaving. We also know that they have indicated money will be paid in addition to our contributions up to leaving date. They will need to show that they are getting something for such a generous offer. Any deal they accept will need primary legislation to go through both Houses of Parliament to provide the authority to implement it.




Do we need a road bridge or tunnel across the Channel?

You could argue that as the rail tunnel is not at anything like full capacity it would be wrong to add another cross Channel link. Clearly the owners of the rail tunnel would not welcome a new competitor, and were not expecting one under the terms of their concession.

You could also argue that maybe a road link would be more popular and better used than the rail one. Whilst a new road would doubtless do considerable damage to the business model of the rail tunnel by taking substantial traffic away from it, it might also generate some additional traffic of its own. If more French people came to the UK as tourists that would be a bonus for the UK economy. If more UK people went to the continent to shops and holiday it would be bad for the UK balance of payments, but might be welcomed by  those taking advantage of cheaper and easier travel.

It is difficult to see the Channel tunnel keeping much of its shuttle business carrying lorries, if they were able to carry on driving to get to the UK. That is the mainstay of the tunnel’s freight business, which would be badly affected. Passenger traffic is more difficult to gauge, but again there could a lot of people who would like to go by their own car instead of taking the train and  then hiring a car or using taxis when they get to the cities on the continent served by the trains.

My advice to the government would be  not to commit any public money to a road crossing. They should also check the legal position carefully over the concession to the current Channel tunnel operators and owners. There are many other road projects we need in the UK that should take priority for limited sums of public capital. If the private sector wishes to design, build, operate and finance a road link then of course the government should be willing with the French authorities to examine the scheme to see if it deserved approval and support from the government as regulator. It would need to be built with artificial  islands to avoid ship collisions with its piers, and would need to leave plenty of rooms for deepwater shipping lanes in what is a very busy piece of water.

The government would need to consider the security and borders consequences of a road link, given the difficulties the rail link helps create in Calais today. It sounds as if from additional briefing there are no current plans for such a scheme.




The Worboys case

There were plenty of representations to the government against the Parole Board decision to let Worboys out of prison soon. The Justice Secretary promised to rewiew the situation to see if he could intervene. He has  now concluded he cannot  mount a successful legal challenge. The Parole Board is an independent body where Ministers do not involve themselves in decisions on individual cases. I assume  the Justice Secretary thinks the Parole Board followed the proper process, even if he along with many other people think they reached the wrong conclusion. Judicial review concentrates on process, not on outcome.

This will  be a disappointing conclusion to the constituents who wrote to me about this case, but they can be assured the government did know the strength of public feeling on this issue.




The Channel tunnel has proved to be an expensive and disappointing investment

When the idea of reviving plans for a tunnel under the Channel came to Margaret Thatcher in the early 1980s I provided some of the briefing on the project. I researched the 1964-74 project which had got to the point where tunnelling started on the English side, only to see the Labour government cancel the project in January 1975 on the grounds that it was too expensive and not likely to  be a good investment. The nineteenth century had vetoed several plans on security grounds, the later  twentieth century became more worried about the money.

My conclusion was simple. A rail tunnel under the Channel was most unlikely to make money for its investors. There were many other more pressing needs for road and rail capacity in the UK that could justify public investment and would produce a better return. Given the strength of feeling for a Channel project in other parts of the government I proposed that the Prime Minister gave her consent, as long as no public money was put at risk in the project. She agreed with the advice, and the government proceeded accordingly. I thought the forecasts for build costs, for operating costs and for revenues were all too optimistic. I was also surprised that the private sector was so keen to press ahead, given the large risk of loss.

The UK and French governments offered a 55 year concession to the Channel Tunnel company to operate a rail tunnel and collect fees and charges to reward their shareholders and pay off their debts, with the tunnel then reverting to the two states. The company thought this a fair offer, raised shareholder money and set out to the governments how it would build and operate the tunnel, agreeing to meet government safety standards.

The Tunnel turned out to be a poor investment for many who put up their savings for the project in the early rounds. It was first beset by a major cost overrun. An overrun of around 80% depending on whose calculation you accept  led to a total cost well in excess of the starting estimate, with considerable general  inflation also affecting the outturn. This made getting an early and decent return much more difficult.

This was compounded by discovering that the forecasts of potential usage were far too optimistic. As I had expected, use of  a rail tunnel on that route was much less than the enthusiasts thought. The 1985 traffic forecast said there would be 37 million passengers using the trains by 2003. Instead there were just 15.2 million. They said there would be 11.4m tonnes of train freight by 2003. There was instead just 1.7m tonnes. Their forecast of lorry use of the shuttle  was more accurate but still ahead of outturn. Revenues as a result fell well short of forecast in the early years.

The Channel tunnel company had to go through various financial restructurings to raise the extra money it needed to keep going. Governments helped by extending the concession period, first by ten years, later allowing it to stretch out to 2086, almost one hundred years. The tunnel has never hit the original passenger forecasts or train freight forecasts. It means there is plenty of spare capacity on the existing rail tunnel. The tunnel company reviewed the case for a road tunnel to go alongside it in the late 1990s and concluded there was not nearly enough potential use to justify such an additional investment.

I will talk in Monday  about whether we need another such link