6740. CHAIRMAN: Thank you, Mr Pritchett. Well, now, Mr Mould, what are you going to do about this? Are you going to call Mr Smith?

  6741. MR MOULD: I am. What I was proposing to do, if this is convenient to you, is call Mr Smith specifically to deal with the last of Mr Pritchett's three points, that is, to deal with the land disposal policy. Before I do that I was going to make one or two legal points if I may, perhaps to set the scene, and then obviously deal with any matters your Lordships may have and Mr Smith no doubt also likewise. While we are on technical matters there would be a difficulty with the first of Mr Pritchett's three suggestions in the way in which it is put at the moment. I do not think it would be appropriate for the Crossrail Bill to amend a public Act, but to overcome that one would simply say that in its application to the Crossrail scheme section 30 of the Land Compensation Act should apply with different provisions.

  6742. Let me just deal with the merits of that. Mr Pritchett said that the home loss payment regime was a regime which Parliament has introduced in 1973 in order to, as it were, mitigate the compulsory nature of acquisition of public works, and broadly that, I think, is correct, and I think that one gets a flavour of that from the very term itself, home loss payment. It is designed to mitigate the fact that one's home is being taken from one compulsorily. The will of Parliament nevertheless, and this is the corollary, was that the amount concerned should have a cap; there should be a maximum payment, and it was set in 1973 at £15,000. It is presently set at £44,000 as I have indicated, and it is fair to say that that current level of £44,000, which represents the maximum, reflects the will of Parliament. I have put up the statutory instrument itself which provides that current figure and, as your Lordship will see, that statutory instrument was laid before Parliament in June of last year and so it is right to say that it reflects not just the views of the Secretary of State for Communities and Local Government, but also reflects through that process the will of the legislature. That, I think, is the short legal answer to Mr Pritchett.

  6743. CHAIRMAN: Subject to the fact, of course, the legislation cannot amend the £44,000?

  6744. MR MOULD: No, but the fact is it has been laid before Parliament the matter was able to be debated and Parliament could have said in the House of Commons or, indeed, in this House the point that was being made by Mr Pritchett, that is to say the maximum figure was too low, was in principle subject to debate on the grounds that he has put. There has to be, of course, in these cases a balance and the balance is drawn not, in my submission, in relation to a bill which is concerned with providing powers for an infrastructure project but the balance is drawn through the medium of general legislation, both primary legislation, that is to say the Land Compensation Act 1973 itself, and so far as the periodic amendment of section 30 is concerned through the medium of subordinate legislation of general application, that is to say this statutory instrument.[7] It is a point which I have made on a number of occasions in relation to Petitioners who raise compulsory purchase and land compensation issues. This Committee, in our respectful submission, should be very slow indeed to recommend that legislation of general application should be changed on an ad hoc basis in order to meet the concerns of Petitioners. Your Lordships have heard that submission I think in our opening of this case and it is one that we maintain. This is a substantial infrastructure project but it is, nevertheless, an infrastructure project and Parliament has laid down these rules so that they apply not just to this project but to projects which engage the land compensation provisions up and down the land. They take account of the balance between legitimate grievances and concerns of those whose land is taken and the public interest in these schemes being able to proceed in a way which is cost-effective in economic and other terms. That is no less a situation in relation to this point as it was, for example, in the case of the Souzel Petition which you heard last Thursday. That is the legal case and the policy case in response to that part of Mr Pritchett's Petition. It is striking that this statutory instrument was made as recently as last June. It is in a true sense up-to-date in so far as the cap on the home loss payment is concerned.

  6745. Just one more point. It is not true of course to say, as Mr Pritchett did, with respect, that this sets up a rule which is the same for everybody, that it applies in its effect equally to everybody. The principle is that the home loss payment should be determined on the basis of a fixed percentage of open-market value and until one reaches an open-market value of £440,000 or more, that is the effect of the provision. The maximum is there and it has been worked out as one sees—I will just show your Lordships the explanatory note to the statutory instrument—the basis upon which the increases have been calculated are set out just about two-thirds of the way down in the explanatory note: "the increase has been calculated by reference to the Department of Communities and Local Government house price index which varies in line with changes to house prices".[8] That is the express basis upon which the current maximum has been determined and your Lordships may feel it makes obvious sense to approach the matter in that way.

  6746. CHAIRMAN: Do you know what the 2006 regulations have in limit?

  6747. MR MOULD: I think it was 40 because if one looks about halfway down the page it has gone up from £40 to 44,000.

  6748. CHAIRMAN: It is changed quite frequently?

  6749. MR MOULD: That is the position, yes. I do not want to say anything more about that at this stage, but our submission would be that the first of Mr Pritchett's proposed amendments would not be justified.

  6750. Turning to the second one, first of all by way of introduction, it is certainly not the Promoter's case to say that in expressing his concerns about the impact of compulsory acquisition upon his home that he is exaggerating or expressing an unreasonable sentiment. One can well imagine the sense of grievance that any homeowner would feel at having his property compulsorily purchased for public works but the Compensation Code, including at its heart the concept of open-market value being assessed on the hypothesis of a winning seller and a winning buyer, so a free and open transaction taking place in the absence of the scheme, as your Lordships is well aware, is one which is designed to ensure that as far as possible the dispossessed owner receives fair compensation for his interest. The home loss payment is there to reflect the fact that it is compulsory, but an integral component of the established general law in relation to the assessment of open-market value on that hypothesis is that there should be a valuation date at which point open-market value is determined. That date, previously identified in accordance with a decision of your Lordships' House in the 1960s called the West Midlands Baptist Church case, has recently been the subject of consideration by Parliament which has led to the insertion of section 5A into the Land Compensation Act 1961, that being a new provision which deals specifically with the identification group, the stipulation of valuation date in compulsory purchase land compensation cases and that being inserted into the Land Compensation Act as recently as 2004 under the aegis of the Compulsory Purchase Act of that year. Again, my submission is that recently as a matter of amending the general law of compulsory purchase Parliament has made provision for the identification of the appropriate valuation date and it would be wrong in principle for the reasons I have already given for this Committee to seek to change those recent provisions of the general law as they apply to the Crossrail scheme. There seems no reason to do so.

  6751. CHAIRMAN: I wonder if Mr Pritchett knows what the change consists of?

  6752. MR MOULD: I wonder if he does. We put this up I think in response to Mr Saunderson's Petition but the change, as it applies to Mr Pritchett, is effectively as follows. What that provision did was to confirm the previous common law provision that ordinarily the valuation date is the earlier of the dates on which the statutory undertaker actually takes possession of the land to be acquired or the date on which compensation is agreed or determined in the absence of agreement by the Lands Tribunal, that is to say agreement between the parties, the statutory undertaker and the dispossessed landowner, or in failing that an agreement determined by the Lands Tribunal. In a case where the owner of the property remains in possession of his property until it is actually required by the undertaker in order to carry out statutory works, in this case some time in late 2010/early 2011 on the current programme, or in practice that date of possession is the valuation date, in the majority of cases that is how that provision in the Land Compensation Act applies. Where, for example, the landowner is one who is entitled to serve a blight notice and so to bring forward the compulsory acquisition to suit his convenience, if you will, then in those circumstances the valuation date may be earlier than the date of possession because if he is able to agree compensation with the statutory undertaker at an earlier date so, for example, if Mr Pritchett were to serve a blight notice during the course of next year and it were possible to agree a figure for compensation during the course of 2009 then compensation would be assessed as at the date of that agreement. As I say, in the absence of agreement, it may be necessary to put the matter for determination to the Lands Tribunal and then in those circumstances if the Tribunal determines the matter before the date of possession, then that would be the appropriate date. It is the earlier of those potential alternative dates. I do not know whether that has been explained to Mr Pritchett but that, I hope, is a reasonably clear explanation of the position. It is certainly something which is touched on in the letter that I showed you in opening the case. What he calls his Concern 10, which I think is really in principle focused upon the date at which open-market value falls to be assessed, again the answer to that is really that will involve making changes to the general law which has recently been set by Parliament and that would not, in our submission, be justified for the reasons he has given.

  6753. That then brings us to the final of his three proposed changes and that is to do with what happens after the Crossrail works have been constructed and there may be landed interests which fall to be disposed of by the Promoter under his land disposal policy and it is at this point I think that I would prefer you should hear from Mr Smith who can explain these matters from a much more practical and commercial point than I can do from a legal perspective.

  6754. CHAIRMAN: Please do that. Of course, Mr Pritchett, you will be able to ask questions of Mr Smith.

  6755. MR MOULD: Mr Smith, for Mr Pritchett's benefit I wonder if you could remind the Committee who you are and your position within the project?

   (Mr Smith) Yes. I am a chartered surveyor with over 35 years' experience and I am retained by Crossrail to advise them on property matters.

  6756. Thank you. Mr Smith, it might be helpful if we had to hand the Promoter's land disposal policy which is Information Paper C10 and your Lordships will recall that is set out in the red bible of information papers which you have in front of you. I would like to explain to the Committee in a little more detail than we have so far the basis and justification for our land disposal policy. I wonder if perhaps by reference to section 2 on page 2 of that document under the heading "General Approach" you could explain how our land disposal policy fits in with the Crichel Down Rules?[9]

  (Mr Smith) Yes. The Government have issued guidance which is best practice, known as the "Crichel Down Rules", and that really applies to land which has been purchased under compulsory powers or under the threat of compulsory powers that is no longer needed for public works generally and the rules set out as guidance to government authorities, public authorities, how that land should be disposed of. In Crossrail we have an infrastructure project here which, certainly in the central area, is largely underground and, therefore, it brings in nuances to the Crichel Down Rules which really are not captured in those rules so we have come forward with a policy that we would adopt to help people understand how we would deal with it. Basically we are saying if it is a plot of land and it is in the outer area where the railway is at surface it will be dealt with under the Crichel Down Rules, it is terra firma. Where we are taking about essentially airspace above an existing ticket hall where any future development will have to take its loading from that structure, i.e. the ticket hall, then we have rather more different --- We outline the appropriate way that these should be dealt with. This largely builds upon the best practice of London Underground in London, how they develop above their own ticket halls and, therefore, it attempts to bring that into being.

  6757. Thank you. If we note paragraphs 2.2 and 2.3, 2.2 sets out the basic approach under the Crichel Down Rules themselves. I think that is right, is it not?

   (Mr Smith) Yes.

  6758. It notes the fact that under the Crichel Down Rules there is no obligation to offer land back to the former owner where the works have materially changed the character of the land in question and then 2.3 goes on to explain under the Promoter's land disposal policy provision is made to cover that eventuality and that is dealt with in detail in the land disposal policy itself?
  (Mr Smith) Yes, it is.

  6759. Clearly we know that in this case Mr Pritchett's property forms part of a larger block which, as I have explained, is to be demolished in order to carry out the station construction, ventilation and escape shaft works for the western ticket hall of Tottenham Court Road. A material change in character I think is inevitable in those circumstances?

   (Mr Smith) It is. I think the Crichel Down Rules would not apply to this site if we took them literally.

8   The Home Loss Payments (Prescribed Amounts) (England) Regulations 2007 (SI2007/1750), Explanatory Note (SCN-20080326-002) Back

9   Crossrail Information Paper C10-Land Disposal Policy, http://billdocuments.crossrail.co.uk (LINEWD-IPC10-002 to -005) Back