6780. No, the process of disposing—effectively, doing this business of offering the site for two potential developers.

   (Mr Smith) Obviously, the earliest date, I would say, must be after Royal Assent. The earliest date will be Royal Assent. We would want to start it early enough in order for there to be plans fairly well developed by the time the Crossrail works are complete. So I cannot give you an exact date, I am afraid, Mr Pritchett; I would not know, but it will be after Royal Assent and most probably before the works start. I can be no more helpful than that, I am afraid.

  6781. Are you currently having talks about talks with anybody?

   (Mr Smith) On this site, no.

  6782. Would you be prepared to meet and discuss the project with me as soon as the process starts, after Royal Assent? This is obviously not the place for any sort of negotiation. I would note, however, I have been chairman of a publicly traded company, I have been a director of finance in another. I would not have this quite large plot, and although obviously I would not be laying the bricks myself any more than anything else, I feel I would be quite capable of assembling a team of people, including a reputable construction company who has constructed something above one of the very many Tube stations in London, perhaps, and a reputable team of architects in order to make a credible bid.

   (Mr Smith) After Royal Assent, I am sure that Crossrail will have to go through the process outlined in this disposal and inform and discuss the future policy with the various owners on the site, so I think the short answer is yes, we will come and inform and discuss the matter with you.

  6783. Will you seek to exclude people such as me on a technicality? For example, I am a human person and, therefore, as the leaseholder, I would be a human person who would have to bid, but you might say, "A human person is an entirely inappropriate entity to undertake the development and, therefore, we are going to exclude you even if you can bring a team together".

   (Mr Smith) Well, I think the short answer is that we are not excluding people because they are human. We are dealing with a large development above an operating railway, so the type of requirements that are specified in the land disposal are quite reasonable and, providing that you can comply with those and with the policy, there is no reason why we should object. If the various owners on this site all get together and form a consortium, as I have described, there is no problem and we are not planning to stop that.

  6784. Well, there is a problem if they form a consortium because, if one neighbour just round the corner decides to be bloody-minded, if you will excuse the phrase, if you look at number 5.3 there, it only takes one neighbour to pop in a little bid and then the whole thing is off.

   (Mr Smith) Well, I am afraid that the Secretary of State is not going to choose between different qualifying owners bidding for the site. I think that you raised this in your evidence, that it was unfair, but, if there is more than one qualifying owner coming forward, all complying with the policy, how does he then choose? Well, in those circumstances, and this follows the Crichel Down Rules which are put forward by the Government, so this part is not new to this process, it is offered generally in the open market. This is the statement of best practice that is put out by the Government and we are following that.

  6785. But you have also said that we have not had anything quite like this before, two blocks of prime West End land which happen to be currently slightly fragmented. The reason we have got this policy is that the Crichel Down Rules were not specifically written with this sort of thing in mind, and what I am suggesting is that, if you look at the whole of paragraph 5 down to 5.3, it just seems an extraordinary way to conduct any sort of tender.[12] As a surveyor, have you ever been involved in a tender where, if there is more than one bid, no one gets it because one bid would get it?

  (Mr Smith) I am sorry, but I think I need to be clear here. This is a principle that is not extraordinary and is included within the Crichel Down Rules as a statement of best practice. On this particular point, whether the site is in Soho, Scarborough or Penzance really makes no difference to the process that is being followed, which I can understand. It is not for someone else to choose who gets a site if there is more than one owner. It goes to the outside market. Those people who are interested can bid in that circumstance if they are very interested, but they just have to compete for it.

  6786. The question I asked you was whether in your 30-odd years' experience as a surveyor you have ever participated in a tendering process where, if there is more than one bid, nobody gets it and, if there is one bid, they get it?

   (Mr Smith) No.

  6787. Have you ever heard of such a process in the commercial world?

   (Mr Smith) Yes, it has happened. In fact it has happened on other cases where other surveyors have dealt with public authority land in line with the Crichel Down Rules. It is a policy that is set, it is a government guideline.

  6788. It seems to me that the guideline is slightly odd. It just seems to make no sense. If there were, for example, two bids that came in, it would seem perfectly sensible, in fact slightly complementary, to go back to the people and say, "First of all, is there any way you can get together and form a consortium with the best of your proposals for this site and, if not, we'll go for one of you?" I have suggested one way of dealing with it which is that you choose by lot, and the alternative way would be to have a sealed bids process where you are bidding to pay a premium above the open-market rate, in which case the Secretary of State would get some good money for the public coffers, which might be good practice, but the underlying principle here is the possibility of offering land back to former owners, such as that they can participate. I would contend again that, under the European human rights principles, if it is possible to get back a home on the same land that you happen to be attached to or what-have-you with reasonable efforts compatible with undertakings for the site to be properly developed in a sensible manner and all of those things which I think are excellent in this policy, it seems to me that a reasonable effort ought to be made rather than just throwing it out because one person happened to put in a frivolous bid.

   (Mr Smith) I think that you may have missed the point a little bit here because, when the Crichel Down Rules apply and this land disposal policy, it says elsewhere in the policy that the site will be sold at the market value, and that market value is determined by the Government or, in this case, by Crossrail's professional adviser who will say, "It's worth this much", so, if there is more than one bidder, we say the site is worth a price and, if there is one person, he either accepts that or goes away. He accepts to pay the price and get on with the development or go away. If there is more than one, that sort of approach cannot apply because you have got a fixed price and you have got more than one developer, so what we are saying is that, in those circumstances, you can still bid in competition, and, as I say, this is set out in the Crichel Down Rules, and we will throw it open to a wider audience. You can still bid, but you have got to maybe come in with your own price and, in those circumstances, providing they qualify under the policy and they are able to show that they have the right track record, resources, et cetera, then it will be accepted on that basis, so we are not starting off with a tender here and the highest bidder wins, but we are starting off with the Government, the Department, local authority, whoever it is, saying, "You're a former owner. This is what we think the price is worth. If you are the only bidder in town, you can have the site at that price. If there are more than those, we're not going to select who gets it, so you'll have to bid in competition". They, I am afraid, are the rules and they are the ones we are following.

  6789. Well, they are not the rules because, in practice, policy is what is going to happen.

   (Mr Smith) They are the rules set out in the policy which follow the Crichel Down Rules.

  6790. But the Crichel Down Rules do not apply. This policy is what is actually going to happen, so what I am suggesting is that the policy could be modified. The plot, as we have seen on the site, is actually clearly divided in two by a street. Are you in fact planning to dispose of one to increase the chance of competing bids and, therefore, in fact ensure that it goes on to the open market?

   (Mr Smith) No.

  6791. Has that crossed your mind?

   (Mr Smith) No, because in this policy it is going to be Crossrail that will determine the boundaries of the site and here, I would imagine, it would be either one site or two. There will not be any other sensible way to split it. There is a site south of Fareham Street and one north of Fareham Street, so we would take advice at the time as to whether it is best actually to just get one development on there under way or to split it in two. I would not like to say at this stage which would be best, frankly.

  6792. So in fact you are saying, and I think we saw on one of your slides earlier, that in fact it said it would be normal to dispose of one site and what you are saying is that in fact there could be some flexibility if the proposals proved to be sensible.

   (Mr Smith) In this one case, and I think this is the only case, there is a road, if you like, through the site, so you have the choice of one or two under the policy.

  6793. I do not think we have quite got to the bottom of it. Are we saying that, if I were in partnership with sensible developers and all the rest of it, going to bid, in fact I would not be excluded from bidding because, for example, it would be sensible to incorporate so that the ultimate developer would be an incorporated body with the right financial resources, but I would not be excluded just because the technical former owner was the human me and you would be prepared to consider it effectively passing into a more sensible body, headed by me?

   (Mr Smith) No. If you became, for example, Mr Pritchett/British Land Limited, I am sure we would not disregard your interest.

  6794. Have you had any problems with Tom, Dick and Harry attempting construction before?

   (Mr Smith) On the Underground, there have been problems in the past, not where the Underground has controlled it, but from developers on adjoining, shall we say, Underground property. I can remember a time when the roof at Vauxhall Station was broken open by some builders above who thought it was just a bit of concrete, what was wrong there, and suddenly it came through the roof of the station, which was rather alarming and we did not know they were there, so it can happen.

  6795. If there were a Tom-, Dick- or Harry-type bid, would that be eliminated before the point or after the point at which you decided there were competing bids from former owners, therefore, getting out of this process of offering it back to former landowners?

   (Mr Smith) I think the point there is that, unless the interested party really qualifies, it probably would be sensible only to consider those who qualify under the paragraph of this policy who have the natural, financial capability and the track record. I think it would only be fair to deal with it that way.

  6796. So will you perhaps be offering people guidance or publishing guidance in the run-up to the bidding process about what they need to do to prove that?
  (Mr Smith) No, what we have agreed, and I am just looking back, there is a process here for offer back and, if you will just excuse me, I will look for that. It says here in 6.1, that, before offering it back to any party, we need to be satisfied that this complies with the guiding principles, which is fair enough. It is set out in Appendix 1 to the policy, the offer back, and it sets out there that, where the address of a former qualifying owner is known, we will inform them, and there are timescales and there is even a process where the address is unknown.[13] This actually follows the Crichel Down Rules to try and get in touch with people to say, "We are intending to dispose of this".

  6797. Are you aware of any disadvantage if there are sensible bids with appropriate qualification undertaking? There could be one position where there is one bid and it goes ahead like this: that, if hypothetically there were two and my suggestion was adopted of choosing between them by lot, is there any disadvantage to the public purse or what-have-you as opposed to the situation where one person had been selected?

   (Mr Smith) It is just adding more process, I think.

  6798. There is plenty of process going on though.

   (Mr Smith) Yes, but the reason we are altering the Crichel Down Rules here essentially is that, in a built-up area in inner London, we are knocking down buildings. Once you knock down buildings, the Crichel Down Rules do not apply. This process will, if you like, widen the right to be offered back an interest in the new development, also having regard to the fact that it is over an underground station, a Crossrail underground station. Having said that, once you have got beyond that, I do not see there is any reason to change the process other than is up there, and I know you feel that there may be benefits for you, but this has been tried and tested, it has worked for many years and I do not really see a need to change it. I think you are mistaking the fact that this is a tender and I think you have to bear in mind that this is a public authority, saying, "This is what we think the land's worth. Do you want it?" If that is to more than one qualifying owner who has the track record and expertise, then I think the fair way to do it is to say, "Right, okay, you both comply. What's the highest bid?" I think that is a fair way of dealing with it.

  6799. That might be, but what I am suggesting is that, if the two people inadvertently both bid, a more sensible and collaborative way is to go back to them and say, "Do you two not think you could get together and put in a joint bid, because you obviously are on different plots to start with, and work with us on it?" There is going to be plenty of time for this. There are years and years and years.

   (Mr Smith) In my experience, when you have tried to push developers together, unless they do so voluntarily, it is like a marriage. You should not force it and it should be something two people are willing to engage in.

13   Crossrail Information Paper C10-Land Disposal Policy, Appendix 1 http://billdocuments.crossrail.co.uk (SCN-20080326-003) Back