The Channel Tunnel

Us against Them

Alan F. Cornish

The Fox River rises in Lake Fox, northern Illinois, near Chicago. It is a heavily polluted river. The factories which line its banks use it as a convenient means of waste disposal. Their owners have been pressed by every legal means to halt the practice, but have so far managed to continue, because it is cheaper to argue in the courts than to buy new equipment before the old is worn out.

Frustrated by obstruction, delay, and concealment of facts, a few local people have begun turning to direct action. A mysterious kind of industrial Robin Hood' has popped up on the scene, known as 'the Fox.' It is the habit of 'the Fox '• to treat the offending industrial enterprises with the same kind of contempt with which they use the river. His particular forte is to deposit a large bucket of noxious mess in the middle of the plush reception area of their headquarters offices. So far he has not been caught, and his identity is unknown. In fact, there may be more than one 'Fox,' since eye-witness descriptions, usually from hysterical receptionists, tend to vary. If he (or they) is caught, it is unlikely that a jury will find him guilty of much, since the local press and population are very sympathetic to the cause. He is almost literally giving the real offenders a dose of their own medicine!

Here in Britain, we have not yet reached such a stage, but we may be a surprisingly short distance away. Just now we have an organised 'ring-in ' or telephone siege of selected extensions of the Department of the Environment, on the first and third Monday of each month. The organisers have prepared a list of the numbers and extensions of the departments responsible for key environmental factors. People who find the switchboard trying to filter the call are advised to insist that their busi ness is confidential, or to describe themselves as 'reverend " councillor ' or from 'the Conservative Party Chairman's Office' etc. The idea is to jam the switchboard of a government department.

If this sounds a little extreme, consider that, last January, the Sunday Times devoted almost the entire edition of its colour magazine to a 'Plain Man's Guide to Territorial Defence '; and last , month the Daily Telegraph, in its colour magazine, presented an analysis of five pressure groups, distinguishing from their experiences some of the rules for success in crumbling "the bulkiest barricade of remote bureaucratic existences "; while the BBC recently gave half an hour to a programme entitled "Us Against Them — The Householder's Guide to Community Defence against Bureaucratic. Action." Suitable instruction manuals on how. . to combat the government ' machine ' are now on sale through your local bookshop, price 50p!

Obviously we must be worried at the clear prospect of administrative chaos, as the general public become more adept and imaginative at such techniques. In terms of basic politics, we cannot afford to have large, disaffected sections of the community — often from the middle classes — declaring 'open season' on the central administrative machinery of government. What lies at the root of these changing attitudes, and how can our civil servants come to terms with the situation? At present, they still have a choice. On the one hand there is the laissez-faire policy which could lead to a decline in administrative efficiency and simultaneously to an escalation of costs and thus taxation as the bureaucrats marshal their forces to combat obstructionism. On the other hand, they could attempt to modify their approach to accommodate most of the more reasonable points before they reach the stage of being ! objections.'

The method by which government economists now attempt to calculate the value of alternative investment policies is known as social cost/benefit analysis. It is applied even to proposals from the private sector, especially where planning permission is required, or financial assistance is sought. It entails "the enumeration and evaluation of all relevant costs and benefits" and is applied where it is necessary to consider a project from the community viewpoint. It is a method which is supposed to take into account the comparative effects of projects upon "third parties." Most large investment projects, especially in the transport field, affect a lot of third parties: one man's fast drive along an urban motorway may be the mat man's house vibrating until the windows rattle and the foundations move. A jet coming into Heathrow may be the end of a successful trip or holidaY, but it is just a horrible noise to somebody living beneath the flight path. Each event is being measured on quite different scales of value. And this is the nub of the problem — different scales of value, and 'relevance' of the costs and benefits of each event as measured on these different scales of value.

When one comes actually to use social cost/benefit analysis, the problems on a practical level are indeed daunting. Where does one draw the boundaries on the study? How can so many different scales of value be collapsed into one? How can intangibles be evaluated? How do you provide an equitable solution to the dispersion of a community and the destruction of a social and natural environment? In the face of such imponderables, refuge has been found in simple expediency: omit what cannot be counted. But while the backroom econom ist can omit this or that factor from his calculations, that does not remove the problem out in the real world. Where some development affects the lives of people, they are showing an increasing unwillingness to be omitted. Primarily for this reason, communities have discovered that they must fight if they wish to survive. It is because their fighting will grow more effective as time goes on, that a fresh look is being taken at the application of social cost/benefit analysis.

Two schools of thought are apparent — one to analyse the fight and show how better or more effective action can be taken in a given situation, the other to try and change the methodology or its means of application to encompass the sources of grievance instead of trying to by-pass them. The first, led by such people as Professor Philip Kotler of Northwestern University, Illinois, is considering how the techniques of modern marketing might be applied in the field of social action and planned social change. Professor Kotler is a past chairman of the College of Marketing of the American Institute of Management Sciences, and with typical thoroughness seems likely to prepare a body of theory and practice of direct relevance to both sides in the confrontation between bureaucracy and the citizen.

In interesting contrast to this, Professor Marvin Lee Mannheim, Associate Professor of Civil Engineeering at the Massachusetts Institute of Technology, is working on the development of a methodology for administrative decision-making in this type of field which will go far beyond the superficial level of social cost/benefit applications as we have seen them to date. His line of research seems quite close, in fact, to the work of two British transport economists — David Barrell, senior lecturer in Urban and Regional Economics at the Oxford Polytechnic School of Town Planning, and Peter Hills, lecturer in Transport at the Imperial College of Science and Technology in London. Barrell and Hills have drawn up a list of recommendations to remedy apparent methodological weaknesses, based on their

comparative study of some twenty applications of cost/benefit analysis to transport investment projects in Britain in the past twelve years. They recommend, for instance, that the viewpoint of most studies should be extended, so as to avoid confinement within arbitrary local government boundaries, and that a wider range of ' externalities ' should be considered — externalities being defined as consequences for third parties. Intangibles, they feel, should be included explicitly in all such evaluation exercises, and equity considerations should be investigated in any transportation plan, since most projects have considerable equity implications for particular areas or socio-economic groups.

To obtain some idea of the scope of these recommendations, it is necessary to consider examples from one specific

project — for instance the Channel Tunnel. This is exactly the type of project

where incorporation of the recommend ations is crucial to the whole outcome of what has been described as a major national strategic planning decision. It must be realised that the proposal to build a .Channel Tunnel rests entirely upon an extremely large public involvement, even though it is often claimed by the private groups sponsoring the project that no public money will be involved. For construction of the actual tunnel, the taxpayer is being asked to underwrite a bond issue by the sponsors, so that they might raise up to 90 per cent of the necessary capital in the form of a government guaranteed debt.

Thus only a small fraction of the capital will be contributed privately by the sponsors themselves, reflecting the true risk level inherent in the proposition. They also want numerous fiscal advantages and tax concessions which have been officially described as " incompatible " with the tax law or structure in either Britain or France. In addition, essential transport connections running from London •to the tunnel entrance, and fanning out on the Other side to Paris and elsewhere, are all likely to fall as direct costs to the taxpayer. These alone amount to an estimated £500 million, and the entire project will total approximately £1,000 million.

Participation by the taxpayer on this enormous scale is being justified on .the grounds of overriding net social benefit. It is perhaps fortunate that Barrell and Hills included in their study of different applications of social cost/benefit

analysis, the 1963 Government White Paper, Proposals for a Fixed Channel Link which is the only published information concerning this so-called net social benefit.

On most counts considered by Barrell and Hills, this study was rated very poorly. No serious consideration was given to the key alternative of "doing nothing," i.e. allowing the shipping operations to cater for future growth. This was graded as Weak" by comparison with studies elsewhere.. Likewise, the boundaries of the project were " weak " — they excluded consideration and inclusion of the essential land connections which call for so much of the capital involvement from the public sector, and they failed to question the wisdom of heavily subsidising British Rail to compete on the London-Paris prime route in competition with British European Airways and Air France — also stateowned public carriers.

Many other essential features were simply ignored or distorted — for instance the economic value of the ships was actually treated as a credit on the tunnel side. Crucial issues like vulnerability to labour disputes were not mentioned, even though since that time both a national dock strike and a national seamen's strike have failed to halt the ferries, whereas the British Rail Advanced Passenger Train cannot be driven out of its, shed for testing because of labour difficulties. Intangibles such as creating havoc with the Kent

countryside — the Garden of England — either through actual tunnel construction

or major works on the rail connections to permit speeds of over 150 miles per hour, were also bypassed without more ado.

Of course, the White Paper on the Channel Tunnel was published in 1963, and many of these points will doubtless have been taken into account since that time. Unfortunately, however, there is no way for the average citizen and taxpayer to verify this for himself, since the 1963 White Paper remains the last written word from Whitehall. Unofficial action groups in Kent are rapidly gathering strength, and are trying to bring home to taxpayers throughout the country that this will affect them too — it is not simply a problem for Kent. Specialist consultants have prepared a study on their behalf which incorporates the Barrell/Hills recommendations, and have concluded that the Channel Tunnel would result in a net economic deficit somewhere in excess of £400 million — for which the taxpayer is granting special privileges to the tunnel sponsors!

Clearly there are going to be great difficulties in modifying our use of social cost/benefit analysis to bring in all the externalities and, intangibles which surround a project of this magnitude. It has been likened to tossing a stone into an irregularly shaped three-dimensional pond, and trying to calculate a formula for ensuring that the ripples reach the circumference with equal force and speed, and without disturbing any hidden islands.

Yet the alternative — of escalating skirmishes between Whitehall and the rest of society, sometimes even ending in violent demonstration, industrial action and the like — is equally invidious.

The round of objection, inquiry, appeal and further hearings on the scale of

Roskill, for each significant public investment, is likely to generate legions of civil servants just to keep the paperwork of government flowing. It would be much better — and more in line with our concept of an open, democratic society — if Whitehall stopped acting like an administrative bulldozer and adapted a methodology to include all aspects of each project from the outset.

How this might be done, of course, could represent a further source of difficulty. A participative democracy can give headaches to the ' tidy ' administrator. But a start could be made by attempting to generate an informed public discussion, instead of suppressing all official details until the last moment before a final decision and then playing for a fait accompli. In the case of the Channel Tunnel, for instance, the British Government has assumed a maximum contingent liability of £4 million to £5 million in underwriting the technical studies of •the sponsors on how a tunnel might best be built (Mr John Peyton, Minister for Transport, Commons written answer, October 23, 1972).

Presumably the Government has done further social cost/benefit studies on the project since 1963, if only to serve as justification for the commitment of our initial millions. Publication of even the outline of these social cost/benefit studies now, to show what is being counted and what values are being attached to each factor — including the intangibles — would provide the basis for an informed public debate in an unhurried manner. It would permit some airing of all of the complicated side effects and their impact upon the various areas and socio-economic groups involved before the contractor starts pressing to pour concrete. It would facilitate the enumeration and evaluation of all relevant factors, by giving the people most affected the opportunity to say what was important to them, and see that it was being properly weighed in the final calculations. They, 'after all, are in the better position to know more accurately than ever the man from Whitehall. In fact this has already been recognised in official circles, since it would follow the Skeffington Report principles of public participation,, and more recent recommendations of the Centre for Environmental Studies.

We already have a suitable medium for generating this kind of debate — the Government Green Paper. This is a medium for the Government to show the general direction of its thinking and to put forward, the alternatives which it faces, before finally committing itself to a hard line of action. It therefore seems highly desirable, as the British and French Governments sign a contract for the next stage of studies by the sponsors on the

Channel Tunnel, to publish as a Green Paper the latest details of the social cost/

benefit studies which have been undertaken by the British Government. It would herald a new and refreshing approach to major public investment policy, and meet halfway the , environmentalists and other such groups. It could save some red faces in Whitehall a year from now, when the final decision on the project is to be taken.