16 February 2015

Dear Councillor,

Before your Budget meetings last week I contacted you asking that you would not support any increase in tolls. We also sent you a document with various points to try and counter the claims that are made on behalf of Merseytravel. Those of you who were members of MITA a year ago may remember that we also sent you last year a document after the budget meeting which dealt with some of of the statements made by Merseytravel which we believed to be wrong. This is what we sent you then:

http://www.tunnelusers.org.uk/tomitamember11feb2014.pdf

We are again sending you a post budget-meeting document which is attached. Unlike last year, we have not dealt with what Merseytravel has recently said such as in the Echo last week, even though we do not agree with it. Merseytravel may not like what we say, and again we invite you to raise with us anything that we say which you think is untrue, inaccurate or misleading.

At the Authority meeting on Friday it was decided to carry out a review of the tolling. What was said seemed to indicate that the intention was that tolls would only be used for Tunnels purposes. The MTUA welcomes this move and would like to contribute to this process or to at least make a submission to this review by the Authority.

Yours sincerely,

Dave Loudon

Chairman

Mersey Tunnels Users Association

To Council Leaders who are full members of the Combined Authority

To Councillors on Merseytravel Committee

To Merseytravel & LCRCA from MTUA - More points on Tunnels Tolls

a) Deciding on the actual tolls payable and setting the budget

The MTUA believes that there should be no tolls, or that if there are tolls then the tolls money should only be applied for Tunnels purposes as was supposed to be the case prior to the 2004 Act.

We also believe that even under the 2004 Act, there is no legal requirement that the tolls payable should be increased. Whatever Merseytravel's intention was, the law as amended kept the discretionary powers to reduce or remove tolls at any time for any reason.

There is however a requirement that the authorised tolls be reviewed each year and the timing of this is bad. One reason for the timing is that instead of basing any RPI increases on the movement of the index from around the time the Act was passed in summer 2004, Merseytravel told Westminster it wanted increases based on the November 1999 index. This gives a higher level of authorised tolls but also means that the process of doing this review can not be done any sooner in the financial year than when the November RPI is published, which is around mid December.

It only takes a few minutes to calculate the level of the authorised tolls, so the decision on those and on the tolls actually payable could have been scheduled for the end of December or in January. But for some reason Merseytravel had the 2004 Act specify that the new Tolls Order has to be made during February. This puts it very close to the point by which Merseytravel as a levying authority had to determine its budget and levy. In practice rather than have two meetings, Merseytravel has always considered at the same meeting the budget and what to set the actual tolls payable. Whatever the reason for this, it had the effect that there would then be more pressure to agree any proposed increase as it was already in the draft budget.

We have commented in the past that this situation is not desirable, and it was even odder when this year Merseytravel at their budget meeting considered the budget before they considered their tolls recommendation though they were told that the level of tolls has “no net effect”.

There is now of course an added complication in that it is the Combined Authority who decide what the tolls payable will be and who will have to take account of what grant it will make to Merseytravel and what levy it is aiming for.

If the law stays as it is, we suggest that the Combined Authority should meet earlier each February and make their decision on tolls payable before Merseytravel meet to decide what budget / operating grant they want the Combined Authority to agree to.

We realise that in practice there may be meetings behind the scenes where Merseytravel is told how much they will be allowed to ask for, but that does not alter our point that the tolls payable should be formally decided by the Authority before the Merseytravel Committee decides what operating grant request it is submitting.

At the meeting of the Combined Authority, last Friday, the tolls report was considered before the Budget. Given that the tolls decision has not been made at a previous meeting of the Combined Authority, this is the correct order. But as the unexpected decision was made that the tolls payable would not go up, there was then a problem as the budget request from Merseytravel and the levy figures assumed that there would be a tolls increase. An officer did point out that the budget would have to be amended but in our view that statement was not sufficient. It did not seem to be clear whether the levy would be increased, or some expenditure would be cut or some other income found. It is the opinion of the MTUA that this lack of clarity is not normal with local authority budget making.

There is also in our view some doubt about either the tolls figure or the traffic figure in the Tunnels budget as agreed. The tolls report that went to Merseytravel Committee last Thursday (4.1.2. on page 201) said that the effect of the toll increase would be £1.5 million. The Tolls Report that went to the Authority on Friday gave the effect as £1.1 million (4.1 on page 55). The MTUA did not notice this difference and have been quoting the figure of £1.5 million for the effect of the toll increase.

Before quoting the £1.5 million, we had checked that it was consistent with the Tunnels Draft Budget which showed the tolls increasing by £1,568,000 from the Revised Estimate for 2014/15 of £42,307,000 to the Draft budget of £43,875,000 (page 116 line 26). There was a possibility that part of that £1.5 million increase could be due to an increase in the estimated volume of traffic, but the service details provided in the budget at page 117 showed the Traffic Total for the Revised Estimate 2014/15 and the Draft Budget 2015/16 as the same figure (24,866,000 excluding concessionary). Indeed, if Merseytravel were assuming an increased uptake in the use of tags, then there would be a fall in income if the traffic level did not increase, so it was implied that the effect of the planned toll increase was more than £1.5 million.

The difference between the £1.1 million and the £1.5 million is similar to the increase of £423,000 between the Revised Estimate 2014/15 and the Base Estimate 2015/16, but there seems to be no reason for this increase as the traffic was the same.

So it seems that the Authority will now have a budget which assumes that there is no growth in traffic between the Revised Estimate 2014/15 and the Budget for 2015/16 but with tolls income going up by over £400,000. It seems that the only possible explanation, other than a mistake, is that it is assumed that the number of tagged journeys will fall.

b) Review of the Tunnels Act 2004

The Combined Authority passed a motion “to press for a review of the Mersey Tunnel Act in any on-going devolution negotiations.”

We assume that by the 'Mersey Tunnel Act', the motion is referring to the Mersey Tunnels Act 2004. The vast majority of the statutory Tunnels law still in force is not in the 2004 Act, it is in the County of Merseyside Act 1980 and perhaps to a small extent in eleven previous Tunnel Acts going back to 1925.

We also assume in the context of what was said at the meeting that this review is to stop the use of tolls for non-Tunnels purposes and to end the annual consideration of a possible increase in the tolls payable. But otherwise we are not sure what is expected and what will happen. We certainly can not see a connection between this review and 'devolution'.

The problem is that in 2004 Parliament gave Merseytravel too much power and ignored the interests of the users of the Tunnels.

The 2004 Act should be repealed in its entirety. The situation would then be as it was before 2004, which in theory limited what the Authority could take. It would also mean that the situation at the Tunnels was similar to the law that covers most tolled roads and crossings and which has provisions to protect the interests of users mainly through oversight by a Minister of any toll increases.

We say that the law protects roads users, but over the last twenty years Governments instead of protecting roads users have collaborated with the owners of tolled roads and crossings. The current Government intended last year to amend the law so that most owners of tolled roads and crossings would have similar powers to those given in 2004 to Merseytravel. Fortunately for roads users elsewhere this was abandoned because of pressure from those people affected and their elected members. There are soon to be elections and we don't know which parties will form the next Government or whether their policies will be different from those of previous Governments.

c) The future of the tolls

At its meeting the Combined Authority gave the impression that it would stop the use of tolls for any purpose other than the Tunnels. That is of course what we want to see happen, and we hope that the Authority is sincere. We do however note that despite the Authority’s views and the decision not to increase the cash toll, the Authority in 2015/16 is still expecting to make a profit of £15.8 million from Tunnel users.

As we pointed out in our last letter, Merseytravel used to obscure the toll profits from the public (as for example in this Liverpool Council Tax leaflet for 2013-14 which on page 25 shows the Tunnels income as only just covering the expenditure), but from various sources we have found out what the profits were. Our letter to you on the 7th said that since 1994 the tolls money taken by Merseytravel was over £100 million. We will be sending you another letter to show how this started at a low figure and has gradually grown to reach its present level of nearly £16 million a year.

d) Halton

Our last letter said that “there seems to be every incentive for Halton to vote for Tunnels toll increases”, and that we had queried the Merseytravel claim that Halton would not be allowed to vote on this.

At the meeting last Friday, Halton abstained on the Tolls vote (as did the LEP representative, though under the Authority's constitution - paragraph 14.6(g) of Part 5 - he was not allowed to vote on this anyway.) The Halton abstention this time round does not seem to prevent them from voting on any future decisions regarding the level of Tunnels tolls.

end of document