In October 2016, Dame Margaret Hodge MP was appointed to lead an independent review of the Garden Bridge project. As part of this review, she conducted a number of interviews with key people and organisations. To aid future research and debate, we have committed to transcribing these interviews into a searchable, full-text format.
The completed transcripts can all be found on our Garden Bridge Review page. Please be aware that this is a large project – combined, the interviews comprise around 250,000 words. We thus ask for your patience when waiting for the transcripts to be completed.
The interview took place on 30 November 2016. Present were Dame Margaret Hodge MP (MH), Claire Hamilton (CH), interviewing Rebecca Sheeran (RS) and William Rollo (WR) of the National Audit Office.
RS: I’m sure you have questions and I’m happy to be led by questions that you have. Is it helpful for me to explain sort of what documents we had access to in doing this piece of work?
MH: Go on, yeah.
RS: Because I think that sets it in context.
MH: And then it might help me, actually, in deciding on — yeah, go on.
RS: Okay. And Will worked on this review and he’ll know the detail better than me — but in principle, the backdrop to this. We’d received quite a lot of correspondence. We wanted to have a look at this from an accountability perspective. Our remit is pretty much restricted to looking at the Department for Transport and following the money that the Department for Transport hands out, hence the scope of the review, which is very much focused on the handling of their grant. So primarily, all of the documentary evidence that sits beneath this report has come from the Department for Transport.
MH: Yeah. Not from Treasury?
RS: Everything has come through the Department for Transport that we have received, so initially it was documents that they held. There are one or two things that came from the Garden Bridge Trust themselves directly in the clearance process where they wanted to clarify things, but pretty much all of the information we’ve got is from departmental documents, including submissions to ministers. It’s the full range of things: exchanges of emails between senior officials, all of that evidence trail, all the things that you would expect. I think there are one or two bits —
WR: We had a number of items that were in the public domain as well. The funding agreement and things like that between TfL and the Trust.
RS: Yeah. Neither TfL nor the Garden Bridge Trust submitted any primary documentation to us, other than we saw, I think, a couple of press statements that they drew our attention to in clarifying some of the numbers that we were quoting and points in time that we were quoting. But pretty much everything has come through the filter of how the department saw the project at a given point in time, which I think for the scope of our work was entirely appropriate, because we were looking at how did the department conduct itself. So does that help put it in position?
MH: Yeah, that’s fine. Yeah.
RS: Now, do you want me to talk through the findings or do you want to ask me some questions about particular bits that you wanted to know a bit more about or …?
MH: One of the things, you got to £37.7 million spent on the bridge. Is that your most up-to-date figure or have you gone back on that?
WR: That’s not the latest figure. That probably would have been superseded by now. I think that was May of this year.
MH: I’ll tell you one thing that interests me. Your main criticism is that they went ahead without the permissions, that’s one of your findings, they went ahead without having secured the permission on the land. That’s in point 3 of the note, without getting the PLA [Port of London Authority].
MH: Why did you not look at the funding?
RS: I think our findings are actually about what the department knew at the time and why it relaxed its grant controls. We couldn’t audit the Garden Bridge Trust itself or even TfL and so —
MH: I understand that, but to know whether the department acted in a proper way, particularly in giving the underwritings, you needed to have a feel of the risk and a big chunk of the risk is dependent on how successful they are at getting their private resources.
RS: Yeah. So we did look at what the department knew at that time, and one of the things that we highlighted in here, that basically up until the current Secretary of State coming in, the department didn’t really hold any information. And that’s partly because of the way it had set up the project intentionally, frankly, in order not to have that information.
MH: So when the department took the decision then to go out to whatever it was, £13 million, £13.5 million of underwriting, they did that without any knowledge of how much private money had been raised?
RS: They were getting basically verbal updates as I understand it. But in terms of a documentary trail for us to look at, we couldn’t see that they —
MH: Because it was verbal updates?
WR: So at the request of ministers and the Department of Transport, there was monthly updates requested as a result of the ministerial direction that was issued.
RS: So that’s only in the latter months. So prior to that point, the first increase – and indeed the second increase – came at a point at which the department didn’t have any access to any information. It didn’t have access to detailed project management reports or funding reports. A lot was happening via conversations, which we point out in the report, but they —
MH: Between who?
RS: I think with the department there were conversations between their London team, so it a relatively junior level in terms of the civil servants, and the Garden Bridge Trust, but it was all done on the basis of “Could you do me a favour? Could you give me some information?” as opposed to, “We are giving you this money and we are entitled to know what’s going on”.
And that all goes back, as Will said, to the way in which they set it up. I think I’m paraphrasing what’s in our report, I don’t think I’m going beyond it here. It’s almost a “We’ve got some concerns about value for money. Well, if we make it TfL’s problem, we don’t have to worry about it”. That’s basically how the thing was set up. They didn’t want to be in a position where they were monitoring the overall confidence over the programme.
MH: But within the department, if they were being asked to release more money, they had to have confidence.
RS: Which I think is implicit in what we say in our report.
WR: The whole arrangement was for TfL to get assurance as well through the funding agreement, that they had the close relationship. And I imagine there was an element that TfL were feeding back the information to the department.
MH: Because when I think would I have given them extra money, I would have looked at permissions, but I would have also looked at were they raising the private money.
RS: Absolutely. Well, if you were directly funding a project you’d want a full risk register, you’d want to know what the profile was. And if you set a condition to try to manage your exposure to risk, you wouldn’t want to go back on that condition without seeing what your current exposure to risk was on that. And that comes from, you’re right, the project as a whole, which is why we do note in the report that they weren’t receiving monthly updates until June 2016.
WR: I think an important fact is the fact that the money in full, the £30 million that was pledged by the Department for Transport, was actually given in its entirety to Transport for London.
MH: Yeah, I know, I know. Well, use of it. It had conditions —
RS: And one of the difficulties is actually to what extent were those conditions ever binding anyway. Because of the way they’d done it, it was done as basically an un-ringfenced grant. If you contrast with something where — I don’t know, culture, media and sport sector grants, small grants going to the museum, “Here’s some money. We’d like you to do an education project. We’d like you to spend this much. We’d like you to give us a performance report that says what you’ve done when you’ve done your education project”.
MH: It wasn’t even ringfenced.
RS: It’s not ringfenced. Essentially it’s added as an uplift to the TfL general grant anyway.
[Break in recording]
RS: “The funding commitments to the Garden Bridge project were made by the then Chancellor of the Exchequer to the then Mayor of London without the involvement of the Department for Transport.”
And we subsequently note in the report that the Department for Transport, having been gifted this project to do, then had to assess it in —
MH: So why haven’t you gone back to the Treasury to see how they’ve spent it? Why did you not, on how they took the decision?
RS: That’s a good question.
MH: The business plan wasn’t done until yonks after they already had the money.
RS: There wouldn’t have been anything there is my hunch. I don’t know whether that is an on or off the record thing, but I don’t think there would have been anything to audit. I don’t think we’d have — in the context that —
MH: Did you talk to Treasury officials at all?
RS: We did, in the process of clearing the report, and we tested whether they recognized this. We received no comments from Treasury, I don’t think. There might have been a couple of points of detail.
WR: No, they agreed with the content of the report.
RS: Indeed, and one of the difficult things for us, our remit is to audit the Civil Service, but obviously in doing this, you — I think Amyas [apparently Amyas Morse, Comptroller and Auditor General of the National Audit Office] would say you see the way decisions are really made in Government and, there is a paragraph in here where we note in respect of the ministerial direction later on that we had seen a communication from the Cabinet Secretary expressing a view that the —
WR: 3.23, the last sentence. It says:
“The ministerial direction was in the context of an email from the Cabinet Secretary informing the accounting officer that the then Prime Minister and the then Chancellor felt frustration at the need for a direction.”
RS: So this is him expressing frustration at the need for Philip Rutnam to comply with his duties under managing public money and to seek a direction for doing something he did not believe to be value for money.
MH: Yeah. And how awful, terrible. NB.
RS: Okay. It’s the most interesting line in the whole report. If you’re an observer of the —
MH: I hadn’t even noted it, yeah. I hadn’t, so thank you, yeah. Awful, that is awful. I’m going to use that in my general discussions about accountability.
RS: Yes, it is. And that’s why we were interested. It’s a one-liner, but Amyas felt very strongly that it was one line that needed to be in there, in view of our wider commentary.
MH: What I don’t get is, if you then look at the Department for Transport, they look at it at an early stage. They say it’s not a transport project. They also say it’s a high risk of value for money, but they agree to go ahead.
RS: Yes. I agree, I think there is a question about whether they could have sought a ministerial direction earlier.
MH: At that point.
RS: I think the argument that was put to us — they considered it, it was discussed, I think, at their board. I think the argument they have made, and I think they may have made this argument publicly, actually, is the accounting officer could not preclude the chance that it might be good value for money. The issue for them was it was very uncertain whether it would be value for money, not that it was a clear case that this was a poor value for money thing to do, definitely.
MH: But even then they should have known how — they should have the information on which to take a proper decision. They didn’t know how much money. Did they know about — was the Trust there by then?
RS: Yes, I think so. Because the Trust has actually been around for quite a long time. I think one of the interesting things to think about is even if Philip had — and it is an accounting officer’s personal judgment about when to seek a direction – I think there is a question and it was probably fairly finely — balanced but you probably need to talk to Philip Rutnam directly about that.
MH: Are we going to talk to Rutnam?
CH: He’s on the list.
RS: And if you want to explore that question, it has to be him personally, really, not any of his officials, that you have that conversation with. But I do wonder, if Philip had sought a ministerial direction earlier, would it have made a difference to the way in which the project was conducted in the context when there was far greater evidence of a risk to value for money?
MH: They still put the £30 million, yeah.
RS: He covered his own back in his direction, which was the right thing to do in the circumstances, but he still got directed to support the project. I don’t know how much difference it would have made in the context.
MH: Just out of interest, when did that direction come out?
RS: The direction came out the day before the publication of our report or on the day of publication of our report.
MH: Why was that?
RS: At the time at which we were first made aware of the direction and Meg was alerted to the direction shortly after that, because we are required to do that, as you will well know, an argument was made that it was commercially sensitive; managing public money does not require you to make a direction available immediately; it encourages you to bring it into the public domain at the earliest appropriate time. But the requirement in managing public money is that it is made public no later than at the time of the publication of the next set of accounts. It is ambiguous.
MH: So it’s a weakness, isn’t it?
RS: Yeah, it’s ambiguous.
MH: Can you do me a note on that?
RS: Absolutely. We could do you a note on MPM [?].
MH: Just on the process and then also the timing, so that he did the letter in whenever, whenever.
RS: Yeah, so you’ve got the dates of the letter. We can pull all this together for you.
MH: Yeah. And in May, it was May 2015, wasn’t it?
RS: Yeah, and about a week or so later — and we can check our files — but we were made aware of it. At the time there was an argument. You will see it’s marked as being commercially sensitive.
MH: Commercially sensitive to whom?
WR: The Trust. Because of the land acquisition, “We can’t then negotiate. We are negotiating how with Coin Street Community Builders”.
RS: Yeah, so commercially sensitive is perhaps not the perfect term to use here, but they were basically worried that there was a public interest, in that if Coin Street knew about this, it would make it even more difficult to conclude the negotiations — which at the time were expected to be concluded very shortly – and that they would string it out and that it would change the negotiation position and that would result in a loss of public value.
Amyas had quite a back and forth with Philip Rutnam about trying to really understand where the public interest was.
RS: In the end, where we came down to was that, given that they were expecting negotiations to be concluded shortly, Amyas wrote to Philip Rutnam. I think I can tell you all of this, because these are all — you could get hold of these documents if you wanted to, I’m sure. But it’s an exchange between officials, isn’t it? Amyas was very clear with Philip Rutnam that he expected it to be made available at the earliest opportunity. “As soon as the sensitivity around those negotiations goes away, we would like you to put it out”.
MH: And there’s still sensitivity, if you like.
RS: I think we then had a lot of conversations with them in the course of clearing our report, where we were quite clear that we were going to publish it anyway. And I think in the end the department recognised that the particular circumstances, since a lot of stuff had come out in the public domain about the difficulties on the project and not least, I think, that the Trust had made some public statements in response to some of the Newsnight coverage.
Oh, I know what it was. The Trust made a statement publicly around the time that the Secretary of State agreed to extend the period of the guarantee, saying, “Without this, we would have been done” or words to that effect.
MH: Did they say that?
CH: I think that was on the back of the Newsnight report, wasn’t it? I seem to remember watching that.
RS: It was, and then, yeah, it was all around the same time, but it was touch and go for a while whether the Secretary of State was going to extent the guarantee. In the end what they did was extend the guarantee, but reduce the amount in order to protect their position. When they did that, the Trust made a public statement saying, “It’s really great that they’ve given this vote of confidence and they’ve extended the guarantee, otherwise it would have been very difficult for us” which to our minds was a very clear signal to the world at large that they were having difficulties. And the fact of the knowledge of the exchange of direction letters would not change the negotiating position at all, which is why we were quite firm in saying, “Look, we’re going to publish this”. The department came around to that point of view and published the letters at about the same time as the publication of our report.
MH: In your work in the NAO, is it usual to let a contract before you’ve raised the money?
RS: I’m trying to think of any examples where I’ve seen that on other projects. To let the contract before you’ve got the funding, I can’t think of any examples off the top of my head. We can take that away and have a think about it some more, but no, I don’t think it’s usual.
MH: Because, you see, that’s another thing that is quite extraordinary, and of course now, because they haven’t got the permissions, the costs are — they said to me that costs — I don’t think I’m even confident; maybe I am — is that, they’re now talking about £200 million.
RS: So I think there is a question about, letting a contract and having a contractor who you are paying before you have certainty that the project can go ahead.
MH: Well, they’re different things. Certainty is the permissions; the money is a separate — and they lost money, they went down from £85 million to £70 million, didn’t they? I think the Wellcome Foundation — it’s a bit unclear who dropped out.
WR: Who pulled out?
MH: Yeah, somebody pulled out.
RS: I think there are a couple of things to separate out there. In terms of letting a contract before you’ve got the money, I don’t think you would ever really see that in a public sector funded project. You simply wouldn’t have a —
MH: Or a voluntary sector funded partly…?
RS: I am less certain about that, because I think that there are circumstances where things that are privately funded or third sector funded, where people get to a certain stage with some seed funding and —
MH: Like the Tate, that might be one example.
RS: There may well be examples. They wouldn’t be ones that we’d audited though, I think they would be a bit further out. But I can envisage circumstances in which you have a certain amount of funding to get you a certain step of the way and that you wouldn’t expect investor s to invest very heavily until you got a point where they were sure they were going to get a return on their investments.
MH: Well, they’re not getting a return.
RS: Well, that their investment was going to deliver something. The planning permission I think is a really interesting issue. We’ve published a report on a project we’ve seen where they were doing bits of work on a project before they had all of the planning permissions.
The Greater Western route modernisation that we published a report on earlier this month, where they needed something like 1,000 planning permissions all the way along the route, and instead of going for a Transport and Works Act, which would have got them the one planning permission, it takes longer to get and then you start working, they thought they could get it as they went along and they didn’t allow enough contingency for it. And the risk is you end up doing a lot of rework.
So I think there are consequences there of not having spent enough time getting your planning, then letting your contract. I think there’s a sequencing thing. I think there are examples in the public sector of where you don’t spend enough time in planning and making sure you’ve got the permissions you need to start work and things then, frankly, becoming inefficient in the way in which they’re delivered.
MH: It does seem that they just — even forget Coin Street, which they shouldn’t, anybody who knows Coin Street would have known they’d be a difficult customer, and they should have known that, if they’d been at all sensitive. Anybody would have realized that. But they were moaning to me about the Westminster side, where there was an issue about who owns the air above Temple Station. Did you get into that?
RS: We did in our report. I’m aware of some of the issues around it.
MH: So it’s obviously ridiculously complex, so you’re obviously going to take ages to sort that out. And they were moaning that that took..
A number of official reports into the incident are currently being commissioned or discussed within the industry and government. As is our practice, we will avoid commenting extensively on the incident (and its causes) until those have been released. Given the extended debate online, however, it seemed best to provide some background on detraining incidents in general, and points worth considering in the context of any current discussion (such as at our own upcoming meet up later this week).
The risk of imminence
Whatever the individual causes of incidents such as this – and they vary – there are three things that historically have generally played a critical part.
Firstly, that correctly evaluating the risk of imminence during railway incidents is a problem. Imminence, in this context, is how far away (in time) the solution currently being pursued is to being successfully carried out. The oft-overlooked issue here is that in many individual instances the timescales involved in implementing the currently preferred solution are considered, but not whether that was the first solution attempted.
As a result, there can be a tendency to think of a solution as being ‘imminent’ for passengers, because that solution itself will only take a short time to implement, whilst ignoring the total time spent on previously failed solutions. Ultimately, there is a point where a ‘best’ solution for detraining in the mid-term must give way to the opportunity do something quicker, with a slightly elevated risk.
Previous incidents have repeatedly shown that the failure here can happen when the operator (or National Rail) procedures in place undervalue the opinion of the staff on the train in relation to those managing the ‘bigger picture’ of the wider incident.
This can be a dangerous oversight, as it is often the driver (or other train-based staff) who knows better than anyone the emotional and physical state of the people on their individual train. They know when repeated (and genuine) intentions of dealing with the problem ‘shortly’ need to give way to dealing with the problem now.
Other incidents – such as at Kentish Town in 2011 – have shown that this is a particularly critical thing to get right in (or around) London, where there is often a station IN SIGHT of the passengers. This means that what seems imminent to them can be very different from what seems imminent in the control centre.
The importance of decisions
Undervaluing driver input also relates to a second common failing: decision-making responsibility isn’t delegated appropriately to local operational managers or staff on the scene. Or, if it is, then staff are insufficiently trained or supported in making those decisions.
This leads, subconsciously or consciously, to the benefits of possible solutions not being properly evaluated, or re-evaluated even when they’re technically permitted. This is because the ‘safer’ option for those involved in the decision-making process is to delay making one until someone senior ‘signs it off’ – entirely understandable in such an environment.
The importance of trust
Thirdly, in recent years there has seemed to be a correlation between Operators with a bad reputation for service and unplanned detraining. How much this is correlation rather than causation remains to be seen, but it may be because it is sometimes forgotten that the railways operate on a currency of trust.
That trust – which is paid to an operator by their passengers – can be thought of as operating on a Keynesian model. It is earned, and banked, by an operator through the delivery of good services and a positive passenger experience during the ‘good’ times. It is then spent to maintain control and understanding during the ‘bad’.
An appreciation of the role that trust plays in the operator / passenger relationship is more critical now than it ever was before. In previous eras, the information provided by train staff was often the only such information available to passengers during an incident, no matter how much faith the passengers had in its accuracy. Regardless of trust, the only competing source was the passengers’ own instincts or knowledge.
Today, however, a variety of other, ever-present information sources exist, competing to provide information or advice about the situation at hand. Indeed, by preference, an increasing number of travellers consider social media – in whatever form – to be one of, if not their preferred, method of communication during an evolving situation. Regardless of the merits of that approach, it is the reality. Worse, for an operator, it is a reality that dramatically impacts their ability to maintain control of the narrative when trust is found wanting.
The importance of evaluating the evidence
How much of a role these factors, and more, played in the recent Southeastern incident remains to be seen. A number of accounts from passengers claiming to be involved have begun circulating. No doubt many of these will turn out to contain critical information about what went wrong and what the industry needs to change.
They are, however, by definition subjective accounts which can only ever present a single perspective on events. It is the combination of these accounts, along with those from the railway professionals involved, and the data and recording systems in play that day, that will yield the wider picture of what happened.
Once that full picture has been established, whether through the guise of an ORR investigation, an RAIB investigation (should it be deemed appropriate) or other means, we will look at it further here on LR.
Those reports will highlight just how much the railway has learned – or failed to learn – from previous, similar incidents, most recently at Kentish Town, East Croydon and Denmark Hill. They will also provide some guidance on what the industry needs to do to avoid such incidents in future.
One thing that should be made clear, however, is that those conclusions will likely highlight that, as in previous incidents, the main causes were related to management and to risk, not politics.
It is perhaps not altogether surprising that much of the debate swirling online since the incident have looked to frame it through a window of ‘nationalisation vs privatisation’ or of ‘driver only operation’.
Those debates perhaps have some indirect relationship to this incident, but they are almost certainly far from its cause. There is no intrinsic reason why a national operator would be more ‘trustworthy’ than a privatised one if the underlying service (or at least the perception of it) has been consistently poor. This is something that LR readers with long memories who experienced bad service during the British Rail era would no doubt attest to. Similarly, there is no reason why a two-person train crew would be better placed to overcome the risk management issue of imminency than a single operator, if both lack the power or backing from their employer to do so.
As human beings we quest for simple, clear solutions. It is wired into the fibre of our being. In the overwhelming majority of railway incidents such of this, however, the causes are both more complex and more mundane. Politics doesn’t make the railways work or fail, people and procedures do.
Establishing and evaluating the causes of this incident will take time and the conclusions almost certainly won’t be simple. We look forward to seeing what the results, however, and to sharing them with you here.
Should people wish to discuss the incident or share links, ahead of the release of reports, then this article is the place to do it. Be warned, however, that unsupported assertions about what happened or general comments on the politics of nationalisation or DOO deemed outside the scope of the discussion will be deleted without comment.