ECONOMIC POLICY REVIEW COMMITTEE

S T A N D I N G C O M M I T T E E O F T Y N W A L D C O U R T O F F I C I A L R E P O R T R E C O R T Y S O I K O I L B I N G V E A Y N T I N V A A L P R O C E E D I N G S D A A L T Y N ECONOMIC POLICY REVIEW COMMITTEE VISION NINE HANSARD Douglas, Friday, 14th July 2017 PP2017/0127 EPRC-VN No. 4/16-17 All published Official Reports can be found on the Tynwald website: www.tynwald.org.im/business/hansard Published by the Office of the Clerk of Tynwald, Legislative Buildings, Finch Road, Douglas, Isle of Man, IM1 3PW. High Court of Tynwald, 2017

Members Present: Chairman: Mr M R Coleman MLC Mr T Baker MHK Mr J Moorhouse MHK Clerk: Mr J D C King Assistant Clerk: Ms N Lowney Contents Procedural... 91 EVIDENCE OF Mr Nick Black, CEO, Department of Infrastructure, Dr Malcolm Couch, CEO, Department of Health and Social Care, Mr Mark Kelly, CEO, Department of Home Affairs, and Mr Gary Roberts, Chief Constable... 92 The Committee adjourned at 11.14 a.m.... 110 90 EPRC-VN/16-17

Standing Committee of Tynwald on Economic Policy Review Vision Nine The Committee sat in public at 10 a.m. in the Legislative Council Chamber, Legislative Buildings, Douglas [MR COLEMAN in the Chair] Procedural 5 10 15 20 25 The Chairman (Mr Coleman): Welcome to this public meeting of the Economic Policy Review Committee, a Standing Committee of Tynwald. I am Mike Coleman MLC and I chair this Committee; with me are Mr Tim Baker MHK and Mr Jason Moorhouse MHK. We also have with us our Clerk, Mr Jonathan King, who will take a full part in this particular oral evidence session, and we have our Assistant Clerk, Nina Lowney, at the end there. Please ensure that your mobile phone is off or on silent so that we do not have any interruptions. For the purposes of Hansard, I will be ensuring that we do not have two people speaking at once. The Economic Policy Review Committee is one of three Standing Committees of Tynwald Court established in October 2011 with a wide scrutiny remit. We have three Departments to cover: Cabinet Office, Treasury, and Department of Economic Development, plus the Gaming Commission and the FSA. On 19th April 2016, Tynwald approved the appointment of Vision Nine as TT promoter for a period of up to 10 years with an option for a further five years. On 28th November 2016, the Department of Economic Development stated in a media release that it had decided to discontinue the independent promoter tender process for the TT Races and Classic TT Races. On the same day, 28th November 2016, the Minister for Economic Development, Mr Laurence Skelly MHK, referred this matter to us. On 6th December 2016, we announced in a media release that we had decided to investigate. We heard, on 3rd May 2017, from the Department of Economic Development. Today we are hearing from some of the members of the Motorsport Strategic Group. We are grateful to the DED for supplying us with the minutes of the meetings from February 2012 to September 2016. The Group first met in February 2012 and includes representatives from the Department of Economic Development, Department of Infrastructure and the Department of Home Affairs. The current Chief Executive Officers from these Departments along with the Chief Constable are here today welcome. 91 EPRC-VN/16-17

EVIDENCE OF Mr Nick Black, CEO, Department of Infrastructure, Dr Malcolm Couch, CEO, Department of Health and Social Care, Mr Mark Kelly, CEO, Department of Home Affairs, and Mr Gary Roberts, Chief Constable 30 35 40 45 50 55 Q253. The Chairman: Okay, for the record, could you please each state your name and describe your connection with the subject we are looking at? Please can we go from the left? Dr Couch: Malcolm Couch, Chief Executive of the DHSC. My Department takes part in the Strategic Group because we provide emergency health services for the motorcycle festivals. Thank you. Mr Black: Good morning. Nick Black, Chief Executive, Department of Infrastructure. The Department provides infrastructure support services to the delivery of the events and is a partner of the Motorsport Group. My own connection goes back a lot further, back to my time as Chief Health and Safety Inspector, my time as Director of Motorsport, and various other functions. In total, I have probably been involved with the running of the TT for 15 years. Mr Kelly: Good morning. Mark Kelly, Chief Executive, Department of Home Affairs. My Department has responsibility for public safety, and I was a member of the Motorsport Strategic Group during the period you mentioned, Chairman. Mr Roberts: I am Gary Roberts. I am the Chief Constable. I first became involved in TT when I oversaw the planning of it in the year 2000 and that was the first year I commanded TT. I have been in senior positions in relation to the TT ever since that time, and until the beginning of May, 4th May 2016, I was a member of the Motorsport Strategic Group. Q254. The Chairman: Fine, thank you. Would any of you like to make an opening statement, or a collective one? No, okay, fine. Do you think that the membership of the Motorsport Strategic Group was correct in its makeup and its frequency of meetings? Mr Kelly: From my point of view, Chairman, absolutely: the key people were in the room. 60 65 Mr Black: I think we would endorse that. The Chairman: Okay, fine. Mr Roberts: I think that, in my view, though, meetings ought to have been more frequent, certainly as TT approached, and I had a view, when I was a member, that the frequency of the meetings started to become an issue for me. Q255. Mr Baker: In a sense that they were just not frequent enough to focus on the issues that should have been addressed? 70 Mr Roberts: Absolutely. If you look at the genesis of the Motorsport Strategic Group, it was in the creation of a Gold Group that planned the Centenary TT. That was a very big event and we were meeting, towards the end, almost weekly. I am not suggesting for one minute that the 92 EPRC-VN/16-17

75 80 85 90 95 100 105 110 115 120 Motorsport Group in its normal business ought to have met weekly, but it certainly ought to have met more frequently, I think. Q256. Mr Baker: The fact that it did not, Chief Constable, what were the consequences of that lack of frequency? Mr Roberts: I think we are cutting straight to the quick, really, now. The consequences were if I just refresh my memory for example, on 5th April 2016, when Julian Topham from Vision Nine attended the Motorsport Strategy Group Tynwald approved the whole thing just over a week later that was the first detailed involvement we had had with anyone from Vision Nine. So, there had been infrequent meetings, if you like, leading up to that point, so that was certainly a fait accompli, and that and other things that went on led me to leave the committee. Q257. The Chairman: You took the decision to leave the committee. Can I ask, was that caused by the lack of involvement or the fact that you were, for the first time, being exposed to perhaps some of the detail of what was proposed to go ahead? What were the main reasons that you decided to discontinue your involvement? Mr Roberts: I think there were two or three things. Firstly, at that meeting in April, when Mr Topham attended We were aware, as a committee, that work was going on and we had been briefed about the World Series and the attempts to contract the thing out. Mr Topham came along and gave a presentation, and I was unusually quiet at that presentation because I was perturbed at the absence of some important issues around safety, for example, but I was also concerned at the implications for my service in terms of how things were being set up. And I had a very short and sharp exchange at the end of the meeting, after Mr Topham had left, with the Chief Executive of DED, Mr Corlett, who said words to the effect of, This is terrific because the risk has now gone from the TT. My view was, and in my world, risk is not commercial risk; it is not revenue targets. It is about safety; it is about bikes going into the crowd and killing people. I felt, and I had felt for a period of time, that there was insufficient attention being paid to the safety of the event, and the oversight or the overview we had been given of how Vision Nine would operate would likely commit my organisation to things that other people cannot commit them to. I have complete operational independence and I decide what we do in relation to events, with the primary focus being on safety, and there was clearly no focus on that. I made it very clear to Mr Corlett that my focus was on safety. So, I increasingly had the view that I needed to put distance between myself and the organisation of the event at that level in case I were required to investigate it. Q258. The Chairman: One of the things that we have noticed is that, in the various documents we have seen since 2013-14, they seem to change from it being a third party promoter, a third party promoter and organiser, and then even further, so as you go from one phase of this exercise to the next, it seems to change. Is that the feelings that you guys have, or were you not? Mr Black: Chairman, I think I can assist you: going back quite some years, the Departments that have been responsible for the TT and as you know there was a change with Government Departments changing name have, for some time, provided and secured assistance with what we might call the sponsorship and the commercial promotion, by which I mean the placing of things on the television, the adverts, the encouraging people to come, the maximising the money you get from letting out a piece of land. That commercial sponsorship has previously been done by companies such as North One, originally, of course, and looking back at your own 93 EPRC-VN/16-17

125 130 135 140 145 150 155 160 165 170 records you will probably have seen reference to Signature Sponsorship that commercialisation. I think Government realised and I was there at the time of some of these decisions that has not always been a strength, and the ability of Government to work in an area where sponsorship is an agreement necessarily other than something you tender through the Financial Regulations, so involving the private sector in that, I think, was something we are all used to. We worked well with the people doing sponsorship and that worked at an operational level. That, to my mind and I would support the Chief Constable here does not have an impact on risk. That is how you sell the event, not how you deliver and package or promote or operate the event. But I would endorse your view that we had taken, as a Group, interest in the TT World Series, but we are quite locally focused. I understand why the DED would want to look towards the world as a stage, but I could not imagine, for example, the Department of Infrastructure laying cones on somebody else s island. Our interest is here, just like the Chief Constable s is responsible for our safety and my colleagues are responsible for local things, so it was interesting to be kept informed of those. But, I would agree with you that it went from World Series, then more towards, Well, we could get more commercialisation of the event we have on the Island. I think I probably could speak for us all in saying the Chief Constable has referred to a presentation on 5th April 2016 and I think that was the first time we were aware of how much operational delivery was scheduled to be outsourced. I think my colleagues have made clear in even describing their role to you that the TT is not done by one Department. I do not think the TT has ever been done by one Department, because no one Department could take it. It is actually delivered by the Island. It is not delivered by Government. We know how much volunteer support there is. It is a collective endeavour. I think what certainly took me by surprise and I will leave my colleagues to make their own comments was that, if you are going to change something, you would perhaps want to speak to the people who were currently doing it. I think we were all quite surprised by the presentation. I do not think anyone was against the principle of contracting all of this out and I perhaps still would not be against the principle of contracting it all out, but I would want to make sure that it was done properly and that matters such as safety and budget and the capability of the Island to respond had been considered in the decision. Maybe they were, but the first we knew of that was in April 2016, with, I think, a potential award for the tender prior to TT that year. Mr Roberts: Sorry, I think there is a significant issue around promotion which goes to the Road Races Act 1985, which has now been superseded by new legislation. That Act requires there to be a promoter and an organiser, and often confusion would creep in about who was the promoter and who was the organiser. That confusion appeared, at times, to run even within DED. The TT Master Agreement, which is the thing that describes who owns the TT and how it is run, talks about the TT being owned by the ACU and that DED is the promoter, as set out in the Road Races Act 1985, and that ACUE runs the event under a permit from the ACU. So, that describes how complex these things are and you really do have to have knowledge of them. So, the conflict that emerges between the promoter of the events as defined by the law and the promoter of the event who seeks sponsorship is quite an important one, but sometimes that distinction was lost. Q259. Mr Moorhouse: Just going back to the April 2016 meeting, when you actually look at the minutes, prior to that meeting there was a mention of possibilities but they were quite brief, but in the April 2016 meeting the minutes were really clear in terms of what consequences there could be. 94 EPRC-VN/16-17

175 180 185 190 195 200 Are those minutes reflective of the prior meetings being quite brief in that review and then in April 2016 that realisation that things had changed? Mr Black: If you are referring to the meeting of 29th, Mr Moorhouse, where you have a fairly detailed set of minutes that reflect I think that was a meeting that lasted most of the day. Mr Kelly: Yes, I think, if I may (Mr Black: Sorry, ) the meeting prior to the one that you refer to was held on 8th February, at which point we were informed that stakeholders would be consulted on what was termed the TT promoter update. We then moved to 5th April and you mention, Mr Moorhouse, that the minutes are very clear. They are, of course. They are prepared by DED. They are very clear. Following Mr Topham s presentation, Nick is quoted as noting, It was imperative that all Departments continue to work closely together and with Vision Nine. And I added that, The correct operating structure from the beginning was fundamental. Further down, the Chief Fire Officer, a member of the Group, Kevin Groom, expressed concern over the anticipated and increased visitor numbers which would have significant repercussions on the Island s infrastructure. And Gary, as he has earlier mentioned, noted that, The management of risk would be vital to ensure longevity of the event. It is also worth mentioning that we were quite keen to make this a success. We were not negative or opposed to it by any means, and again that is reflected in the comment, It was noted that all parties were keen to make the relationship work and it was agreed that an away day be arranged in order to discuss the structure and roles in more detail. That then led on to 9th May, which Nick mentions, and that meeting lasted seven hours. That was the consideration of the TT promoter contract. Q260. Mr Moorhouse: So, the April meeting was a key turning point in identifying issues that then could be discussed in more detail? Mr Kelly: Yes. 205 210 Mr Roberts: But, further to that, at that stage, no one had seen the draft contract that is an important point to make. I actually was not formally sent a copy of the contract, because I advised DED after the meeting of 5th April that I would be withdrawing, and I only wrote to them formally on 4th May to tell them I would withdraw, and in the meantime the contract was then shared with my colleagues, and I eventually got a copy of it through the Department of Home Affairs. Dr Couch: We received an email on 29th April in preparation for the 9th May meeting and the draft contract was an attachment to the email I mentioned. 215 220 Mr Black: For absolute clarity, if I may add, Chairman, it was a redacted contract. There were some details that were excluded from that. Q261. The Chairman: I know this a funny question, if I may, do you know which bits were redacted? Mr Black: I think the bits you might describe as commercial in confidence. The Chairman: Okay, fine. 225 Q262. Mr Baker: So, just reflecting back what I am hearing, just for either confirmation or the opposite, we had a concept which developed out of the World Series which then effectively 95 EPRC-VN/16-17

230 morphed into outsourcing the TT promotion, but nobody defined quite what promotion meant, and there was no engagement with the Departments who clearly were integral to delivering it until the point beyond which the promoter designate was appointed and a contractual framework had been developed in isolation? Dr Couch: Yes. 235 240 245 250 255 260 265 270 275 Mr Roberts: That is a perfect summary and, further to that, then when we saw the contract it was very clear that it was not fit for purpose. Q263. The Chairman: Can I just interrupt here for one moment? The promoter shall manage, organise and promote : it is quite an all-encompassing clause in the agreement, isn t it? Mr Roberts: It is. I go back to the point I made earlier sorry, I am perhaps talking too much I manage my resources, not a commercial company. The Chairman: Go on, Jason. Q264. Mr Moorhouse: Just going back a step, in terms of January 2015, it was made clear in the minutes that DED had stated that it would circulate any contract to the group prior to signature. I know you actually saw it with regard to that meeting in April 2016, but was it that, as you went to the meeting, you were given the contract or? In your case, it was subsequent, but it seems there is a bit of confusion over that. Mr Kelly: After we had the first contact with Vision Nine, which was at the presentation by Mr Topham to the Group on 5th April, we then received the contract on 29th April in preparation for the away day which Nick had recommended should take place on 9th May. Q265. Mr Moorhouse: All right. Moving on to July 2015, in the minutes it states that Trevor Hussey reported that six companies had reached the PQQ stages and two companies were progressing to the bid stage. Bids are due in mid to late August with a decision going to Tynwald in November 2015. Trevor Hussey added that, should the TT Series initiative not be progressed then there was an option to move to an independent promoter arrangement for the Isle of Man TT. Nick Black suggested getting a group of key people together to discuss ideas options for an alternative solution. Was any such group put together and were the options for alternative solutions ever considered, again with a group? Mr Black: Mr Moorhouse, there is a minute I think you are reading from 19415 and exactly where I said that I would assist. I made reference to you in my opening comments that I have had involvement in a number of aspects of the TT now, both regulatory, delivery and now in support mode. Whilst there are people, such as the Chief Constable, who have been doing it longer and no doubt to a higher standard, I felt that a number of my colleagues across Government a number of whom are not represented here but there are a number of people with extensive background You have seen reference in the papers to the TTFMAG. The Chief Constable has referred to the Gold Group. We have been around this loop quite a few times and a number of us, over the years, have picked up quite a lot of information and understanding of how the event works. And, of course, there are people not in Government who have a fantastic knowledge. If you look at, for example, some of the previous I would still refer to a previous 96 EPRC-VN/16-17

280 285 290 295 300 305 310 315 320 325 330 Clerk of the Course with a significant legal knowledge, who, in my view, has got a huge amount to offer and has assisted me many times. There are lots of people out there who are good at knowing what happens in the TT. I felt that it was a really sensible suggestion to make that these people be brought together and asked for a view, and that is all that minute says, but, to answer your question, I was not asked subsequently to assist. As my colleagues have said, the first we knew was the presentation, as a Group, from Julian Topham on 5th April, and the first time we saw the contract in any detail was 29th when an email was sent to us, including that redacted copy. So, I am afraid I would have to suggest that my offer of assistance was not taken up. Maybe other people who could offer more were asked, but I do not think they were and I am not aware of any group being set up at all. Q266. Mr Baker: It feels as though the proposition was just being developed in complete isolation with no recognition of what was actually going to be required to actually deliver it. Is that a fair? Dr Couch: I think it is fair, and our reaction when we attended the meeting in May, having had actually, admittedly, a very short time, really, to look through an extremely long draft contract, was that I think we were shocked at the implications. It had come, I think it felt to all of us, really quite out of the blue. Q267. Mr Baker: When you say, Dr Couch, you were shocked at the implications, could you just give us a couple of examples of those implications, just to help those of us who are not quite as close to it as? Dr Couch: Well, I suppose I should state clearly that I think, in general, although clearly emergency medical services are very important to a major sporting festival, DHSC s part in MSG is minor, so I would want that for the minute. I suppose the knowledge and experience I brought to the Group if that does not sound too pompous is that I have got a long background of working in detail with contracts and agreements, some of them international agreements. I think my personal view, from looking at the draft contract, was that it was poorly drafted; it was, in the plain English sense of the word, incoherent in places. We highlighted many points where whoever had drafted it did not seem to have updated themselves on Manx law; there were incorrect legal references; there was confusion about terms. Even as we got to some of the redacted areas, it was clear what was in them, so there was a section on costs, which I think had been excluded, and then there were the promoter performance indicators, if you will. That is fine, I do not think we needed to see those, but you realised that the focus was almost exclusively on DED and the DED elements of putting on the TT and almost everybody else was not taken account of. For example, there had been discussions over many years, really, about, for example, what the cost of the TT is to Isle of Man Government. Of course, you should be able to consider what the benefit is to the Isle of Man of the TT. We do not need to go into that now, but the reference to costs, it was very clear as we got to that meeting and looked at the draft contract, it was only the costs that DED directly managed, so for example, the costs that come onto my services were not there and I suspect not others. I could go on for a significant time. I will not, for brevity s sake, but the draft contract, I think all of us said, from the non-ded side of the Strategic Group, was poorly put together and would lead us into all sorts of strange places. I think one of my observations might be that and I was thinking this as the meeting started there may even have been a fundamental misunderstanding of the word promoter. I think, as the Chief Constable was saying earlier, that actually is a legal term in the Isle of Man, 97 EPRC-VN/16-17

335 340 345 350 355 360 365 370 375 380 but I suppose in plain English, in relation to any form of event, a promoter is somewhat different: a promoter is somebody who goes out, sells the concept, generates activity, generates bums on seats, if you will, and therefore increases the economic activity associated with it. I think that it felt that the contract was drawn up more with the plain English meaning of what promoter might mean, rather than the legal term. Q268. The Chairman: May I interrupt for a moment? (Dr Couch: Yes, certainly.) You spoke about the requests for getting total costs of TT. Now, that goes right the way through the minutes of the MSG and yet, at the end of it, I gather you still did not get a figure. Mr Kelly: We still have not. Q269. The Chairman: They were made in 10 sets of minutes. It was requested by the Group, Can we have a total cost for TT? and you still never got it? Mr Kelly: Just picking up Mr Baker s point, if I may, Chairman, has the Committee seen the notes of the session on 9th May? You have them? Yes. They are extensive. Mr Black: I think it might be helpful, Chairman, if I added Dr Couch has quite rightly said that his service has perhaps a less key role in the planning for the event, but his own contribution is none the less for that. We are equal as members of that Group. He added specifically, in the discussions on that long day that is recorded in those minutes, challenges in respect of the legal drafting, the financial sense. You will have seen and I know from your Hansard of your previous sessions you have picked up the issue of the impact on infrastructure. Whilst, if you wish me to, I can talk about that or provide you the paper that summarises what the Island s capability is in terms of handling large sums of people, my interjections in that respect were not actually driven by my Department s professional concern. One of the things that a number of us recall, who have been involved with the TT, is the previous Select Committees I think under the PAC, in fact, technically into the Signature contract, something like ten years ago. Although many people remember that the debate publicly was about the organisation of the Civil Service and the behaviour of individuals, the real lesson for those of us involved was the difference between net and gross. My fear, once I understood some of the messages that Dr Couch was passing on, was that the contract remuneration appeared to me, from what I could see and again the commercial aspects were redacted that we were going to reward them in a way that did not take account of the cost of delivery of the event, because the cost was hidden. No-one knew what the cost was. No one had asked, for example, myself, what money I had to spend as a Department on supporting the TT and I am sure it goes the same for the Chief Constable and for all the services, through the Home Affairs. Attempts have been made over the years, but there is a real danger, surely, in any contract that is as complex as this, that you end up spending more than you earn, so there becomes an illusion that you are becoming more successful because your income has risen, but if your costs rise disproportionately then clearly, in a very simple business analogy, you are not doing any better; in fact, you might be making less of a notional profit and I accept that is very simplistic analogy, but I hope it assists. My concern was that, unless we knew what the consequence on the Island was of these more visitors coming, we might be carried away on a tidal wave of enthusiasm that we now had 60,000 people coming and how great that was, but I was not able to advise in that time what the cost of managing those people would be. The Chief Constable has referred in his opening remarks that it would put a pressure on his service. If he had needed, say and I entirely make up the following figure 50 more constables to be employed, what would the impact of that be on the net of this measure? My concerns about the infrastructure and I suspect I took the lead 98 EPRC-VN/16-17

385 390 395 400 405 410 415 420 425 430 in this, but I think my colleagues all shared this was that, unless you work that out, how do you know if this is a commercially sound contract? I also shared the same concerns as Dr Couch: this was a contract that appeared to me to be written with a limited understanding of motorsport issues. I had found out only a few days before, I think on the 5th, that Her Majesty s Attorney General and his Chambers had not been involved in the drafting, which I have to say gave me concern. Although I accept it is entirely compliant with the financial rules, it is not commonly done. I was even more concerned when I found that the staff I do not wish this to sound, and indeed in any of my evidence, like I have any lack of respect for colleagues in DED. Inside DED are colleagues with fantastic knowledge of motorsport, real good understanding of commercial contracts and lots and lots to offer, but the people that I had worked with over the years when I was there had been excluded from this process. Whilst I can understand that, perhaps, while you are developing something new, you may not involve persons outside your body, surely you would ask the people in your own organisation who knew about it. That may be an area that merits further examination another time, but I think, looking at Hansard, for example, Mr Phillips said that he had a very limited role, but Paul has been the Motorsports Manager for it must be 10 years. Mr Kelly: At least 10 years, yes. Mr Black: Why would you not ask him? So, I think we left that day somewhat concerned. Mr Roberts: If I can expand on that, the critical thing here is that no one was asked what the implications would be for the Constabulary or for the Department of Home Affairs, the Fire and Rescue Service, about there being a TT that brought 60,000 people to the Island every year. No one asked, and yet we had all that information to hand. We had carried out exercises in 2007 for the Centenary where we did just that sort of planning. If I were to extrapolate the data from then to now, given the reduction in the size of the Constabulary, I would need to bring 57 officers over to give me the support that I would need if it reached that level. They are the sorts of things I could have answered almost off the top of my head, but I was not asked. Dr Couch: If I could also add, Chair, that I have not brought the draft contract with me today, but my recollection is that and it is picking up on what the Chief Constable has just said there was a sense that it had been drafted largely with the DED focus and, as I said earlier in my evidence, that the costs, we were fairly sure, related to DED costs. However, if I recall, one of the operating aspects of the draft contract would be that the Isle of Man Government as a whole and I include the Constabulary in that would provide the TT as it had always been run. So, you had a consequence that, for example, our costs were not included and what we needed to do were not really referenced in the draft contract. The promoter, as it was called, would be trying to increase the TT and the Festival of Motorcycling in large measure, and they would then generate their performance indicators and therefore their income from the contract based on the way that the contract worked, if that does not sound too convoluted. However, the bodies represented here, who were somewhat to the side of it, they had to effectively run business as usual. If we make a figure up if you doubled the number of visitors, you are going to have a significant impact on the other services needed, but that was not included at all in any concept of the contract. However, I still feel that the Government would have been contractually bound to do it. I think that was a confusion and a great difficulty for us. Q270. Mr Baker: Presumably, any failure to ease those constraints which impacted on the number of visitors that Vision Nine were able to bring to the Island would potentially have given 99 EPRC-VN/16-17

435 440 445 450 455 460 465 470 475 480 485 them, as promoter, a claim against the Government for loss of earnings, because in any contractual situation there are obligations both ways and, if one party fails to do that they are due to do, the other side can say, Well, you need to recompense us for the income that we would have had if you had, for example, procured additional boats to bring visitors to the Island or additional police officers to allow more or additional beds. Mr Black: I could give a concrete example, Mr Baker. There was a clause in the draft that concerned me; it said that the party to the contract and the party was to be DED would maintain the Mountain Course in a state fit for racing. Now, that was not further defined, as I could find in the contract. The Mountain Course is a road and, each year, my Department endeavours to make sure that it is fit to be handed over to the Clerk of the Course and it is for the organiser of the events to obtain the relevant permits to say that the course is fit to be used for road racing. A state fit for racing could, under some contractual interpretations, be analysed by, Well, it is not as good as Silverstone or Brands Hatch, but it is never going to be. If it were to be contractually required to be, the costs would be immense. You might recall that we had to undertake some works on the TT course a few years ago, just between Brandish and Signpost, where we were required to re-lay a section we had just done. I suspect, Mr Baker, that you could have driven on the Mountain Road daily without noticing a single flaw in that length of road, but there was a tiny bit where the back of the paving equipment had just clipped the lorry delivering the material into it, and at a motorcycle speed, on a racing line, with compressed suspension, the TT organisers said to us, Nick, that is dangerous, that is a problem and it was done again, even though there was the usual complaint from the public that we had had to close the road again and we had not done it right the first time. We would never have done that again for a highway purpose, but we did it again and incurred the cost because it was right. But if you have to do that round 37¾ miles, your costs climb quite rapidly. More to the point, I had raised with the Attorney General the query that I had that, as far as I knew, the Department of Economic Development had no vires to maintain the highways of the Isle of Man. I accept this moves more, for some people, into the arcane issues of how Government is organised, but it is a legal fundamental that Departments work within the powers they are granted in legislation. The Department of Infrastructure has the vires to maintain the highway and the funds to do it, but that Department was being committed through another Department which was not legally acting for it to a standard they would never have endorsed. So, had we not seen that draft contract, that could have continued into law contract law, I admit and I absolutely endorse your point then, that had we failed and left a little bump somewhere someone could have said, Well, it is your fault, DoI, that the TT did not succeed as much as it should and they could have therefore made a claim. I am hoping that was never going to be the way that the event would have been run, and I am sure it would have been run on a partnership rather than an adversarial basis, but checking the contract at an early stage would appear wise. Q271. The Clerk: Just picking up on what Mr Black said, Chairman: the point about vires, for example, could that be addressed by having a subcontract or supplementary or subsidiary contract which obliges the DoI to do what is needed in order for the party to the contract with Vision Nine to do what that contract requires? Mr Black: I think, Mr King, the initial fix proposed was that the other Departments would be party to the contract. Q272. The Clerk: And going back to something the Chief Constable said earlier, I think you used the words, nobody asked us. Isn t it the case that by coming to you on 9th May with this draft contract, that is exactly what the DED was doing? 100 EPRC-VN/16-17

490 495 500 505 510 515 520 525 Mr Roberts: I had withdrawn by then but, in my view, that was too late. You talked before at the start of the hearing about the approval given by Tynwald that followed fairly rapidly. These questions should have been asked months and months before, even at the beginning of the whole tendering process, because some of these things are fundamental. In my world, for example, I charge the promoters and organisers of motorsport events for policing. It is entirely right that I do that, but I do not charge those that belong to and are run on behalf of Government. Q273. The Clerk: Why was it too late? I can see that it might have been too late in April, May 2016 to set in place new arrangements for the TT in 2017, but in principle couldn t these things have been worked through for some future implementation? Mr Roberts: But we had Mr Topham from Vision Nine coming along and being presented to us as the man who in future was going to be running the TT. Mr Black: I think if I may add, Mr King, the instruction we had was that this contract was to be signed before TT 2016. I cannot remember now the exact dates of TT 2016, but I saw the contract on 29th April and I am fairly sure that TT would have come along not many weeks later. Q274. The Clerk: When you say the instruction? Mr Black: We were advised by DED that it wished to be in contract with Vision Nine before TT 2016 so that Vision Nine could observe TT 2016 as a learning opportunity and be ready to deliver 2017 under the new arrangements, and I am sure my colleagues will correct me if I am wrong. Mr Kelly: If I may, referring again to the minutes of 2nd June 2016, which was the first time the Motorsport Strategic Group met after the 9th May session: item 24216, Next steps: CC Mr Corlett noted that Vision Nine required the agreement to be finalised as soon as possible. That was on 2nd June. A number of us made observations. I noted that, time was needed by the other Departments to consider the changes in the contract. Q275. The Clerk: So, bearing in mind that, assuming the committee knows nothing about Vision Nine, it is a party which is in dialogue with different bits of Isle of Man Government, what is the impact of giving them hope that they are going to have a contract for 2017 in these circumstances? Mr Black: I am not sure, Mr King, if the matter is still subject to some sort of the debate with the Attorney General s Chambers Mr Kelly: I am not sure we can answer that. 530 535 Mr Black: so I would be reluctant to answer that. Q276. The Chairman: Okay. I have a question and it is to do with It goes all the way through this tendering process, with the fixation on numbers. I note that within the communications that you had had with the Attorney General s office about Schedule 8 of the proposed agreement, which is 2.5% per annum increase in people. Your responses to that, I think, reflected I think in the case of Mr Black, it was, We think we can cope with 20,000 more, which was the 2007 Centenary. I think from Home Affairs and from Health the feeling there was that, We cannot handle greater numbers than we are doing at the moment and that, perhaps, although it does not say it, I 101 EPRC-VN/16-17

540 545 550 555 560 565 570 575 580 585 590 assume that organic growth rather than forced growth would have been acceptable until you reach a certain break point when you say Okay. The point I want to get at is, in quoting the 2007 experience as a possibility, just how easy was it for you to handle the extra 20,000 people that came for the Centenary in 2007? Mr Roberts: We handled it because we worked on it for 12 months and prepared for it. That is the way we handled it and there was a great deal of co-operation with all the Departments represented here and the Constabulary. I will give you some detail, for example: the Constabulary brought 12 extra officers to the Island from the States of Jersey Police that cost 74,000; we brought 30 extra police vehicles at the cost of 15,000 for shipping we had to borrow them; all sorts of work was done to overhaul the bus timetables; we cancelled all the leave of our support staff and all police officers, and we spent most of the rest of the summer of 2007 reallocating those rest days to officers; there were daily multiagency meetings as we got closer to the TT; I went to the Council of Ministers and briefed the Chief Minister on at least two occasions about planning as we went through the process; extra cell capacity was developed for the Constabulary; measures were taken to overhaul the TETRA that is the radio network that is used by the emergency services; extra CCTV was installed in Douglas; the one-way system on the Mountain was installed for the first time; there were changes to court procedures; there was a new telephone service introduced so that members of the public could contact people with concerns; table-top exercises were run at regular intervals in the run up to the event. There were efforts that lasted all year and, as I said earlier on, at that time I had 238 officers and I brought in mutual aid. For TT this year, I ran it with 198 officers, so the implications are considerable and I am sure Dr Couch will be able to describe things like that from the hospital environment where planning of that nature went on for the whole year, and colleagues from Transport, as it was at that time, and Health were included in all those planning activities. It was a major undertaking, and I had a senior officer at Chief Inspector rank who worked almost solely on this and nothing else for the whole of the year. Mr Black: May I add, Chairman? Subsequent to many of these meetings that you have got the minutes for and you discussed, in November 2016, with support from colleagues, I issued a document that tried to understand the capability of the Island s infrastructure to cope. The Chief Constable has said that we did cope and there was a cost, but one of the issues we have to, I suggest, consider is whether the public would tolerate that. I could say to you now that the access road would cope with more vehicles Q277. The Chairman: But you limited it to 50,000. Mr Black: We suggested that, as it rises above 50,000, two things will happen: one, driver tolerance of the associated delays will become eroded because the delays become simply too long; secondly, we have a current practice of closing the access road when an emergency vehicle needs to use it and clearly we are mainly talking about ambulances here. That creates temporary but not short-term traffic chaos. As the numbers increase, there are potentially likely to be more people needing to access the hospital, because there are more people who might have either a minor or a major incident. We became concerned that there was a risk that the second emergency vehicle would be trapped in the associated traffic disruption, which could lead you to either say, Well, we need to improve the access road and improve the bridge. We looked at a cost in the order of and, in fact, we proposed very illustrative costs of 5.375 million capital and ongoing costs of 320,000 a year to handle the increased numbers. We were able to demonstrate, by working with colleagues in utilities, for example, that the sewerage system could cope and we have got that report if you wish to have a copy. 102 EPRC-VN/16-17

Q278. The Chairman: We would like to have a copy of that, please. 595 600 605 610 615 620 625 630 635 640 Mr Black: Now, that was approximately This comes back to the point the Chief Constable has made: that work, which involved co-ordinating with all the infrastructure providers in Government, support from the Home Affairs and other colleagues here, took us between eight and 10 weeks to get to a stage of having a useful draft that could be circulated for comment. If I refer to the question posed by Mr King, we originally were looking at perhaps six weeks to comment; well, that took us eight to 12 weeks just to do to draft stage. It was an immense piece of work. It was done to a high standard and I will happily supply you with a copy after the meeting. That was the sort of thing we needed to make decisions, and this does not particularly consider the capabilities of the emergency services; this is an infrastructure report. So, what may have been acceptable as a one-off in 2007, both in terms of cost and impact on the public, because it is 100 years and we are all thrilled, may not be acceptable year in, year out, because people might say, Oh well, this is too much. You need to do something. The delays are now unacceptable. There may have been political pressure and therefore cost. All of those things, in my view, should have been considered at an early stage. Mr Roberts: And in 2007 the weather was fine. Policing the TT and providing services to the TT is largely easier when the weather is fine, but if the weather is poor and you have flooded campsites or you have tents that are blown away then we really struggle as a community to deal with it. Even this TT, this year, we saw some issues towards the end because of the very poor weather and how we had to accommodate people who were simply being washed out of their campsites. Q279. The Chairman: Okay. I also note that the responses from Home Affairs and from Health and Social Care were basically that, We think we are at about the right numbers that we can handle. I think the other emergency services, the Fire Service, would equally be as stretched as the Constabulary. I know you work very closely on certain road accidents and they are working together. So, the numbers, I think, exercised your thoughts quite considerably around the time that you were discussing all of this. Do you think it was the numbers that? You see, part of the process in this tendering has been very highly based and the matrix for assessing people who put in bids had a factor in it which was the numbers that we think we can get, so the more you said, the more that part of the matrix went up. Yet, what we are hearing is that it might not be desirable to raise the numbers; therefore, the actual bidding matrix, the judging matrix, was flawed, because if we cannot manage the people on the Island and yet we are looking for someone to bring in as many people as possible, therefore the bid matrix was flawed. Mr Black: Mr Chairman, that goes back, if I may, to my comments about the net and the gross. There may have been a tipping point and it may have been at 50,000 Whatever it was, there may have been a point at which extra visitors were unsustainable in terms of either our capability or our cost. Mr Roberts: What we showed in the Centenary year was that we could do it but it took a lot of time and effort and expense. Q280. Mr Baker: One point which has emerged as we have gone through this process is talk of a concept of restructuring the TT to make it, effectively, a two-peak event where the racing The concept appears to be that the racing would be concentrated around the first weekend and then the second weekend that would particularly work for television and that, therefore, the 103 EPRC-VN/16-17

645 visitor numbers could increase but the amount of people on the Island at one time would not necessarily increase in the same manner. Is that anything that you were aware of at any stage in this process, or is this something that has only emerged subsequently? Mr Roberts: Mr Topham referred to that in his presentation to us. 650 655 660 665 670 675 680 685 690 Dr Couch: That was the first time we were aware of it. Mr Black: And the report that I referred to certainly includes discussion of whether the peak visitor days make a difference. Without reading right through it in front of you now I will supply that for you but there is certainly reference to 2016 TT visitors peak day: 29,621 on one day. We also, perhaps, should say that the 60,000 figure quoted regularly for TT 2007 is not necessarily an accurate figure. It was an estimate based on the available numbers. I do not think anyone would ever be able to say exactly how many people came or, indeed, how many were on the Island on any one day. Mr Baker, that is a very relevant point to say how many are on a day, but we can only guess at some of these numbers by looking at the movements of the Steam Packet or the movements of the airlines. Mr Roberts: My service struggles to cope if it extends beyond the fortnight, so I have people who are very, very tired because they have been working very hard and, if they had to work very hard for a third successive week, perhaps without days off, then there would be health implications for officers. Mr Black: Perhaps I should also add, it is not just the number of visitors we should be worrying about. How many people leave the Island? A number of people will say that they are more disturbed in their daily routine by Grand Prix than TT because less people are away from the Island. There are chunks of our community who say, I am not staying for TT and they take a week or two off and go on their holiday. It is about the total number of people using the services, so focusing even just on the visitor even if we could have accurate numbers of visitors on one day, what most of our services need an assessment of is the maximum number of users. That would be something that we would need even more work to do. Q281. Mr Baker: So, this idea of a fundamental restructure of the TT around a two-peak approach, that was just something that came out of the promoter designate s presentation to yourselves, which again had not been discussed at any level within the officer group? Presumably, it must have pretty profound implications on the demands on the Island and your services? Mr Black: We saw the graph that associates that on that presentation on 5th April. I think that is the first we knew about that. It is, in many ways, a good idea, but that I think is when we knew of it first. Q282. The Chairman: Do we ever consider the number of business people that do not come during the TT period, who would otherwise be coming to visit lawyers, estate agents? Mr Black: When determining the road closures, we certainly consider the impact on business. As a Department You will recall there has been consultation recently on whether road races 104 EPRC-VN/16-17