Cameron on road to nowhere

We have been here before. Lots of times. The idea of trying to turn the roads into some form of cash cow for the government, ostensibly as a way of attracting private investment, has been the subject of government announcements and ‘leaks’ with almost the same regularity that traffic jams form on the M25.

I remember in 1993 going on a special press trip in a little 20 seater plane with the then Transport Secretary, John (now Lord) Macgregor to look at road charging systems in Norway and Sweden and being briefed that such as a scheme would be introduced in the UK within five years. Indeed, the five year time frame became something of a joke amongst us transport commentators as this commitment was repeated time and again by successive governments. Five years, the cynics amongst us noted, was of course always going to fall within the term of the next  Parliament.

So this latest ‘plan for toll roads’ splashed across the Monday papers on the day before the Budget has to be viewed in the context of the succession of similar initiatives which have come to naught. This time, though, it is even more difficult to see how anything can come of it because the Tories have boxed themselves in by ruling out road pricing in their manifesto.

That would, of course, have been the most obvious way of funding a major road construction programme but politicians have been terrified of suggesting it ever since the infamous Downing Street petition against road tolling which attracted 1.7m signatories. The fact that this was a highly dishonest poll was based on the completely fallacious suggestion that drivers would have to pay £1 34 per mile has long been forgotten and the perception remains, especially given the results of the congestion charging ballots in both Edinburgh and Manchester, that this is a no-go area for any government that wants to stay ahead in the polls..

Therefore in announcing government plans, David Cameron was limited to suggesting that private capital could be used to finance investment in roads and ruled out any tolls on existing roads. Elaborating on the Today Programme on Radio 4, Matthew Hancock MP, a former adviser to George Osborne explained that a proportion of Vehicle Excise Duty could be syphoned off – hypothecated – to provide an income stream to private investors in the road network. He suggested, for example, that improvements to the A11 which have long been in the roads programme, could be brought forward through this scheme.

This idea, though, is fraught with difficulties. Clearly, the notion of stopping motorists at a toll booth in the middle of the busy A11 is not feasible as no one is suggesting a return to pre-Victorian turnpikes. Nevertheless, some way of collecting the money from everyone driving on the new section would have to be devised and occasional users would not want the hassle of signing up electronically, especially as they might be totally unaware that they were crossing a tolled section. Inevitably, local residents will quite rightly complain about the fact that they have to pay to get direct access to London, while their counterparts on the other side of London do not.

Moreover, as John Humphrys pointed out, VED revenue goes into the general tax fund, and therefore is used to fund everything from aircraft carriers to primary schools, and therefore its hypothecation to roads implies an overall reduction in spending or collecting taxes elsewhere.

‘Private capital’ is not a free lunch and needs to be serviced. The money will undoubtedly cost more than government lending and therefore overall spending will rise. Moreover, there seems to be a hint that some risk, such as numbers using a section of road (incidentally road traffic and consequently congestion has reduced in recent years, despite the complaints from the motoring lobby about increasing delays) will be transferred to the private sector. Any attempt to offset such risk inevitably comes at a price, and therefore will raise the cost further.

Even if practical and financial difficulties can be overcome, the political ones seem insuperable. The general mistrust of politicians is demonstrated by the online Daily Telegraph poll which suggested that a vast majority of drivers would be opposed to the idea of the private sector being brought in to run roads as they were concerned that this would lead to a much wider charging regime, despite government promises to the contrary. Given that Cameron’s advisers must have known that this idea would be as attractive to drivers as being stuck behind a caravan on a windy two lane road, I suspect that is another bout of political kite flying that will quietly suffer the same fate as John Macgregor’s road pricing promise. Announced with a fanfare, it will disappear with a whimper.

  • Paul Holt

    Paragraph 2 “…five years…”: the North Springfield railway station (subject of http://www.christianwolmar.co.uk/2006/01/little-money-available-for-new-stations/), is repeatedly reported as being five years away, just as it was when I first moved to Essex in the early eighties!

  • Is this new, or a re-hash of one of Labour’s not-so-clever transport policies,  The southern end of the M40 is a PFI, where private finance funded four lanes to High Wycombe, and maintenance of part of the route onwards.  The M40 was never as congested as the M1, where 4 lanes now go from 6A (M25) to 10 (Luton A6) but I have not seen lately what is happening Js 10-14.  How would private finance tie into this, or any new schemes?
    The one being most talked about is the A14/45 corridor from M1 J19 Eastwards.  But hang on, hasn’t DafT spent way over the odds for a busway (anyone know the final cost; £185m?), has that not sorted out the traffic problems here?
    Er …. no it hasn’t.
    The same goes for the Birmingham Northern Relief Rd, the M6 Toll.  Rip-off charges, aimed to discourage HGVs as they wear out the slow lane, is now charging crazy prices for 28 miles.  For a car it’s about 18p / mile, the ordinary M6 no extra charge but slower.  This was a disastrous policy as the Government has no say in the charges.  The Severn Bridge £6 to Wales, free to come out, is similarly criticised.
    The problem is how best to reduce traffic in a corridor by providing a real alternative.  Chiltern Railways have got the basics right for the M40, but Virgin and the M1 / M6 corridor?
    As a social welfare economist, if we cannot justify making the service free, then price should equal marginal cost, which for rail could bring the cost of many trips would come down,  These price tags in hundreds will just depress the market, so profits are made from an under-utilised assets, whether the M6 Toll or Pendolinos on the West Coast line

  • Guest

    The Government decided to push through the ill-considered Health and Social Care Bill despite widespread opposition, so it would not be inconsistent if it decided to apply the same policy of privatisation to roads. There could be a mixture of public and privately-owned motorways, and although people would still (in theory) be able to drive anywhere in the UK without paying a toll, their journeys might be considerably quicker if they pay to take a private route. Motorways which are deemed not to be financially viable could be allowed to go bankrupt and be shut, but successful toll motorways could potentially make huge profits for shareholders.

  • Paul Holt

    Supplemental: http://www.bbc.co.uk/news/business-18064363, particularly the comment about motorists being considered cash cows.

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