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Dan Lewis: Our cost-cutting politicians will store up more transport misery for the years to come
A CRASH in tax revenues, a fast rising population and a government and opposition both quietly intent on cutting spending are shaping up to be the perfect storm for Britain's ageing transport infrastructure.
But our politicians should think again. We are already paying for decades of under-investment in transport with high fares, delays, overcrowding and congestion.
Few developed countries in the world have such a low regard for the economics of movement. Britain has long-been ill-served by a bizarre anti-infrastructure cult. The fear is that investors in UK plc, already vociferously unimpressed, will take note, not arrive or just up sticks and leave.
In every recession, it's always the same. Faced with the choice of cutting public sector payroll or slashing capital expenditure, our politicians pick the latter every time. They are still scared of our public sector trade unions. And, this time, transport looms large in their crosshairs. According to a report by the Institute of Directors, public sector net investment in transport is forecast to fall from 3.1 to 1.3 per cent of GDP by 2013-14.
This is crazy because as projections from the Office for National Statistics show, there will be more than 70 million people living in Britain by 2033 and those extra 10 million will need a lot more transporting capacity than now exists.
Transport infrastructure's impact on the economy is huge. We may not realise it because transport is just a transaction cost for most of us. When travelling – despite the best efforts of the mobile phone operators – most of us are not working, consuming or adding value in any real way.
To use the jargon, this is lost output time. And there are only three ways to reduce it: speed up journey times, making the departure and arrival times more predictable by reducing congestion or not travelling at all.
The truth is, we could do quite a lot about the first, more with the second and very little about the third. Getting to the office and to meet, talk and do business with people is going to matter for some time yet.
But there's a disconnect about what really makes a difference in transport. Twenty years ago, Margaret Thatcher was much maligned for saying the UK was a road economy. She was of course, as in so many other things, right. Today, 90 per cent of passenger kilometres and 84 per cent of goods carried by freight are made by road. And if it wasn't for the distortionary impact of London, those figures would be much higher. Britain's capital is unusual because 69 per cent get into the Central Business District by track, five per cent walk and three per cent even take a bike – not just Boris Johnson and David Cameron.
Supposedly then, the axeman is eyeing up big name projects like London's Crossrail – a huge 16bn project due in 2017, to connect from East to West the full span of London and only 10 per cent funded. And there is real reluctance to grant planning rights to expand air travel, build motorways and envision more port capacity.
The truth, though, is that it is the glamorous types of projects – usually involving shiny trains or trams – that politicians like to associate with in a photo-op and these will survive.
Yet, for every Crossrail, there are hundreds of much smaller no-name projects that they would find much easier to cut. These projects have unflattering names like the Birmingham Motorway Box or a hard shoulder running scheme between Junctions 25 and 30 on the M62 between Bradford and Leeds. And it's most likely these, and others like them, that will make the most difference to travel times.
This is particularly so in the North, where distance is not the problem. Accessibility is. Lower connectivity between home and the workplace always leads to two things: fewer opportunities and lower wages. Better transport infrastructure is crucial to reversing that.
Indeed, there are some really boring – and very cost-effective – steps that could be taken to improve matters. Actions like extending platforms on train stations, road-widening, allowing for hard shoulder running on motorways, improving road layouts and making traffic lights turn green when buses approach them.
And then there are practical steps. The bulk of transport spending by the taxpayer still goes on trains and Network Rail has done virtually nothing to develop its property portfolio – the railway stations. They should be more like today's airports; with car parks, retail outlets and office space. And I can personally attest that hiring a car from right next to the railway station in Britain is next to impossible, unlike in France or Spain. This won't change until we go back to vertical integration and regional monopolies of train operating companies and their underlying tracks and stations.
At some stage, we are going to have to think about the really unpopular measures like road-pricing again and closing down loss-making rural railway lines and replacing them with roads.
My guess is that the key word we will hear in the years to come from a future Chancellor and Secretary of State for Transport will be delay, not cancel. But they will just be storing up even greater transport misery for the rest of us for years to come.
Dan Lewis is chief executive of the Economic Policy Centre. www.economicpolicycentre.com
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Saturday 26 May 2012
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