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A businesslike approach to fixing transport?

The Eddington Report on how to modernise the UK's transport network is palpably the work of a businessman rather than an economist or a policy wonk.

Rod Eddington's approach is pretty practical, treating the United Kingdom as if it was a giant business.

This former BA chief executive's methodology is basically to ask what kind of returns, what kind of profits, are generated by different kinds of transport investments.

Now he has absolutely no doubt that investing in transport brings significant returns.

He says, for example, that unless we tackle congestion, it will cost an extra £22bn in wasted time for all of us, especially business, by 2025.

Which is one of the reasons that he is such a powerful advocate of road pricing - or charging us each time we use a busy road.

Benefits

Now, it is probably worth spelling out in more detail what he says about the financial benefits of a national scheme of pricing the use of busy roads.

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In his study, he assumes there would be a maximum charge of 80p per kilometre to travel at the busiest times.

He estimates that such a scheme would reduce congestion by 50% below what it would otherwise have be in 2025 and would therefore reduce the requirement of big new investment in road capacity by 80%.

And from there he deduces there would be benefits of £28bn every year in 2025. These are basically the benefits of being able to get from A to B quicker for those for whom it is most economically important.

And he says that these benefits are so big that they can't be ignored - although he also acknowledges the policy challenge of ensuring that poorer people are not discriminated against as and when it becomes more expensive to get around.

Priorities

He also makes what I would call two very general and sweeping points about where money should be directed.

First he identifies three strategic priorities:

*to invest in congested and growing city areas
*to spend money on improving links between important urban areas
*and to invest in improving gateways, or links between the UK and the countries with which we trade and do vital business.

BA's former chief executive is in favour of expanding Heathrow

Second, he says there are - on the whole - diminishing returns to investing in ever-larger projects. The best returns, he says, come from relatively small investments designed to make our existing transport network and system function better.

Things like increasing capacity on existing railway lines or bus routes.

Almost the biggest possible project in his report which he specifically endorses, for example, is so-called mixed mode at Heathrow - which would allow runways to be used for take off and landing.

Funny that a former BA chief executive should like that.

General principles

I think some people were expecting clearer recommendations from him about specific projects.

In fact, there aren't many of those.

Thus in the main 60-odd page report, I could find no reference to Cross Rail, the new line linking east and west London so favoured by business in general. As it happens, I think he's mildly in favour, but that's not explicit.

Britain's transport networks are "inefficient and disjointed"

And you have to deduce that he's in favour of Heathrow and Gatwick expansion from his saying that a) they are terribly important to the economic success of this country; and b) delays to flights at both of them are the worst in the European Union.

But nowhere is there a detailed grand plan for fixing Heathrow.

Going green

The other really important point about this report is that Eddington is very much a Stern acolyte.

He's totally bought into the Government-commissioned report on how to reverse climate change prepared by Sir Nicholas Stern - who gave him a bit of help with this report, as it happens.

So he says that the costs of damage to the environment, the costs of climate change, must be fully factored in to any assessment of specific transport schemes.

And he says that cars, planes, trains and so on must be charged for their relative emissions of carbon, their relative contributions to climate change.

As such, he's another influential voice endorsing more green taxation of transport or the rationing and trading of carbon emissions from the transport sector.

Which, if implemented of course, would make it more expensive for all of us to get around - the more so if it combined with congestion charging on the roads.

It's hoped that road-pricing will raise £28 billion

Someone needs to point out to these gluepots that there's no such thing as a free lunch.

There's only so much money going round in the country, and there are other countries in the world.

You'll get a GPS box and road charging kit in my car over my dead body, Blair. I'm fed up with everything you've done to my country. You've turned it from something respectable into a place I'm ashamed to live in.

Your lying, sleazy, corrupt, greedy government should be nailed to the walls of the Palace of Westminster.

Russell Long, Tonbridge, Kent, United Kingdom

I think this bloke on HYS pretty well sums up how a lot of people feel about the whole road charging idea:

It's hoped that road-pricing will raise £28 billion

2 in 3 motorists could face higher costs under pay-as-you-go charges
by RAY MASSEY
Last updated at 22:00pm on 1st December 2006

Two thirds of drivers will be worse off under controversial proposals for pay-as-you-drive road tolls, a major report commissioned by Gordon Brown has revealed.

Former BA chief executive Sir Rod Eddington also admitted that motorists who are already paying some of the world's highest road taxes could be forced to pay over £1.50 a mile .

In a further blow, it emerged that people who use public transport will also be hit with extra charges for travelling on trains and buses at busy times.

Sir Rod's report has called for £28billion - the equivalent of 9p on the basic rate of income tax - to be ploughed into Britain's creaking road and rail network.

The controversial plans are likely to form the blueprint of the Chancellor's transport policy if he becomes Prime Minister.

Under the road pricing scheme, which will be introduced within ten years, cars will be fitted with Big Brother-style black boxes and have their every movement tracked by satellite or roadside beacon.

Motorists will then be charged by the mile, with prices rising at times of peak congestion. Each month, drivers will receive an itemised bill setting out where they drove and how much it cost.

In a blunt assessment, Sir Rod insisted there was 'no alternative' to road pricing.

He said: "Ask yourself this question: Do you, in 20 years time, want to waste up to four more working days of your life every year sitting in congested peak traffic in one of the UK's largest cities?

"Or are you prepared to change your travel patterns and pay a full, but reasonable price, to reflect environmental impacts and benefits in terms of improved speed and reliability of your car journey?

"In my view, the right way forward is to accelerate progress towards a widespread road-pricing scheme."

But the former BA chief also warned that drivers who switch to public transport will also be charged more to travel on overcrowded trains and buses at peak times.

He also admitted that there were 'significant risks and uncertainties' involved a pay-as-you-drive scheme as the technology has never been used at a national level.

The high pay-as-you go charges are designed as a 'stick' to persuade people to travel at off-peak times.

But critics yesterday warned the plans will create 'roads for the rich' and will hit millions of employees, commuters and school-run mums who have no alternative but to travel at peak time.

There are also fears that the scheme will become another way for the Treasury to raise revenue, rather than reducing gridlock.

Edmund King, of the RAC Foundation, said that 9 out of 10 motorists did not trust the Government to run a pay-as-you-drive road toll scheme.

He said: "People do not trust the Government given their track record. The underlying worry that comes through from the public is that its is just another stealth tax."

Stephen Joseph, from Environmental group Transport 2000, also expressed concern. He said: "There is a danger that people who are priced out of their cars will then be priced off the trains because of spiralling ticket prices."

Anthony Smith, chief executive of the train-users' watchdog Passenger Focus, added: "We are already seeing passengers priced off the busiest trains. We don't want this to spread."

But Sir Rod insisted the pain was a price worth paying because it will leave the UK economy up to £28billion a year better off and halve congestion by 2025.

The report called for greater spending on road projects and railways - but with funds concentrated on easing bottlenecks rather than on 'grand projects' that are over-hyped, over budget and late.

On the railways, he said lengthening trains and platforms would be a more practical way to cope with congestion - particularly on busy commuter services in the South East of England.

But he effectively ruled out in plans for a high speed North-South rail link, arguing it would cost too much and be too risky an investment. Sir Rod also backed controversial plans for expansion at major airports such as Heathrow, but he called for 'green taxes' for air passengers.

Transport Secretary Douglas Alexander welcomed the study as a "major contribution" transport policy adding: "We will set out our initial response in the Pre-Budget Report next week and will publish a fuller response alongside the Comprehensive Spending Review."

Tory Shadow Transport Secretary Chris Grayling said: "Road pricing has to be used as a means of managing congestion or for financing transport projects. it must not become a stealth tax."

Astonishingly, the recommendations for "pay as you drive" road charging may apply only to England - because of the vexed devolution issue, Tories pointed out last night.

The small print of the Eddington report says: "It should be noted that in Scotland and Wales (and Northern Ireland when devolution is restored) it is for the devolved administrations to decide policies in devolved areas. Therefore the recommendations in this report do not apply to devolved areas of responsibility."

Tory Shadow Transport Secretary Chris Grayling said: "I am astonished that Sir Rod seems to be suggesting that a national road pricing scheme should apply only to England.

"This is more evidence that the report hasn't always been fully thought through and that the Government's plan for a national road pricing scheme is unrealistic."

But although transport is almost totally devolved to the Scottish Parliament, it is thought any move towards pay-as-you-go charging on trunk roads could only be implemented on a UK-wide basis.

The small print of the Eddington report says: "It should be noted that in Scotland and Wales (and Northern Ireland when devolution is restored) it is for the devolved administrations to decide policies in devolved areas. Therefore the recommendations in this report do not apply to devolved areas of responsibility."

Which is one of the reasons that he is such a powerful advocate of road pricing - or charging us each time we use a busy road.

There was an excellent article on the government's road charging plans in last Saturday's Telegraph motoring section by Austin Williams entitled Britain deserves better.