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Labour
Needs a U-Turn on Toll Road Strategy 23 July 2004 Hard-pressed motorists will pay the price if a second toll-road
is built alongside the M6, says one of Birmingham's leading infrastructure
experts. Bill
Bullivant, who heads Martineau Johnson's projects group, believes
such schemes can only deliver worthwhile benefits as part of
a comprehensive transport strategy. "Taking
a piecemeal approach to such issues as congestion can never
provide best value for either taxpayers or motorists," he says. "The
government must commit itself to a strategy for the long-term,
taking into account such issues as the best balance between
road and rail and other forms of public transport, and the
level of subsidies to be provided, not just on a project by
project basis. "The
construction industry would also benefit from such a long term
approach. Companies would be able to plan and invest for the
future, without the current level of uncertainty." "Even
if a long-term strategy was conceived, it would need to be
much wider in its scope than at present. The government seems
content to identify a congestion blackspot, such as the M6,
and decide a toll-road in private hands is the answer," he
suggested. Transport
Minister Alistair Darling recently unveiled plans to build
a toll-road alongside the M6 from Birmingham to Manchester. He
has asked for ideas on the controversial subject, but hinted
that a private company might be invited to construct, manage
and operate the route. Mr
Bullivant expresses doubts about this approach to the existing
M6 Toll, and he takes a similar view about the prospect of
a second 'pay as you go' motorway. "I
think that such projects are only likely to deliver their full
potential if carried out as a partnership between the Government
and a private sector operator, rather than by a sector operator
being given full control over charges etc." "The
M6 Toll has still to persuade hauliers to pay its charges,
and most motorists who use it are doing so to escape from the
lorries on the M6," he suggested. "Toll
road operators have to price an element of risk into the early
stages because they have no idea how many vehicles they will
attract. This of course affects the price paid by users. "Then
as more and more people start to use them, the operator can
make windfall profits, also at the cost of users." Rather
than simply leaving it to the private sector the Martineau
Johnson expert is certain that better value would be gained
by creating PFI schemes for major infrastructure developments. He
was involved in one of the UK's first such projects, to replace
a bridge over the A1 in Doncaster. "Back
then the Government expected the private sector to take all
the risk, and simply agreed to pay the contractors 'shadow'
tolls based on the predicted traffic usage," recalls Mr Bullivant. "Whilst
bidders were prepared to proceed on that basis, it was never
going to deliver optimum results." He
believes the current generation of PFIs, which operate as genuine
partnerships between the public and private sector, would work
for toll roads and other highways projects. "Their
greatest benefit is to allow infrastructure developments to
proceed even if there is a dip in the economy, and public sector
spending is reduced," says Mr Bullivant. "The
most critical aspect would be getting the numbers right though.
Projects must be structured with value for money as the central
objective, and that can only be achieved if the initial cost
estimates are realistic." He
says early estimates on public projects are invariably much
too low, whether it be the construction of the new Scottish
Parliament building, or the recent figures floated for the
construction of an underground rail network in Birmingham. "Some
early PFIs, particularly involving hospitals, went wrong because
the initial figures were too low, and the deals had to be abandoned
when the true costs became apparent." Once
PFI contracts have been signed however, they have an unprecedented
record of being delivered within budget, unlike many conventional
public sector projects. For
further information please contact Catherine Burke catherine.burke@martineau-uk.com |
