Our roads are the arteries that fuel the UK – time to revolutionise how we fund them

Jul 13, 2017

By Julian Glover

Glamorous multi-billion pound projects like Crossrail and HS2 tend to get all the attention – but none of them matter as much as our roads.

Driving, cycling or travelling by bus, we spend our lives on them and it is getting tougher. Figures from INRIX and Clean Air in London show the cost of air quality on our health and congestion to our economy. Parts of London are nearing gridlock.

What’s the answer? Not to force people off the roads but to think properly about the way that we pay for and use them so we can invest where it’s needed. That’s the key aim of the £250,000 2017 Wolfson Economics Prize, which I have just run. The winner is announced tonight.

London’s first congestion charge made a difference but now it is time to go further.

In his new Transport Strategy, the Mayor of London said that he will consider a new form of pay-per-use road pricing to manage the three million car journeys a day in the capital. Note the consideration, not the cast-iron commitment. We need a proper conversation about our roads, and how we fund them. Not just in London, but across the UK.

In private, politicians mostly agree. But until now they have been afraid to act, convinced that changing the way we run roads would be electoral kryptonite.

No longer avoidable

However, now there’s no avoiding the hard truth that the current system is broken. In Britain, we pay some of the highest fuel taxes in the world and get some of the worst and most congested roads in Europe in return. Only a third of the money the government makes at the moment goes back to road users.

On top of that, as cars get more efficient and electric vehicles come in, the government’s tax take is set to collapse. One estimate puts the cost at £2.3m a day – and a recent Policy Exchange analysis suggests that if carbon targets are met, fuel duty receipts could be £23bn lower in 2030.

Our roads are the arteries that fuel British business and drive foreign investment into the UK.

With our toxic air, traffic, taxes and resistance to tolls, fixing Britain’s road network – and how we pay for it – is one of the greatest infrastructural and political challenges of modern times.

This year’s Wolfson Economics Prize is seeking to meet that challenge. The £250,000 prize question asks for a better way to pay for better roads, in a way that’s fair to road users, good for the economy, and good for the environment. The winner will be drawn from five brilliant finalists – whittled down from 120 entrants from seven countries.

Five revolutionary news ideas

Their thinking is fresh and innovative, and two of Britain’s biggest motoring organisations – the RAC Foundation and the AA – are going head to head in the final.

The economist Deirdre King and her husband, AA president Edmund King, suggest the idea of Road Miles, a new and popular way of paying for roads where drivers benefit from at least 3,000 free Road Miles each year with a small charge thereafter. Commercial income would come from adopt-a-highway naming rights to boost investment – think the Morrison’s M25.

Recent graduate Gergely Raccuja, with help from the RAC Foundation, has come up with a distance-based charge to replace Fuel Duty and Vehicle Excise Duty (VED), to be collected by insurers with revenue raised ringfenced for roads, and a “pothole-free Britain” within five years.

Clearways, a team from Australia, reject mandatory road pricing and seek to end congestion by rewarding people for voluntarily changing their driving habits, encouraging people to use the road more efficiently.

Catriona Brown argues for a new technology platform, ‘T-Forward’, a stepped approach to upgrade existing charging systems.

And transport economists Volterra have teamed up with engineering firm Jacobs to call for “Pricing for Prosperity”, eliminating fuel tax and VED and replacing them with variable charges for each journey – helping drivers to make better decisions on how, when, and where to travel.

Five new ideas submitted, five new ways to deliver a better way to pay for better roads.

The winner will be chosen by a panel of expert judges including former chancellor Alistair Darling, former deputy mayor of London for transport Isabel Dedring, and economist Bridget Rosewell.

Roads might not be a hot topic of conversation at dinner parties, or at the forefront of our minds as we go about our business, but they affect us all. The Wolfson Economics Prize will spark that conversation, and policymakers should pay attention.

This article appeared in City A.M.

Julian Glover is director of the 2017 Wolfson Economics Prize, and a former Downing Street and Department for Transport special adviser. 

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