Roads to riches – or highways to hell?

Plans to use private finance to modernise our road network have delighted potential investors, but motorists are more sceptical

When Margaret Thatcher cut the ribbon on the final section of the M25 in 1986 she had little time for those who thought the new London orbital and its already notorious jams anything but a success.

"Nobody shops at Sainsbury's because of the queues," remarked the grocer's daughter while simultaneously announcing the first of the many upgrades designed to cope with the South East's unstoppable traffic growth.

By the time she left office she had presided over 42 privatisations, and in one of her final acts decided to award the building of what was known as the North Birmingham Relief Road (now the M6 Toll) to a private company.

It was the resurrection of an idea not popular in Britain since the heyday of the turnpike trusts 200 years earlier when venture capitalists were called on to unclog the nation's vital arteries turned into quagmires by the advent of the cartwheel.

But while the cause of Britain's current £7bn annual congestion problem is infinitely more complex, the present Government's solution is surprisingly familiar.

Yesterday David Cameron called on private investors to step in to help improve the "decades-long" degradation of the nation's road network.

Alongside potential tolls which could be introduced when new lanes are added during works such as on the A14 in Cambridge, he urged the private sector – including pension and sovereign wealth funds – to build for a future with a new "Victorian spirit".

His invitation, which comes ahead of the Budget in which there will be little new cash for transport, was immediately welcomed by a group of pension funds with assets of £65bn which pledged to invest in a host of new schemes.

Julia Prescot of Meridiam Infrastructure, which heads the funds' co-operation agreement with the Government, said they would speed up plans by backing the construction phase of projects as well as taking over the day-to-day running of those built with public money – a move which could create thousands of jobs.

But the prospect of privatisating the road network was criticised by Labour, environmentalists and some motoring and transport campaigners despite Mr Cameron's insistence that there would be no "mass tolling" on UK roads.

In a speech in which he also promised a review into plans for a new London airport in the Thames Estuary, the Prime Minister said Britain had been let down by a "failure of nerve" by previous administrations.

He said he would fight "vested interests" to force through improvements to the transport network. Mr Cameron compared his vision for roads to another privatisation – that of water in 1989 under Mrs Thatcher.

According to industry regulator Ofwat the current system has delivered water bills a third lower while encouraging investment to reduce leaks and improve quality. But mounting concern over the profits accrued to the 22 private water companies which last year passed £1bn has left some to reconsider.

Jonathan Portes, director of the National Institute of Economic and Social Research, who worked on the water sell-off as a junior Treasury official in the 1980s, said that while road privatisation could offer economic and environmental benefits, water was "exactly the wrong model" to pursue.

He said: "Consumers ultimately benefited from increased efficiency and from greater capital investment than would otherwise have been (politically) possible. However, at the same time, the industry was privatised under an excessively lenient regulatory framework that clearly led to shareholders making very large excess profits at the expense of consumers."

Stephen Joseph, chief executive of the Campaign For Better Transport, said neither bus nor rail privatisation offered attractive blueprints either.

The Government currently pays £5bn in an annual subsidy to the railways – compared with £1bn before the sell-off under John Major. Fragmentation of the different parts of the network has left fares in the UK 30 per cent higher than elsewhere in Europe while costs were 40 per cent more, he said.

Bus deregulation and subsequent privatisation initially led to a sharp drop in use, particularly outside London with numbers rising again thanks in part to the pensioner concessions.

"I don't think anybody, including the people who ran the buses, feel the way privatisation was done was a brilliant idea," he said. "What is needed is more integration. The danger is you will get bits of the infrastructure that the private sector will think it is able to make money out of," Mr Joseph added.

But Britain's experimentation with private road building continued beyond the opening of the M6 Toll road. Its 27-mile length commands a fee of £5.30, which critics say is too expensive. Today it carries less than half the number of vehicles it was designed for.

Attempts to lure in private capital to help alleviate the £8bn cost of building new roads continued throughout the 1990s. A series of Private Finance Initiatives – known in Whitehall as Design, Build, Finance and Operate agreements – were rolled out on major trunk routes. Although largely invisible to the average motorist, those such as the M40 and A1M – repay private companies for improvements through the "shadow tolls" – payments based on the number of cars using the roads.

Ian Mulheirn, director of the Social Market Foundation, said the question of who owned the roads was secondary to the necessity of reducing congestion. He advocates the abolition of vehicle excise duty and the introduction of a system of privatisation in which each citizen is given a voucher or share.

What was important, he said, was persuading people through smart technology and national road pricing to use the network more efficiently – reducing journeys at busy times and increasing them when the roads were empty. But changing the way the nation's 31 million motorists pay to drive is unlikely to go down well with voters and remains politically explosive.

Institute of Advanced Motorists director of policy and research Neil Greig said: "British drivers simply don't trust the Government to come up with a new way of paying for roads that will not lead to increased costs in the long run. Drivers already pay far more in taxes and duties than they get back in investment in new roads."

THE A14: CAN IT GET WORSE?

The Cambridgeshire traffic report yesterday will have come as no surprise to locals: "Four-vehicle smash on the A14 – long delays." It was just another day on a road that is so bad the Prime Minister appears to have taken a personal interest in easing its congestion.

The A14 in East Anglia is notorious in Cambridgeshire, Northamptonshire and Suffolk for its regular traffic jams and terrible safety record. Now, it has become a symbol of the brave new world of privatisation.

As motorists digested the Government's plan to privatise parts of Britain's road network, a long-standing scheme to improve arguably its worst section was referenced by the Prime Minister as an example of a route that could be improved with funding raised from toll roads.

The A14 links the Port of Felixstowe, in Suffolk, where 40 per cent of the UK's container traffic comes ashore, with the Midlands.

Local campaigners sent a petition to Downing Street last year, complaining of "huge delays on an almost-daily basis" and bigger accidents that "bring most of Cambridgeshire grinding to a halt".

The Government withdrew a £1.2bn scheme to expand the road to four lanes, but has since announced a £130m plan to upgrade sections of the road.

Miles of road in the UK:246,000

Miles of motorway: 2,200

Annual cost of road congestion: £7bn

Money that could theoretically be raised if entire network were privatised: £100bn

Cost of driving 27 miles on the M6 toll road: £5.39

Average annual car mileage in the UK: 8,430

News
peopleActress speaks out against historic sexual assault claims, saying things have 'gone quite far now'

Sport
Aaron Ramsey celebrates after opening the scoring in Arsenal's win over Hull `
sport
Arts & Entertainment
A stranger calls: Martin Freeman in ‘Fargo’
tvReview: New 10-part series brims with characters and stories

Life & Style
Guests enjoy food and cocktail parings by Chefs Jimmy Bannos, Jimmy Bannos Jr, Daniel Rose and Mindy Segal with mixologists Josh King and Alex Gara at Bounty & Barrel: A Jack Daniel's Single Barrel Dinner Series at Heaven on Seven on April 9, 2014 in Chicago, Illinois.
news Sprinkle Palcohol 'on almost any dish' for 'an extra kick' firm says...
VIDEO
Have you tried new the Independent Digital Edition iPad app?
Arts & Entertainment
Shaun Evans as Endeavour interviews a prisoner as he tries to get to the bottom of a police cover up
tvReview: Second series comes to close with startling tale of police corruption and child abuse
Sport
Liverpool players rush to celebrate with captain Steven Gerrard at the final whistle
sport Another hurdle is out of the way for Brendan Rodgers' side
Arts & Entertainment
Schwarzenegger winning Mr. Universe 1969
arts + entsCan you guess the celebrity from these British Pathe News clips?
News
Portrait of Queen Elizabeth-II by David Bailey which has been released to mark her 88th birthday
peoplePortrait released to mark monarch's 88th birthday
Arts & Entertainment
The star of the sitcom ‘Miranda’ is hugely popular with mainstream audiences
TVMiranda Hart lined up for ‘Generation Game’ revival
Life & Style
The writer, Gerda Saunders, with her mother, who also suffered with dementia before her death
healthGerda Saunders on the most formidable effect of her dementia
Arts & Entertainment
Charlotte Brontë, the English novelist, poet and the eldest of the three Bronte sisters who lived into adulthood, has been celebrated with a Google Doodle depicting her most famous novel, Jane Eyre.
arts + ents "Reader, they doodled her".

Arts & Entertainment
Oxegen in Ireland has been axed as promoters decide it is 'no longer viable'
arts + ents Promoters have axed the event as it is 'no longer viable in current form'
News
The troubled star is set to give fans the biggest insight into her life away from the headlines
people Star made the announcement during the final episode of the programme, entitled Lindsay
News
YouTube clocks up more than a billion users a month
mediaEuropean rival Dailymotion certainly thinks so
Arts & Entertainment
The original design with Charles' face clearly visible, which is on display around the capital
arts + ents
Independent
Travel Shop
the manor
Up to 70% off luxury travel
on city breaks Find out more
santorini
Up to 70% off luxury travel
on chic beach resorts Find out more
sardina foodie
Up to 70% off luxury travel
on country retreats Find out more
Have you tried new the Independent Digital Edition iPad app?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Geography Teacher

£130 - £140 per day: Randstad Education Ilford: Secondary Geography Teacher Lo...

Do you want to work in Education?

£55 - £70 per day: Randstad Education Cheshire: Are you a dynamic and energeti...

SEN Teaching Assistant

Negotiable: Randstad Education Group: SEN TAs, LSAs and Support Workers needed...

Private Client Senior Manager - Sheffield

£50000 - £60000 per annum: Pro-Recruitment Group: The Sheffield office of this...

Day In a Page

Rubin ‘Hurricane’ Carter: The man who could have been champion of the world - and the Bob Dylan song that immortalised him

The man who could have been champion of the world

Rubin ‘Hurricane’ Carter and the Bob Dylan song that immortalised him
Didn’t she do well?

Didn’t she do well?

Miranda Hart lined up for ‘Generation Game’ revival
The Middle East we must confront in the future will be a Mafiastan ruled by money

The Middle East we must confront in the future will be a Mafiastan ruled by money

In Iraq, mafiosi already run almost the entire oil output of the south of the country
Before they were famous

Before they were famous

Can you guess the celebrity from these British Pathe News clips?
Martin Freeman’s casting in Fargo is genius

Martin Freeman’s casting in Fargo is a stroke of genius

Series is brimming with characters and stories all its own
How I brokered a peace deal with Robert Mugabe: Roy Agyemang reveals the delicate diplomacy needed to get Zimbabwe’s President to sit down with the BBC

How I brokered a peace deal with Robert Mugabe

Roy Agyemang reveals the delicate diplomacy needed to get Zimbabwe’s President to sit down with the BBC
Video of British Muslims dancing to Pharrell Williams's hit Happy attacked as 'sinful'

British Muslims's Happy video attacked as 'sinful'

The four-minute clip by Honesty Policy has had more than 300,000 hits on YouTube
Church of England-raised Michael Williams describes the unexpected joys in learning about his family's Jewish faith

Michael Williams: Do as I do, not as I pray

Church of England-raised Williams describes the unexpected joys in learning about his family's Jewish faith
A History of the First World War in 100 moments: A visit to the Front Line by the Prime Minister's wife

A History of the First World War in 100 moments

A visit to the Front Line by the Prime Minister's wife
Comedian Jenny Collier: 'Sexism I experienced on stand-up circuit should be extinct'

Jenny Collier: 'Sexism on stand-up circuit should be extinct'

The comedian's appearance at a show on the eve of International Women's Day was cancelled because they had "too many women" on the bill
Cannes Film Festival: Ken Loach and Mike Leigh to fight it out for the Palme d'Or

Cannes Film Festival

Ken Loach and Mike Leigh to fight it out for the Palme d'Or
The concept album makes surprise top ten return with neolithic opus from Jethro Tull's Ian Anderson

The concept album makes surprise top ten return

Neolithic opus from Jethro Tull's Ian Anderson is unexpected success
Lichen is the surprise new ingredient on fine-dining menus, thanks to our love of Scandinavian and Indian cuisines

Lichen is surprise new ingredient on fine-dining menus

Emily Jupp discovers how it can give a unique, smoky flavour to our cooking
10 best baking books

10 best baking books

Planning a spot of baking this bank holiday weekend? From old favourites to new releases, here’s ten cookbooks for you
Jury still out on Manchester City boss Manuel Pellegrini

Jury still out on Pellegrini

Draw with Sunderland raises questions over Manchester City manager's ability to motivate and unify his players