David Cameron sets out transport network plans

David Cameron acknowledged the need for more airport capacity in the South East today (Reuters)

David Cameron set out plans today to boost Britain's airport capacity and attract private money into the roads, as he promised to take on "vested interests" to force through improvements to the transport network.

Speaking ahead of a Budget in which Chancellor George Osborne will have little spare cash for investment, the Prime Minister said he wanted to look "urgently" at private-sector options - which could involve tolls for new roads.

He revived speculation about a new "Boris island" airport in the Thames estuary, by saying that the Government's aviation review will look at the pros and cons of the idea, heavily promoted by London Mayor Boris Johnson.

Mr Cameron's comments came in a speech in London shortly after a meeting of the so-called Quad of senior Tory and Liberal Democrat ministers to put the final touches to Wednesday's Budget.

Reports suggested that the group - the Prime Minister and Chancellor, Deputy Prime Minister Nick Clegg and Treasury Chief Secretary Danny Alexander - may have approved a cut in the 50p income tax rate paid by those earning above £150,000, perhaps to 45p.

Lib Dem deputy leader Simon Hughes fuelled suggestions that the coalition's junior partners have accepted a reduction in the top rate, saying that the Lib Dems were not committed to "hanging on" to the 50p figure.

The Lib Dems' priority was "a Budget for the millions not the millionaires", which would ensure that those at the top of society made a greater contribution towards dealing with the deficit, he said.

Labour leader Ed Miliband accused the Government of being more interested in cutting taxes for the rich than helping "hard-pressed families".

Mr Miliband said: "We would be concentrating on jobs and growth and we would be using every penny of scarce resources in order to help millions of hard-pressed families who are struggling to make ends meet.

"My fear is the Government is more interested in cutting taxes for people earning more than £150,000 a year."

In a speech setting out his long-term vision for British infrastructure, Mr Cameron said the UK needed better transport links but had suffered from a "failure of nerve" by previous administrations.

"Without world-class transport we will not get growth, people won't invest here and regions in decline will be further left behind," he said.

"Without better transport, we will continue to pollute, too."

Mr Cameron said the country needed to be "more ambitious" about improvements to its road network.

"We need to look urgently at the options for getting large-scale private investment into the national roads network - from sovereign wealth funds, pension funds, and other investors," he said.

The Department for Transport and Treasury have been asked to carry out a feasibility study by this autumn of new ownership and financing models for the national roads system, to encourage investors to back desperately-needed upgrades to the ageing network.

However Mr Cameron said: "Let me be clear: this is not about mass tolling - and as I've said, we're not tolling existing roads - it's about getting more out of the money that motorists already pay."

The Prime Minister insisted the UK must not give up its status as a major global hub for air travel, although he acknowledged the issue was "controversial", not least to environmentalists who oppose airport expansion.

"I'm not blind to the need to increase airport capacity, particularly in the South East," he said.

"Yes, this will be controversial. We will need to take decisions for the long-term - and we will be bringing forward options in our aviation strategy which will include an examination of the pros and cons of a new airport in the Thames estuary."

He acknowledged there would be "furious objections" to new roads and airport capacity, but insisted: "We will take difficult decisions, we will risk short-term unpopularity, and we will hold fast to our vision in the face of vested interests, because our motivation and our duty is to protect and champion the national interest."

John Cridland, director general of the CBI, said: "Getting growth going must be the Chancellor's number one priority in this year's Budget. As we've said, one of the best ways we can create activity and new jobs is by attracting investment into our ageing infrastructure.

"Congestion on our roads costs the UK economy up to £8 billion a year, so the Prime Minister's ambition to get much-needed private investment into the strategic network could not have come at a better time. Every £1 spent on infrastructure adds £3 to the economy as a whole."

Institute of Civil Engineers director general Nick Baveystock said: "It is encouraging to see further evidence of Government's commitment to infrastructure forming a central plank of the plan for growth, and the acknowledgement that a more efficient planning system that builds confidence within industry is crucial to achieving this vision."

However Friends of the Earth's head of campaigns Andrew Pendleton said: "Building and widening roads to tackle congestion is a dead-end policy that will simply lead to more traffic, more pollution - and even more gridlocked roads.

"The Prime Minister should be promoting alternatives to driving such as affordable buses and trains - and reduce our transport system's reliance on expensive overseas oil."

PA