Toll roads are not the answer

M6 Toll by amandabhslater on flickr CC-BY-SASome in Government have signalled an interest in using tolls to pay for big new roads. But new toll roads aren't the answer to cutting traffic from existing roads. In fact, they might make things worse.

On roads like the A14 in the East of England, long-distance lorry traffic may try to avoid paying tolls by diverting down country lanes. The alternative – a publicly subsidised ‘shadow toll’ system – is similar to the Private Finance Initiative and very bad value for the taxpayer, guaranteeing profits for private investors while keeping the major risks of the project in the public purse.

Problems with private roads, August 2012Problems with private roads

Toll roads, old-style PFI deals and even putting all the money raised from Vehicle Excise Duty (VED) into a privatised Highways Agency have all been proposed recently.

Our report, Problems with private roads looks at all the options proposed for privatising roads, and shows that none of these proposals can provide value for private investors and taxpayers.

UK toll roads are a risky investment

We support the principle of enabling pension funds to be invested in some long-term infrastructure projects, especially in public transport and energy saving. However, there are a number of serious issues that should deter private investors and pension schemes from funding new and expanded roads in this way.

Our briefing The risks of toll road investment in the UK shows the risks to investors of putting money into toll roads and toll lanes in the UK.

These include:

  • Uncertainty about timing, caused by community opposition and planning processes.
  • The need for large guarantees from government to make investments attractive, which could be altered or cancelled due to political changes or pressure.
  • Evidence that long-term traffic forecasts are too high, so expected levels of traffic on the toll roads does not appear.

The M6 Toll is a failure

We’ve shown how the UK’s only major toll road so far has been a costly failure in our report, The M6 Toll, five years on: Counting the cost of congestion relief.

The report shows the 27-mile M6 Toll motorway, which opened in 2003, has failed to provide any significant congestion relief for the original M6. And the toll rate, which has been increased significantly year on year, is bad value for drivers who use it.

Because fewer drivers are using the road than expected and private borrowing is getting more expensive, the company operating the toll road has been losing tens of millions every year.

What's more the Government recently had to spend another £500m on the existing M6 to tackle the congestion the M6 Toll was supposed to solve.

Tolls are unpopular with almost everyone

And on top of all these problems, new toll roads aren’t popular with motorists or local communities.

Getting new toll roads built would take many years to plan, approve and build, and would have to deal with objections from residents in the surrounding area as well as motorists opposed to paying to use the roads.

We predict that if the Government proceeds with a network of new toll roads it will face an unholy alliance of angry motorists, local residents and environmental groups determined to stop their plans.

Smarter spending on public transport and smaller schemes is a better idea

Our Smarter Spending report, released in November 2011, shows there are much better alternatives to sort out traffic problems and benefit the economy.

This report looks at how transport spending can help stimulate the economy and proposes a wide range of better transport projects that the Government should be backing, including rail, bus and ‘smarter choices’ programmes to reduce traffic without spending, or risking, billions of pounds on big new roads.

Last updated: 8 October 2012
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