Submitted by Mark Prior, EC Harris, Head of Transportation
In the Autumn Statement at the end of last year George Osborne pinpointed investment in infrastructure as a fundamental component in the UK’s wider growth strategy. In today’s Budget review he reaffirmed this vision and confirmed that talks are now ongoing with a dozen pension funds. Equally positive was the commitment to streamline the UK’s onerous planning process and remove many of the barriers that make it so difficult to get ‘spades in the ground.’ However, across each of the transportation sectors further detail is needed on the progress that has been made since last November and on how the projects outlined in the National Infrastructure Plan will begin to move forward over the coming months.
The main news to emerge from the Chancellor’s address was a renewed focus on improving the rail network in the North of England. The move to create new rail links between Manchester and other cities across Lancashire and Yorkshire is welcome and will help to address the previous lack of investment within this part of the UK. This focus on better rail links aligns with the government’s previous assertion that investment in rail can help to underpin the wider growth agenda by creating jobs and facilitating better trade links.
Earlier this month the Secretary of State for Transport issued a new directive for rail policy following the end of the consultation on the findings from the McNulty review and whilst no additional detail was added to this, the Chancellor did allude to a new Transport strategy that will be launched by Justine Greening later this summer. This report should offer some insight into how big schemes such as Crossrail and HS2 will come together with the expansion of the Northern Hub to form an integrated UK rail network.
In his Budget address George Osborne outlined ambitious plans to double the UK’s income from exports to £1.2 trillion and identified greater engagement with emerging markets such as Brazil, Russia, India and China. As the only mode of transportation capable of moving goods large distances around the world quickly, aviation will be fundamental to meeting this target. The onus on the government now, is to design a framework that allows aviation to be a conduit to this growth. The aviation policy framework that was due to come out this month has now been deferred until the summer but when it is finalised it must ensure that London has the required airport capacity to remain a global centre for trade and that the UK as a whole is seen by the rest of the world as “open for business”.
Policy makers have explored several options to address this capacity issue however they must now accept that the only sensible and realistic option is to press ahead with plans to build a third runway at Heathrow. The arguments are well researched and well founded - Heathrow offers a solution that can be delivered within a reasonable timeframe and at an affordable cost. A third runway that increases capacity at the airport will also enable them to reduce congestion and the flexibility required to help minimise noise pollution and associated carbon emissions.
George Osborne also confirmed what the Prime Minister outlined at the start of the week – the UK is exploring how to attract inward private investment to help improve its road network. No further detail was shared on road tolling or on alternative charging policies however with the cost of maintaining our road infrastructure continuing to increase this appears to be an inevitable next step. Is the decision not to cut fuel duty a pre-cursor to the tolling plans outlined earlier this week? Quite possibly, road-tolls are something which pension funds are keen to push through as they will provide a guaranteed return on their investment.
Congestion continues to be a problem and traffic will always exist because the end user has no decision to make at the point of use. Direct intervention is likely to be deeply unpopular however tolling initiatives across Europe demonstrate the success that can be achieved. The no. of strategic reviews currently taking place within the sector should create enough informed opinion that will provide the government with the ammunition it needs to begin to introduce people to the idea that it is not actually a bad thing to pay at the point of use of your car. In other industries where there was similar pessimism, public opinion has changed - the water and rail industries have definitely improved despite initial scepticism.