The logic behind privatised roads is deeply misguided, as we are slowly finding out

Handing over management of major infrastructure to the private sector means decisions over its use are no longer made in the national interest but in the interests of shareholders, which can be very different.

Traffic pollution

Sian Berry is a campaigner for the Campaign for Better Transport

Allowing lorries to use the M6 Toll Road for free has put Britain’s sole pay-for-use motorway back in the headlines. But this marketing wheeze exposes the weakness of the operator’s position and the flawed logic behind privatised road building.

The M6 Toll’s operator, Midland Expressway, recently announced it was to allow lorries free access to the road during July. Giving away your product with the hope that punters will subsequently adopt the paid-for version is a good way for new players to announce themselves to the market. But the M6 Toll has been around for a decade. That such desperate measures are under consideration shows the mess the 27 mile road has got into and the problems of using private finance to pay for new roads.

The M6 Toll has been struggling for some time. Traffic levels on the road have been falling since 2006 and in the last quarter it carried just a third of traffic it was built to handle. The cycle of lower use has gone hand in hand with higher tolls as Midland Expressway attempts to make running the road pay.

It is a strategy that has not worked. Last week, the papers including the Financial Times reported the Midland Expressway’s owner, Macquarie Atlas Roads, is currently trying to refinance its £2.1bn debts – a tough proposition with assets valued at only £1.2bn.

It isn’t just Macquarie who is paying the price the failure of the M6 Toll. While the toll road is underused, the original M6, which it was built to relieve the pressure on, is sucking in millions of scarce public money to cope with on-going congestion problems. Geoff Inskip, chief executive of Centro, the West Midlands transport authority, cheekily suggested the best solution would be to nationalise the M6 Toll.

All this is a timely reminder of the folly of new private roads – something we’ve been warning about the impracticality of all this since last August. The DfT continues to examine how it can attract private finance to pay for the hundreds of new road schemes that local and national governments want to build. An announcement over its favoured approach expected around the time of June’s Comprehensive Spending Review.

But, as the M6 Toll shows, handing over management of major infrastructure to the private sector means decisions over its use are no longer made in the national interest but in the interests of shareholders, which can be very different.

Furthermore, with traffic stable or falling across much of the country, there are wider questions about why anyone (Government or private investor) would be interested in new road building schemes. We should be working to break our reliance on the car. Public money for roads should be focused away from new building, with spending instead channelled on increasing the effectiveness of our existing provision – starting with tackling the £10.5bn backlog of potholes.

5 Responses to “The logic behind privatised roads is deeply misguided, as we are slowly finding out”

  1. OldLb

    Stop HS2, divert the money to roads.

    Or at 35 bn, think about the DLR extension at 140 million

    Hmmm. 35,000 / 140 =250

    So you could have 250 DLR extension across London. Well, there isn’t enough room for that many.

    So Brum, Manchester, Bristol, … etc could all have lots of their own.

    You get economies of scale. You can start and stop, its not all your eggs in one basket.

  2. blarg1987

    There is a hell of a difference between HS2 and DLR extensension.

    The idea you can compare the two is like saying it is cheaper to take a train to space then launch a rocket.

  3. Lb

    There is a big difference between 250 dlrs and 1 white elephant of a railway line that will never pay its way

  4. blarg1987

    Alot of infastructure never does! If we look at alot of infastructure at the time ie. M25, channel tunnel etc, it did not pay for itself. But is now necessary.

    I accept HS2 may not necessarily be the best option but upgrading the existing rail network might be a better option.

  5. blarg1987

    Alot of infastructure never does! If we look at alot of infastructure at the time ie. M25, channel tunnel etc, it did not pay for itself. But is now necessary.

    I accept HS2 may not necessarily be the best option but upgrading the existing rail network might be a better option.

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