Get the chequebook out. If ministers can’t agree new funding schemes, spend more motoring tax building the roads we need

By Professor Stephen Glaister, director of the RAC Foundation.

If the Financial Times is to be believed (Wednesday 6^th March, p3) the government just lost its resolve on a reform of vital importance to the economic recovery: road infrastructure. Whilst it decides which way to go it should immediately end the delay with getting on with using conventional funding for some crucial schemes such as the improvement of the A14 and A303. And if it looking for other infrastructure improvements that will repay their investment costs many times over there is a long list of other languishing road schemes.

The government has a fixation about achieving economic growth. So would any government at the moment, for the simple reason that the arithmetic dictates that without growth the deficit cannot be eliminated. Vince Cable hinted at such a thing on this morning’s Today programme on Radio 4 just after 8am.

This government has also acknowledged that historic under-spend on capacity and maintenance, growing population and the need to serve economic growth all point towards a need for more resources for infrastructure. The big question is who is going to pay for it?

In March 2012 the Prime Minister outlined this infrastructure problem and specifically mentioned the need for more strategic roads. He pointed out that pension funds and sovereign wealth funds have lots of capital available to invest in long-lived infrastructure like this.  He mentioned the analogy with the water industry, which has achieved a massive investment in order to deliver more and better quality water with no burden on the taxpayer. Why not do the same for strategic roads?

There was a snag: the Prime Minister explicitly said he was not considering introducing charging for using existing roads, only new capacity. But there are few opportunities to build self-funding, distinct new roads in Britain. What is needed is better maintenance and capacity enhancement of the existing network: so where was the money going to come from to repay the investors? Water users pay for all the water they use and it is that which funds the industry’s infrastructure.

This fundamental flaw in the argument was quickly spotted and the Prime Minister commissioned the Treasury and the Department for Transport to carry out a “Feasibility Study” into options for correcting it.  This duly reported by the end of November.

But it seems that nothing offered found favour: the hoped-for announcement was missing from the 2012 Autumn Statement. There was only a promise that something would be announced before the 2013 Budget (20^th March). It is rumoured that there was a section in the Coalition Government’s “half term review” document but that was dropped at the last minute.

Now, apparently, nothing will appear until the summer of 2013 at the earliest.

It is all very difficult. If there is going to be significant private investment there has to be a significant new cash flow to service the debt. There has been speculation in the press that this could come from some form of new charge for access to parts of the system, perhaps similar to a scheme proposed in a think piece by Brian Wadsworth and published by the RAC Foundation. Yet the government knows that with 35 million motorists amongst the electorate it cannot risk creating a perception that a significant proportion will be losers. To avoid this it would probably be necessary to sweeten the pill with an offsetting reduction in one or both of the main road taxes: fuel duty and the tax disc (VED).

In a world where “there is no government money” that is going to be difficult to achieve. But maybe the growth imperative will persuade government to do this.

For motorists that could turn out to be an attractive deal: better, less congested roads and less of the money they pay now being siphoned off the pay for other areas of general government expenditure. But judgement on that must await the detail of a firm proposal.

Whilst this hand-wringing is going on nothing much is happening. Although there have been worthwhile investments in solving “pinch-points” some really urgent, growth-critical schemes continue to languish.

The most important of these is the improvement of the inadequate A14. This road serves the east coast ports (Felixtowe and Harwich) and travels west past Cambridge and Huntingdon towards the industrial heart of the country. It is recognised as being of European significance, part of the Trans European Network. A good scheme for rebuilding it was developed over a decade with much effort and expense. There is considerable support amongst local communities, commerce and industry.

Yet, at the last minute, the Coalition Government cancelled the scheme and gave up planning consents in the 2010 Spending Review on the grounds that it was “unaffordable”. Since then the government has been feeling its way towards re-instating a scheme. First there was a consultation, the “A14 Challenge”. Then, before the response to the consultation was fully complete the government announced a new plan involving three-way funding: central government, local communities and tolls.

The new proposal is on much the same line of route as the abandoned one but is physically more complex and seems likely to cost no less. Raising the required funding from a number of local sources, all financially hard-pressed, is going to take a long time to negotiate. The tolling proposal is controversial with the locals.

The RAC Foundation is not opposed to charging road users, if that is part of a coherent, national-scale package including adjustment to road taxes. But the free-standing proposal for the A14, whilst interesting, in practice looks like a recipe for endless further delay—and it conflicts with both the wider national road funding policy and the new lorry charging scheme which is currently in Parliament.

A piecemeal approach also risks the creation of a postcode lottery. Why should users of this economically strategic piece of road pay extra to drive along it when city bankers in their trophy cars can zoom down to the coast along the A3 and through the new Hindhead Tunnel without extra financial hindrance?

It is now two and a half years since the government cancelled this crucial scheme and began wondering what to put in its place. The hybrid funding scheme it is trying to broker will likely cause more delay. Pending a resolution to its confusion about whether and how to reform national road funding as a whole, it should simply stop prevaricating on the A14 and get going using the conventional exchequer funding method.

There is a broader point.  As Vince Cable points out, so long as investments are made in schemes with a good rate of return they will eventually cost less than nothing. Unless the government is confident that it can agree and implement innovative funding mechanisms for roads soon it should stop wasting time and get on with the broader, economically justifiable national roads programme using conventionally funding methods.

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The death of integrated transport? We have tactics but no strategy. #roads #hs2 Lessons from T5

By Professor Stephen Glaister, director of the RAC Foundation.

The Coalition government has, quite rightly, made strong commitments to delivering new, high quality infrastructure and to doing that soon.

This includes roads and railways. The Secretary of State for Transport is in the process of announcing a number of important decisions. There are number of rail schemes contained in “the biggest rail investment programme for a century” in addition to High Speed Rail; a number of new national and local road schemes; not to mention the development of a national roads strategy and the announcement of the outcome of the  “feasibility study” of new funding and ownership models for national roads.

Yet there is no stated policy context for these decisions: by what criteria is the Secretary of State deciding to allocate the desperately scarce publicly funded capital between the competing possibilities? The government has committed to producing a series of National Policy Statements (NPS, see the explanatory note below) which would have helped, but we have been promised the one on roads and railways (“surface networks”) for years and it seems to have sunk without trace.

On more than one recent occasion the Secretary of State for Transport has shown no knowledge of or interest in the concept of a National Policy Statement—although he was keen to outline his choices of specific nationally significant road and rail schemes. This can only be taken as evidence that officials and the Department for Transport as a whole now see announcing projects as a higher priority than developing a national policy context. He did not seem keen on the idea of any kind of strategic review.

For schemes of national significance delays caused by the planning process is one of the fundamental obstacles faced by both this government and its predecessor (the other being funding—how it is going to be paid for).

The planning approval for Heathrow T5 took years (it saw the longest public inquiry in British history) because a debate about a specific scheme became hijacked by a dispute about high level national policy. Similar things have happened with inquiries into road, rail and port schemes. In the attempt to rationalise this and speed things up the Labour government passed the Planning Act 2008.

Under this Act the government publishes for general consultation a statement of national policy in a particular area. After the public have had a say it will, after revision, be submitted for approval by Parliament. Once approved, if a specific application for a “nationally significant infrastructure project” is consistent with its relevant NPS, the policy underlying the project cannot be an issue when the application is examined. And there are clearly defined time limits within which a decision must be reached.

This system was adopted by the Coalition government: the only major change being to transfer responsibility for final decision from an Infrastructure Planning Commission (which was wound up) back to ministers.

The government has designated six NPSs on energy, one on ports and one on waste water. One on hazardous waste is promised soon.  It has probably attempted several drafts of an NPS on roads and railways but it has never published one.

It is a characteristic of large road and rail schemes that they tend to require significant financial contributions from the Exchequer (from you and me).  Parliament and the general public deserve to know ministers’ views on what problems they are trying to solve with our money and how they think the particular schemes they are promoting will help.

There are other interests. The government is—rightly—keen on attracting private funds to invest in transport infrastructure: for instance in major rail freight terminals and the A14 road improvement scheme. But why would a private enterprise risk wasting endless time and money on promoting a scheme in the knowledge that it might fall foul of some unannounced national planning policy and without the assurance on timely decisions that the NPS system is designed to provide?

Maybe this does not matter: there are (sometimes cumbersome) parliamentary procedures available for railways. The surface transport planning process has not yet ground to a complete halt, though the going may become harder when large and controversial schemes come up for decision.

This integrated transport policy seems destined to go the way of all previous attempts. We will muddle through as we always have. But, surely, this is a becoming a great missed opportunity?

 

 

An explanatory note on the Planning Act 2008 by Ian McCulloch, Bircham Dyson Bell LLP

The Planning Act 2008 introduced a new regime for authorising nationally significant infrastructure projects (NSIPs), as defined by the Act.

National Policy Statements

A central element of this new regime is the concept of National Policy Statements (NPSs).  An NPS is a statement by the relevant Secretary of State setting out Government policy in relation to one or more specified descriptions of development in the fields of energy, transport, water, waste water and waste.

An NPS may specify the amount, type or size of development which is appropriate nationally or for a specified area; the criteria to be applied in deciding whether a location is suitable; the relative weight to be given to such criteria; the identification of one or more locations as suitable (or unsuitable) for specified development; the identification of one or more statutory undertakers as appropriate persons to carry out such development; and the circumstances in which it is appropriate to mitigate the impact of specified development.

The idea is that, if a specific application for an NSIP is consistent with its relevant NPS, the policy underlying the project cannot be an issue when the application is examined.

From an applicant’s/developer’s perspective, it is therefore desirable to have an NPS in place providing policy support for the specific proposal.  More generally, the existence of NPSs should be facilitating the whole agenda for infrastructure development and implementation.

The previous Government indicated its intention to produce 12 NPSs across a range of industry sectors.  The Coalition Government has designated eight NPSs – six on energy, one on ports and one on waste water – and a ninth awaits designation – hazardous waste, which we could expect to see soon.  The NPSs not yet made are for water supply, for roads and railways (the so-called National Networks NPS) and for airports (which presumably now has to await the outcome of the Davies review into capacity in the south east of England).

Consultation on NPSs and Parliamentary Scrutiny

The Secretary of State must carry out public consultation in relation to each NPS and must have regard to responses to such consultation.  In preparing an NPS the Secretary of State must have regard to the objective of contributing to the achievement of sustainable development.  Draft NPSs are subject to formal sustainability appraisals.

NPSs are also subject to a form of parliamentary scrutiny. The SoS is obliged to lay a draft NPS before Parliament.  In the House of Commons, either an ad hoc Committee or the relevant Select Committee will call for evidence, scrutinise the draft NPS and publish a report on it.  In the House of Lords, an NPS is debated in a Grand Committee and also on the floor of the House, if called for.

The Government must consider representations made during the consultation, any committee recommendations and any resolutions of either House of Parliament.  It must then lay before Parliament a statement setting out the Government’s response to the resolution/recommendations before amending the NPS and must also allow the Commons 21 days to have a chance to disapprove of the NPS before designating it if no such disapproval is forthcoming.

Process for Development Consent Orders

When an application for a Development Consent Order (DCO) is submitted to the Planning Inspectorate (PINS), PINS has 28 days to accept or reject the application.  PINS may reject an application if, for example, it considers the content not to be of a satisfactory standard or if it considers that the pre-application consultation has not been adequate.

When an application has been accepted, it must then be publicised.  A period of not less than 28 days is allowed for initial representations to be made by third parties.  Then, after a period of evaluation by PINS, a Preliminary Meeting is held where PINS’ proposed timetable for the examination stage is discussed (which will include an opportunity for further representations to be submitted).

The examination stage takes the form of a mixture of written representations and short, topic-based, hearings.  There is no public inquiry of the kind that is held under other procedures.

PINS is under a duty to complete the examination of an application within six months of the preliminary meeting.  PINS is also under a duty to make a recommendation to the Secretary of State within three months of the end of the examination of the application.  These periods may be extended by the Secretary of State but this has not yet proved necessary.  Once a recommendation has been received by the Secretary of State, it must be decided within three months.  This date may also be extended by the Secretary of State but this has not yet happened either.  These periods are set out in sections 98 and 107 of the Act itself.

The only period for which there is no statutory time limit is the period between acceptance of an application and the holding of the Preliminary Meeting.

In practice, the way this is working out is:

• Application to acceptance: 28 days (say one month)
• Acceptance to Preliminary Meeting: say 3 months
• Examination stage: 6 months
• Report to Secretary of State: 3 months
• Decision by Secretary of State: 3 months.

This totals 16 months, which, for a complex or controversial scheme, is short compared with the likely period under the procedures that would have applied previously.

 

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Are travel plans worth the paper they are written on?

They’re been around for an age, but the latest child pedestrian casualty figures have helped put the effectiveness of travel plans – school based in particular- into sharp relief.

Travel plans can be developed for schools, companies, individuals or areas. They are essentially tools to reduce the dependency on cars and by consequence can help reduce congestion, relieve parking problems, allow for home working and minimise the impact of travel on the environment.

But the question is: are they worth the paper they are written on? A published international systematic review raises serious concerns about their validity, or at least they way their effectiveness is analysed.

A Cochrane Review looked at 17 studies into travel plans all of which analysed modal shift and one specifically assessed health impacts. The Review’s conclusion was not encouraging:

“Despite widespread implementation, there is insufficient evidence to determine the effectiveness of organisational travel plans for improving health or changing travel mode.”

Although not an uncommon conclusion for systematic reviews, this finding provides cause for concern. So what is the situation in this country?

Almost ten years on from the publication of the influential DfT report Smarter Choices: Changing the Way We Travel we find that travel planning is used across much of the country. Government White Papers continue to promote ‘enabling good transport choices through ‘nudge’ interventions’ such as travel plans, and in 2010 the Local Sustainable Transport Fund made £560 million available over four years to support travel plans and other sustainable transport initiatives. An analysis of the Sustainable Travel Towns project found that ‘smarter choices’ activities, of which travel planning is one, helped to reduce car driver trips by 9% and car driver mileage by 5-7% in the towns and their surrounding areas.

The Cochrane Review also touched on the impact of travel plans on accidents amongst children, saying that programmes:

“…should be implemented in the context of robustly-designed research studies, accounting for potential adverse effects such as child pedestrian injury.”

This is particularly pertinent given the road casualty stats which came out this week revealed the number of child pedestrians killed or seriously injured in quarter 3 of 2012 was up 8 per cent on the previous year (of course, school holidays would have taken up half of this period).

A 2010 evaluation of school travel plans concluded they had not had a significant effect on the mode share figures for the school run and it was difficult to assess the health benefits in terms of reduced child obesity.

None of this means that travel plans do not work, but does suggest that when we put public money into projects we need to have a better handle on what they achieve. If travel plans are truly delivering transport and sustainability goals, scheme promoters simply must find a better way of expressing the benefits. Taking another decade to do so, would be too long!

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Where does the money go? Analysing just what gets spent on local transport…

By Professor Stephen Glaister, director of the RAC Foundation.

The ways in which English Local Authorities receive their money – Local Government Finance – is horribly complicated. Almost nobody understands it in detail and few people care. And the current policy of devolution is going to make the muddle a whole lot worse.

We should give the subject more attention: it directly affects the levels of local services we all worry about: from library provision, through street cleaning and refuse collection, schools and housing to the number of potholes we have to endure and the amount there is to spend on adult and child social care.

The Public Accounts Committee is a powerful (and once much-feared) cross party committee of backbench MPs. Their role is to scrutinise the way government spends national taxpayers’ money, acting on behalf of Parliament and us all.  It applies “value-for-money criteria which are based on economy, effectiveness and efficiency.” On Tuesday 5th February it published an informative little report that illustrates the fundamental inconsistencies in current policy on devolution. It is an overview of funding for local transport.

The days when local people decided on the level of service they would like and then voted to pay their local authority the necessary money directly are long gone.  Much of the money now comes from grants from central government via departments such as the Department of Communities and local Government and the Department for Transport.  And government capping of local domestic taxes limits the freedom councils have over the income they are supposed to be able to raise from the people who use their services.

This degree of centralised control over local community income and spending is quite unlike anything to be found elsewhere in the developed world. It is Coalition Government policy to further devolve things from central government to the people. The trouble is that, in practice, the temptation is always to devolve the responsibilities and statutory duties without devolving control over the cash that must go with them. This can create misalignment of incentives, lack of transparency and poor accountability for national taxpayers’ money.
Tuesday’s report makes some worrying observations. For instance the Department for Transport gives grants according to a formula for the purposes of roads maintenance and other transport projects. But there is no attempt to prevent local authorities choosing to spend the money in any way they choose. Worse, they seem to have no way of keeping a record of how the money is actually spent. Nor are minimum quality standards set down. In practice it seems inevitable that the pincers of reduced total income and ballooning statutory obligations (environmental and social services particularly) will force many councils to spend less and less on roads maintenance, whatever local people would prefer.

So what national objectives is this ‘transport grant’ supposed to be meeting?

We have long-established, legally constituted and democratically accountable local authorities.  Now, through a somewhat mysterious process the government has encouraged the creation of Local Enterprise Partnerships. These vary in geographical scope and typically cover several local authorities; some overlap and some areas are not covered at all.  It is unclear how professional or administrative support is to be provided. It seems that the nitty-gritty of financial audit, accountability for funds and democratic accountability will reside with existing local authorities, but how will these channel though to the Local Enterprise Partnerships? Then, on top of all this it is intended that there should be thirty-nine new non-statutory ‘transport bodies’ to execute transport policy at the local level. The Public Accounts Committee also had a view on this.

When launching the report the committee Chair remarked:

“We are not convinced that government has thought through the risks of devolving more control over the funding of major transport projects to a local level. For example, the Department is confident that local bodies will naturally cooperate to fund and implement projects. We believe this confidence may well be misplaced.

“The risk is that local transport bodies, under severe financial pressure, will not take sufficiently strategic and joined-up decisions, threatening national or regional transport funding objectives.”

This is surely a realistic assessment. Shortages of money and special parochial interests will cause endless strife in and amongst disparate bodies that may have different party political loyalties, and little dedicated professional support and no democratic mechanisms for resolving disputes.

The Committee also raised an issue that has not been satisfactorily addressed since the Coalition Government closed the Regional Development Agencies: “We asked how large infrastructure projects which span the boundaries of several transport bodies would go ahead and who would consider these wider regional or subnational needs. The Department considered that common sense would prevail and maintained that there were examples where local bodies had come together to pool funding across boundaries.” This is a serious worry. Central government is responsible for the strategic road and rail infrastructure. Local authorities look after the infrastructure in their own back yards. But there are major items of Regional importance which now risk falling between the two and which will cover too big a geographical span to be dealt with by the new transport bodies.

During the evidence sessions another enormously muddled subject was raised: the extent to which it is right, or even legal, for local authorities to seek to make good their failing general budgets by increasing car parking charges. They can make charges for their on-street street parking as part of a policy to manage traffic and, generally, any net revenue must be spent on transport purposes. But they cannot increase on-street parking charges with the primary objective of raising revenues: that would be a tax without a mandate on one particular activity.

But Local authority charges for off-street carparking is not restricted in the same way: it is just like any other provision of off-street parking (by the public or private sector). It was revealed in the Committee’s evidence session how much pressure has been applied by central government on local government to raise additional funds by increasing parking charges in order to make good reducing central grant: another example of the chaos and obscurity that surrounds the funding of local government.

The overall conclusion is clear. Devolution is fine, but the money must go with the duties and powers. If government continues to try to pass on one without the other democratic and fiscal accountabilities become broken And over many decades and all over the world we have learned through bitter experience that bodies responsible for cash and executive decisions must have a proper legal constitution and be subject to effective, independent audit. Otherwise things inevitably end in tears.

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#peakcar? Myth or reality? RACF #traveltrends report delves beneath the headlines.

By Professor Stephen Glaister, director of the RAC Foundation.

You’ve heard of peak oil, of course, but what about peak car? The theory that here in Britain travel by automobile has plateaued; indeed is starting to decline. It is an idea that is gaining traction in many corners of academia and Whitehall, and confirmation of its existence would have important repercussions, certainly as far as transport policy is concerned.

On the face of it there is a lot to suggest the idea has merit, not least the levelling off of total car traffic which began in the early 2000s and which became a decline as the recession hit.

But what is going on beneath this bald overall figure? What happens when you start to disaggregate the total? Thus far no one had really done the work to reveal the true picture hiding under the surface. They have now. A team led by Professor Peter Jones from University College London – sponsored by the RAC Foundation, the Office of Rail Regulation (for the researchers also looked at rail travel), the Independent Transport Commission and Transport Scotland – has spent months pouring over official transport facts and figures going back a decade and a half. And the conclusion of their On the Move report is? Essentially that the nation’s love affair with the car is not over yet. Indeed millions more driving virgins have been charmed by its wiles over recent years.

As you might imagine the reality is a complex one. Since the mid 1990s there has been a huge drop in company car mileage as the tax regime surrounding these vehicles and the fuel they use has changed. Men of most ages are also driving less with a big decline in licence holding amongst young men aged 20-29. London has also seen a significant fall in per person mileage.

Yet that is only part of the story. Around 2.5 million more women have a driving licence today than fifteen or so years ago. This figure is not simply a product of population growth, but an increase in the proportion of females driving.

And those females who do drive are also doing more miles on a person basis than ever before (though they still drive only half as much as men).

In fact if you take out the collapse in company car use – which could be viewed as a one-off factor which has now pretty much worked its way through the figures – then for those aged 30 and over outside the Capital then car use has been growing, not falling. This group of people represents 70% of the British population. For them there has been no ‘peak car’ effect.

Women in their 30s are also leading the charge in growth on the railways, increasing their mileage by around 80%, compared with national growth of 54%.

Cause and effect are difficult to determine but there seems little doubt that increased female travel is linked to women’s increasing level of economic activity (as men’s declines), the rising age at which they have children, more middle-aged people living alone and increased longevity.

There is also the regional dimension. On the Move demonstrates that London really is a world unto itself. It had the unique distinction of being the only part of Britain where – prior to the recession – there was a decline in traffic.

Some of the reasons for this are obvious: the congestion charge, excellent public transport, emphasis on walking and cycling. But also playing a part are international migrants and the very large young population, two demographic groups who drive less than the average.

Perhaps the biggest unknown going forward is: what will happen to those young men who are not currently driving? Will they decide they can forever go without a car or once their financial and domestic circumstances change will they revert to type and become drivers? A lot hangs on their choices, but not all transport policy is dictated by relatively small changes in individual choice. Some of it is down to sheer weight of numbers. And with the official forecasts predicting a ten million rise in the population in the next couple of decades, it would take a brave person to suggest we should be cutting investment in our road network.

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Small print could save road expenditure from savage cuts at @BhamCityCouncil

There was grim news the other day from Birmingham City Council as it announced £600m of savings would have to be made between 2012 and 2017. This is likely to result in the workforce shrinking from 19,000 full-time employees to just 15,000.

The Council leader, Sir Albert Bore, said Birmingham would have to “start decommissioning services” and foresaw that the financial crisis would lead to “the end of local government as we have known it.”

Amongst all the bad news for city residents and council staff, a big question mark hangs over the future scope and scale of the road maintenance programme.

Birmingham is one of a small band of authorities that have contracted out their roads programme, in this case to Amey, in what are essentially PFI deals. The company’s website explains the scope of the project:

“Amey is responsible for improving and maintaining Birmingham Highways infrastructure, including 2,500km of road network, nearly 100,000 street lights and over 850 highway structures and bridges across the city. Additionally, we deliver a wider Corporate Social Responsibility (CSR) element within the contract that aims to benefit the local community through various initiatives.

“The contract has a 25 year service delivery period which includes the improvement and repair of roads in Birmingham, maintenance of footways, bridges, street lighting and traffic signals along with the upkeep of street scenery, such as safety barriers, seats and trees.”

The key point lies at the start of the second paragraph. Amey has, presumably, a legally binding contract with the council to carry out the work for a quarter of a century. Which means that if it keeps its part of the bargain then the city has to keep paying up, no matter what other demands there are on its financial resources. On the one hand this would appear to be good news for road users – and the businesses which depend on a smooth running transport network – in the West Midlands, and there are positive reports from councillors about the success of the deal. But on the other hand it raises questions over the nature of long-term contracts in times of shrinking public budgets.

The RAC Foundation has long argued for more long-term certainty around road provision and management, and the government is considering introducing five-year funding and spending plans for the Highways Agency-managed roads, just as there is for railways (the High Level Output Specification and Statement of Funds Available). One of the reasons a broader horizon is needed is exactly to counter the hand to mouth existence created by varying political pressures now being seen in Birmingham. However if all services are outsourced on a contractual basis then where exactly do councils make cuts? Just one more thing to consider in tough times.

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Q. How many #accountants does it take to build a #road? A. 183

Interesting(?) fact of the day from Hansard.

Stephen Barclay: To ask the Secretary of State for Transport how many members of staff working for her Department had a recognised accountancy qualification in each of the last three years; and how many such staff (a) have the Associate Chartered Accountant (ACA) qualification and (b)are working towards a recognised accountancy qualification. [107989]

Norman Baker: The Department (including its seven executive agencies) has 183 staff with recognised accountancy qualifications, of whom 36 have ACA status. In addition, 25 staff are currently working towards a recognised accountancy qualification.

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Chancellor drives through #fuelduty rise in #Budget2012 but what would Adam Smith think?

So that’s that then.

After a cut in fuel duty in the March 2011 Budget and the postponement of the January 2012 3p rise until August this year, it was always going to be hard to convince the Chancellor to once again tinker with fuel duty rates even if there are pressing and convincing reasons to do so, as George Osborne himself appeared to recognise today.

What was surprising about Mr Osborne’s Budget speech was that contained the rationale for amending the way motorists are taxed. Referring to the work of the 18^th Century economist Adam Smith, Mr Osborne said that a tax system needs to be four things: fair, predictable, simple and supportive of work. Yet it is quite easy to argue that fuel duty is no more than one of those things.

The premise behind fuel duty has never been entirely clear: varyingly it has been described as an environmental tax, general revenue raiser and method of covering the externalities drivers impose on others (who are often other road users). Nor have the changes in fuel duty rates over many years been smooth or consistent. Fuel duty is also a regressive tax, hitting the poor harder than the rich.

Therefore the single area where fuel duty might fit the bill under Smith’s criteria is the ease by which it is collected.

Mr Osborne did recognise that drivers are likely to be hit by things beyond his control. Early in his speech he said a risk to the economy identified by the Office of Budget Responsibility “is a ‘further spike in oil prices’, and there is no doubt that the high oil price – driven both by real demand and the Iranian situation – is of great concern across the world.”

While it is a dangerous game to predict the future from the past, it is hard to see oil prices falling significantly, which does at least mean that rises in fuel duty – at least during the life of this Parliament – will be inflation only. In the unlikely event that oil prices drop below $75 a barrel for a sustained period of time then the Treasury will raise duty rates by inflation plus one percent per annum.

Many of the nation’s 34 million drivers will be feeling disappointed tonight that the price of fuel remains were it is with the prospect that it will jump markedly later this year. The cost of motoring is a real drag on the finances of the majority of households. In the absence of more, effectively arbitrary and politically driven postponements in duty rate rises, perhaps the Chancellor will at least turn his attention to making motoring taxation more closely fit the principles outlined by Adam Smith more than two hundred years ago. That would be progress.

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Can we deliver transport using a retail model?

The RAC Foundation has today published Achieving Complete Mobility, a piece of research carried out by MRC McLean Hazel about the potential of moving towards a more integrated and service-oriented transport system.

For quite some time now there has been a trend towards increased individualisation, customisation and integration of products and services. Transport has not been part of this process for understandable reasons: transport operators are mostly responsible for only one part of the journey experience, which does not take account of people’s overall (mobility) needs.

This might be a missed opportunity since the development of a more integrated, service-oriented transport system could bring many benefits. For end users it would mean that transport fits more closely with their individual needs, and the service received would be more efficient; for business and government, particularly local government, such a system could create new revenue streams as it is reasonable to expect that people are willing to pay for an improved or new service where none existed before.

Technology offers significant potential for facilitating transport service provision. Smartphones, satellite navigation systems and smart cards—to name but a few options—enable the integration of transport with other sectors of the economy. From the point of view of operators, technology enables information about different transport modes, for example usage patterns, to be collected and linked with a view to making the service work more efficiently. End users, on the other hand, can use technology to obtain real-time information about traffic, public transport services and the next leg of their journeys.

There are, however, several challenges facing a new approach to transport policy which include government capacity and resources; public trust in institutions and privacy concerns; and questions about how a retail-like transport provision would fit into the general tax system.

Nonetheless the report provides a useful first step in understanding how change in transport provision might come about, and what it might look like.

To download a PDF copy of the report please visit our website by clicking here.

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Is it time to design the motor vehicle off London’s streets?

The opening statement made by the RAC Foundation’s Head of Research today at the Royal Academy of Engineering as part of the London Design Festival 2010

‘Well, unsurprisingly some might think, we at the RAC Foundation say No to the proposition that we should design the motor vehicle off London’s streets. Now this is not for some pure ‘pro-car’ ‘let’s keep everything the same’ reason, as this is not the type of organisation we are. As a research based charity we look at the facts and evidence and form a reasonable and responsible position from this basis. I will now take a few minutes to explain to you how we have come to this conclusion.

Firstly it is important to recognise what alternative transport solutions are able to deliver in London and how the car fits into this overall mix. Over the last decade two Mayors and Transport for London have overseen major improvements in London’s transport system: upgrading the tube, more reliable bus services with a denser network, cycle lanes and an ambitious cycling strategy…and the list goes on. One of the consequences of this is a 5% shift from car usage to public transport.

We undoubtedly need to continue investing in public transport, walking and cycling initiatives in London. This is indisputable, but this does not mean we should design the motor vehicle off London’s streets. The car still has a role to play.

It is also important to remember that  ‘London’ is not one entity – there are two different London’s – central London with its radial routes and a doughnut shaped outer London and these two places have very different characteristics and travel patterns. Only 19% of all movement on the roads is by car or taxis in central London whereas 67% of travel in outer London is by car, which is similar to many other parts of the UK. With this in mind there are different ‘design’ options for London as a whole, but to date, there has been too much focus on what can be achieved in the relatively small ‘centre’.

So why is the car still so popular given the level of congestion on London’s road network? Can anything be done about it? In outer London, travel is typically geographically dispersed, so it is difficult for rail to offer an alternative for all but a modest proportion of journeys. The density of movement will also rarely justify a high frequency bus network on all but a few key corridors into major centres such as Croydon, Harrow, Heathrow and similar. This inevitably leads to personal movement being dependent on the road network and this will always be the case in outer London, whatever public transport accessibility improvements are made at the margin. It is also important to recognise that ‘cars’ do not only account for personal travel. Excluding commuting, over 20% of London’s road traffic is directly involved in business activity, which tends to be difficult to shift to over modes.

This is the reality of the situation that London is faced with. Going forward travel demand is only expected to increase with 1.25 million more people and over 750,000 new jobs in the Capital expected by 2031.  As desirable as it might first appear to design the motor vehicle off London’s streets, we need to be aware of what function the car is playing, especially in outer London and recognise that other modes won’t on their own be able to fill the gap. Congestion, environmental concerns (both local and global), social segregation and road safety issues are all legitimate reasons for wanting to rid streets of cars, but the reality is that cars can’t be taken completely out of the equation. Parking charges and more wide spread road user charging could go some way to managing down the use of cars (as suggested by the Mayors Transport Strategy), and there is even a question about whether London’s aims can be achieved without this. With or without road pricing the ongoing smoothing traffic flow agenda is vital for providing a more economically viable road network for the city as ‘roads for movement’ are still needed alongside the development of more liveable streets.

Where environmental issues are concerned, strict EU targets on new vehicle emissions, and the development of new low carbon vehicle technologies, means that a large proportion of all domestic transport CO2 reductions will be delivered by vehicle improvements. There will also be significant improvements made to air quality. Over the past 18 years, particulate matter from vehicles has decreased 53% and further decreases will be secured from the EURO VI standards after which time diesel particulates are expected to equal those from petrol vehicles by 2015.

Difficult choices will undoubted need to be made to achieve viable transport operations in inner and outer London over the short, medium and long term. In the short term, maintaining a viable traffic operation in Central London will be a significant challenge. Difficult decision may well need to be made about vehicle access times, speed limits etc, but designing out the car completely will not be possible. Land use planning to reduce the need to travel will be increasingly important.

Going forward it is vital that the strategic transport issues facing the city are addressed rather than there being a pre-occupation with modally-focussed schemes. Cycling initiatives although well placed, are on their own, unlikely to secure great modal shift from the car. For instance if a quarter of cycle hire use came from  existing car drivers, reductions in vehicle kms would only be around 1%. The expectations of these schemes need to be realistic.

All this does not to suggest however that we should forget the role of behavioural change, it has an important part to play, especially in the urban centre of central London. Roads need to be more attractive for walkers and cyclists, but we ignore at our peril the need for a viable road network. Getting the balance right is difficult, but this is the essence of transport planning – London is no different.’

And the conclusion… the room was marginally in favour.

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