Funding, structure and delivery of local transport

Tony TraversLondon School of Economics

Funding - 1 Transport is one of the ‘not-protected’

services Unlike the NHS, schools, international

development, social security Other ‘unprotected’ services include defence,

environmental services, fire & emergencies and highways

Public sector capital investment to be cut by 50%+ between 2011-12 and 2013-14

Likelihood, therefore that capital and revenue spending will fall sharply

Funding - 2

Implications of such sharp public spending reductions include:

Increase in user charges Fares, parking charges, licences Renewed interest in road pricing?

Search for ‘private finance’ Need for government to manage planning and

other inhibitors to investment

Inevitable pressure to cut back unprofitable public transport services

Structure - 1

National and local responsibilities Little likelihood of major new schemes

at the national level unless a radical change is made to capacity to raise income

Risk of endless preparation of schemes as substitute for action…

More hope locally if freedoms are given to local/city-regional authorities

Structure - 2

Local and city-regional authorities would have the possibility of undertaking small-scale investments and service improvements

But freedoms would be required, eg Less constraint on ‘prudential borrowing’

resulting from tax capping Innovations such as Tax Increment Finance New access to local charges or taxes

Delivery - 1 Risk that revival of growth in private

sector will coincide with shrinkage of public transport services and investment…

…which could mean relative switch of growth in travel to road transport

Looks like return to ‘booms’ and ‘slumps’ of investment in transport

Endless effort to clear a backlog of under-investment

Delivery - 2 Key challenge facing the next decade

is, therefore, how to sustain existing transport services and quality of infrastructure

Unless there is significant additional freedom at the local level, hard to avoid a big squeeze on provision

Perennial risk of ‘false optimism’ in regards to major projects

Conclusions Transport is not high on any political

party’s list of services to be protected Failures to invest, eg in many urban

and inter-urban routes, will become increasingly exposed by 2020

Probably better for transport to lobby for ‘across the board’ impacts of public expenditure constraint?

Transport facing radical change…

Funding, structure and delivery of local transport

Tony TraversLondon School of Economics