Sunday, December 03, 2006

Rod Eddington on British transport

As my profession includes transport, it is worth noting a major report just released about British transport written by Sir Rod Eddington, former CE of British Airways.
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All the details are here, and Eddington has done a pretty good job in my view. His conclusions are sensible, he doesn't pander to the motoring lobby nor the ecologists, although he does talk about green taxes which make no sense (why should the government benefit from you doing something "bad"). Here are some of his key conclusions:
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- Without action, congestion will add £10 billion a year in costs to the economy, and another £12 billion is lost time to households;
- The main business trends in transport will be more home working, more working while travelling, more e-commerce (deliveries rather than shopping), increased logistics and more international travel;
- If half of commuters worked at home one day a week it would be more effective in reducing congestion than a 5% mode shift from cars to public transport;
- The benefits from road pricing are tremendous, particularly in reducing congestion and enabling better targeting of road spending - but road pricing should also be used to fund new roads. Such pricing could also have enormous environmental benefits because of reduced congestion;
- There are more benefits from certain road investments (mainly targeted junction/capacity improvements) than rail investments. Road improvements can deliver major benefits in urban areas, although this is often neglected by councils;
- Better pricing should also apply to public transport especially rail, after it has been introduced for roads;
- Buses can deliver most of what light rail does at a fraction of the price;
- Decisions on funding road and rail projects should not be made politically, but made by independent agencies required to meet certain objectives;
- Competition law should no longer limit bus companies colluding and co-ordinating in ways that will enhance their ability to provide services;
- Barriers to private sector investment in new capacity should be removed;
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No this isn't a libertarian vision, but it is a step forward. He rejects big increases in subsidies for transport, he supports economically efficient pricing and more private sector involvement, and for changes in how roads are managed. The key thing for me is that he supports providing more capacity where users are willing to pay, but that the biggest change is to get rid of bureaucratically based pricing - moving towards pricing based on getting best use out of infrastructure - market oriented pricing as is applied everywhere else.
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It's not rocket science - roads are the most pervasive form of economic socialism today - no wonder they are managed so poorly.

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