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Roads budgets axed to fund rail spend hike

BRITAIN FACES a three year lull in new road construction after Chancellor Gordon Brown axed highways budgets to fund higher spending on rail in Monday's Comprehensive Spending Review.

Overall transport spending increases will easily be swallowed up by the higher cost of maintaining and renewing the railways.

Earlier this year, £26bn was ring-fenced for Network Rail to spend over the next five years, £11bn more than originally planned.

The increase was imposed on the government by Rail Regulator Tom Winsor amid acrimonious exchanges with transport ministers.

On Monday Brown promised that transport spending would grow by 4.5% on average in real terms over the three year period from 2005/6 and 2007/8.

Total Department for Transport (DfT) spending will increase from £10.4bn in 2004/5 to £11.5bn in 2005/6, rising to £13.6bn in 2006/7 before falling to £12.9bn in 2007/8.

This equates to an increase of £3.4bn on commitments made in the 10 year transport plan over the three year review period.

Pro-roads campaigners were disappointed by the announcement.

'You can safely assume that the roads budget and volume has been cut and we're hopping mad about it, ' said AA Motoring Trust director John Dawson.

'When you remember that in the 10 year plan the government talked about aspirations for a transport system to rival any in Europe, this is a complete backtrack on what was promised, ' he added.

The AA Motoring Trust has been campaigning along with five other business and motoring groups for £4bn to be set aside to widen the most congested parts of the M25, M1, M4, M6 and M62 (NCE 27 May).

It now holds out little hope for work to start on these schemes before 2008.

It has instead told transport secretary Alistair Darling that it wants to see these schemes ready to go in the next review period.

Darling will set out his priorities for the next 10 years in a revision of the 10 year transport plan, expected next week.

'The key to understanding the government's commitment is going to be the volume of schemes being prepared for implementation after this spending review period, ' said Dawson.

Dawson hopes that Darling's long-awaited review of the rail industry - expected to be announced today - will lead directly to a change in the way in which the rail industry is regulated.

At present the DfT is powerless to overrule the Regulator's decisions on funding .

'It is absolutely barmy that we regulate transport budgets by giving rail whatever it needs, leaving whatever is left for roads, ' said Dawson.

'We cannot carry on like this.'

The Freight Transport Association (FTA), which also took part in the campaign for road cash, branded Brown's decision as 'disgraceful'.

It was furious that transport spending earmarked for 2005/6 was lower than promised in Brown's 2002 Comprehensive Spending review.

The DfT said the figures were not directly comparable, but could not offer figures to back up its explanation.

'The chancellor has gone back on what he promised, by undercutting the spending plan he took credit for three years ago, ' said FTA chief executive Richard Turner. 'The future for congestion is bleak.'

ICE senior vice president and Arup director Colin Clinton said that the roads spending shortfall reinforced the need for road user charging to raise extra revenue.

'The M6 Toll is a good example of what can happen.

You have to accept that there is a certain amount of money in the pot and that to supplement this you have to look seriously at road user charging, ' he said.

Darling is expected to announce the results of a 12 month feasibility study into road user charging early next week.

It is understood that such a scheme could raise up to £10bn a year by charging motorists up to 90p/km for using the nation's roads.

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