Within the big transport debates going on today, arguments about how we plan and assess transport projects aren’t far below the surface. Are time savings from High Speed Two worth the huge budget – and are they valuable anyway? Will HS2 help or hurt regional economies? Is free travel for pensioners an expensive subsidy for richer old people or a valuable way of cutting social isolation? Is evidence of the deadly effects of air pollution on children taken into account in city planning? Are the health benefits of cycling projects valued enough?
Over the years, sophisticated models and forecasts have been developed by the Department for Transport and economists to plan and value transport spending and policies. This has grown into something known in the trade as ‘webTAG’ – Transport Analysis Guidance (read more here). The department also has a National Transport Model, which projects future demand for road, rail and air. These – alongside computer programs with acronyms such as TEMPRO and DIADEM – are used to produce value for money estimates for transport projects and policies. Traditionally, the Treasury has really liked all this – it gives hard economic analysis to justify transport spending.
The problem is that there’s increasing evidence that this elaborate system is broken in two important respects.
First, it relies on forecasts of the future which are both unsustainable and inaccurate – unsustainable because if air and road travel were really to grow as the forecasts predict (a 43 per cent increase in road traffic by 2040, a doubling in air travel by 2050), climate change targets will be impossible to meet and, however much we expand roads and airports, congestion will get worse. And the forecasts are criticised as inaccurate – since the 1980s they have consistently overestimated road traffic growth and underestimated the growth in rail traffic. (see more here and here).
Second, this system isn’t good at answering the questions that politicians and decision-makers are now asking about transport projects. It gives priority to time savings, especially by motorists, calculated by modelling future traffic with and without a new road. These time savings, sometimes of a few seconds, are multiplied up over 40 years and, with other factors like savings in lives or reduced/increased noise, are set against costs to create a Benefit: Cost Ratio, or BCR.
This system is very complex and pleasing to economists wanting to justify policies with numbers – but it can’t really tell people and politicians what they really want to know. By ignoring a wide range of social and environmental consequences of transport projects, it isn’t good at telling us which will be best for tackling joblessness, regenerating cities, reducing obesity, improving air quality or cutting carbon emissions. For some kinds of projects it values completely the wrong things – cycling schemes or bus priority will be marked down if they impose delays on motorists. Its methods also undercount some very important factors, such as social isolation (especially among older people), access to jobs for the long-term unemployed, or the severance of communities by heavy traffic. Above all for progressives, it’s not good at identifying the real winners and losers from transport investments.
It’s not surprising that, as localism takes hold, the system is being bypassed. In making their initial selection of transport schemes that will receive more than £800m of devolved DfT funding, the new Local Transport Bodies and Local Enterprise Partnerships haven’t been obliged to use webTAG processes (though they will at a later stage when schemes are given final approval). The risk is that, without objective appraisal at the first sifting stage of scheme selection, projects will be pushed forward based on a list jotted down by a Porsche-driving LEP chairman in his golf club. Indeed, this already seems to be happening, with nearly 60 per cent of the first wave of LTB prioritised schemes focused on road-building, widening and other increases in capacity for private traffic.
So there’s a strong case for a fundamental review of the way we plan and value transport projects. The present government has reviewed some parts of the appraisal framework, but a more fundamental change is needed. The next government should conduct a full review of all aspects of transport appraisal, forecasting and modelling. This should set out the real questions that the system needs to answer, and find the best ways of doing it. And it should create a system that makes the consequences of transport decisions transparent and accountable – rather than black box economics or golf club prejudices.
Proper assessment of transport projects and spending is important. But we need to make sure the processes we use ask the right questions and come up with the right priorities – for people, communities and the environment in the future, not just for motorists in the present.
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Stephen Joseph is chief executive of the Campaign for Better Transport. He tweets @StephenJoseph7
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