Roads Plc? Why privatisation might look tempting

The day the M6 toll road opened The M6 toll road opened in 2003

10 reasons why roads privatisation might look tempting to the government...

1. Our roads infrastructure is hopelessly out of date

2. The Department for Transport estimates the cost of congestion to business is set to rise by £10-12bn over the period to 2025

3. Investment in roads will always be behind schools, hospitals and a lot more besides in the queue of things the chancellor will spend money on

4. A new RoadsPLC could borrow against a guaranteed steady stream of income - either road tolls or "shadow tolls" - ie a fee paid for each driver using a road by the government

5. It would raise a lot of money for a cash-strapped exchequer - £100bn according to a report by the bankers NM Rothschild

6. All parties have, at one time or another, accepted the need to find new ways to fund roads

7. A nationwide "pay-as-you-drive" system was unveiled by former Transport Secretary Alistair Darling in 2005

8. Vince Cable dubbed the Rothschild plan "an attractive, positive idea which could release considerable resources to the public finances and may have real environmental merits"

9. The RAC Foundation has backed the idea

10. It's hard to imagine a time when the government will have enough money to spend on roads

Road pricing


...and two big reasons why it might not

1. The public hate the idea of road tolls. Labour's examination of road tolls produced an e-petition of 1.7 million names which is why David Cameron is now saying that he won't allow tolls on existing roads. Since then the cost of motoring has gone up

2. The public don't much like anything that smacks of privatising that which they already think they own (although water shows that once it's happened people shrug their shoulders and get on with their lives)

PS: Here are a couple of reports which examine the options

RAC Foundation - Funding Strategic Roads

Social Market Foundation - Roads to Recovery

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  • rate this

    Comment number 1.

    Yet more money syphoned off from taxpayers to the tories rich chums.

    Either we will be paying VEL + fuel duty AND tolls to the bloated private companies ...

    ... or we will be paying out in PFI style private sector ripoff deals.

  • rate this

    Comment number 2.

    Niok - don't you realise that large chunks of the network are already on PFI contracts known as DBFOs? Private consortia use private finance and are repaid shadow tolls based on flow and level of service. This is nothing new!!!!!!!!!

  • rate this

    Comment number 3.

    There are two issues with this:

    1)Prior attempts at privatisation have proven much more expensive than public sector offerings, because as with the utilities the private firms will have local monopolies & therefore no incentive to reduce costs.

    2)The public would accept this if the money raised were reinvested, but past evidence suggests they will spend it on politically-motivated tax cuts.

  • rate this

    Comment number 4.

    Yes PFI on wheels and there will be the inevitable bail out or novation to another company at higher cost. What the Government should be doing is developing a transport or people movement strategy not roads privatisation. What do we want - the greenest government ever what do we get - more roads and more cars and more pollution!

  • rate this

    Comment number 5.

    Water does not show that people shrug their shoulders. Look at anyone forced to use Southwest water. Privatisation that allows no competition, the highest rates in the UK and he treasury paying £50 to the company per customer, whilst they make a profit of £110m, sounds fair for all involved.


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