EASY PAYMENTS
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SUBSIDIES for certain kinds of transport operation have become accepted as inevitable. Parallel with this development has been the growing insistence that the precise and genuine costs of providing other transport facilities should be ascertained and charged in full to the operators and users. The two strands, in some ways contradictory, have been woven into the pattern of transport policy laid down in the Government's White Paper and now being translated into action.
It was stated in the White Paper that Exchequer grants would be available for major capital projects and the possibility was canvassed of passing on to local communities part at least of the financial burden of unremunerative rail services. The Minister of Transport, Mrs. Barbara Castle, has now suggested that each of the new gigantic area passenger undertakings—or conurbation transport authorities as she prefers to call them—would finance unremunerative bus services and concessionary fares out of contributions from the member local authorities.
New partnership
Arrangements on these lines would constitute a new sort of partnership between central and local government, says the Minister. They would possibly be made in advance of the report of the Royal Commission whose proposals for the reorganization of local government would be expected to abolish what the White Paper calls the fragmentation of responsibilities for public transport and for highways, traffic control, parking and land use planning.
The Minister does not trouble to conceal the fact that the structure of her brave new passenger transport world to be built on the site where the 1947 Transport Act crumbled away will be dictated by financial considerations. The assumption is that substantial subsidies will have to be paid by the public through national and local taxation. Ability to collect and disburse these subsidies will be a major factor in determining the constitution of the new conurbation authorities. They must combine the independence of management characteristic of a professional board, says the Minister, with the broad democratic oversight characteristic of a local authority and at the same time provide for an appropriate division of financial responsibilities between central and local government.
It would be unrealistic to seek a return to the days when all transport was selfsupporting—if there ever was such a time. There are deserving cases for a transport subsidy. It so happens that these are to be found mainly on the railways and in road passenger transport. Hidden as well as direct subventions are already common. Railway deficits are met by the Exchequer. The Minister will soon have power to make grants to bus operators to meet the 10 per cent surcharge added to the fuel tax last July. She can already make reimbursements in respect of the previous increase of 6d. per gallon.
What is important is that the subsidies should go to the right quarter and that they should not be habit-forming. The time may have come to look at them again if and when the development of the Government's plans seems to be dictated too much by the need to provide for easy payments out of national and local revenues. The longsuffering taxpayer has some right to know where his money is going.
The principle laid down in the White Paper is broadly acceptable. Transport services which can be run commercially will be expected to pay their way. Socially necessary services will be helped by either local or central government payments. Already there are suggestions that this does not go far enough. In the District Bank Review, Dr. Norman Lee, University of Manchester. calls into question the distinction between commercial viability and social needs. "A Government subsidy permitting lower fares or more frequent trains on existing, remunerative services", says Dr. Lee, -may be as equally justifiable on grounds of public interest as a subsidy to finance the revenue shortfall on an existing, unremunerative service."
Unpopular
Such a general invitation to the Government and the railways for a spending spree may not please everybody. Road operators can hardly fail to notice that Dr. Lee seems to be concerned only with the financial health of the railways. He goes on, in fact, to commend for further study the inference in the White Paper that in some ways the costs of rail operation may be over-stated—he gives as an example the obligation to maintain road bridges and level crossings—while the costs of some categories of private motoring may be understated because of the social costs of congestion.
Road operators and particularly the carriers of goods can see only too clearly the direction in which this kind of argument is moving. On the one hand the case is made out for subsidizing the railways on an increasing scale. On the other hand methods are sought on one pretext or another of getting more money out of road users who already pay over £1,200m. a year in direct taxation. Because hauliers make a profit, the reasoning seems to be, they must be enjoying some kind of subsidy. Once it is discovered the situation can be put right.
Adequate roads
Perhaps Dr. Lee's suggestion should be examined in the context of the transport industry as a whole and not merely the railways. There can be no better example of a social service than the provision of an adequate road system. Why not a subsidy for that?
Mrs. Castle has announced the steps taken to set up the large-scale road construction units which are to speed major trunk road and motorway schemes. The financial issues have been touched upon but lightly. It has been left to the County Councils Association, with whom the Minister has been discussing the matter, to strike the only sour note. There is no lack of planning, the Association agrees, but little will be achieved unless the Government releases more money. What will count in the end is the resources the country is willing to devote to solving the problem. There are not enough funds for urban roads, the Association adds, to support wider town planning schemes.
The concept of social service goes even beyond the basic road system. It provides the justification for complaints from road users that they are asked to pay tolls for crossing bridges the cost of which they have already met in taxation. Operators are also right to complain when they are treated as undesirable aliens and hounded off the streets of towns to the prosperity of which they have in no small measure contributed by the trade they bring.