Cut subsidies build roads
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TO MAKE UP for the policy mistakes of the past the Government should make a large shift in transport spending away from unproductive subsidies towards road building.
This is the basic plea made by the British Road Federation in its response to the Transport Policy Green Paper.
Even assuming that overall spending in transport had to be cut — and the BRF believed that there is a good case for increasing investment — there was still scope for better allocation of resources.
Public transport is a "chronic loss-maker" needing bigger and bigger subsidies while losing passengers and freight. On the other hand more households are buying cars and more goods are being shipped by road.
"In economic terms the policy most likely to pay dividends is one which devotes the most resources to the sector that is the most efficient and the fastest growing."
If resources are available to subsidise public transport they could be better devoted to productive, lasting road investment.
The BRF suggests that this could "painlessly" be done by making a £150 million saving on British Rail subsidies and, by abolishing new bus grants, cutting urban subsidies and increasing rural subsidies, get back £50 million from bus services.