National Alliance Against Tolls - M6 Toll Consultation

NEW M6 TOLL ROAD CONSULTATION - NAAT SUBMISSION TO DFT

Summary

Existing tolls and any foreseeable tolling system are unfair, uneconomic and unwanted by road users. NAAT believe that the proposed M6 toll road should not be built and that no more time and money should be wasted on developing that option. The Government should instead proceed without any further delay with the already agreed extra lanes on the M6.

In our view the toll consultation paper will have had the effect of stimulating opposition to the extra lanes that the Secretary of State agreed in 2002, and lead to further dispute and delay. We are concerned that the consultation exercise will be followed by interminable assessments, studies and investigations.

The foreword to the consultation paper says that:- "A better strategic road network that can support more reliable journeys will make a significant contribution to this country's economy and deliver benefits to us all".

NAAT agree with the Secretary of State, but to maximise benefits it is essential that this road network is not financed from tolls.

Introduction

The National Alliance Against Tolls (NAAT) was formed earlier this year by groups protesting against existing tolls in England, Scotland and Wales. The NAAT is the only road users body that solely deals with the tolls issue.

On 6 July 2004, a Government consultation paper was issued:- "M6: Giving motorists a choice". It was suggested that instead of, as previously agreed, widening the M6, a new road with 2 lanes in each direction would be built alongside the existing motorway. The paper said that this would be easier and cheaper than widening the existing road and that this new road would probably be tolled.

The Secretary of State invited comments on the proposals. This is a response to that invitation.

To help prepare this response, we have raised various questions with the DfT and through them the Highways Agency. NAAT are grateful for the help of the officers concerned and in particular the officer in the Highways Agency, but the considerable time taken to get answers has hampered this response.

Tolls are unwanted and uneconomic

Turnpike tolls have been around for a long time, but they were hated, and nearly all had been either abandoned or bought out by 1900.

Prior to the opening of the M6 toll in December 2003, all the significant road tolls in Britain were on water crossings. There are about 100 road crossings of tidal rivers or seas in Britain. 13 of them are tolled, though some are tourist attractions rather than communication links. There are also a small number of minor privately owned tolled roads. Tolled crossings require a major detour to avoid them. Though this also applies to many of the 90 or so free crossings, and to many roads that do not cross water.

Most of the 13 tolled crossings were tolled on the basis that they would become free when the initial construction cost had been recovered. In most cases one way or another the crossings have remained tolled.

Tolls are unfair to those drivers who have to use tolled roads. People that frequently have to use a tolled road feel that they should not have to pay more, as they already pay over Ł40 billion in taxes and the Government only spends about Ł7 billion on roads.

Tolls are regressive. A poor person pays the same toll as a rich person. The driver of a small car pays the same as the driver of a large car. It is usually the well off who support tolls as it forces poorer drivers out of their way. In the words of the president of the Foundation of Economic Trends:-"(Toll) barriers are highest for consumers on the lowest economic rungs"

Most drivers consider that fuel taxes are too high. Despite that, in a survey that was published by the RAC Foundation in January 2004, drivers said that they would like to see other road taxes scrapped and merged with fuel duty, because it would be fairer and harder to evade. Motorists also said that they did not want a system of road user charging.

Toll roads inhibit economic activity in the areas where they are situated. Businesses where road transport is important will prefer to locate elsewhere. This has been shown by research abroad.

In Britain, there has been very little research. One exception was the research carried out in 2002 by Napier University into the effect of the Skye bridge toll on the economy of Skye and Lochalsh. The study concluded that removing the toll would mean increased tourism, increased business efficiency and more business start-ups. It also estimated that there would be growth of 6.3% in employment.

Toll collection causes delays and queues, and tends to prolong peak periods as traffic is on the road longer than it would otherwise be. During the late summer hurricanes, some Florida tolls were suspended to speed traffic.

To the extent that there is a choice, drivers will tend to avoid toll roads and use other roads. This means longer journeys and more fuel consumption, and possibly use of less suitable, less safe and more congested roads.

Research in USA indicates that even a nominal toll will discourage commercial traffic. And, what in Britain might be regarded as low tolls, will discourage over 50% of commercial traffic. In USA as in Britain, this is regarded as a problem, as the authorities and people would generally prefer the trucks to use the "turnpikes" as they are more suitable for such traffic. There is a view in UK that high tolls for lorries will lead to a massive switch to rail. It is more likely that the distribution system that we all depend upon would grind to a halt.

Road users are blamed for pollution, global warming, destruction of the countryside etc. This is then used as a reason for high taxation, road charging, and not improving roads. But:-

a) A study by Lancaster University published in June suggested that trains can be less fuel efficient than cars. The electricity used by trains and trams comes from fossil fuels . ("Renewables" and nuclear form part of the base load as either their fuel is "free" or they can not be easily switched off. So all electricity use at the margin comes from fossil fuels.)

b) Fuel used by cars and commercial vehicles is massively taxed, but fuel used by trains, trams, buses, planes and ships, and for heating, electricity generation and farming is either taxed at a very low rate or not taxed at all.

c) Demand for road use is mainly linked to population size and economic growth. Unless these can be inhibited then Britain needs more roads in the same way as we need land for more houses and other facilities. Use of road tolls is not the solution to the population problem.

d) There are objections before a new road is built. But how many people would want to close an existing motorway, river crossing or bypass?

The Government seems to be moving towards a system of tolling on most roads, probably based on a satellite system. NAAT believe that such a system is not only unwanted, but is also unworkable and uneconomic. The possible cost and problems with such a system can be seen by what has happened with the "Toll Collect" system in Germany.

M6 Toll Road opened in December 2003

Proposals for a new motorway west of Birmingham to relieve the M6 go back many years. Around 1990 it was decided that it would go ahead but as a private scheme. Roads are built by the private sector anyway, but in this case they would also run it and recover the construction and running costs through tolls.
The contract for the new road was awarded to Midland Expressway Ltd (MEL), a company mainly owned by an Australian investment group. MEL awarded a contract to a consortium of construction companies to actually build the road. Construction started in September 2000, and the road was opened in December 2003. The construction cost was estimated at Ł500 million.
MEL have a concession to collect the tolls to 2054. It appears that they can charge whatever toll will maximise their profit.

The road has been hailed as a success but what does this mean? It seems to mainly mean that the new road has helped to relieve congestion. But this is because there is a new road, it has nothing to do with it being tolled.

The equivalent stretch of the old M6 carried about 175 thousand vehicles a day. With the opening of the new toll road, total traffic is now around 200 thousand vehicles a day. Of that around 55 thousand vehicles a day are using the toll road, at least during the roadworks which are being carried out on the old M6. Traffic on the M6 Toll will grow but many drivers will continue to avoid it.

Why does this matter? It matters because, the optimum economic use would mean that more like 50% of the traffic would use the new road. In particular it would be better if more lorries used the new road, but many are boycotting it. This means not only are lorries still using the old M6, but they will also be using non motorway roads. Lorries should not be discouraged by tolls from using the most suitable roads for their journeys.

In order to attract lorries, MEL reduced the toll for lorries in August 2004, but this is only a temporary reduction. It is questionable why a private road operator would want to attract lorries, as they cause more road wear, and more disruption if they breakdown or are involved in an accident.

Part of the contract with MEL is that they can charge what they like. In the short term, this will be moderated by the need to attract traffic and by the possibility of more contracts. But in the long run, it would be logical for them to generate the maximum revenue from the minimum traffic, because more traffic generates more costs due to need for more toll collection and more road maintenance, and higher chance of disruption.

Toll Roads and Private Operators

One possible reason for toll roads is that like a PFI scheme, the Government can then exclude the capital cost from spending figures. If that is the aim, then the road does not have to be tolled. Some roads have been built using a "shadow" toll system, i.e. the Government pays for the road on a "hire purchase" basis according to the use made of it. NAAT does not recommend this approach, but it shows that a road can be financed as a PFI scheme, without tolls being levied on road users.

In general the reason that is given for PFI like schemes is that they are cheaper. But this just means that they are cheaper than a "public sector comparator" set by the people who want the scheme. The estimated cost may also be increased by a subjective "optimism factor".

The major cost of a toll road is its construction. Whether the road is tolled or not it will be built by private contractors. It seems that the only way a private road operator can make savings is that they are better than the Highways Agency at drawing up contracts, supervising contracts and maintaining the road when it is built. But if the Highways Agency is inferior to the private road operator at drawing up and managing contracts, then how effective will they be in controlling the private road operator?

The private road operator will have various costs that the Highways Agency will not have. A significant cost is of course that of collecting the tolls. The road operator will also expect a higher rate of return for its investors than the rate at which the Government can borrow, and it will also have to factor in risks that would not apply to a public road:-

a) a future Government in some way might repudiate the contract,
b) the traffic over the life of the scheme may be lower than expected,
c) interest rates may increase relative to potential for toll price rises.

After a PFI like scheme has been operating a few years it may be "refinanced" by the operator. On early contracts this gain went to the contractor. But contracts now usually include a clause whereby any refinancing gain is shared 50:50 with the public body. With a toll road it is not clear where this gain goes, but if tolls are at the discretion of the road operator then such gains will not go to the road user.

It is not clear what happened with the cost of land for M6 toll road. As the road operator can charge whatever tolls they like, one would expect that the road operator would have to pay the cost of or a rent on the land. But did they?

The proposed new M6 toll road or "Expressway"

Proposals were published in 1994 to increase the lanes from 3 to 4 on the M6 carriageways. The scheme was reviewed and in 1997 it was confirmed that the lanes should be increased. In 1999 another study was called for and in March 2002 the resulting report (MidMan) again recommended increase to 4 lanes.

On 10 December 2002, the Secretary of State for Transport "gave the green light" to the recommendation that the M6 be widened between Junction 11 at Cannock, north of Birmingham and Junction 20 (M56).

The main effect of the consultation paper is that yet another review will take place rather than spending going ahead. In the context of vast spending on rail, it might be expedient to delay or avoid expenditure on roads, but this is not good for the economy.

When the consultation paper was first published, most of those commenting on it seemed to base their comments on whether or not they agreed that roads in general should be improved or not. But as well as the NAAT, there was opposition to the tolling part of the proposal from the Association Of British Drivers and the Road Haulage Association.

The Government's consultation paper on the plan to extend the M6 Toll gives little justification for the idea, but mentions tolls on the Severn Crossing and the "success" of the M6 Toll. NAAT were alarmed at the mention of the Severn Crossing which is due to be made toll free in 2016, when the construction cost etc has been recouped. NAAT have raised questions on what has happened with VAT and with PFI refinancing on the Crossing and we are not satisfied with the answers. Campaigners have been urging that tolls should be lifted before 2016. But it now seems that the Government may have no intention of lifting the tolls at all.

The paper says that the Government believes in choice, but this would only be for those able and willing to pay. And if there is to be a choice then will the Government build free roads alongside the existing tolled roads?

Some people seem to have the impression that the bulk of the traffic on the M6 is long distance car and goods traffic that should be forced to use rail instead. Apart from the question as to whether such action is either practical or good economics, it appears that the bulk of the traffic is local, i.e. most of the traffic travelling between junctions 11 and 20 has either joined after the start of this stretch or leaves before the end of this stretch. (Para 3.3.3 of the MidMan report - only 30% of cars and 35% of hgvs travel the whole stretch between junctions 11 and 19). In our view this would indicate that an increase in the number of lanes is a more sensible option than building another road alongside the M6.

NAAT asked the DfT for various information. The main items were:-
a) What financial / economic figures had been used to decide that the agreed road widening might be abandoned and the new road tolled.

b) Any other figures that led to the toll road proposal:- "This would include the surveys as to origins and destinations of the vehicles that are travelling along this stretch of the M6 and nearby roads."

c) What other options, if any, were considered apart from the widening and the toll road.

d) How the DfT had calculated that the widening of the M6 by one lane in each direction would require a landtake 25 to 30 metres wide.

NAAT have been told that there are no financial / economic figures of any description to justify the proposals for tolling. It is a pity that the previously agreed widening has been put to one side and this proposal has been issued without attempting any sort of financial or economic evaluation. In our view if one had been done, then it would have confirmed that the untolled road widening should have gone ahead without further delay.

NAAT were surprised that there are no financial / economic figures for tolling as the MidMan report in March 2002 mentioned long term tolling proposals for the M6, and said that the overall effects of tolling would need to be investigated in detail. It seems that they haven't.
As part of the Mid Man report there had been some consideration of tolling and we were sent a copy of Technical Note M06 "Road User Charging" which dealt in part with how the effect of tolling was taken into account when the main options in the Multi Modal Studies were evaluated.
The Note says that a model was used. It does not go into much detail, but it seems that a time cost was used and that it assumed that users would behave rationally and with perfect knowledge. (i.e. they would use the toll road based on a comparison of the toll with how much extra time and money they anticipated would be spent using an alternative route). This was all done in the context of tolling the existing M6 (as is, and widened to 4 lanes) so the alternative routes would be limited.
It isn't clear how, if at all, the results of the model were confirmed.
Though the broad conclusion was the obvious one, i.e. a significant amount of traffic would avoid the toll and use other roads.

It is not possible from what has been published to isolate the effect of tolling from the other variables in the 3 MidMan case studies at the 2 dates (2011 and 2031). And of course the effect of tolling would depend upon the amount of the toll, which in the case of the existing M6 Toll is at the discretion of the private operator.

NAAT were told that the traffic figures we wanted were in the MidMan report, which we eventually got a copy of. This was a useful document but it did not contain the destinations and origins figures we had asked for. We were then given a copy of a "Technical Note" from 2001: "Video Licence Plate Recognition Surveys".
The origins and destinations were too broad. For the areas outside the Midlands and North West regions, it was reasonable to say e.g. "Scotland" or "London". But a breakdown which goes into no detail for "North West" and "Midlands" is almost useless.
We also assumed that any data would give figures as at each junction, but it all seemed to be figures from the northern end (junction 19).
The "North West" was shown as the destination for about 75% of the traffic and the "Midlands" for almost none. This seems a bit odd, but the survey was apparently only on the northbound carriageway
All in all, we were surprised that the traffic figures we requested were not available.

NAAT did not get an explicit answer to the question of what other options had been considered since the Secretary of State decided in December 2002 that the M6 widening would proceed. We have taken it that no other options have been considered since then.

Part of our purpose in asking for the traffic figures and what other options had been considered was that we thought that there might be an indication of to what extent other roads in the wider area (e.g. A34, A41, A49, A51) should be improved, including more dualling and bypasses. There might also be an indication that completely new roads well away from the M6 might be beneficial. For example, a new road nearer to the Welsh border, might have opened up relatively sparsely populated areas for development to cope with UK population growth.

The initial answer to our question on the landtake was that the 25 to 30 metres figure in the consultation paper was calculated as:- 14.6 metres - new running lanes
3.3 metres - a new hard shoulder
4.0 metres - separation between new and old carriageways
5.0 metres - additional land-take to facilitate enhanced planting/mitigation.
26.9 metres - Total But this led to further questions and answers.

It would take too long to go into all the follow up questions and answers on the landtake, but bearing in mind that there is only to be one additional lane in each direction, the maximum landtake if symmetrical widening was used would only be 7.3 metres. Potentially the landtake for some stretches could be nil as it has been with most of the widening of the M25 because of unused land within the existing boundaries.

NAAT feel that the landtake required for widening as per the consultation paper is a maximum figure rather than a likely figure. It assumes there is no unused land within the existing boundary, that there is a completely new 4 lane carriageway rather than symmetrical widening, and that most of the redundant carriageway (i.e. half of the existing motorway) is used "to support mitigation initiatives".

The issue of the landtake is important. Most people want to see as little land as possible used for roads. If another picture had been given of what the extra lanes might mean as against a new toll road, then a lot of those campaigning against any road improvement, might have rejected the toll road but accepted the extra lanes that had already been agreed in 2002.

NAAT have seen some of the literature circulating that encourages local people in Cheshire and Staffordshire to oppose not only the tolls road but also the already agreed extra lanes for the M6. They refer to "doubling the size of the M6" and widening the M6 "by 4 more lanes". One wonders where these erroneous impressions of the widening proposal have come from, apart from the Government's own consultation paper. But it is likely that these impressions will cause many consultees to oppose any road improvement and not just the toll.

END