Reaction to Transport in 2018 Budget

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Key industry figures comment on transport within the Budget 2018 below

Steve Gooding, Director, RAC Foundation:

There was a lot for motorists to applaud in the Chancellor's Budget speech, even if much of it was a recap of things already in the public domain.

We knew about the fuel duty freeze – welcome for low income households already squeezed by spiralling pump prices due, amongst other things, to a turbulent exchange rate.

And weekend briefing suggested that billions were headed toward Highways England and schemes on key local roads. The commitment to ringfencing VED income from 2020 for spending on England's most important roads over the second Road Investment Strategy period is so important for building confidence in the supply chain.

Extra cash to help councils fill in potholes (and fix a few pinch-points along the way) can't go amiss, though motorists might wonder whether this marks the start of a longer-term strategy – as the National Infrastructure Commission has recommended – or just the latest in a series of temporary patches. And tech investment in the likes of the Stephenson challenge should feed through into better, cleaner cars.

But might the end of the Government's love affair with private finance sideswipe the programmes for the Stonehenge Tunnel and the Lower Thames Crossing, which were conceived as PFIs and might now need substantial, and time-consuming, financial re-engineering? Time will tell.

Jim Steer, Director & Foundation, Steer: 

In a minimalist budget for transport, two rail projects got a mention, with another £37m for Northern Powerhouse Rail – needed because further work is needed to narrow down remaining options to a preferred scheme – and £20m more for the central section of East West Rail, the part with the new alignment that also remains to be finalised. No, it doesn't cost anything like these amounts to come up with suitable designs; but it does cost this much to produce all the back-up needed to survive detailed scrutiny in public inquiries and the NAO.

Whether either project in due course will be able to attract any private sector funding is looking less likely because the Chancellor has made clear that both PFI and its successor, PF2, introduced by HM Treasury as recently as 2012, are effectively scrapped. Quite how this aligns with DfT's call for the private sector to come forward with new rail investment proposals remains to be seen.

The use of private finance in PPPs was a British creation that remains in widespread use around the world, but new applications will not be found in the land of Chancellor Hammond.

Darren Shirley, Chief Executive, Campaign for Better Transport:

There was a lot in this Budget in terms of roads, with £30 billion for various funding pots. The biggest is the National Roads Fund, at £28.8 billion funded from vehicle excise duty, but this is not really new money as it had been previously announced. There was some new money announced in the form of £420 million to tackle potholes, but with a £9 billion backlog in repairs this will do little to address the years of neglect of local road maintenance. If you compare this to the billions allocated to just three per cent of the road network, we think the Government's public transport spending priorities need reconsidering.

Whilst the support for on-demand buses announced is needed and welcome, this doesn't replace the need for a proper national bus investment strategy, nor replace the £172 million in local bus funding lost in the last eight years that has left some communities isolated without access to any public transport.

Rail passengers have suffered appalling service this year and deserve a fares freeze, so we were disappointed that the Government only chose to freeze fuel duty, which undermines public transport and will do nothing to tackle the air pollution crisis.

Anthony Smith, Chief Executive, Transport Focus:

Drivers will welcome the promised investment in England's motorways and major 'A' roads. We will now work to ensure the money is spent on the issues that drivers tell us are the key priorities driving satisfaction: reliable journey times, improved road surfaces, better handling of roadworks and delays, and safer road design.

We will also be engaging with innovators offering on demand bus services in Future Mobility Zones to ensure these develop in a manner that benefits passengers, creates genuine alternatives to car use and expands public transport provision in areas that are poorly served.

David Leam, Infrastructure Director, London First:

We tend to think of the Budget as the main event, but for infrastructure what really matters is next summer's spending review. The Chancellor had some tasty morsels to whet our appetite – more money for national and local roads, for new transport investment in the city regions (including welcome additional development money for Northern Powerhouse Rail), and to unlock housing. But I was left hungry for more detail on the spending review. My interest was momentarily piqued by the government's interim response to the National Infrastructure Commission, but this contained nothing new beyond confirmation that government will respond fully through a National Infrastructure Strategy next year. Nor was there any steer on whether government would commit to spend the bare minimum 1.2% of GDP every year on infrastructure that the NIC planned for. This must now be the transport sector's key ask of government if we are to secure vital investment across the country – to get a commitment to Crossrail 2 and Northern Powerhouse Rail, amongst other schemes. Finally, for all the talk of abolishing PFI let's not get carried away. There's still life for private finance in UK infrastructure investment – just not as we know it.

Ed Thomas, Head of UK Transport, KPMG:

The most eye-catching transport announcement in Philip Hammond's budget is clearly the increase in road investment. The Road Investment Strategy 2 (RIS 2) will see £28.8bn invested from 2021 to 2025, which is a step change from the £15.2bn RIS1 programme announced in 2015.

"RIS2 will support business productivity and competitiveness by providing a safer and more resilient roads network. With trade high on the agenda, it is anticipated that a number of the RIS2 schemes will improve access to airports and the ports, providing improved international gateways. The proposed Oxford-Cambridge expressway can also support new large-scale housing development in this strategic corridor, which is another of the Government's infrastructure priorities.

"The roads lobby has long envied the relatively generous funding settlements provided by the rail sector's system of regulation. The five-yearly RIS process and the hypothecating of VED for investment goes some way to providing greater certainty to the contractors and wider supply chain involved the sector.

"There still remains questions over roads funding in the long term. Fuel duties are anticipated to decline as the uptake of hybrid and electric vehicles increases. In its recent National Needs Assessment, the National Infrastructure Commission has also recommended a shift in transport funding from strategic road and rail infrastructure towards cities and major urban transport projects.

"In rail, additional money was announced for the development of the East-West and Northern Powerhouse schemes, both of which have improvements in regional connectivity and productivity at their heart. However, there is major uncertainty over how these schemes will ultimately be funded with Government having committed significant funds both to Network Rail's CP6 programme and the first phase of HS2 over the coming years. This uncertainty remains after today's budget."