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Moves toward privatisation of road network speeded up
By Roland Gribben 9:00PM BST 31 Mar 2013

Work on an overhaul of the Highways Agency involving greater financial freedom and part privatisation of the road network is being accelerated by the Transport Department.
Vehicles aproach the M6 motorway toll booths: Tolls: M6 toll motorway one of Europe's 'most expensive roads'
The M6 toll motorway, opened in 2003, was the first pay-to-use road int he country. Photo: GETTY

The Prime Minister called for a review of the current set-up last year and asked the department to examine prospects for privatisation and the introduction of private capital.

Capital spending cuts and persistent criticism about the damage to the economy caused by the weaknesses in the transport infrastructure have added to the pressure for action and Patrick McLoughlin, Transport Secretary, is promising an announcement “a little later in the year.”

New ownership and financing models for the strategic road network form the basis of the review. There is support for the Agency to be given the freedom to raise money in the City to fund badly needed improvements in the motorway structure.

The Agency is struggling to cope with extensive budget cuts while contractors are complaining that some of the business on offer is not worth the bother of preparing a tender. The CBI has been urging a series of radical measures involving privatising the motorway network and introducing more toll roads.

John Cridland, CBI director general, wants to break up the Agency and supervision of the motorways allocated to a new regulator which would offer a franchises to the private sector to run parts of the network. He has suggested it is just a question of when the network will be privatised “rather than if” but there is unease in some Transport Department quarters about the ability of the private sector to successfully manage the new structure.

One alternative favoured by advisers is copying the model adopted for Network Rail, the organisation responsible for running the rail network. It has the commercial freedom to borrow at attractive rates in the market .

There are doubts about whether far reaching changes can be achieved before the next election and the review document is being described as a green discussion paper rather than a policy white paper.

A Transport Department official said: “Good reliable infrastructure is vital to the economic prosperity of the country and we have been working hard to invest by approving or advancing 26 new major schemes on the strategic road network. But we need to think boldly about how we ensure investment continues over the long term.”