Improving U.K. road network through Private investment

This article was last updated on April 16, 2022

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In a struggle to improve Britain’s ailing road network, PM David Cameron is seeking to bring in the Private investors in a bid to run and maintain existing routes and develop new ones.

The current government is favoring this notion due to an estimated fact that traffic congestion costs the U.K. economy about £7bn per annum. The road network is in desperate need of investment to become operative for long. And since the government is presently facing the finance related issues, Mr. Cameron is searching for “innovative approaches” to make the job done. The more cheap and efficient way to take on the problem is to hire private sector to attain the desired outcome and earn a better return – pound for pound – on expenditure on the network.

The main plan of the government to put this idea into work is through leasing motorways and trunk roads from the government to companies, bringing improvements to them adding lanes. In case of meeting timely targets, they would get entitlement in the share of road taxes. New roads’ construction could also be taken on by the private sector.

The companies will earn revenue through charging tolls to motorists for using roads with new improvements like extra lanes or remodeled junctions. Side by side, they could also be paid “shadow tolls” – a fee earned by the company per user of a road, but paid by the government rather than motorists themselves.

If traffic jamming on the U.K. road network continues to become worse, in such case an estimated cost to business would rise by £10-12bn by 2025. This indicates that motorists may be increasingly prepared to pay toll for further improvements. But a an online petition suggests entirely different results that British motorists hate the idea of charges; and strongly oppose the plan.

Current Labour leader, Ed Miliband has argued the government’s plan: “Loading extra costs on ordinary families for using our roads would be the wrong thing to do at this time. It would be wrong for them; it would be wrong for the economy.”

The wider reaction on the plan has been seen as being backed by the business and motoring groups and viewing an opposition from environmental groups as they want more investment into transport alternatives rather than road building.

A feasibility study has to be carried upon at “new ownership and financing models” for the roads by the Treasury and Department for Transport are whose submission is due in the autumn.

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