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GEORGE YOUNG CALLS FOR 'REALISM' IN TRANSPORT INVESTMENT

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Transport secretary George Young has welcomed the CBI's report on transport investment, Winning Ways, but called fo...
Transport secretary George Young has welcomed the CBI's report on transport investment, Winning Ways, but called for realism in the discussion of future plans.

Speaking at a CBI seminar in London, Sir George said, maintaining tight control of public expenditure will remain a top priority for this government - 'a message which I believe will be welcome to most business interests and one which reflects the CBI's call for fiscal prudence and long term control of inflation'.

Sir George said he believed two courses of action were necessary in response to the need for restraint in public spending: we must make better use of existing infrastructure and we must seek new sources of finance for further investment.

Sir George continued: 'A number of important initiatives are already underway in the search for more efficient use of our existing roads. Developing route strategies is one such approach, now being considered by the Highways Agency. Under this proposal, agreed service standards could be set for new routes with co-ordinated programmes for improving and managing Other initiatives rest on the new possibilities offered by developing technology.

'Electronic signals can be used to control speeds, with variable message signs to inform drivers of alternative routes. To make the best use of these relatively straightford techniques, the Highways Agency is developing systems based on sophisticated traffic modelling, designed to react to conditions at local as well as at strategic levels.

'Privatisation will lead to more efficient use of the rail network, both for passenger and freight services.

'We are already seeing the fruits of this approach, in the plans of the first passenger rail franchisees. South West Trains, for example, are looking to reinstate a number of off-peak services, and to double services between Southampton and Salisbury. National Express Group, the franchisee on Midland Main Lin, will be running an extra 22 services each week day from Leicester to St Pancras. And we expect to see significant improvements in the punctuality and reliability of services arising from the demanding performance regimes which form a key part of contractual relationships in the restructured industry.

'Freight services are also set to benefit from liberalisation and privatisation, which we believe will check and then reverse the decline in rails share of the freight market. North and South Railways, owned by Wisconsin Central Transportation, have already announced plans for substantial new investment in rolling stock and are examining the scope for services based around wagonloads of goods.'

Sir George acknowledged that efficiency improvements could not be expected to meet all of industrys demands for improved transport, and there was a need for targeted investment in new infrastructure. However, it was not realistic simply to offer lists of desirable projects without saying where the funding would come from.

'A number of recent proposals for increasing transport investment rely heavily on changing the structure of public spending, without identifying areas for corresponding cuts. This is simply unrealistic - not to say irresponsible. There are no soft targets left in the public sector. Proposals for new spending which are based simply on an assessment of the amount currently paid in taxation by road users do not offer genuine solutions, but simply suggest a different division of the existing level of resources.

'I would have liked to see this issue addressed more fully in the CBI's Winning Ways. That report relied rather heavily on the assumed possibility of making savings elsewhere in the public sector - without saying exactly what should be cut. And in referring to new revenue streams as a partial solution, the report did not identify exactly who would end up paying more to finance higher investment.

'There is no room for conjuring tricks: extra public spending on transport on the scale proposed in the report can only come from three possible sources: less spending on other public sector programmes; higher taxation on individuals or businesses; or extra payments by transport users. If the issue of funding is not squarely addressed, then we are only hearing half the story.

On the search for new sources of finance, Sir George referred to the success of the private finance initiative in the transport sector, and noted the government's agreement with the major conclusions of the CBI's separate report Private Skills in the Public Sector.

Looking ahead, Sir George outlined plans for a new study to examine in greater depth the links between traffic growth, transport investment and economic growth. The Standing Advisory Committee on Trunk Road Assessment will be taking this study as thier next task.

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