# Road Privatisation



## sallytrafic (Jan 17, 2006)

As this affects us all lets see if we can keep it out of the bar/lounge

The PM has just announced they are looking at privatisation of all of our major roads

"David Cameron will clear the way for a multibillion-pound semi-privatisation of trunk roads and motorways as he announces plans to allow sovereign wealth funds from countries such as China to lease roads in England."

Full link >Here<

Our road tax will be part paid to private companies to look after the roads

There will be no tolls unless new capacity created, by new roads or adding lanes.

Is this a good thing or a bad, will it become messy like the railway privatisation?


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## BrianJP (Sep 17, 2010)

If we end up with a network like France I say bring it on.But it will probably take another 100years to get going and end up a shambles like the railways have.


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## Rosbotham (May 4, 2008)

sallytrafic said:


> Our road tax will be part paid to private companies to look after the roads


What's new? None of the guys actually doing road maintenance/repairs on motorways are currently public sector : it's all out-sourced to MacAlpine etc with a thin layer of public sector bureaucracy provided by the Highways Agency (NB I use the term "bureaucracy" in the dictionary definition sense, not in any way to suggest it's a bad thing). From what I can see, this initiative removes that veneer meaning that rather than contracts being awarded on a build-by-build basis, in effect the whole of a given motorway or region is franchised out...so long as there's some form of contractual controls and SLAs, that's not necessarily a bad thing.

Of course, the thing that will get debates going is the application of tolls on new builds...but that's been government policy for sometime (I think even under Labour), so to a large degree orthogonal to this.

Paul


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## cabby (May 14, 2005)

another hairbrained scheme from our Dave :roll: :roll: also an attempt to refute responsibility from the government, again.

cabby


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## erneboy (Feb 8, 2007)

My first question would be how can they be sure of finding a form of words for use in the contracts which will be sufficient to stop costs escalating over time. Governments have not been good at that, too frequently costs spiral out of control as clever company people figure out ways to chisel more money out of contract for which they tendered at a price to get it rather than to make it pay.

I don't object to using toll roads when on long journeys so long as the prices are not extortionate. I do wonder though whether the Government might do well to look at toll roads in other countries. While I find that they are usually a pleasure to drive on due to the very small traffic volumes on many, I do wonder, as I drive along nearly empty roads, how they can possibly pay.

Although it may not be meant to be, I think it could turn out to be the thin of a wedge. I would need to hear a lot more about this to be convinced it could work, Alan.


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## TR5 (Jun 6, 2007)

If the road tax revenue, regardless of whether it is spent on them, pays for the maintenance costs of our roads now, why do we need to privatise them?
Will China use their own labour force to maintain them, taking more work away from us? Will China add the 'occasional' improvement to a road, to then justify making it a toll road?

They aren't going to take this on if they can't extract further wealth away from the UK and into their own economy!

Looks like a very poor and rediculous move to me.

What next, the council tax, with little Chinese road-sweepers based at every Foo King takeaway?


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## rosalan (Aug 24, 2009)

We should recognise that on a European scale, we can build roads but not maintain them.
Diesel is forecast to rise to £1.50 a litre =£6.75 a gallon or £27 per 100 miles.
Road tax to be added will now be further exacerbated by Toll roads :roll: 
If the existing charges on the M6 toll road are to be used as a guide, the future of road use is looking rather glum.
In Spain there are tolls, but not over expensive, even France is not able to match the UK tolls.

Summing up............... :evil: 
Alan


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## ched999uk (Jan 31, 2011)

I cannot understand how any government can think privatisation is better for the public.
Just look at the water suppliers. They make huge profits then because they haven't invested in new reservoirs to cope with growing population we get hose pipe bans!!!
The gas and electric companies make huge profits and the public suffer.

Is the M6 toll road making money? I doubt it, no one uses it.

In my opinion the only reason that any government privatises things is they want money and some of their cronies will make money! 

I can't see any privatisation has ever made things better (either cheaper or better service) for the public. 

If this really is required because we cannot afford to maintain our roads the UK is in a much worse situation than they are telling us!!!


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## Rosbotham (May 4, 2008)

ched999uk said:


> I can't see any privatisation has ever made things better (either cheaper or better service) for the public.


Well perhaps I look at the world through rose-tinted spectacles, but working in the telecoms industry can I beg to differ? When privatised, BT had approx double the staff of the industry as a whole today, doing the same job. If you could dig out a phone bill from those days you'd see that reflected...it'll be approx the same level as your phone bill this month, 28 years later. Take a look at some of the countries that still have state telecoms monopolies and e.g. look at how long it takes to get a line or fault repaired.

"Free" dial-up internet? Came from Freeserve, BT would never have launched it. Broadband? The volume growth came from new entrant players. Broadband @24Mbit/s instead of 2Mbit/s...was when new entrant local-loop unbundlers deployed their own kit...BT only upgraded theirs to match the competition. Superfast broadband rollout? Well BT's rollout is totally unrelated to the competition from Virgin and forthcoming availability of 4G mobile, of course.

And working in the business sector, BT are a ruthless competitor. But only because they have to be to match the competition.

All of that is because of competition, of course, rather than privatisation. But you can't have the former without the latter.

(Before anyone says it, of course you can't have competition between two roads. You can, though, have significant competition at the award of the franchises)


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## erneboy (Feb 8, 2007)

The Chinese might fund it but Ched is right, Dave's cronies in the city will run it using local companies, those who already do it, and the bankers will get richer.

I find it difficult to see how it has advantages for the rest of us, Alan.


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## Bob45 (Jan 22, 2007)

The argument here is not for and against privatisation but what do they do with our money. The vehicle excise duty brings in many more times the figure governments have spent on roads.
We already pay for roads through VED and we should be taking successive governments to task about the appalling state of our roads not on looking for new ways to fleece the motorist.
Bob


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## ched999uk (Jan 31, 2011)

Rosbotham said:


> ched999uk said:
> 
> 
> > I can't see any privatisation has ever made things better (either cheaper or better service) for the public.
> ...


Thank you, I stand corrected.
BT is a good example. It is interesting that the telephone network isn't privatised as such as a large proportion of the network is owned by 1 company (excluding cable companies and a few exceptions) and rules were put in place to enable competition.
If the road pricing worked the same way, maybe 1 organisation would own most of the roads and the competition would be who you buy your 'miles' from.
Interesting.


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## Rosbotham (May 4, 2008)

Again, subtlety between privatisation and competition.

It is privatised, but the final mile is bottleneck, so heavily regulated (concept of "equivalence"...heavy price regulation, then they're compelled to offer same service at same price at same SLA to everyone).

In principle you could have heavy regulation on a state-owned enterprise and achieve the same. Nobody has ever achieved it though : without the peril of knowing you can go bust inefficiencies always creep back in. It's as much a mindset issue as anything else.

I'm not asserting privatising roads is a good thing...I just couldn't let the assertion that there haven't been successes go unchallenged. I _would_ assert that the roads initiative is not as revolutionary as it seems at first glance, because the roads are _already_ privately maintained.


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## Bill_H (Feb 18, 2011)

How many of us drive motorhomes not made in the UK as you head for the ports for your foreign holidays, or drive to the supermarket to buy imported food in our Japanese car?
Have a look around your house and try to point out the products made in the UK.
And you have concerns about foreign investment in our roads?


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## DTPCHEMICALS (Jul 24, 2006)

Bill_H said:


> How many of us drive motorhomes not made in the UK as you head for the ports for your foreign holidays, or drive to the supermarket to buy imported food in our Japanese car?
> Have a look around your house and try to point out the products made in the UK.
> And you have concerns about foreign investment in our roads?


And the reason for all the foreign goods.
Over priced poor quality and delivery of home made products.

We have not supported our own industries like the continentals.

I have just shelled out £669 for VED as it is now named on Mh, car, van and motorbike. It is now a tax on vehicle ownership not Road Fund Licence as it used to be known. I do not care who owns the roads. But they are a disgrace to drive on.
Dave p


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## erneboy (Feb 8, 2007)

Bill_H said:


> How many of us drive motorhomes not made in the UK as you head for the ports for your foreign holidays, or drive to the supermarket to buy imported food in our Japanese car?
> Have a look around your house and try to point out the products made in the UK.
> And you have concerns about foreign investment in our roads?


The UK makes plenty of stuff Bill: http://en.wikipedia.org/wiki/List_of_countries_by_GDP_sector_composition that we don't is a popular misconception.

Although more would not hurt. It's just that we don't make a lot of household stuff.

I don't see how that connects to roads though.

The ownership of the roads is not at issue, it's the management, improvement and financing thereof, Alan.


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## cheshiregordon (Sep 24, 2011)

I think the idea of paying at the point of use rather than with a flat tax as on fuel or VED is to be preferred. 
As I understand it the proposal for road pricing (which I haven't seen ) is to be applied for new road build only, if it were to be applied across all motorways the congestion on trunk roads as people seek to avoid the charges would be interesting.


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## bigfoot (May 16, 2005)

Locally we have had an issue over road contracts awarded to certain companies-dodgy dealings. Next it will be companies set up to do a contract and then fail. Remeber the cable installation companies? Our local installer had 4 renames. 
Then the Eastern European Mafia will get involved. I'd like to see a gypsy fighter up against a Romanian gangster!


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## SpeedyDux (Jul 13, 2007)

The way I understood this is:

It will be a new kind of PFI scheme that allows private companies to fund by-passes or dual A-Roads and then charge usage tolls. 

It's a nonsense because the Government can borrow at far lower interest rates than the private sector. The returns for (e.g.) pension funds etc would be derisory unless the tolls are set high. 

I can also see traffic shifting to the B-roads and rat runs if they have to pay to use A-Roads just because one stretch has a new dual carriageway section funded by the private sector under a PFI scheme.

SD


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## raynipper (Aug 4, 2008)

It's screw the easy target so they can waste billions more on other failed harebrained schemes and their expenses going first class.

Ray.


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## GROUNDHOG (Mar 7, 2006)

At the moment all we have is what the media ( we all know how accurate they are) have told us and as ever the stories are hyped to the max. 

In theory I have no objection if a private company wants to build a motorway and then charge me to use it, that would create jobs and arguably relieve congestion from other roads. It works in other Countries so why not here.

I am a believer in paying for roads by the amount you actually use them, my pensioner neighbour does about 250 miles a YEAR yet still pays the same road tax as the rep that does 100,000 miles so there is something not right about that.

I often wondered why it would not be possible to scrap road tax altogether and add a few pence to fuel duty, the problem of course is that means people in rural area would suffer disproportionately so again it is unfair.

It is easy to sit and snear at what the government is trying and having to do but we have to face the fact the World economy is out of synch and as lifestyles and expectations change it will only get harder to balance the books.

I will reserve judgement until I know exactly what the proposal is.


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## erneboy (Feb 8, 2007)

They won't scrap road tax because it would not effect savings for the Government. All the bureaucratic ancillaries would have to remain any way. There has to be some register of all the cars on the road and these days the DVLA mesh with the Motor Insurance Database, combining these it is possible to check whether vehicles are insured, taxed and MOT'd. Recreating these functions in another way would be costly and may end up saving nothing.

They could just add road tax to fuel but raising the cost of fuel further would be even more unpopular.

The issue is how to pay for new roads. I agree with SD, long term Government borrowing has to be more efficient than borrowing private money with at least two sets of middle men raking off their cut. That's public borrowing and it's politically unacceptable at the minute both at home and with Europe so that's out. It will probably come down to PFI or nothing, Alan.


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## Oscarmax (Mar 3, 2011)

At the end of the day, why worry they have already made their minds up you are going to get shafted good and proper.


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## DTPCHEMICALS (Jul 24, 2006)

Quote GROUNDHOG.
I am a believer in paying for roads by the amount you actually use them, my pensioner neighbour does about 250 miles a YEAR yet still pays the same road tax as the rep that does 100,000 miles so there is something not right about that. 

The company car user is paying more to use the roads.
Its called Road Fuel Duty.
I do object to having to pay £74 a year for a motorcycle that has done less than 7k miles in 4 years, when neighbour pays £30 a year for a volvo in which he does in excess of 30k miles
Dave p


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## rayc (Jun 3, 2008)

Oscarmax said:


> At the end of the day, why worry they have already made their minds up you are going to get shafted good and proper.


Nothing much will happen in the life of this Parliament. The Tories will then be desperately trying to get elected by a majority that will not need Lib Dem support. What they do with this proposal could determine the result of the election. 1.6m people signed the e petition against road charging and that is why the PM is desperate to keep repeating any tolls will not apply to existing roads.

I will be very surprised if there is any substantial new roads built in the next 10 years


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## Glandwr (Jun 12, 2006)

I’m at a loss to see why private is always seen as being better than public. The same task is being done whether it be emptying bins or running utilities like water (DC is expected to liken to roads to water). 

Is it dogma that says it is always better done by the private sector?

It’s salutary to think that two of the biggest players in our electricity industry (EDF and another whose name I can’t recall at the moment) are in effect nationally owned (by the French government) and that all profits made from selling us electricity goes to them, presumably lessening the tax burden on the French. 

Why is it that we as a nation are so ready to give those profits away, into private and/or foreign hands?

Dick


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## Rosbotham (May 4, 2008)

Glandwr said:


> Why is it that we as a nation are so ready to give those profits away, into private and/or foreign hands?
> 
> Dick


Basic stockmarket theory : the value of a share is the Net Present Value of future dividends. Because of the vaguaries of dividend policy and the ability to manipulate profit figures, it's generally best to calculate as the NPV of the free-cash flow generated by the business. So if someone owns a share and sells it, the market price will reflect the value in today's money of future profits. Share prices vary from day-to-day because of changes to assumptions on the discount factor to use for time value of money, and assumptions/predictions of future profitability/free cash flow.

So far from "giving these profits away", in effect what the governments that privatised the state enterprises (i.e. sold their shares in the enterprise) did was to bank the future profits, by taking the NPV of them at the time of the sale.

Of course, convention is that to launch any company float successfully a substantial discount to market price is given. Otherwise, whoever bought the share would be taking on all the risk of whether the assumptions on future performance. You could have a very long debate about whether previous governments applied too deep a discount, but given many privatisations (gas, telecoms, electricity) were targeted at individual rather than institutional shareholders, the beneficiaries of that launch discount were those individuals. Those same individuals doubtless sold their shares to the overseas companies, so it's not as if the overseas companies got something for nothing.

Paul


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## Zozzer (Aug 13, 2006)

BrianJP said:


> If we end up with a network like France I say bring it on.But it will probably take another 100years to get going and end up a shambles like the railways have.


I'd prefer the Austrian system where everyone over 3500kgs has a Go Box and those under 3500kgs buys a vignette.

Imagine how much it would cost to travel from Dover to Edinburgh on Toll Roads, on top of road tax and on top of the highest diesel prices in the EU.


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## fastanlite (May 5, 2006)

What politicians say today will be different to what they say tomorrow.

Cameron will say today that tolls will not apply to existing roads until such time as the investors in the new toll roads get their fingers burnt because not enough motorists are using them to make a profit for a dividend.
Then what? the City complains to the Government and the Government eases things a bit to include more of the existing roads and before you know it all major roads are tolled and yet we still have to pay a licence fee.
This has happened on nearly every project that the Government get involved with, The Dome The Olympic Games ,New Wembley Stadium, anything to do with the Ministry of Defence and a host of other things just like these.
Sorry It's a bit of a rant but , you just can't trust the Government. 
Hopefully someone will start the ball rolling again with another petition against this proposal


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## GEMMY (Jun 19, 2006)

Which present/former government :?: , the dome etc were labour controlled.

Or are you talking generally. :?: 

tony


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## JockandRita (Jun 1, 2005)

GEMMY said:


> Which present/former government :?: , the dome etc were labour controlled.
> 
> Or are you talking generally. :?:
> 
> tony


They are all the same in my opinion Tony. You can't trust *"any of them"*, no matter which government it is. 

Regards,

Jock.


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## Glandwr (Jun 12, 2006)

Do you vote Jock?

Dick


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## bulawayolass (Jul 27, 2010)

All this is making fulltime on the continent with odd trips back to uk look better and better. Even Andy who was against it before is starting to like the idea.


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## rogerblack (May 1, 2005)

If this genuinely only applies to new roads then I am all for it.

I am a big fan of the M6 toll road although I hardly ever actually use it myself*! Why - because I don't need to, since the toll road has taken a lot of the traffic away from the charge-free sections of the M42/M6 and so has greatly reduced the congestion on those, making the journey easier even for those who choose not to pay for the toll road. 
To me, that's a win-win. 

*If I am in the car and it's a busy time of day, I may use the M6 toll especially if I'm on business and have a schedule to follow. I've never used it in the motorhome since I'm not usually in a rush and the cost is considerably higher, thanks to our overcab bed bulge. 

(Unlike the Severn Bridge where it's cheaper for the motorhome than it used to be for my little Astra Van!). :roll:


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## Stanner (Aug 17, 2006)

BrianJP said:


> If we end up with a network like France I say bring it on.


Can that be the same network I've used? The ones that cost an arm and a leg to drive any distance and the older stretches of which make most Belgian motorways look (and feel) like snooker tables?

No thanks, I'll stick with £215 (until the Budget no doubt :roll: ) PER YEAR instead of a big chunk of that PER DAY.


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## fastanlite (May 5, 2006)

Talking genarally about all and any government unfortunately.


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## Stanner (Aug 17, 2006)

cheshiregordon said:


> I think the idea of paying at the point of use rather than with a flat tax as on fuel or VED is to be preferred.


What on earth can be more "point of use" than fuel duty?

If you don't use any - you don't pay anything. :roll:


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## JockandRita (Jun 1, 2005)

Glandwr said:


> Do you vote Jock?


Yes I do Dick, but I find it very hard to decide which bunch of lying barstewards I give my vote to, and it's no blooming wonder that many folks don't vote at all.

Regards,

Jock.


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## sallytrafic (Jan 17, 2006)

I have just last week bought a new road atlas my previous one from the same publishers was dated 2008 (2007 mapping) so what has happened on the roads in 4 years? Well I flipped over the pages and compared, looking for new dual carriageways, new motorways and I struggled to find anything in fact all the changes I noted were:

The A1 M past Wetherby
The M6 A74M Carlisle to Gretna

Whereas all my Ireland maps from 2007 might as well be binned.

So clearly something! needs to be done  

Just not sure that privatising is the answer as someone has already said once there are layers of profit to be had you can't trust our government to get contracts right (and that's not party political) Look at the recent rail franchise upset Firstgroup giving up the first Great Western franchise as the contract was rear end loaded and they could walk away with lots of money that they should have been paying back in the last years of the franchise.


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## Rosbotham (May 4, 2008)

Off the top of my head :

Low / High Newton bypass in Cumbria.

New dual carriageway north of Chester cuts out bottlenecks near Queensferry.

Wasn't the M40 / A404 junction revamped in that timeline?

Widening of M1 Hemel-Luton


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## Melly (Jul 5, 2007)

I live on the doorstep of the M6 toll and as the price goes up so less people use it so they put the price up to compensate and even more stop using it.
It now makes a huge loss so what a waste of an empty road.
Maybe if the government used all the tarmac that puts speedbumps everywhere, which damages cars even at slow speed,to fill in all the potholes we may not need private money grabbers.


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