Prioritise transport spending for economic growth – London First report launch (15 June 2010)June 15, 2010
London businesses today urged the Government to reconsider how it prioritises transport spending.
In a new report, Greater Returns: Transport Priorities for Economic Growth, influential business group London First examines the way Government evaluates spending on transport across the UK. It concludes Government has no consistent and comprehensive assessment of the wider economic impact of many of its large-scale programmes when making decisions on which should proceed.
The report analyses 17 schemes across the country to understand the Department for Transport’s methodology for assessing projects. The paper argues that in the current fiscal climate, the highest priority should be given to transport investment most likely to sustain growth. The current state of public finances means it is unlikely that all schemes with a net positive value will receive the necessary funding, let alone that are seen as socially desirable. Given the Coalition Government’s stated twin objectives of tackling the deficit and encouraging private sector growth, a comprehensive and consistent method of assessing economic benefits is needed.
The report will be launched at an event this evening, where Secretary of State Philip Hammond will address London’s business leaders for the first time as he sets out the Government’s transport priorities.
The Department for Transport last week put on hold all decisions on major schemes until after the comprehensive spending review in the Autumn.
Baroness Jo Valentine, Chief Executive of London First, said:
“The way in which Government judges the benefits of spending on transport needs urgent overhaul. After years of sunshine the Government now faces stormy weather and the challenge will be to secure the greatest returns from limited resources. That means being able to assess infrastructure investment across the country on a like-for-like basis, and prioritising transport projects most likely to sustain economic growth.
“Philip Hammond faces tough choices in his new role. We want to help him make the necessary cuts. The right decisions will support economic growth. A ruthless prioritisation of transport spending should have at its heart a credible, consistent means of judging which projects will deliver the best returns for UK plc.”
Notes to Editors
Greater returns – Transport priorities for economic growth draws on analysis commissioned by London First from Deloitte and Peter Brett Associates. It looks at the contribution of transport investment to growth and the way in which schemes should be prioritised by Government. The report calls for a credible, transparent and consistently applied framework for prioritizing transport projects, based on their long-term contribution to the wider economy.
London First is a business membership organisation with a mission to make London the best city in the world in which to do business. London First undertakes this by mobilising the experience, expertise and enthusiasm of the private sector to develop practical solutions to the challenges facing London. London First also seeks to persuade central and London government to make the investments that London needs in its infrastructure.
London First delivers its activities with the support of the capital’s major businesses in key sectors such as finance, professional services, property, ICT, creative industries, hospitality and retail. Membership also includes further education colleges and all of London’s universities. London First members represent over a quarter of London’s GDP.