Monday, 19 March 2012
On the road
David Cameron has a cunning little plan to lease out the English road system. What he wants are countries such as China through sovereign wealth funds to lease bits of roads and motorways to improve and maintain the road system.
The idea is that these new road companies would be set a series of targets to reduce hold ups and improve the roads they’re responsible for. In return the companies would get a cut from the vehicle license revenue.
Indeed what was known as the road fund license would really become just that. It would be a form of hypothecation, meaning the revenue raised in the tax would go to a specific end, in this case roads.
Hypothecation is normally resisted by the Treasury, they like to get their grubby little paws on all taxes, to do with, as they will.
Clearly such is the desperation of government with the state of the infrastructure that both the Prime Minister and his Chancellor have lent on Treasury officials to get them to drop their objections to such a tax.
So if Cameron gets his way the good workers of Swansea’s DVLA will be raising money that ultimately goes into the coffers of the Chinese state.
Why? Well, it was only but recently that the Chancellor took his bags to China to persuade them to invest their cash surpluses in infrastructure schemes in the UK. This latest wheeze by the Prime Minister is just an added project to the ever growing list of infrastructure projects that government want outsiders to fund.
The government has to go down the humiliating route of asking a foreign government to bail it out because the country’s infrastructure is crumbling.
The chronic under investment in the past means that the UK just can’t compete. It is now dawning on the government that a great deal of investment is needed. It is ideologically opposed to public investment which leaves it no choice but to go cap in hand to the Chinese for their cash. Nothing is for nothing, so in return they get a stake in our roads.
And if, as is likely, these companies start adding new lanes and even new roads to reduce congestion then tolling will enevitably follow.
But roads and transport are devolved so this will only apply to England. True but Wales and the Welsh will be greatly affected.
Quite apart from the fact that many journey to England on a regular basis and our trade links are cross border. There is the little matter of our old friend Barnet and his consequentials.
The more the private sector takes over the burden of investing in the transport system in England the less the UK government has to put of its own cash. Consequently, the Department of Transport gets less cash from Treasury and the old Barnet formula kicks in with Wales’s bit of the cake going down too.
So less cash for Carwyn Jones to spend. Either on roads or any other pet scheme of his.
God knows, if England’s infrastructure is not fit for purpose what can be said about Wales’s.
No track of rail electrified. Very few miles of road with dual carriage ways. A third world airport that the First Minister describes as a disgrace.
Wales needs projects galore to just get it to twentieth century standards let alone equipping it for the current century.
To do so, our politicians may also have to think sovereign funds, and take not the long boat to China but a plane ride there. But not from Cardiff.
Socialist ideology goes out, to get communist money in. There’s irony there, somewhere.