Category: Transport

A Major Change in My Life

In the last few days I have given up driving after over 60 years due to medical incapacity. I sold my last car (a Jaguar XE -photo below) to We Buy Any Car who offered a fair price although they were a bit slow in paying up – managing their cash flow over Xmas I suspect, but otherwise very efficient.

My wife has already committed some of the cash generated on a new, larger TV.

The first car I owned was a Rover 10 built in 1947 which I painted white by hand. It cost me £25. Rather a slow vehicle with useless brakes. Since then I have owned multiple Jaguars – XJs and an XJS, and a Lexus LS400 – all good vehicles in their way.

I have stopped further kidney dialysis as planned but am not declining as rapidly as expected. Have to wait and see how this pans out. Doctors are generally not good at forecasting life expectancy even at my age of nearly 80.

My stock market portfolio is in a healthy condition and Alex, my son, is taking it over. It’s useful having two sons who are competent in many respects.

In summary I think it’s an opportune moment to depart this world.

Roger Lawson (Twitter: https://x.com/RogerWLawson  )

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Heathrow Expansion, Lower Thames Crossing and Just Stop Oil Sentences

The Chancellor is backing the expansion of London Heathrow Airport with a third runway. This has of course been proposed in the past but plans have always been thwarted by political and legal opposition. Rachel Reeves believes it would assist her plans to grow the economy, and it should be pushed through. Even if she manages to overcome all the hurdles it could be many years before we see the new runway.

Is it necessary and a good thing? The issue to my mind has always been the increased noise and pollution from expanding this airport in a London suburb. A much better plan has always been to build a new airport to the east of London on Maplin Sands or elsewhere in Essex/Kent.  

Other alternatives are expansion of Stansted, Luton or Gatwick airports, or even better, expand regional airports. Is it really necessary to have people travelling from all over the UK to Heathrow just to catch a plane to their ultimate destination? It is not and the financial cost of expanding Heathrow is enormous – for example it requires major alterations to the M25/M4 which will add months of disruption to key roads.

I have always opposed Heathrow expansion and will continue to do so because of opposition to the noise that it causes that affects a very wide area of London. Heathrow Airport is also one to avoid in my opinion by any sensible traveller.

Lower Thames Crossing

Apparently the Chancellor is looking at a private finance deal to get the Lower Thames Crossing built. This is a tunnel near Tilbury to divert traffic from the Channel ports to avoid them using the M25 and Dartford Crossing. This is a very worthwhile project that makes a lot more sense than expanding Heathrow Airport.

Just Stop Oil Appeals

Yesterday appeals were heard in the Court of Appeal over the sentences on Just Stop Oil protestors who blocked the M25 for 4 days. That included 5 years for Roger Hallam who helped to organise the protest. Were the sentences justified? Well the cost imposed on the millions of road users who use the M25, and the general inconvenience caused do justify stiff sentences in my opinion. That is particularly so after Hallam in April 2024 was given a suspended two-year sentence for attempting to block Heathrow Airport with drones. Basically he and his supporters are persistently attempting to disrupt normal life. These are not “peaceful” protests – they aim to cause the maximum disruption they can just in the cause of bringing their views into public attention.

I hope the Appeal Court will not be sympathetic.

Roger Lawson (Twitter: https://x.com/RogerWLawson  )

You can obtain notifications of new posts in future by following me on Twitter (now “X”) – see https://x.com/RogerWLawson where new blog posts are usually mentioned.

Book Review – Scared to Death   

One of the books I have been reading lately is “Scared to Death” by Christopher Booker and Richard North. First published some years ago but more recently updated it covers the public scares from BSE to Global Warming including speeding on our roads and why scares are costing us the earth.

To quote from the Introduction: “In the past twenty years, Western society in general and Britain in particular has been in the grip of a remarkable and very dangerous psychological phenomenon. Again and again since the 1980s we have seen the rise of some great fear, centred on a mysterious new threat to human health and wellbeing. As a result, we are told, large numbers of people will suffer or die. Salmonella in eggs; listeria in cheese; BSE in beef; dioxins in poultry; the ‘Millennium Bug’;DDT; nitrate in water; vitamin B6; ‘Satanic’ child abuse; lead in petrol and computers; passive smoking; asbestos; SARS; Asian bird flu – the list is seemingly endless.

Indeed, we are currently in the grip of the greatest such fear of all: that of a warming of the world’s climate which, we are officially told, could well put an end to much of civilized life as we know it. The price we have paid for such panics has been immense; most notably the colossal financial costs arising from the means society has chosen to defend itself from these threats. Yet, again and again, we have seen how it eventually emerged that the fear was largely or wholly misplaced. The threat of disaster came to be seen as having been no more than what we call a ‘scare’”.

The book certainly covers the ground well and shows how these scares arise and are promoted by the ignorant. Popular media and even the supposedly responsible press love a “bad news” story that helps their circulation (or their on-line media “hits” that helps their advertising income).

But the financial cost to the public can be enormous with no cost/benefit justification for the chosen solutions to the perceived problems. Indeed in the case of road safety the chosen measures (speed cameras) have not only been financially damaging but have diverted funds from effective road safety measures and meant that the UK no longer has a lead in reducing accidents and deaths (KSIs).

Some of the scares, such as that for AIDS, did turn into a serious problem only the worst outcomes being averted by advances in medical science and simple contrary public health measures. But other scares just disappeared because they turned out to be unreal – such as the Millenium Computer bug. However many millions of dollars and pounds were spent on curing imaginary problems.

One issue I was personally involved with was the “speed kills” issue which has resulted in the proliferation of speed cameras and speed humps. It is covered in Chapter 10 of the book.

As the book says, during the early years of the last century the death rate from road accidents in the UK consistently fell. By 1993 it was below 4,000. Britain’s roads were the safest in Europe. In France and Germany, the annual death toll was over 9,000. In Portugal the death rate was well over three times as high. Then the rate of decline suddenly slowed. Over the next decade the total fall was smaller than in any of the years between 1990 and 1993. On five occasions the yearly figure actually rose. So what had changed? Road safety policy as promoted by the Government changed.

The book says: “Undoubtedly one important factor in the steady fall in the fatal accident rate in earlier decades, despite a doubling in the number of vehicles on Britain’s roads – from 12 million in 1966 to 25 million in 1994 – had been the technical advances that made vehicles themselves much safer. But this could not have explained the slowing in the fall of accidents in the 1990s, when new regulations had made vehicles safer still”.

In reality the automated speed enforcement and reduction in speed limits created a financial incentive for the police to invest in speed cameras, speed awareness courses and enforcement when they had very little impact on road casualties. Over 2 million people are now issued with speeding fines every year in the UK at enormous cost to themselves and a whole industry has been created to support this mistaken policy due to the scare that “speed kills” when excessive speed is one of the less common factors in the cause of road accidents.

Expenditure on road policing and other effective measures to reduce accidents such as local road engineering were reduced in favour of more enforcement by cameras in the hope that would cut accidents when it did not.

See this web page for some of the articles I have written on this subject: https://www.freedomfordrivers.org/road-safety

As regards the book “Scared to Death” although the authors have documented well how such scares arise and are promoted by the misinformed they unfortunately have not tackled the issue of how to stop us wasting money on false solutions. But the book should be essential reading for all politicians.

Roger Lawson (Twitter: https://twitter.com/RogerWLawson  )

You can obtain notifications of new posts in future by following me on Twitter (now “X”) – see https://x.com/RogerWLawson where new blog posts are usually mentioned.

Sondrel – Another Disappointing IPO, and Grant Shapps Appointment

This morning saw the share price of Sondrel (SND) collapse by over 60%. It only listed in October 2022. Revenue forecasts are shot and losses will no doubt be substantial. This is what Camtab had to say on it on Stockopedia: “I am just amazed that people wonder why the City of London is losing credibility in the world. Sondrel are a fantastic example of the duplicity, stupidity and greed inherent. Float October 22 mentioning semi conductor (oh must be good then!) lots of prospects (brilliant) loads of opportunity (great!!). Less than a year later a profits warning on this scale. I gave up investing in IPOs years ago recognising that you only list on UK markets now if its a sh&tshow. Sorry to be so down about but it is so depressing and I don’t think people do hit brokers or markets enough for devaluing one of our main income providers in this country. Still keep devaluing it on this scale and we can always fall back on our resources (oh!) well we have some fantastic multi-national businesses (didn’t we sell those to someone)…………oh, well perhaps we could bottle fresh air then”.

There are several key messages here: 1) never trust a company with a volatile financial history; 2) recurring revenue is very important; 3) the semiconductor market is particularly tricky due to rapid obsolescence; all IPOs are risky as it’s easy to spin a good story about future prospects.

This was a company lined up to fail in my view and could well now be taken private again. Why do people invest in such dogs? Because there are lots of people who are suckers for a good tale is the reason.

The other surprising news today was the promotion of Grant Shapps to Defence Secretary. Someone who had made a hash of his previous job of Transport Secretary by promoting LTNs and then backtracking when they proved so unpopular (and impractical), a supporter of the impossible Net Zero policy and managed to change jobs so rapidly that his mistakes never caught up with him. His profile on Wikipedia also makes for interesting reading.

UK politics is beyond salvation if Rishi Sunak could not find someone better to take on the job.

Roger Lawson (Twitter https://twitter.com/RogerWLawson  )

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A Political Manifesto

A few years ago I penned some policy suggestions for a new political party. I just had a clear out of some of my old files and thought it was worth publishing as it’s still very topical.

Reference Policy Suggestions My suggestions for policies in those areas and others are below:

Finance

1.       The personal taxation system is way too complicated and needs drastically simplifying. At the lower end the tax credit system is wide open to fraud while those on low incomes are taxed when they should not be. The personal tax allowance, both the basic rates, and higher rates, need to be raised to take more people out of tax altogether.

2.       The taxation of capital gains is also now too complicated, while tax is paid on capital gains that simply arise from inflation, which are not real gains at all. They should revert to being indexed as they were some years ago. For almost anyone, calculating your own tax that is payable is now way too difficult and hence requiring the paid services of accountants using specialist software.

3.       Inheritance tax is another over-complex system that wealthy people avoid by taking expert advice while the middle class end up paying it. It certainly needs grossly simplifying, or scrapping altogether as a relatively small amount of tax is actually collected from it.

4.       The taxation of businesses is inequitable with the growth of the internet. Small businesses, particularly retailers, pay a disproportionate level of tax in business rates while their internet competitors often avoid VAT via imports. VAT is now wide open to fraud and other types of abuse such as under-declarations, partly because of the EU VAT arrangements. VAT is in principle a simple tax and the alternative of a sales tax would create anomalies but VAT does need to be reformed and simplified.

5.       All the above tax simplifications would enable HMRC to be reduced in size and wasted time in form filling by individuals and businesses reduced. Everyone would be a winner, and wasted resources and expenditure reduced.  

6.       The taxation of company dividends on shares is now an example of the same profits being taxed twice – once in Corporation Tax on the company, and then again when those profits are distributed to shareholders. This has been enormously damaging to those who receive dividends and the lack of tax credits has also undermined defined benefit pension funds. The taxation of dividends should revert to how it once was.

7.       The regulation of companies and financial institutions needs very substantial reform with much tougher laws against fraud on investors. Not only are the current laws weak but the enforcement of them by the FCA/FRC is too slow and ineffective. Although some reforms have recently been proposed, they do not go far enough. Individual directors and senior managers in companies are not held to account for gross errors or downright fraud, or when they are, they get off too lightly. We need a much more effective system like they have in the USA, and better laws.

8.       Shareholder rights as regards voting and the receipt of information have been undermined by the use of nominee accounts. This has made it difficult for individual shareholders to vote and that is one reason why investors have not been able to control the excesses in director pay recently. The system of shareholding and voting needs reform, with changes to the Companies Act to bring it into the modern electronic world.

9.       The pay of directors and senior managers in companies and other organisations has got wildly out of hand in recent years, thus generating a lot of criticism by the lower paid. This has created social divisions and led partly to the rise of extreme left socialist tendencies. This problem needs tackling.

10.     Governance of companies needs to be reformed to ensure that directors do not set their own pay, as happens at present, but that shareholders and other stakeholders do so. Likewise shareholders and other stakeholders should appoint the directors.

11.     Insolvency law needs reform to outlaw “pre-pack” administrations which have been very damaging to many small businesses. They are an abuse of insolvency law.

Transport

1.       Way too much money is spent on rail transport and trams which cannot be justified on any cost/benefit analysis. HS2 is just one extreme example of this. Meanwhile the road system does not receive enough investment – this has resulted in traffic congestion, wasted time which is damaging to the economy and lots of poorly maintained roads (e.g. potholes). Only 25% of direct tax on vehicles is spent on the roads.

2.       Public transport should generally pay for itself. In London alone there is a subsidy of £1 billion per year on buses which is totally unjustified. Many of these subsidies are given to people who could afford to pay for their travel, even when they are receiving social security benefits.

3.       Road safety has flat-lined due to an excessive focus on speed reduction and the perversion of the law by the use of police waivers to force people to take useless “education” courses. Policies have been distorted to enable the police to make money from drivers, while improving the roads, better education and other policies to reduce road casualties have been ignored.

4.       Charging of drivers via road pricing to reduce congestion should be opposed (as it does not work and is just a money-making taxation scheme). Likewise Clean Air Zones where drivers are taxed for driving some vehicles, all of which were legal when purchased, should be stopped and the whole focus of environmental legislation should be reviewed. EU regulations in this area have made illegal air pollution levels when there is no real evidence of danger from them. ULEZ and CAZ schemes are just a way to raise taxes with little real benefit on health grounds and no cost/benefit justification.

5.       Likewise the EU has mandated speed limiters (ISA – Intelligent Speed Adaptation) for all vehicles in future which will delay vehicles and not contribute to road safety, while generating millions of speeding fines on innocent drivers. There should be a commitment not to follow the EUs lead on such legislation.

Education

1.       Education should be free for all those who can justify they will benefit from it. At present too many people go to university who will be unlikely to benefit from it and they should be redirected to lower cost vocational courses.

2.       Loans to support students taking courses should be interest free.

3.       There needs to be a much stronger focus on technology education in the UK as only people with such education will contribute positively to the economy.

4.       There needs to be more emphasis on the use of technology in teaching to improve the productivity of that profession which has basically not changed in hundreds of years. The use of on-line resources can assist and would enable teachers to be more productive and hence be paid more.

Environmental, Climate Change, Population and Housing

1.       There should be more attention paid to the real science of environmental impact rather than the hysteria of left-wing campaign groups.

2.       Mrs May’s commitment to a zero-carbon economy, which is financially unaffordable, should be scrapped because there is no practical way to achieve it and it is based on very dubious scientific analyses.

3.       The population of the UK needs to be controlled, if not reduced, to improve living conditions and ensure a healthy economy. This can be achieved by tougher limits on immigration (along with better enforcement of existing rules), and encouraging the population to procreate less.

4.       Housing costs, and the inability to find suitable accommodation, are major problems for the young. Controlling/reducing population would help but other measures need also be considered including the financing of more social/rented housing.

Local Councils and London

1.       The funding of local authorities, and some of their important functions such as providing social care, needs to be reformed. At present they are too dependent on central Government funding which means obligations are often put on them without the funds to cover the cost.

2.       There are wide variations between the efficiencies of different local councils with many being wasteful. They should have guidelines and limits on how they spend their money, laid down by central Government, to avoid waste.

3.       London is a particular problem where it has become dominated by populist Mayors (both Labour and Conservative) and where elections are driven by national politics rather than local issues. The most recent Mayor, Sadiq Khan, has been pursuing a “gerrymandering” policy of increasing immigration to gain more people that are likely to vote for him, thus making London even less acceptable as a place to live than it has been for years. Crime, transport and housing are all in a major crisis. I suggest the position of the Mayor, and the Greater London Authority be scrapped as Mrs Thatcher did with the GLC when Ken Livingstone became so damaging. In other words it should revert to central Government control, with the local boroughs having more control over their own affairs. That would no doubt be popular with London borough councillors.

4.       Transport for London should be taken out of the control of the Mayor be made an independent body with an objective of making it a profit centre rather than a consumer of enormous subsidies. They should also lose control of the road network (the TLRN) where they currently have a perverse incentive to make the road network unfit for purpose so that more people use public transport from which they gain income.

I hope you find the above useful.

Yours Roger W. Lawson, M.B.A., M.B.C.S. ++++++++++++++++++++++++++++++++++++++

Roger Lawson (Twitter: https://twitter.com/RogerWLawson  )

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Transport Disruptions and How to Stop Them

In the South-East of England we are suffering from major transport disruptions. First from rail strikes affecting London commuters and second by the activities of Just Stop Oil on the road network.

The RMT union have announced further strikes on November 3, 5 and 7 and are balloting their members on pursuing them for another six months. I issued a tweet yesterday which suggested the way to stop these strikes was to give an ultimatum to employees to either work normally or get fired. The problem is that train drivers are so highly paid that a few days out is affordable.

Rather surprisingly I got a response from the RMT which said “In your haste to sound draconian you’ve not considered who would staff the railway or train the replacements if you’ve fired them all? Nothing would move for years!!”.

My response was “Well it worked when Ronald Reagan did it for air traffic controllers, did it not?”. This refers to the events in August 1981 in the USA. To quote from Wikipedia: “After PATCO workers’ refusal to return to work [over a pay dispute], the Reagan administration fired the 11,345 striking air traffic controllers who had ignored the order, and banned them from federal service for life. In the wake of the strike and mass firings, the FAA was faced with the difficult task of hiring and training enough controllers to replace those that had been fired. Under normal conditions, it took three years to train new controllers. Until replacements could be trained, the vacant positions were temporarily filled with a mix of non-participating controllers, supervisors, staff personnel, some non-rated personnel, military controllers, and controllers transferred temporarily from other facilities”.

The US airlines continued operations with minimal disruptions and the Reagan move had a significant impact on union activities in other organisations effectively resetting labour relationships in the USA. Strikes fell in subsequent years. From 370 major strikes in 1970 the number fell to 11 in 2010, and it had a positive effect in reducing inflation.

Just as Margaret Thatcher handled the coal miners in the UK, Reagan’s firm resolve on facing up to the unions created a new and better culture.

As regards the Just Stop Oil (JSO) campaign the closure of the Dartford Bridge created enormous traffic jams and delayed people for many hours. The whole of south-east London was affected as many people commute around the M25. The Metropolitan Police tweeted they had “made 404 arrests linked to JSO activity. We have needed nearly 5500 officer shifts diverted from local communities in London, to deal with the serious disruption caused by this activity”. The total cost including the delays to people must be many millions of pounds.

The Police seem to be totally ineffective in stopping the activities of JSO. People get arrested but then released. Fines, if any, are minimal. There is a Bill currently going through Parliament that might assist – The Public Order Bill – see https://www.parallelparliament.co.uk/bills/2022-23/publicorder . It creates a number of new offences relating to “locking-on”, obstructing major transport works and interfering with the use or operation of key national infrastructure. It also confers preventative powers for the police to search for and seize articles related to protest-related offences and provides for a new preventative court order, the Serious Disruption Prevention Order, to disrupt the activities of repeat offenders”. But will it be applied vigorously?

The Police already have considerable powers that are not used and JSO could be proscribed as a “terrorist organisation” as they meet the criteria. Let us hope the Public Order Bill is passed quickly. But it’s really down to the Government to take a lead on this matter even if they may be distracted by financial matters at present.

Peaceful demonstrations are OK but disruption to normal life should not be permitted under any circumstances.

Roger Lawson (Twitter: https://twitter.com/RogerWLawson  )

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Train Strikes – What’s It All About?

The national rail strikes this week have been incredibly inconvenient for those who rely on trains to get to work or for essential trips such as visits to hospitals. In London the strike has also extended to the London Underground. Commuters have been badly affected although the ability to work from home (WFH) has softened the blow and reduced the impact.

Why are RMT union members striking? It’s partly that they want a pay increase to offset the impact of inflation. But it’s also about whether rail management have the power to decide on jobs and working practices. For example, they wish to block any forced redundancies such as the closing of ticket offices. In London they are even intervening over the outsourcing of the contract for underground cleaning by TfL.

It should be a business decision as to whether ticket offices should be closed. There are now generally alternative ways to buy tickets although a few people might be inconvenienced. But if it saves money then management need to decide on a commercial basis whether to close offices.

National Rail Chief executive Andrew Haines said: “We cannot expect to take more than our fair share of public funds, and so we must modernise our industry to put it on a sound financial footing for the future. Failure to modernise will only lead to industry decline and more job losses in the long run.”

In reality the national railways have lost money for the last 100 years and have been massively subsidised by the Government (i.e. by you and me from our taxes). It’s exactly the same in London. With reduced passengers on all services due to the Covid epidemic and more WFH all rail services need to cut their costs to get revenue and costs more into balance.

The rail system is an enormously labour-intensive operation to maintain the track and signalling. Railways are also enormously expensive to build – just look at the cost of HS2 or Crossrail (about £100 billion and £19 billion respectively) – both projects are late and over budget.

The big problem is that railways use old technology and are operated using archaic working practices. The rail unions are trying to protect their pay, their jobs and working practices which is simply unjustifiable. They need to accept that passengers have alternatives and if they are unwilling to use the railways as much as they used to do then management has to retrench.

The unions need to face up to reality or they will go the way of the dinosaurs (like the coal miners did when faced with the Government being unwilling to subsidise perpetual losses).

But the core of the problem is a confrontational approach from both sides. There should be a consensus about how to run the railways profitably for the benefit of both the owners and the workers.

Roger Lawson (Twitter: https://twitter.com/RogerWLawson  )

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Transport Crisis in London

Both Sadiq Khan, Mayor of London, and Andy Byford, London Transport Commissioner, have warned that unless they get more money from the Government then there are going to be savage cuts in public transport and on major infrastructure projects. The latter might include the required repairs to the Rotherhithe Tunnel, the A40 Westway and A12 Gallows Corner flyover leading to their closure.

Some 100 bus routes face the axe and frequencies may be cut on 200 other routes. Other proposals are no more electric buses, no more step-free stations, no more “Healthy Streets” cycling and walking schemes and no more 20mph zones or safer junctions.

Now some readers might welcome some of those things and clearly the Mayor is trying to scare the Government into providing more funding within weeks. But some of those suggestions like closure of the Rotherhithe Tunnel and the Westway would be disastrous for the functioning of the road network in both east and west London.

How did TfL get themselves into such a mess? It all stems from the policies adopted by Ken Livingstone which was for massive subsidies to buses and commitments for large expenditure on Crossrail and other underground projects. The bus network has certainly been greatly expanded but at a cost that was never justified and Crossrail has been a financial disaster. Over budget, over schedule, and never justified on a cost/benefit basis. The Mayor was relying on income from it to cover TfL’s future budgets which it never has.

Boris Johnson never tackled the problems created by Livingstone when he was Mayor while Sadiq Khan has actually made matters worse by spending enormous amounts of money on cycle lanes, LTNs, and other schemes that have damaged the road network. He has also encouraged the growth in the population of London while the infrastructure never kept up with it despite massive central Government funding.

A report in the Express shows that £515 more per person was spent on transport schemes in London than on the North of England. A new report from the IPPR North think tank has published an independent analysis of transport spending over the past decade. Between 2009/10-2019/20, the North received just £349 per person in transport spending. In comparison, the UK as a whole received £430 per person, while London received a staggering £864 per person. Where did it all go one might ask? On pointless and generally uneconomic schemes not justified by any cost/benefit analysis is the answer.

The daft transport schemes such as the Congestion Charge and the ULEZ have actually encouraged people to move out of London and the cuts to public transport that are proposed will expedite that trend. With falling income from bus and tube fares already caused by the pandemic, the outlook is certainly bleak. But failing to maintain the infrastructure such as bridges, tunnels and flyovers while the Major prefers to spend money on other things is surely a sign of gross incompetence.

London needs a new transport plan where expenditure is matched to income and needless subsidies removed. In other words, people should pay the cost of the trips they take on public transport and free riders should be stopped. But will a socialist Mayor ever take such steps? I doubt it. So London is likely to go into further decline and more people will move out.

But London is at the heart of the UK economy so there is some justification for central Government stepping in once again to reform London’s governance. We need less populism (which generally means hand-outs to win votes) and more financial acumen in the leadership. Certainly the current arrangement where you have a virtual dictator in the role of Mayor and a toothless London Assembly is not working.

The key to improving the London transport network is not to have it all (both public and private transport) under the control of one body (TfL) which leads to lack of competition and perverse incentives. For example, encouraging cycling to relieve pressure on public transport while causing more road traffic congestion and introducing schemes such as the ULEZ to help subsidise public transport while increasing the cost of private transport.

Perhaps we need a new Dr Beeching to put the London transport network back into a cost-effective structure as he did for British Rail. But at least the Government seems to have taken some rational decisions by cancelling the eastern link of HS2 to Leeds. Just like Crossrail in London, HS2 was never justified in terms of benefits achievable and the money would have been better spent on smaller projects. But politicians love grandiose schemes. Reality seems to be finally sinking in on the national scene even if not yet in London.

Roger Lawson

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Government Powers Ahead with Decarbonising Transport

An announcement from the Government yesterday spelled out the world’s first “greenprint” for decarbonising all modes of domestic transport by 2050.

Plans include a ban on the same of all new “polluting” road vehicles by 2040 and net zero aviation emissions by 2050. The former includes the phasing out of all petrol and diesel HGVs by 2040 – subject to consultation. Consultation will be very important because the practicality of HGVs that need to go long distances without repeated refuelling is important economically. LGVs can probably be electrified but HGVs need to use alternative fuels.

The 2050 commitment applies to aviation emissions and a consultation on that is also launched under the “Jet Zero” banner. It is clear that new technologies and aviation fuels need to be developed to achieve a major reduction in aviation emissions. Whether such changes to reach zero emissions are achievable is not at all clear and the cost, which might be very considerable, is not given.

Similarly, the costs of electrification of all rail transport is likely to be enormous as the UK lags far behind other European countries in that regard. Less than 50% of the UK rail network is currently electrified. For example the cost of electrifying the Great Western mainline to Cardiff was estimated at £2.8 billion.

The Daily Telegraph has speculated on a new system of road pricing to replace the £30 billion currently raised through taxes on petrol and diesel. But the latest Government announcement leaves out any mention of how that issue is to be tackled.

As with all good political missives, the Government document contains lots of fine words about how the environment will be improved while not inhibiting us from travelling when or where we want (for example, taking holiday flights). It’s a policy statement in essence that leaves out all the detail of how this nirvana is to be achieved and at what cost. It ignores a lot of the practical difficulties. But it’s worth reading to get an impression of what might happen in the next few years.

Where is the cost/benefit analysis that justifies this revolution in transport modes? It’s nowhere to be seen. It’s as if the Government has signed up to the global warming religion so as to save humanity while ignoring the fact that reductions in UK emissions, particularly those that are only transport related, will have very little impact on worldwide emissions. The UK generates about 1% of global emissions while transport related emissions are an even smaller proportion. The UK appears to aiming to be a saint among sinners which may make us feel good but may make us economically poor.

What are the implications for investors? It’s clear that many billions of pounds will be spent by the Government to achieve this new world. But there is one simple message to take on board. The UK will be impoverished in comparison with countries that have not become quite so committed to the new religion. So investment in China, India, even the USA, in fact anywhere except the UK and the rest of Europe, might make more sense.

Government GreenPrint Paper: https://tinyurl.com/8ymtap38

Telegraph Article on “Road Toll Confusion”: https://tinyurl.com/edxxh4rp

Roger Lawson (Twitter: https://twitter.com/RogerWLawson  )

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Great British Railways Plan – But Will It Be Great?

The Government has published the Williams Review of proposals for how Britain’s railways should be reformed. The existing franchise system for the train operating companies with a separate company managing the tracks which was introduced in the 1990s has proved to be a dismal failure.

Network Rail went bust and although the franchise services have been improved in some regards, the recent collapse in ridership due to the Covid epidemic has meant the Government had to step in to keep franchises afloat. The franchise system was also exceedingly complicated with horrendously complicated contracts to supposedly provide the right incentives to train operators. It did not stop arguments over who was to blame for delays to services. But the Government (i.e. you and me via taxation) ended up providing even bigger subsidies and in ways that were not that obvious.

Train delays are common. The report says that one third of trains were late in 2019/20 and this has barely improved in the past five years.

Now the Williams-Shapps Plan is now proposing a brave new world of Government control. Grant Shapps, the Transport Secretary, said: “Great British Railways marks a new era in the history of our railways. It will become a single familiar brand with a bold new vision for passengers – of punctual services, simpler tickets, and a modern and green railway that meets the needs of the nation.”

That sounds remarkably like the ambitions of the old British Rail does it not?

New flexible season tickets are promised that will help those who are now only commuting into offices a few days per week and simpler and less confusing tickets are foretold. Paper tickets will disappear and there will be a new app to enable easy booking. This will compete with companies such as Trainline (TRN) on the web whose share price has dropped by 25% since the announcement. There were lots of people shorting the stock even before the news broke, probably because the company has never made a profit and looks financially to be somewhat unstable. Trainline issued some soothing comments including: “The Company believes the proposals will provide Trainline with new opportunities to innovate for the benefit of customers and further grow its business” but it’s clearly a major threat.

The Williams report says that train operating franchises will be replaced by “Passenger Service Contacts”. It is not clear how that is different though. More fine words from the report are: “Under single national leadership, our railways will be more agile: able to react quicker, spot opportunities, make common-sense choices, and use the kind of operational flexibilities normal in most organisations, but difficult or impossible in the current contractual spider’s web”. One claim is that Great British Railways will make the railways more efficient, long the complaint of those who have looked at the finances of the system.

Comment: There is certainly a desire for change as the existing franchise system and separate rail track maintenance system was clearly inefficient. Rail passengers still do not pay for the real costs of running the trains and building/maintaining the tracks except on heavily used commuter lines in the London area. But the essential problem is that the cost of operating trains is high when passenger usage is concentrated into a few hours per day while the public expects a service 18 hours per day or longer. Another problem is that the cost of building and maintaining the tracks and signalling is enormously expensive in comparison with roads.

For example, according to articles in the Guardian (a keen supporter of railways), the cost per mile of building a motorway is £30 million per mile. Does that sound high? But the cost of a new railway such as HS2 is £307 million per mile!

Railways are old technology that intrinsically require expensive track and expensive signalling systems to maintain safety. If a train breaks down or signals fail the whole network is disrupted while this rarely causes a problem on roads. The breakdown of one vehicle on a road makes little impact and traffic actually flows through broken traffic lights quite easily while they are easier to repair.

There is a very amusing section in the report on the “blame culture” that operates at present, and how arguments thus generated are resolved. That’s very worth reading alone.

Changing a rail timetable normally takes 9 months apparently and there have been some big problems as a result in the past. For example in 2019 Northern Rail missed more than a quarter of million stops allegedly after a botched timetable change and generated thousands of customer complaints. You don’t hear of such problems with bus services which are intrinsically more flexible.

How will Great British Railways affect services in London, where commuter surface rail lines are operated by separate companies at present. This is what the Williams report says: “In London and the South East, a new strategic partnership will be established to support housing, economic growth and the environment across the highly interconnected transport network in that part of the country. This will bring together Great British Railways, TfL and local authorities and businesses to coordinate timetabling and investments and to provide a consistent passenger experience in areas such as accessibility, ticketing and communications”. Sounds wonderful does it not, but the devil is surely in the detail.

Ultimately the Government will still be in control of the railways under this plan, so it’s effectively a renationalisation under a different name. That may please some but no nationalised industry has ever been an economic success or pleased their customers. I foretell disappointment.

You can read the full Williams report, which is a panegyric to the future of rail travel in the country here: https://tinyurl.com/3rhcd8e5

Roger Lawson (Twitter: https://twitter.com/RogerWLawson  )

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