Transport subsidies are unsustainable: what next for infrastructure
Contents |
[edit] Introduction
The APPGI chair discusses revenue budget pressures versus capital pressures beyond the 2020/2021 COVID pandemic.
For years, the message from government and environmental groups has been leave your car and use public transport as a means of cutting congestion and improving our environment. During the pandemic, when we were allowed to travel, the messaging was about taking extra care to keep safe in enclosed spaces. It was part of the package designed to help us keep safe, and that message really landed. Travelling down to Westminster on the train, I often had the carriage to myself.
[edit] Government subsidies
The subsidy from the Government to keep services running was needed, as almost overnight, whole industries had become unviable. The cost to the public purse was huge – in excess of £10 billion and counting.
It was the right policy, but it is not a sustainable policy. There has long been subsidy of public transport in the form of payment for routes that are uneconomic but socially important, most obviously seen on bus routes, especially some rural ones. The costs of rail are less easy to see by route, but prior to the pandemic, such had been the years of passenger growth that the industry was getting to a much better place – in terms of revenue, not capital.
The subsidies cannot continue at anything like the current rate. The Government has several hundred billion pounds less than it thought it would have in 2019. There is the prospect of reduced taxation alongside increased cost for some time ahead, too. It cannot be business as usual.
[edit] What else effects subsidies?
There are political pressures to consider. There are demands for more public transport in the parts of country that are the target for levelling up. There are demands for progress on balancing the books in the public sector. There will be huge pressure for extra spending in other government departments.
So what is the answer to these competing factors which are pulling in different directions? There will be a need to maintain support, as usage has not returned to anything like normal levels, and predicting when or if that may happen is not simple.
I suspect there are some difficult conversations taking place right across government, at the centre of those will be those between the DfT [Department for Transport] and the Treasury. I have been a minister in both departments and can confirm they were not easy even in good times. And we are far from those.
[edit] What does the future hold?
The best way out of trouble is to grow your way out. That means lots of efforts to recover passengers. There will be pent-up demand on leisure travel, and operators have reported demand to be strong.
Business travel is a different game and hard to predict. We will start to see what the future looks like in September 2021, as the nation returns from holidays. That is the time for the marketing teams to incentivise a return to the office and to face-to-face meetings.
If I were having the ministerial funding conversations right now, from the DfT side I would be emphasising the difficulty in planning, that trends are not yet clear and that marketing campaigns are yet to land.
If in the Treasury, I would be asking about variable costs, marginal routes and trends in demand. I expect compromises to be reached.
This article originally appeared on The Infrastructure Blog portion of the ICE website. It was written by Andrew Jones MP, Chair of the All-Party Parliamentary Group on Infrastructure and published on 15 September 2021.
--The Institution of Civil Engineers
[edit] Related articles
Featured articles and news
Design and construction industry podcasts
Professional development, practice, the pandemic, platforms and podcasts. Have we missed anything?
C20 Society; Buildings at Risk List 2025
10 more buildings published with updates on the past decade of buildings featured.
Boiler Upgrade Scheme and certifications consultation
Summary of government consultation, closing 11 June 2025.
Deputy editor of AT, Tim Fraser, discusses the newly formed society with its current chair, Chris Halligan MCIAT.
Barratt Lo-E passivhaus standard homes planned enmasse
With an initial 728 Lo-E homes across two sites and many more planned for the future.
Government urged to uphold Warm Homes commitment
ECA and industry bodies write to Government concerning its 13.2 billion Warm Homes manifesto commitment.
From project managers to rising stars, sustainability pioneers and more.
Places of Worship in Britain and Ireland, 1929-1990. Book review.
The emancipation of women in art.
Call for independent National Grenfell oversight mechanism
MHCLG share findings of Building Safety Inquiry in letter to Secretary of State and Minister for Building Safety.
The Architectural Technology Awards
AT Awards now open for this the sixth decade of CIAT.
50th Golden anniversary ECA Edmundson awards
Deadline for submissions Friday 30 May 2025.
The benefits of precast, off-site foundation systems
Top ten benefits of this notable innovation.
Encouraging individuals to take action saving water at home, work, and in their communities.
Takes a community to support mental health and wellbeing
The why of becoming a Mental Health Instructor explained.
Mental health awareness week 13-18 May
The theme is communities, they can provide a sense of belonging, safety, support in hard times, and a sense purpose.
Mental health support on the rise but workers still struggling
CIOB Understanding Mental Health in the Built Environment 2025 shows.
Design and construction material libraries
Material, sample, product or detail libraries a key component of any architectural design practice.
Comments
This article is political opinion about the role of government in supporting public transport, written by a UK politician.
Maybe ok as an opinion piece in the the ICE magazine, but out of place on a non-parisan building design wiki?