Archived press release

Foe calls for 75 per cent increase in rail funding

11 March 2002

Friends of the Earth today called on Gordon Brown to demonstrate the Government's commitment to public transport with a 75% increase in funding for Britain's railways, to be paid for by cuts in road-building and a ten-year programme of increases to fuel tax.

The funding proposals [1] would release desperately needed cash to make Britain's railways a serious alternative for the public and for freight transport. The Government is currently proposing a £64.5 billion investment plan for the trains, but this will not deliver a safe, efficient, reliable and affordable railway.

But public investment in Britain's rail system could easily be increased, Friends of the Earth(FOE) revealed, and called on the Chancellor to use this summer's Comprehensive Spending Review to make the commitment.

The extra money could come from cutting the proposed £26.7 billion budget for new roads(by 2010) to £16 billion; and from gradual increases to fuel tax. Improvements in fuel efficiency mean motoring costs are set to fall by 20% by 2010, but a gradual increase in fuel tax - in line with Government policy to persuade people to use public transport instead of their cars - would keep motoring costs constant.

Tony Bosworth, Friends of the Earth's Transport Campaigner, said:

“If we want a rail system for the 21st century we have to find more money to invest. We can do this by cutting spending on unnecessary road-building and by keeping motoring costs constant rather than letting them fall. This will let us increase public investment in the railways by 75% without affecting other vital public services such as health and education.”

The Government's plans to spend £64.5 billion on the railways by 2010, about half of which will come from public money, has been criticised as inadequate by many commentators including the influential House of Commons Transport Select Committee. The Committee's most recent report concluded that investment was needed on a scale which dwarfed that proposed, and that this should be paid for by the Treasury.[3].

Tony Bosworth added:
“Following the demise of Railtrack, there are big doubts about whether the private sector money the Government hopes for will actually come about. But the main responsibility for vital infrastructure such as the railways must lie with the Government. It's too important to leave to the vagaries of the stock market”

FOE does not believe that more money alone will solve the problems of Britain's rail system. Changes to the structure of the industry and greater rights for passengers are also essential [4].

Tony Bosworth concluded:
“More money alone will not solve the rail industry's problems. We also need to sort out the structural problems and make passengers rather than shareholders the most important people in the industry. But without a lot more public money the Government's promises of rail improvements will remain stuck in the sidings.”

NOTES

[1] 'Paying for rail: funding the railway of the future' - Friends of the Earth, March 2002

[2] According to the Government's 10-year plan for transport, the cost of motoring will fall by 20% by 2010. This is because fuel tax and other costs will remain constant in real terms, while fuel efficiency rises as the result of an agreement between the EU and car manufacturers. FOE believes this runs counter to Government policy, and that the cost of motoring should be kept constant through gradual increases in fuel tax in line with improvements in fuel efficiency.

Research carried out for FOE by the Institute for European Environmental Policy showed that tax on petrol would have to rise by between 13.5 p/litre and 21.3 p/litre diesel tax would have to rise by between 15.6 p/litre and 24.1 p/litre to keep motoring costs constant.

[3] House of Commons Select Committee on Transport, Local Government and the Regions (2002),Passenger Rail Franchising and the Future of Railway Infrastructure. This concluded that “the economy of the United Kingdom depends on an efficient railway. This will not be achieved without investment on a scale which dwarfs the figures proposed in the first 10 Year Plan” (para 40) and that “the Treasury must accept this reality and provide the money needed” (para 30).

[4] More detail is contained in FOE's briefing 'Changing trains: building the railway of the future'

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Published by Friends of the Earth Trust