The Real Profits from the ULEZ

In January we published a note on the likely profits that Transport for London (TfL) would make from the Ultra Low Emission Zone. That was based on our own estimates of the income they would receive (based on TfL data) as TfL had disclosed some information on budgets in response to an FOI Act request but it seemed to be grossly misleading.

We have now received more information which is given in this note: http://www.freedomfordrivers.org/ULEZ-Profits.pdf . This shows that the income they would be receiving after extension to the North/South Circular would be over £125 million per year which is even higher than our own previous estimates.

However, the profits after operating costs would be lower than from the central London Congestion Charge zone alone presumably because the operating costs over the wider area, with many more vehicles affected, would be higher. We do not yet know the implementation cost for the wider area. Can TfL afford the capital cost is one question yet to be answered, bearing in mind that they are heading for a deficit of £1 billion per annum.

But the key point is that the £125 million will be taken out of the London economy every year, plus there is the cost to vehicle owners in upgrading their vehicles to be compliant with the ULEZ which we previously estimated at over £200 million (see our previous note on the cost/benefit ratio of the ULEZ here: http://www.freedomfordrivers.org/Cost-of-the-ULEZ.pdf

We also pointed out in that note that so far as NOX emissions go, which is one of the main concerns, that these are rapidly falling anyway. Is the ULEZ, particularly the extension to within the North/South Circular, really justified? Despite what the Mayor says, there is no major public health crisis in London from air pollution. There are some localised problems which can be fixed by local measures. But extracting hundreds of millions of pounds in what are effectively taxes from Londoners for the ULEZ when it would be better spent on other useful and productive public health measures makes no sense.

The ULEZ will just move money from Londoners pockets to the scheme operators (private organisations) and the bloated bureaucracy that is TfL.

However one looks at it, the economics of this scheme and the justification for it in relation to the benefits to be obtained, when there are surely better solutions to the air pollution problem in London, seem dubious in the extreme. Both the Conservative Party and FairFuelUK have suggested alternative policies to tackle air pollution – you can see the latter’s stance on it here: https://www.fairfueluk.com/Survey-Background.html

Please make sure you oppose these irrational policies.

Roger Lawson

Twitter: https://twitter.com/Drivers_London

You can “follow” this blog by clicking on the bottom right.

Advertisements

TfL to Lose £1 billion per Year

 “TfL expects £1bn deficit by next year”. That was the headline in an article in today’s Financial Times. Apparently they have seen an internal email written by finance director Patrick Doig that the organisation faced an operating loss of £968 million in 2018/19 which he said was “clearly not a sustainable position…”. The deficit in the current financial year is expected to be £785 million this year which shows how rapidly its position is being eroded.

There are several reasons given for this erosion in their financial position – the Mayor freezing public transport fares (estimated cost £640m) did not help, but the big problem is falling revenue from users. Both bus and underground journey numbers have been unexpectedly falling.

Is this because more people are not travelling, e.g. doing internet shopping and working from home? Or is it because they have chosen to travel by bike (usage is growing), or find it is as cheap and a lot more comfortable to call Uber? Or perhaps it’s because some London residents are selling up and moving to the country with house prices peaking in London, or returning to homes in the rest of Europe. Perhaps those French, Polish, Romanian and other residents are worried about their future after Brexit? Perhaps they just got tired of life in London, unlike Dr Johnson who did not have to suffer the mediocre standards in TfL’s public transport provision.

The Mayor has only recently published his Business Plan for the years to 2022/23 (see this article: https://abdlondon.wordpress.com/2018/01/17/tfl-business-plan-mayor-sadiq-khan-wants-more-money/ ). But you can see exactly why the Mayor is so keen to raise as much as £300 million from Londoners via the Ultra Low Emission Zone (ULEZ) charges. As we have said before, the ULEZ is about money, not about improving the health of the population or cleaning up London’s air.

A comment in the FT article was by Gareth Bacon, London Assembly Conservative Members, who said there was now “serious cause for concern” about Mr Khan’s “cavalier” financial stewardship of TfL.

Roger Lawson

Twitter: https://twitter.com/Drivers_London

You can “follow” this blog by clicking on the bottom right.

More Money For Cycling

Sadiq Khan, Mayor of London, has announced a commitment to spend £142 million on new cycle routes. He claims this will benefit cyclists and pedestrians, but why the latter is not clear.

These are the routes where money will be spent:

  • Lea Bridge to Dalston – This 3km route would link the City and Waltham Forest by filling the gap between Lea Bridge Road and Cycle Superhighway 1 at Dalston
  • Ilford to Barking Riverside – This 8km route would link two bustling outer London town centres and a major growth area with up to 10,800 new homes and a new London Overground connection – while enhancing access to the Elizabeth line and London Overground services
  • Hackney to the Isle of Dogs – This 8km route would stretch from Hackney to the Isle of Dogs via Canary Wharf, Mile End and Victoria Park
  • Rotherhithe to Peckham – This 4km route would link Peckham with key and growing destinations such as Canada Water and Surrey Quays, and connect up other cycling routes such as Quietway 1 and the proposed Cycle Superhighway 4
  • Tottenham Hale to Camden – This 8km route would connect major town centres and will cover seven junctions identified as being among the 73 with the worst safety records
  • Wembley to Willesden Junction – This 5km route would be north-west London’s first major cycle route, connecting Wembley, Stonebridge Park and Willesden Junction. Future sections will connect to planned infrastructure in west London such as CS9 and CS10.

The Mayor has also committed to providing a new river crossing between Rotherhithe and Canary Wharf for pedestrians and cyclists. Note that we commented on this project previously here: https://abdlondon.wordpress.com/2017/11/11/new-thames-river-crossing-at-rotherhithe/ . It is surely a financially unjustifiable project, but needless to say the Mayor says the initial analysis of the consultation results shows substantial support – surely a case of folks voting in favour of something when they think they don’t have to bear the cost.

Note that the Mayor has committed to spend similar sums on cycling, if not more, over the next 5 years – an average of £169 million per year. Meanwhile budgets for road maintenance have been cut and projects put forward by local boroughs are being cut back. As usual these days, there is no cost/benefit justification provided for this expenditure.

It is not clear what the nature of these cycle routes will be. Will they be fully segregated as are the Cycle Superhighways or simply minor improvements such as blue paint and junction improvements. It seems some of the routes may be partly on “Quietways” (i.e. back roads with little traffic).

But one thing is for sure from past experience of similar projects. Road space will be removed from motorised traffic and traffic congestion will increase as a result.

Roger Lawson

Twitter: https://twitter.com/Drivers_London

You can “follow” this blog by clicking on the bottom right.

 

London is Pampered while the Mayor Whinges about Lack of Money

The Mayor of London, Sadiq Khan, is repeatedly saying that he does not have enough money to support his transport plans and develop high quality public transport services. This is very clear from the last two articles posted on this blog – on the ULEZ finances and on the Mayor’s Business Plan for the next few years. But in reality, London gets more money than all other parts of the country.

Both ITN National news and the Sun covered a report by think tank IPPR North. They said that per person London gets twice as much as the North in terms of transport funding – £4,155 per person versus £1,600 as an average for all other regions. In some areas such as the North East and South West it is less than £1,000 per person.

Those “up north” in such major conurbations as Leeds and Manchester are complaining of gridlocked roads and very poor services on public transport which is the result of this lack of investment. A typical example of the bias is given as the decision by the Government to fund the Crossrail 2 scheme in London at a cost of £30 billion, while electrification projects in Wales, the Midlands and the North were scrapped or downgraded. The Government disputes the analysis by IPPR.

The breakdown by region according to IPPR is as follows (infrastructure spending from 2017/18 onwards per person):

London: £4,155

West Midlands: £3,029

North West: £2,439

South East: £1,307

East Midlands: £1,134

East of England: £1,134

South West: £984

North East: £855

Comment: Unfortunately this is the result of the London-centric political scene and the fact that the key decision makers (politicians and civil servants) tend to live in London and the South-East. Certainly the economics of Crossrail 2, and even Crossrail 1, in terms of the cost/benefit have been dubious in the extreme. HS2 shows the same effect – enormous expenditure just to enable a few business people to get from/to London somewhat quicker. But the road network in the South-East gets less investment than in the North, with most of the money going on train and underground schemes beloved by the central London intelligentsia. A more rational approach would make a lot of sense, but there is no sign on either major political party taking the lead on this subject. They are both stuck in past ways of thinking.

Roger Lawson

Twitter: https://twitter.com/Drivers_London

You can “follow” this blog by clicking on the bottom right.

 

Press Release: The Real Reason for the ULEZ – It’s About Money

The Alliance of British Drivers (ABD) has said before that we are suspicious about the reasons given for the Ultra Low Emission Zone (ULEZ) in London. The proposed measures, particularly the extension to within the North/South Circular, seemed disproportionate to the likely benefits from reductions in air pollution. This is particularly so, bearing in mind that emissions from vehicles are rapidly falling, as newer vehicles replace older ones.

Now we know the truth!

In April 2017 we asked for information on the financial budgets for the ULEZ – the likely costs and income the Mayor would get. The request was refused and we eventually had to appeal to the Information Commissioner’s Office (ICO). We have now received the requested data following a judgement in our favour. These are the figures received from Transport for London (TfL):

  • Implementation costs: £38.4 million.
  • Operating income and costs:
  • Impact of introduction of ULEZ on income (£m) over 5 years 2017/18 to 2021/22 inclusive. (+ve is net increase in income): £55.3 million.
  • Impact of introduction of ULEZ on costs (£m) over 5 years 2017/18 to 2021/22 inclusive. (-ve is net increase in costs): -£12.7 million.

But these figures make absolutely no sense as against the figures we have calculated for operating income based on data provided in the ULEZ consultation documents. For example we estimate income over five years as being £313.6 million rather than £55.3 million.

In reality TfL may be making a profit over five years of £300.9 million for a capital investment of £38.4 million. At a stroke Sadiq Khan will solve his budget problems with the ULEZ implemented.

The Mayor has great financial difficulties, as is apparent from his recently published budget for the next few years, where he begs for more financial support from central Government. But he surely will not need their support with this scheme in place, even though he does not have the funds to do it without more borrowing.

Just like the central London Congestion Charge (a.k.a. Tax), where charges were later raised (more than doubled), thus making it a very profitable for TfL, once the infrastructure, such as cameras are in place for the ULEZ, charges can then be raised. The scheme can also be extended way past when traffic air pollution ceases to be a problem, thus potentially introducing more general road pricing.

Will the health benefits outweigh the costs of the scheme to Londoners? The answer is no because they are only valued at £7.1 million over 5 years. This duplicity in justifying the ULEZ on health grounds, which few are likely to oppose, when the real reason may be to fund his empire, is surely typical of Mayor Sadiq Khan’s approach to politics and democracy. Who does not want cleaner air? But there are lots of ways to improve air quality from transport and other sources, without imposing such enormous costs on road users.

To remind readers, the ULEZ charge for non-compliant cars will be £12.50, imposed 24/7, and enormous numbers of people will need to buy new cars to avoid this cost.

Readers should make sure they oppose the extension of the ULEZ by responding to this public consultation before the 28th February: https://consultations.tfl.gov.uk/environment/air-quality-consultation-phase-3b/?cid=airquality-consultation

More Information 

Our full analysis of the costs and benefits of the ULEZ are contained in this document: http://www.freedomfordrivers.org/Cost-of-the-ULEZ.pdf

The ULEZ proposals are part of the Mayor’s Transport Strategy which the ABD is vigorously campaigning against – see this web page for more information: http://www.freedomfordrivers.org/against-mts.htm

The unnecessary delays and obstruction by TfL in responding to the ABD’s reasonable request for information on ULEZ costs is documented in this blog post: https://abdlondon.wordpress.com/2018/01/09/press-release-tfl-forced-to-disclose-ulez-costs/

Our views on the ULEZ proposals and how the Mayor is scaring Londoner’s unnecessarily about air pollution and health are documented here: https://abdlondon.wordpress.com/2017/11/30/panicking-londoners-consultation-on-ulez-extension/

For more information on this issue, contact Roger Lawson on 020-8295-0378.