March 2011 | Julian Mills, Stuart Shilson, Quentin Woodley and Alice Woodwark
Good transport infrastructure underpins economic growth. However, as this report shows, the United Kingdom’s strategic roads, railways and airports are some of the most congested in the world. On average, 113 million passenger vehicle kilometres are driven per year for each kilometre of motorway, against 47 million in Germany, 39 million in France and 36 million in the United States. The railways are carrying more passengers than at any time in the past 60 years, on a network roughly three-fifths of its size in 1950. Despite recent upgrades to improve facilities, most major UK airports still compare poorly with their international counterparts.
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Meanwhile, demand is rising. By 2030, the average UK resident is expected to drive an extra 1,100 kilometres a year, use long-distance trains more extensively and take one more flight than at the moment. Over the next two decades, the combined effect of population growth and increased travel is likely to be to increase road passengers by almost 30 percent, rail travel by 50 percent and the number of flights originating in the United Kingdom by as much as 75 percent.
So, as the nation works to strengthen its economy and finances, it faces a period of unprecedented investment to maintain and enhance the quality of its transport assets. The report estimates that the cost of maintaining, renewing and expanding the United Kingdom’s transport infrastructure will be around £350 billion over the next two decades: a 45 percent increase on average annual spending since the turn of the twenty-first century.
Taking a medium-term view, McKinsey estimate that there will be a substantial public-sector funding gap for road and rail of around £100 billion between 2010 and 2030, the equivalent of £5 billion a year. The United Kingdom needs to close this gap. The report identifies two options for achieving this without increasing general taxation: improving productivity among the builders and operators of transport infrastructure and increasing the contribution from the users of transport assets, vehicle owners in particular. Both options are challenging, and it is for policy makers to decide which measures will be the most effective.