Written evidence from David Simmonds Consultancy
Ltd (TE 28)
IMPROVING THE ASSESSMENT OF PROPOSED TRANSPORT
SCHEMES
1. INTRODUCTION
1.01 This Memorandum is written in response to
the Committee's invitation to submit evidence relevant to its
inquiry into Transport and the Economy. It refers to the question:
"Are the current methods for assessing proposed transport
schemes satisfactory?"
1.02 Within that broad question, I am addressing
one specific issue, which is about the appraisal of time savings
and the identification, measurement and interpretation of the
benefits which flow from time savings.
2. BACKGROUND
2.01 The discussion of these issues follows on
from a discussion which has been going on over the summer of 2010
in response to articles written by Alan Wenban-Smith (see Local
Transport today, issue 552, 20 August 2010[61])
which are highly relevant to the Committee's current inquiry.
The Committee may well receive submissions from other participants
in that discussion; what follows has benefitted from their contributions
to the debate but is strictly my personal view.
2.02 I must point out an interest in that the
consultancy of which I am a director is involved in some aspects
of transport appraisal, particularly in relation to assessing
the land-use and economic impacts of transport schemes.
3. SHORTER-TERM
IMPROVEMENTS
3.01 The analysis of "time savings"
is an essential part of the process of assessing the economic
value of transport proposals - known in current practice as "Transport
Economic Efficiency analysis" or TEE. Much of the debate
about TEE centres on the way in which some time savings may be
converted into economic growth. My analysis of the issues is
set out in more detail in the attached paper. In summary I submit
that current methods for assessing proposed transport schemes
need to be improved in five ways.
3.02 The first improvement is largely
one of terminology. It is usual to refer to the benefits of faster
transport opportunities (or more reliable transport, or more frequent
transport services, etc) as "time savings" or "user
benefits in travel time". This is somewhat misleading. Faster,
more reliable transport obviously does result in some users simply
making the same journeys more quickly than they would otherwise
have done. However, an important effect is that improved transport
allows and encourages people and firms to make more frequent,
longer or different trips which would otherwise have been impractical,
unattractive or unprofitable. In the process of making more frequent,
longer or different trips the people affected may well end up
spending as much or more time travelling as they did before, but
they will do si because they are gaining equal or greater benefit
from being able to visit different destinations, to undertake
new business, etc.
3.03 The benefits from providing faster,
more reliable travel therefore take a wide variety of forms of
which simple "time savings" - making the same journeys
more quickly - are only a part. I would suggest that the terms
"time savings" or "travel time benefit" should
be avoided, and the term "benefits due to faster travel"
used instead - to emphasise that faster, more reliable travel
is the change that leads to a range of possible benefits, not
necessarily the form that those benefits take.
3.04 A second improvement would
be that where the existing methods of forecasting and appraisal
do show that more and/or longer journeys will result from transport
improvements, the consequences in terms of congestion, emissions
etc should be clearly identified and taken into account as negative
effects tending to reduce the net benefits of the scheme.
3.05 In current appraisal practice, it
is generally assumed that:
- the benefits due to faster travel can be measured
by the standard methods of estimating travel time savings for
existing and new users, and that; and
- any subsequent changes - in land-uses and additional
economic activity - transform the "time savings" into
other forms but do not change the total volume of benefit.
3.06 Present appraisal is therefore done
mainly on the assumption that the land-uses and economic activities
for future years are fixed. There are some exceptions to this
rule, for example in relation to regeneration and agglomeration
impacts. However, it is important for consideration of the social
and environmental consequences to make all of the land-use, social
and economic effects more explicit. Even if in conventional terms
this does not modify the total amount of benefit, the form and
the distribution of benefits should be taken into account - as
should the environmental consequences, which may not be neutral.
One particularly important case is that if faster travel tends
in the longer term to encourages patterns of living and working
which result in longer journeys, the environmental impact may
be markedly more negative than is considered in current appraisals
where it is assumed that patterns of land-use are fixed. My third
suggestion for improvement is therefore that the consequences
of transport changes in terms of economic, land-use and other
effects resulting from faster travel should be explicitly forecast
and examined.
4. LONGER-TERM
IMPROVEMENTS
4.01 The fourth and fifth improvements
proposed in the attached paper would involve
- extending the formal benefit calculations so
as to apply to the whole of the land-use/transport system rather
than just to the transport system, so as to be able to measure
benefits arising from land-use planning proposals in the same
terms as those arising from transport schemes; and
- developing the methods of analysis and appraisal
so as to allow the benefits arising is the indirect consequences
of transport improvements to be identified more precisely.
4.02 For example, one of the "benefits due
to faster travel" (to use the term proposed above) will often
be that some people enjoy a greater choice of where to live and
work - the benefit to them would ideally be identified as "benefits
of living in more preferred location". At the same time
it would need to be recognized that competition in the housing
market means that transport improvements may sometimes lead to
price or rent increases resulting in some people being priced
out of particular markets - so the same transport improvement
might also result in "disbenefits of living in less preferred
location" for some people. Ideally the pattern of gains
to some groups in society and losses to others should be made
explicit.
4.03 These fourth and fifth improvements require
new developments in appraisal methodology, so I am not suggesting
that they can be immediately adopted, only that these developments
need to be pursued.
5. CONCLUSION
5.01 The first three improvements I suggest can
all be put in hand using methods already available - indeed the
first one is a matter of terminology rather than a substantive
change. I would therefore recommend these for more urgent attention:
1. using terms such as "benefits due to
faster travel" to reflect more exactly what is meant by the
current TEE calculations of "time savings";
2. ensuring and demonstrating that where "time
savings" result in more and longer journeys, these are reported
and their social and environmental impacts are clearly included
in appraisals; and
3. providing more systematic information about
land-use and economic impacts (including property market effects)
to clarify what forms the "benefits due to faster travel"
will take, to inform assessment of the wider social, economic
and environmental impacts of transport schemes.
5.02 These improvements would, I believe,
enable a clearer and better informed debate about the longer-term
impacts of transport strategies and schemes. In particular it
would recognize that there are many such impacts which are of
genuine public concern but which are not recognized as either
benefits or disbenefits in the existing TEE calculations.
5.03 The question posed by the Committee
which I have addressed is about the methods of assessment
for transport schemes. There are obviously related questions
about the application of these methods. I would argue
that more emphasis should be placed on the detailed assessment
and appraisal of transport policies, strategies and programmes,
particularly in terms of wider economic and regeneration effects,
with the assessment and appraisal of individual schemes being
correspondingly reduced. Similar arguments have been put forward
by many others, including Eddington.
I hope these suggestions are helpful to the Committee,
and would be happy to expand on any of the points made here or
in the attached note.
September 2010
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