Written evidence from National Alliance
Against Tolls
SUMMARY
— Tolls have a negative effect on the economy
and increase the divide between people and businesses on either
side of the crossing.
- Tolls should be removed and the costs of paying
off any debts and future maintenance and repair should come from
the £50 billion that road users pay in taxes.
— As well as the Severn Crossing tolls,
consideration should be given to removal of the other crossing
tolls in Wales, and to going ahead with an M4 relief road at Newport
on a non-tolled basis.
— As a minimum, we hope that the Committee
would call for the Government to finance a thorough and independent
study into the effects of removing tolls.
INTRODUCTION
1. The committee are conducting an inquiry
into the Severn crossing tolls and have said that they will examine:
— the impact of the tolls on the Welsh
economy including businesses, local residents and tourists;
— the current level of toll prices and
the available methods of payment;
— the current condition of the bridges
and the costs associated with ongoing maintenance; and
- the future of the bridges after the crossings
have reverted to public ownership.
2. The committee have invited comments and
this is the submission of the National Alliance Against Tolls
which is a loose alliance formed in 2004 by local groups protesting
against tolls in England, Scotland and Wales. We don't have a
formal organisation as a company, charity or anything else. We
do not seek funds from anyone or any organisation.
3. The group in Wales that formed part of
our alliance in 2004 is the "Campaign Against the Severn
Tolls", which was started by a local councillor in Neath.
WHY WE
OPPOSE TOLLS
IN GENERAL
4. "Tolls" is derived from the
Greek word "telos" meaning "tax". They were
mentioned as "evil" in Magna Carta. Adam Smith dealt
with the issue of tolls in the "... Wealth of Nations"
where he said that "Whatever exigency of the state therefore
this tax might be intended to supply, that exigency would be chiefly
supplied at the expense of the poor, not the rich; at the expense
of those who are least able to supply it, not of those who are
most able."[2]
5. At one time there were very many tolled
bridges and roads or "turnpikes" in Britain but there
was opposition including the Rebecca riots of the 1840s in South
Wales. Nearly all these tolls were removed in the late 1800s.
Whether you have to pay tolls in any particular area of Britain
is now a lottery, which is unfair to those drivers who have to
use tolled crossings. As the Government collects about £50
billion a year in taxes on roads use,[3]
and only spends a small fraction of this on roads, it is wrong
for Governments to refuse to pay for an adequate road system or
to say that the only choice is a tolled crossing or no crossing.
6. Tolls tend to be regressive. A poor person
pays the same toll as a rich person. The driver of a small car
pays the same as the driver of a large car.
7. Tolled crossings cast a blight and inhibit
economic activity in the areas where they are situated. Businesses
where road transport is important will prefer to locate elsewhere,
partly because of the reduced numbers of shoppers and tourists
but also because of the additional transport costs for some businesses
and the extra potential cost to employees of travelling to work.
Tolls reduce positive agglomeration benefits and a business located
in a tolled area has a smaller economic hinterland than a similar
business in a toll free area.
8. Tolls reduce the effective capacity of
a road or crossing because they deter use (particularly off-peak)
and disrupt a smooth traffic flow because of lane changes at toll
points. The actual toll collection also causes delays and queues,
and tends to prolong congestion periods as traffic is on the road
longer than it would otherwise be. Electronic tolling might reduce
but does not remove these delays, and where there is a mix of
cash and electronic tolls than there is an increased risk of accidents
and problems caused by the apparent failure of the tags.
9. To the extent that there is a choice,
drivers will tend to avoid toll crossings and use other roads.
This may mean longer journeys, more fuel consumption, more vehicle
emissions and possibly use of less suitable, less safe and more
congested roads.
10. Roads are an essential feature of a
successful economy and movement on them should not be impeded
or discouraged by barriers or tolls.
TOLLS AROUND
THE UK
It is appropriate to consider how the tolls
on the Severn Crossing fit into the context of tolls elsewhere
in the UK before turning to the specific points that the committee
have raised.
11. The first thing to note is that there
are no tolls at all in Northern Ireland or Scotland.
12. When our alliance was formed there were
four tolls in Scotland. One of our alliance's original members
was Skye and Kyle Against Tolls who had been formed when the Skye
bridge opened in 1995. Apart from the campaigning by SKAT (during
which 130 people received criminal convictions and their secretary
was gaoled numerous times), there were other factors which eventually
led to the tolls removal at the end of 2004, including the support
of local politicians.
13. The tolls on the Clyde bridge at Erskine
were removed in March 2006. There had of course been campaigning
by us, but a more significant factor in their removal was probably
the strong opposition to tolls by the Councils on the South bank.
It was also widely believed that there had been a private deal
between Labour and the Lib Dems whereby the Lib Dems had the Skye
tolls removed and Labour then had the Erskine tolls removed.
14. There followed a strong campaign by
us and others to get the last two tolls (Forth and Tay bridges)
removed. The then Labour/Lib Dem Executive and some of their local
councillors were very strongly opposed to the removal of these
tolls, and the Executive produced "evidence" to show
the dire consequences if the tolls were removed. The removal of
the tolls became one of the issues in the Scottish Parliament
election in May 2007. The SNP (who had 25 seats in the old Parliament
compared with Labour's 50) promised that they would remove all
the tolls, and in the event they won one more seat than Labour
and formed the next Scottish Government. Perhaps to some people's
surprise, the SNP then set about fulfilling their election promise.
Legislation was needed and the support for removal of tolls became
almost unanimous, with only two MSPs (Greens) voting against it.
The last tolls in Scotland were removed on Monday 11 February
2008.
15. In the rest of Britain, as well as the
Severn crossings tolls between England and Wales there are three
tolled road crossings within Wales and fourteen in England. About
half of these crossings are small privately operated tolls. Nearly
all the major (over tidal water) crossings are either publicly
operated or a concession for a limited period or a "charity".
These major crossings are—Severn (concession), Cleddau bridge
at Milford Haven (local authority), Dartford crossing (was a concession,
is now Government), Humber bridge (local authority), Itchen bridge
(local authority). Mersey tunnels (local authority), Tamar bridge
(local authority), Tyne tunnel (local authority) and the Clifton
bridge (charity).
16. It is sometimes suggested that crossings
are tolled because they are "estuarial" and that this
somehow makes a difference, though some non estuarial crossings,
eg the Thelwell viaduct on the M6, are larger than some estuarial
crossings. This justification for tolling also ignores the fact
that the vast majority of crossings of tidal water (estuary or
sea) are not tolled at all.[4]
You can go round the British coastline starting at the Cleddau
bridge and go half way round Britain before you come across the
next toll (linking North Shields to Jarrow).
THE IMPACT
OF THE
TOLLS ON
THE WELSH
ECONOMY INCLUDING
BUSINESSES, LOCAL
RESIDENTS AND
TOURISTS
17. In the case of businesses the effect
of tolls will in most cases will be slight but there are obvious
exceptions such as haulage. Though even something that may only
be a small part of the direct financial costs of a business will
have some effect. For instance when a business is deciding whether
to set up in location A which is near to tolls or location B which
has no tolls, then a business may well be put off location A by
the psychological barrier of the tolls, and the effect that it
might have not only on their own transport but on their employees,
suppliers and customers.
18. Obviously the economic effect of tolls
on people is also negative, but the extent of this will vary according
to how often they would have to cross the toll for work and what
their income is. In the case of those on lower incomes it will
tend to restrict the area in which they might seek work and thus
increase the chances of lower paid work or unemployment. Workers
will obviously also be affected if their employer is affected
by tolls.
19. Tourists are again obviously influenced
to some degree by tolls, and most sat-navs and route querying
on websites give the option for avoiding tolls. Avoiding tolls
in the case of most tolled crossings means avoiding the area.
20. There have been few studies of the economic
impact of tolls, and as far as we know there have been no studies
on the impact within Wales. We are aware that Mike German AM as
he left the Welsh Assembly at the end of June put down a motion
which called on the Welsh Assembly Government to:
(a) undertake an economic impact assessment of
the effect of the Severn bridges tolls on the south Wales economy;
and
(b) make further representations to the UK Government
on the negative impact of the tolls, and to prepare the case for
supporting the withdrawal of tolls when the bridges revert to
public ownership."
Unfortunately the motion was defeated by 29 votes
to 16, and an amended motion was passed which meant nothing.[5]
21. One of the earliest tolls impact studies
(2002), and the only academic one that we are aware of was by
Napier University on the Skye bridge tolls and was commissioned
by the Highland Council. The conclusions of the report included—
"1. Although the Bridge has been of benefit
to Skye, the high levels of the toll have considerably reduced
its potential positive impact upon the local economy.
2. There is considerable local resentment to
the tolls, particularly among businesses who report that tourists,
particularly short stay visitors and coach parties, have been
deterred from crossing the bridge.
3. There would be likely gains from removing
or reducing the tolls in terms of diverting existing toll spending,
increased tourism, increased business efficiency and more business
start-ups.
4. The economic benefits from removing the tolls
would be substantial..."[6]
22. Also in Scotland there was a study commissioned
by West Dunbarton and Renfrewshire Councils on —"The
Erskine Bridge and the Regeneration of the River Clyde".
The study concluded that removing the Erskine tolls would "lead
to the creation of some 20,000 new jobs".[7]
23. In England there have been two studies
on the impact of the Humber bridge tolls. The first was published
in 2004. There was no real attempt made to assess the economic
impact of tolling, though the report did say that businesses had
been surveyed and that 41% had said that tolls had a negative
impact on their business performance. Despite the negative effects,
the report recommended—"Retain tolls and continue to
increase them".[8]
24. The second report was commissioned by
four local councils from both sides of the river. The report was
published in October 2008. To arrive at a figure for the economic
impact of tolls, the consultants concentrated on one facet of
the negative impact—"agglomeration effects". In
brief "agglomeration" is the theory that an economy
operates most efficiently if there is a large market in close
contact, without any form of barriers. The consultants calculated
this benefit as £21 million a year if the tolls were removed.
There was also a benefit to the region of £18 million a year
if tolls were not paid. The total undiscounted benefit to the
region of removing the tolls now (rather than in 2032 which is
the date on which they are otherwise due to be removed) was £1.1
billion.[9]
25. To deal with some questions that followed
the publication of the report, a phase 2 report was commissioned,
the work was funded by Hull and Humber Chamber of Commerce. The
report was published in January 2009, it added to, but did not
alter, the conclusions from the first report.[10]
THE CURRENT
LEVEL OF
TOLL PRICES
AND THE
AVAILABLE METHODS
OF PAYMENT
26. In recent years the toll for cars on
the Severn crossings has been either the highest or second highest
in Britain, even after taking into account that the toll is only
payable one way. Currently the cost of a return trip by car on
the Severn crossing is £5.50 (the second highest is the Humber
at £5.40). For goods vehicles, the categories vary from bridge
to bridge, but if the toll for the heaviest vehicles is taken,
then the Severn at £16.40 return is not as expensive as the
Humber where the highest toll is £36.60 return.
27. Obviously drivers would prefer a lower
toll price, though in the case of the Severn Crossing if the toll
were to be reduced and the financing of the Crossing was otherwise
unchanged, it would mean that drivers would have to pay tolls
to the Concessionaire for more years than is currently the case.
28. Tolls, however low, will still have
a negative impact. Business and tourists will still be aware that
there is a toll and don't like paying whatever the price, and
any toll payment may still interrupt and delay travel. Businesses
will also be aware that a toll that has been substantially reduced,
rather than removed, can just as easily be increased.
29. From time to time, politicians have
called for a facility to pay tolls on the Severn Crossings by
credit and debit cards. In our view this should not be done, the
average driver would not use this facility and would more likely
be delayed because of those drivers who would pay in this way.
It is also likely that because of extra costs to the Concessionaires,
they would demand that they be allowed to collect more tolls.
30. At some crossings there have also been
suggestions for more automated tolls, going all the way up to
"barrierless" "tolling. Most automated systems
are in fact slower than a manual system, and are generally introduced
so that either the number of toll collectors can be reduced or
collection made more secure. Mixed systems (eg some drivers uses
"tag" lanes while other drivers use cash lanes) have
the effect of increasing the risk of accidents on the toll approaches.
Barrierless systems have the least delaying effect, but they require
the cooperation of drivers, and are not suitable unless there
is a practical alternative crossing for those drivers without
tags.
THE CURRENT
CONDITION OF
THE BRIDGES
AND THE
COSTS ASSOCIATED
WITH ONGOING
MAINTENANCE
31. We have no particular knowledge about
the condition of the bridges, but we are of course aware of the
problem with corrosion of suspension cables on the older bridge.
As we understand it, this is a problem which is being successfully
dealt with, and the cost is being met by the Department for Transport
under the terms of the concession agreement. Or to be more correct
it is temporarily being met by the DfT, as they intend to claw
it back from bridge users under the 1992 Severn Bridges Act powers
to extend tolls after the concession ends.
32. In our view the costs of ongoing maintenance
or repair on any bridge are almost invisible when compared with
total public spending or the £50 billion of taxes that the
Government derives from the use of motor vehicles.
THE FUTURE
OF THE
BRIDGES AFTER
THE CROSSINGS
HAVE REVERTED
TO PUBLIC
OWNERSHIP
33. Most of the major tolled river crossings
in Britain were tolled on the basis that the tolls would only
apply for a limited period, usually on the basis of the time that
it would take to recoup the cost of constructing the crossing.
Such promises have up to now been ignored, and legislation has
been passed to prolong the tolls. There are of course some tolls
that have been removed but that has been for other reasons.
34. The Severn Crossings are very similar
to those at Dartford. In both cases the original crossing was
built with public funds. Subsequently the original crossing has
been taken over by a concessionaire who undertakes to build a
further crossing and is reimbursed for the construction of that,
and all the operating costs, by collecting tolls on all the crossings
till a certain amount has been reached. At that point all the
crossings pass to the Government who, according to similar legislation
that applies in the case of both Dartford and Severn, can continue
to collect tolls for a limited period. In theory the tolls would
then be removed. As there was no longer any legal authority to
collect tolls under the Dartford legislation, these tolls were
removed and replaced from 1 April 2003 by identical charges using
general powers in the Transport Act 2000. The Dartford tolls were
increased in 2008.
35. So in summary the position is that the
removal (or not) of tolls has in practice nothing to do with the
specific legislation that applies to that crossing. However, the
point at which the Severn Crossings concession should have ended
is we estimate about 2013. This is only an estimate because there
seems to be no published figures which show how much the Concessionaire
has so far collected in tolls.
36. There are a couple of complications,
the first of which is VAT. Due to a European Court ruling in 2000,
VAT was charged on the Severn tolls from February 2003. MPs were
told that this would have no effect on bridge users. Potentially
this could have been so, as it might have been possible to return
the VAT in some way, but in practice the Treasury keeps the VAT,
which in the period from 2003 till the tolls end is likely to
be over £100 million. To allow for the VAT, the amount of
tolls that the concessionaire could collect was increased from
£977 million to £996 million (both in July 1989 prices).
The difference of £29 million at current prices is about
£50 million. It is not clear why this is less than the £100
million VAT.
37. One possible reason for the above discrepancy
is the second complication—there was a refinancing of the
PFI scheme. In recent years there has been a practice that refinancing
gains are shared between the PFI contractor and the public authority.
In 2004 the then Chief Secretary to the Treasury gave information
to MPs about these refinancings including the Severn crossing
deal. We queried the figures and were passed between the DfT,
the Treasury, Partnerships UK and the Highways Agency. We were
eventually told that no one took responsibility for the figures
but that they seemed to be wrong. We raised this with the Public
Accounts Committee in 2006 who in turn raised it with the National
Audit Office, but the NAO told the PAC that they were satisfied
that either there was nothing wrong or that any error would not
be repeated. The conclusion that we have now come to is that the
refinancing gain was used to reduce the additional amount that
the Concessionaire could collect in tolls. The net effect of the
loss of VAT being kept by the Treasury offset by the refinancing
gain is that bridge users will have to pay tolls to the Concessionaire
for just under a year longer.
38. Once the tolls payable to the Concessionaire
ends, the DfT can continue to collect tolls for themselves for
up to five years longer. It has been said by the DfT that this
is to build up a "maintenance fund", though the purposes
which are listed under Schedule 4 of the Severn Bridges Act 1992
in our opinion do not explicitly or implicitly cover such expenditure.
Nor is there any reason why the users of a crossing should be
expected to pay further tolls for such a purpose. Having said
that, as already stated, using Transport Act 2000 powers the Government
can put any toll that they like on the Severn Crossings or any
other trunk road.
OTHER ISSUES
39. The committee's call for evidence does
not mention the social impact of tolls. To the extent that families
and friends are situated on either side of the toll barrier, their
interaction will obviously be reduced. In the particular case
of the Severn Crossings, it is possible that tolling also makes
the other side seem more like a foreign country.
40. The committee also do not mention the
other tolled vehicle crossings within Wales—Cleddau, Pont
Briwet and Penmaenpool. There is also a tolled crossing for pedestrians
and cyclists only at Barmouth.
41. There is also the issue of the toll
that nearly was—the new road that was announced in December
2004 and was intended to relieve congestion on the M4 near Newport.
In July 2009 the Deputy First Minister announced that the plan
would be abandoned. He said:
"The business case demonstrates that tolling
the new M4, while other routes remain free to use, would significantly
reduce the economic, environmental and social benefits of the
project. The tolling of the new M4 alone would not raise the funds
necessary for the scheme, and tolling both roads, in addition
to the toll on the Severn crossings, would damage the attractiveness
of south Wales as a location for investment."[11]
September 2010
2 An Inquiry into the Nature and Causes of the Wealth
of Nations-Book V Chapter I Verse 83. Back
3
Our evidence to Transport Committee Inquiry into "Taxes and
charges on road users"
http://www.publications.parliament.uk/pa/cm200809/cmselect/cmtran/103/103we16.htm
and
http://www.publications.parliament.uk/pa/cm200809/cmselect/cmtran/103/103we17.htm Back
4
List of tidal crossings as per NAAT-http://notolls.org.uk/cross.htm Back
5
Record of debate and vote on 30 June 2010-http://www.assemblywales.org/bus-home/bus-chamber/bus-chamber-third-assembly-rop/rop20100630qv.pdf?langoption=3&ttl=The%20Record%20%28PDF%2C%20397KB%29 Back
6
Napier University report -http://www.napier.ac.uk/randkt/rktcentres/eri/projects/Documents/skyeReport.pdf Back
7
Council newsletter-www.wdcweb.info/EasySiteWeb/GatewayLink.aspx?alId=23547 Back
8
Report for Humber Economic Partnership-http://www.humberep.co.uk/download/FullReport.PDF Back
9
Humber Bridge Impact assessment-Final Report-http://www.northlincs.gov.uk/NR/rdonlyres/68CB05CB-BE3D-40BF-9F96-4C4B63840162/32977/ColinBuchananfullreportOctober2008.pdf Back
10
Humber Bridge Impact Study-Phase 2 Report-http://www.northlincs.gov.uk/NR/rdonlyres/68CB05CB-BE3D-40BF-9F96-4C4B63840162/34242/HumberBridgeImpactStudyPhase2.pdf Back
11
Statement on 15 July 2009 by Deputy First Minister on the National
Transport Plan http://wales.gov.uk/about/cabinet/cabinetstatements/2009/090715ntp/?lang=en Back
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