A clear plan for transport will help the UK ‘level up’ and achieve net-zero

COMMENT With the worst of the Covid-19 pandemic now hopefully behind us, the government must turn its attention to major challenges ahead: achieving net-zero and levelling up the UK economy. The IPCC’s report on climate change released this week serves as a shocking reminder of the urgent action required to reduce our reliance on fossil fuels and create greener, more sustainable cities. Meanwhile, the government must address the UK’s regional inequality and deliver on its “levelling up” pledge. The idea has existed in different forms since 2011, when then chancellor George Osborne declared an ambition to rebalance the UK economy and launched the Northern Powerhouse initiative. However, in the decade since, we have lacked a clear and realistic plan that enables regional towns and cities to truly punch their weight. At the heart of both of these issues is the need for more urgency and vision on the delivery of transport infrastructure. By any measure, the delivery of mass-transit rail and tram systems in the UK over the past 20 years has been disappointing. This is holding back growth and productivity and does nothing to break our dependence on cars. As cities continue to expand, the problem is going to become more acute. A new approach Last week, London Property Alliance, together with Sheffield Property Association, released a new white paper, authored by JLL, which looks at the vital role rapid-transit systems play in regional economies and recommending a new approach to planning, funding and delivering projects. HS2 clearly has a role as a means of connecting the North and South, but as the report highlights, there is a pressing need for greater connectivity within and between our core cities, particularly across the North and Midlands, as well as into HS2 itself. The government’s commitment to high-speed rail should not be at the expense of city region transport projects, including those for London. As Professor Tony Travers points out in the report, you do not level up the economy by levelling down London. As the report argues, one of the fundamental reasons for the UK’s poor track record of delivering transport infrastructure has been an overly-centralised approach to the planning and funding of schemes. Devolving greater powers to metro mayors and combined authorities, while sharing expertise and best practice, would enable our city regions to design, fund and deliver locally supported projects. Funding Funding, particularly in the aftermath of the Covid-19 pandemic which has placed huge strain on the public finances, is another critical issue. We must adopt new ways of attracting private investment to unlock projects. As the study shows, there is a wall of patient capital waiting to be deployed into infrastructure projects – however, the challenge in securing this investment is creating robust long-term income streams, beyond farebox revenues. During the pandemic, transport systems all over the world have suffered from a sharp fall in ridership, and in some cases have required emergency government support. The UK can learn from other nations in developing models less dependent on passenger revenue: For example, in France, transport systems are part-funded by the Versement Transport, a type of employment tax levied on larger corporates in the area, and in North America we have seen projects supported by local property taxation, rather like the Crossrail infrastructure levy in London. The government’s fundamental review of business rates provides an opportunity to rethink how the retention of more rates revenue by local authorities could be used to underpin transport projects. Likewise, the ongoing review of the planning system needs to ensure a strategic approach to future policy, with transport, housing and regeneration closely aligned. In turn, civic leaders need to develop compelling visions for how their areas should develop, with homes, jobs, transformative developments and net-zero targets all linked to new transport infrastructure. Special planning zones around transport hubs, to encourage more dense, mixed-use development, would also help maximise local benefits. We must see the path to net-zero and levelling up not as government objectives but as UK objectives, with public and private sectors pulling together. The property industry has a vital role to play in providing long-term investment in order to create greener communities and help drive prosperity. Fixing our failure to invest in transport will help put the country back on track. Charles Begley is executive director of the London Property Alliance. Martin McKervey is chair of the Sheffield Property Association