The main point to start off with is that the report is based on a form of economics which is highly conventional – cost-benefit analysis (CBA). CBA has been relentlessly criticised for the inhumanity of its basic principles, most forcefully by John Adams, for example in “Transport Planning: Vision and Practice”, which you can download here – and from which the sub-heading above* comes
Essentially, the adverse effects of motorisation are monetised – which means that you have to put a money value on these adverse effects: pollution – noise, noxious and greenhouse gas emissions, “accidents” etc. This involves asking people (which people – ones with a lot of or a little money?) how much they would be willing to pay for people (which people – their loved ones or strangers?) not to be hurt in road crashes, poisoned by pollution etc.
One of the key items counted is what is known as “accidents”. Now, as those familiar with the principles of Road Danger Reduction know, you cannot measure danger by adding up the numbers of people reported as hurt or killed on the road. It is immoral to equate, for example, someone falling off a bicycle and hurting themselves with someone hurt by the rule or law breaking of another. It is frequently the case that locations which present significant dangers – particularly to pedestrians and cyclists – have low numbers of people hurt or killed, often precisely because the danger there has scared them away from being there in the first place.
Instead, how about putting a cost on danger? We could be looking at the effects of limiting the use of the more benign modes. After all, we know a lot about the restriction on the independent mobility of children by motor traffic danger: see “One False Move… A Study of Children’s Independent Mobility” downloadable here . It is possible to add up monetary costs of parent’s time spent driving to school and add that to the costs of car use, if that’s what you want to do. CBA counts the cost of a white collar worker at around £20 per hour: think of all those middle class parents driving children to and from school and how much that cost would add up to. But that is not counted in this report.
Motoring taxation
One item which gets missed out is motoring taxation. This is interesting. The report’s authors argue that motoring taxation is just one of many forms of taxation, and should not be seen as something to be set against the costs of motoring costs. It is an excellent point to make.
The analogy they draw is with taxation on alcohol, saying that there is no reason that it should be used to offset the costs of alcohol to society. The next time a motorist grumbles that the taxes they pay should go on road building or be considered against the costs of car-generated pollution, crashes, global warming etc., do bring in the alcohol analogy. Why shouldn’t the tax I pay on a pint of beer be reserved towards paying for the treatment of alcoholics? Or making pubs nicer? Or helping pubs to stay open? That makes as much, if not more, sense.
Anyway, the amount of taxation raised by UK motorists – fuel duty and its associated VAT along with vehicle excise duty contribute around £38bn a year – is £10 billion less than the £48 billion estimated by the report’s authors to be the external costs of motoring.
What is wrong with this report?
Despite the predictable response from the motoring lobby (see the one by Edmund King of the AA here) it is actually quite pro-motoring. Consider the following from the report:
“The results of this study advocate that the European Union should embark as soon as possible on a process that estimates external costs regularly and develops a smooth integration path of these costs into transport prices: Slowly and steadily, designed well in advance of implementation, with accompanying measures to support adaptation. Let it be remembered that there is no intention of creating additional revenue from transport users: the intention is to give price signals so that everybody adapts and hopefully nobody has to pay these prices. Then, all costs would be reduced, efficiency would be increased”.(my emphasis)
In one sense this is correct: hopefully “internalising the external costs” as economists put it, would result in a modal shift from car use, or shortening car journeys, or driving more fuel-efficiently, or a combination of the above. But let’s consider this in more detail: what would happen if – no doubt to the horror of the AA, petrol prices were to actually double?
https://rdrf.org.uk/2012/12/31/the-true-costs-of-automobility-external-costs-of-cars/
I am quoting from Bob Davis's reaction to this report to show that there is quite another way of looking at it.
You are a cyclist. Your rides are made more dangerous, less healthy and pleasant, by motors. These are real costs, though never monetised. This does not mean that they don't exist, does it? The impacts of motoring on cyclists, to take one example, are real and borne not by those who benefit from motoring, but by us.
How should we monetise them? How much are you willing to accept as recompense for a road environment which many find too unpleasant to cycle on? For myself, it would be quite a lot of money. Why should I be content to put up with this public nuisance for nothing?
