Report challenges road pricing plan

Date: 17/04/1997

By Michael Mann

A GROUP of respected academics has published a stinging critique of Transport Commissioner Neil Kinnock's efforts to make transport pricing fully reflect environmental and social costs.

Experts from Germany, the Netherlands and the UK claim Kinnock's initiative makes no economic sense and could actually have negative effects on both the environment and employment.

The report, commissioned by the Dutch National and International Road Transport Organisation (NIWO), puts forward its own blueprint for future transport policy, centred around the liberalisation of other sectors, improved environmental legislation and increased use of 'combined transport'.

“The most fundamental thing we can learn from the report is that to create a better transport environment you need a policy of stimulation instead of a policy of punishment,” said Hans Koeleman of Transport en Logistiek Nederland. He stressed that 85&percent; of EU road haulage was carried out within 150 kilometres because of trucks' natural advantages in terms of flexibility, and said this would not be changed fundamentally by new pricing policies.

But Kinnock's officials have dismissed the report's criticisms, accusing it of misrepresenting the Green Paper on 'fair and efficient pricing in transport' published in 1995. “They put forward a supposedly alternative policy, which is in fact already a part of existing Commission policy. Our view has always been that all the different elements have to be phased in gradually,” said one of Kinnock's senior advisers.

The new research was carried out at the behest of the road haulage sector, which feels the European Commission's approach is implicitly targeted against road transport.

Based on case studies carried out in all three countries, the report warns that increased costs would “lead to considerable social tensions and bankruptcies with negative effects on the employment situation”.

It also concludes that to internalise 'external costs' in the present climate would be neither fair nor efficient, because the road sector is a much more liberal market than its competitors.

“It is not reasonable to punish road haulage for the negative consequences of an incorrect policy imposed by the authorities responsible,” it claims.

But Commission officials insist it is not sufficient to put all other policy measures on hold until proposals such as rail liberalisation have been agreed. “We cannot win. We are getting the opposite message from the rail unions, who say we should internalise costs first and then deal with rail liberalisation,” said an official.

The report also argues that unilateral pricing policies are not the best way of fighting the damaging effects of road haulage on the environment.

It says past experience has shown that moderate cost increases have simply been absorbed by the industry, so “only a sudden, very extreme cost increase would be capable of having any effect”, and warns that new pricing policies could actually increase damaging emissions.

At a time when the fight against unemployment is a priority for the EU, the report warns that raising the cost of road haulage would cause a shift to other forms of transport which are less labour intensive.

But, underlining that the pricing issue is merely one element in a wide-ranging strategy, Commission officials claim the road haulage sector's concerns are borne of a misunderstanding of Kinnock's intentions.

“We have seen claims that the Commission is planning to double road taxes, which is simply not true. This type of reaction is a bit old-fashioned. More progressive elements in the industry are working with the Commission,” said one.