Congestion charges: Running out of road?

Manchester is preparing to hold a referendum on a proposed £5 congestion charge – and the result threatens to kill off green taxes for a generation. Paul Vallely reports

Sir Richard Leese was stuck in a traffic jam. Which was fortunate really, since I’d been told he’d only have a short window in which to speak. Thanks to the congestion on the road to Wigan, however, we had plenty of time to talk about one of the most ambitious urban road-pricing schemes in the world – which he is currently fighting to introduce.

Sir Richard is the leader of Manchester City Council which, along with the other nine local councils that make up Greater Manchester, is about to conduct what many see as Britain’s first referendum on green taxes.

On December 11 the votes will be counted in a postal ballot in which the region’s population will vote on proposals to invest £3bn on the area’s public transport system. But the money comes at a price. To secure it local people must vote for a £5 a day congestion charge.

The vote has not just national but international implications. Government ministers have warned that if Manchester votes No it will postpone Government plans to roll out congestion charging across the country for at least ten years. The newly-elected US president Barack Obama is so intrigued by the precedent the scheme could set that he recently sent his transport advisors to the city to see if the scheme could work in the US.

On the face of it Manchester is being offered a great deal. A £1.5bn grant will come from the Government’s Transport Innovation Fund (TIF). And controls on local authority spending will be relaxed to allow the city to borrow a further £1.2bn for the integrated plan. Of that £318m will go on setting up the congestion charge kit by which drivers will stick electronic tags on their windows through which charges will be deducted by direct debit from their bank account. The rest will go on trebling the city’s Metrolink tram/rail network and improving bus services.

“It’s a very clear and stark choice,” Sir Richard says. “If we vote Yes we get the biggest public transport investment ever outside London.” That would create 10,000 new jobs and will provide a major boost for the local economy. “If we vote No we get nothing.”

Enthusiasts for a Yes vote are clear on the benefits. “This is a genuine once in a lifetime opportunity,” says Chris Palmer, the communications director of a coalition of environmentalists, businesses, unions and voluntary groups which calls itself the Yes Campaign. “Sizeable contributions from national taxpayer will be matched by money from the people of Manchester. And incentives to public transport will be balanced by disincentives to car use. It’s a very balanced package.”

But for the bid to get the go ahead, a majority yes vote must be achieved in at least seven of the area’s ten local councils. And a tide has grown against the proposals. A No Coalition was developed with a cross-party alliance of seven local MPs and the leaders of the three councils which oppose the plans.

Some 250 businesses – including the Norwich Union, major property developers, airlines, hotels and shops – have lined up behind the Yes campaign. But a similar number – including Kellogg’s, United Biscuits, Unilever, Harvey Nichols and the massive out-of-town Trafford Centre shopping complex – are backing the No vote. Anti feeling is so strong that the chairman of the Greater Manchester Passenger Transport Executive was ousted as a councillor in the local elections earlier this year by a candidate opposing the congestion charge.

Perhaps the most prominent opponent to the plan is the man who was leader of Manchester City Council before Richard Leese. Graham Stringer, now MP for Manchester Blackley rejects the idea that this is a green referendum. “It has nothing to do with being green – there are no concessions for hybrid vehicles or higher charges for SUVs,” he says. “It’s an income raising scheme.”

The two sides are at loggerheads not just about every aspect of the debate. They do not even agree on how much congestion there is. The No campaign says that congestion around Manchester is not that bad. “It’s ‘not that bad’ compared to London,” harrumphs Sir Richard impatiently. “But then London has the worst in Europe. Manchester has the 4th worst. So saying we’re ‘not that bad’ compared to London is not saying much. We need to tackle the problem before it becomes a major obstacle.

Both sides can point to statistics that support their case. “Manchester has the slowest peak-time commuting speeds in the UK,” says the Yes-man Chris Palmer, around 13mph on average. Yet, says Graham Stringer, “the official figures show that congestion in the city centre is not increasing – only 8 per cent of the congestion is in the city centre and it hasn’t even been increasing thanks to the opening of the M60 (the city’s motorway ringroad) and improvements in traffic lights”. No, says Mr Palmer, but “coming off the M60 is the real problem. “The congestion is getting onto the M60,” says Mr Stringer, “but there will be no charge for that.”

Nor can they agree how many losers there will be. The Yes campaign says just one in ten travellers will pay the charge. The No campaign says at least a third of households will pay. “The 1 in 10 figure is based on modelling of current real journeys,” says Sir Richard. “The No claims are based on opinion polls.” Graham Stringer takes a different line. “The modelled figures are based on assumptions which are 3 years old,” he counters. “The polls are based on the intentions expressed by people in the last few weeks.”

It is difficult to tread a path between these, though a BBC survey of 17,000 internet users shows that the overwhelming number of respondents intend to shift their shopping or even their work elsewhere if the charge comes in. This could have serious implications since the official TIF bid acknowledges that 30 per cent of Greater Manchester’s businesses could relocate without difficulty. “The implications for the economy are pretty stark,” says Rachel Wood, the PR director of the No campaign.

There is disagreement too about the health implications of the proposals. Dr Sally Bradley, Manchester’s Director of Public Health has produced a report suggesting that congestion charging could save 135 lives a year, thanks to a reduction in accidents inside the zones and the improvements cleaner air would bring in respiratory diseases. to and from public transport could reduce heart attacks, strokes and cancer.

“All that is extremely nebulous,” says Graham Stringer. Congestion might drop within the zones but it will increase outside them. “There will be longer journeys taken by those going across town who want to avoid crossing and recrossing the boundaries.” That will increase pollution even if it is cuts on the radial roads. “New rat runs will cause new problems and accidents in different places.”

The economic impact of the proposals is similarly disputed. A survey of 10,000 people by recruitment consultants Stark Brooks has shown that 72 per cent say the charge would stop them for looking for a new job in Manchester. But the TUC this week claimed that the plans offered “a copper-bottomed insurance policy for the region as the country faces deep recession”.

The politicians take similarly diametrically opposed stances. The scheme is “a tax on the poor” says Graham Stringer that “will harm the economy”. But Sir Richard Leese says: “A range of independent studies have shown that the cities which have introduced congestion charges have all seen an economic gain not a loss.”

The poor will benefit, says the Yes campaign, since the plans include a 20 per cent discount on public transport for those on the minimum wage. “The tram link to the airport will go through Wythenshawe, an area of high unemployment,” says Chris Palmer. “So it will join two areas where there has been highest growth in jobs in the last ten years– the city centre and around the airport – with people who need jobs.”

But many poor people will have no public transport alternative to their journey to work. “People who work in McDonalds in my constituency drive to work because there is no suitable bus route,” says Graham Stringer. He was approached recently by a mother who will incur one charge as she drops her child off at school and then a second as she carries on to her job as a hospital cleaner. “ She will be £800 a year worse off.

“The average take home pay in Greater Manchester is £14,900 a year,” says Rachel Wood. “People earning that would effectively have to work an extra month a year to pay the full charge which will amount to eight per cent of their salary.”

The looming recession is only widening the gap between the two sides. “The recession has strengthened the case for this scheme,” says Sir Richard Leese. “Construction, plus maintenance and operating, will be an enormous job creator. That will help Manchester recover faster from the recession.” On the contrary, says his predecessor Graham Stringer, “all this is modelled on assumptions which are 3 years old - it assumes that Manchester won’t lose any jobs but will gain more and that 71pc of new jobs will be in financial services. Its figures are self-consistent but they are not in touch with the real world. That is even more true since the economic downturn than it was before.”

One of the reasons that the debate is generating more heat than light is that not all the facts on financing are in the public domain. The full details of the bid were only made public after it had been submitted to the government. Even then key financial information was withheld, on the grounds that it was commercially sensitive.

“The facts are contested because so many of them are secret,” argues Graham Stringer who as an MP has had privileged access to that information. “To my mind it isn’t commercially sensitive but it means people can’t debate the pros and cons properly. You can’t even get simple cash-flow figures from them. It think there’s a huge financial black hole at the centre of all this. It will mean higher council taxes or higher tram fares eventually.”

The Yes campaign reject that, insisting they have run a massive consultation exercise – of which, a recent opinion poll showed 52 per cent of the population were aware. And there have been a number of changes to the proposals as a result of the consultation. Plans to drop charging rings around Stockport and Bolton were dropped. The cap on daily payments was reduced from £10 to £5. The 20 per cent discount for low paid workers was introduced. Exemptions were proposed for hospital out-patients. Some changes were made to the line of the rings.

But the critics were not appeased. It has basically been take-it-or-leave it, says Rachel Wood, with no serious consideration of other options – like a tax on car parking, or pay-as-you-drive charging on motorways rather than urban roads.

“There’s been only the tiniest amount of flexibility at the edges,” says Graham Stringer, “but it is still an ill-thought out scheme. A third of a billion will go on the charging kit. £600m is contingency. £300m will go to guaranteeing the profits of private bus companies.” The key £1bn to be invested in the trams could be borrowed by councils without the need to impose the charge. And the 80 per cent of the area’s journeys which are done by bus could be better improved by re-regulating bus routes and fares. The government’s ‘all or nothing’ approach is just bullying. If Manchester says No the government will look at alternative proposals.”

Sir Richard Leese is not so sure. “Parliament voted this money for innovative transport schemes to tackle congestion,” he says. “Can anyone seriously believe that the government will allocate £1.5bn of that money to us without conditions and say: “Here’s £1.5bn, Manchester, do what you like with it? We have a choice, it’s a free choice but one with consequences.” That is not bullying, he insists, just a fact of life. “If we say No an enormous opportunity to grow the economy will be lost for a very long time”

At a public meeting recently just over 50 per cent present said that they would vote No. Some 46.5 per cent voting in favour. Just three per cent were undecided. The decision, it seems, is wide open.