Government to consider privatising roads

By @ibtimes on

Britain is to examine the potential for privatising parts of its road network as it looks at ways of upgrading the nation's infrastructure, Prime Minister David Cameron will say on Monday.

Cameron will say in a speech that there is an urgent need to fix a decades-long degradation of the country's infrastructure, and that the government needs to look at innovative ways of funding road improvements.

We now need to be more ambitious, Cameron will say, according to extracts of a speech released by his office.

Why is it that other infrastructure - for example water - is funded by private sector capital through privately owned, independently regulated, utilities ... but roads in Britain call on the public finances for funding?

Last November, Britain announced plans to invest 30 billion pounds in major construction projects over the next few years, with two thirds of the money set to come from pension funds.

The coalition government is pushing through austerity measures to reduce a record peacetime public deficit, and Cameron will say there is not enough money for further widescale publicly-funded road improvements.

Britain has one privately-built and operated toll motorway near Birmingham in central England, and there are plans for similar new projects. But Cameron will say the government needs to go much further.

We need to look urgently at the options for getting large-scale private investment into the national roads network - from sovereign wealth funds, pension funds, and other investors, he will say.

That's why I have asked the Department for Transport and the Treasury to carry out a feasibility study of new ownership and financing models for the national roads system and to report progress to me in the Autumn.

The Conservative party, which Cameron leads, privatised the country's rail network in the 1990s, and has advocated a greater role for the private sector in the National Health Service as well as in schools.

(Reporting by Michael Holden; Editing by Andrew Osborn)

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