Privatizing Infrastructure: Leasing Toll Roads

M6 J7 Fireworks

This week Britian's Prime Minister David Cameron gave a speech on infrastructure. He touched upon many different industries and modes, but this is what he said about highways:

Now, road tolling is one option, but we are only considering this for new, not existing capacity.  For example, we’re looking at how improvements to the A14 could be part-funded through tolling.  But we now need to be more ambitious.  We should be asking ourselves, ‘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 still call on the public finances for funding?’ We need to look urgently at the options for getting large-scale private investment into the national roads network; from sovereign wealth funds, from pension funds, from other investors.  That is why I’ve 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.  Let me be clear: this is not about mass tolling and, as I’ve said, we’re not tolling existing roads; it’s about getting more out of the money that motorists already pay.

People are already panicking about China owning the motorways, though the BBC does have a nice Q&A about public private partnerships and toll roads. There is also a focus on "shovel-ready" projects, which is apparently concept in the UK. The most famous example of a privitized toll road in Britian currently is the M6 north of Birmingham, which opened in 2003, was proposed by John Major when he was Prime Minister, and is regarded as a mixed success.

These sorts of public private partnerships (PPPs) are quite common in the US. Edit: There was an attempt to lease the Pennsylvania Turnpike, but that failed with lots of lessons learned. The Pew Center on the States wrote an overview of what states and agencies should consider when entering these PPPs. It will be interesting to see how this plays out.