Question to the Department for Transport:

To ask His Majesty's Government, further to the Written Answer by Lord Hendy of Richmond Hill on 16 October (HL10758), how they assess the benefits of a new non-road transport project with a potential life of up to a century, what network benefits are accounted for in that assessment, and how new jobs and housing developments are included in such infrastructure planning.

DfT assesses the benefits and costs of transport interventions using our published Transport Analysis Guidance (TAG), which is based on HMT’s Green Book Guidance. This covers a wide range of social, environmental and economic impacts of transport investment. We use transport models to understand how non-road interventions will interact with the existing network, and the pattern of passenger demand. This will reflect users changing their route or mode of travel to make use of the new project.

Our forecasts of travel demand, on which these appraisals are based, take account of the expected locations of housing and jobs in the future. For major schemes, we also model how land uses may change in response to the investment – for example, housing developments near new or improved railway stations. There is a significant body of evidence linking transport connectivity and jobs, which our appraisals take account of. Currently, this tends to be small component of appraised project benefits. We are undertaking research to improve how we predict and value transport’s impact on unemployment, which is likely to increase magnitude of these appraised benefits in deprived areas.

TAG recommends an appraisal period that is linked to the life of the infrastructure asset. This allows accounting for the foreseeable costs and benefits over that time horizon, where they are expected to occur. The appraisal period is usually for 60 years after scheme opening, which is used reasonably consistently in the sector. Allowances may be made for infrastructure that is expected to have longer-lasting benefits and costs after 60 years. TAG recommends that, in such cases, the analysis may cover up to a 100-year appraisal period from scheme opening as a sensitivity test. This is the recommended treatment, since large uncertainty is a feature of the very-long-term, and costs and benefits are heavily discounted in this period.