It’s time to re-appraise appraisal, and Wales shows the way

WHAT A CONTRAST IS EMERGING between the Welsh and English approaches to clearly defining the basis upon which future transport investment decisions should sensibly be made.

In this LTT issue we examine the Welsh Government’s lucid and accessible set of plans for how schemes should be drawn up and assessed against clearly stated national policy objectives. Meanwhile, the Department for Transport, whose writ now only runs in England on this policy area, has announced a series of esoteric and impenetrable changes to its complex and multi-faceted transport appraisal guidance, still fundamentally based on seeking to predict what the future holds. 

The only thing in common between the two approaches are the letters TAG — in the Welsh case, now to be known as WelTAG, and departing radically from the inherited national UK TAG framework as used by the DfT.

Contrast these two statements:

“Clarifying that the core scenario does not seek to model fundamental shifts in the underlying relationships between drivers of travel demand, nor major technological, environmental, or economic shocks, but rather represents a world in which future deviation from historic trends and current government policies is minimal (not a world that is necessarily desirable).”

and

“A project can only be shown to deliver value for money if it is consistent with the Welsh Government’s strategic objectives and values.”

The second of these obviously relates to the new Welsh approach to appraisal, whereas the first is a description of one of several conceptual amendments to the DfT approach, introducing the idea of Common Analytical Scenarios as part of the new Uncertainty Toolkit.

The new scenarios are regarded as central to how DfT intends to approach uncertainty in transport analysis. They are a set of seven standardised, off-the-shelf, cross-modal scenarios exploring national level uncertainties which have been developed by DfT for use in forecasting and appraisal. The newly published Uncertainty Toolkit sets out how it is intended the scenarios should be used. The application of the scenarios is expected to be supported by the use of national forecasts of travel demand alongside the National Trip End Model (NTEM) forecasting the development in trip origin- destinations (or productions-attractions) up to 2051 for use in transport modelling.

Two new heavyweight advice documents, relating to both the uncertainty toolkit and the new NTEM forecast have just been published by the DfT, whilst further detailed guidance awaits publication of new National Road Traffic Projections (previously known as Forecasts, and seemingly indicating a drop in confidence about their precision) later in the year.

The complexity, impenetrability and inaccessibility, beyond a small band of mathematical specialists, of the systems used within the DfT has clearly been one of the reasons for the new Welsh approach. It reflects ministerial concerns that the value placed by appraisals on matters such as driver journey time savings has led to outcomes directly contrary to some of Welsh Government’s highest priorities, including addressing climate change and toxic air pollution by reducing traffic and achieving mode shift, and improving public health through higher levels of walking and cycling. As a result, a fresh new set of transparent underpinning principles is now to be used to pass judgement on the appropriateness and suitability of all transport investment proposals in Wales.

Meanwhile, back at the DfT, the Transport appraisal and strategic modelling (TASM) team strive hopefully to incorporate changing values and objectives into formulae which are anchored on long- established methodology of forecasting demand and travel needs and their economic values, which look increasingly well past their sell by date. 

The complexity, impenetrability and inaccessibility, beyond a small band of mathematical specialists, of the systems used within the DfT has clearly been one of the reasons for the new Welsh approach.

Heroically, the new Guidance the DfT have just published acknowledges the fact that increased emphasis needs to be placed on the reality that “forecasting future demand is extremely challenging, and that while the ‘core’ scenario is intended to represent the ‘best’ basis for decision making, in practice it is often not possible to robustly identify a ‘most likely’ or expected outcome with any certainty.” As a consequence, the guidance places greater emphasis on scenario analysis, but in creating the scenarios against which to test schemes, further complexity and lack of clarity to the ultimate decision-makers inevitably soon emerges.

This issue is another key reason that in Wales WelTAG has now been re-drafted to require the elements of value-for-money assessments that derive from journey time changes to be shown separately, so that decision-makers can take a high-level view as to the relevance and validity of the journey-time element.

These considerations are clearly laid out in new Ministerial Guidance on just a single page, so that WelTAG users can be aware that proposals for which the cost-benefit analysis rests largely on generation of driver time savings are likely to be viewed by ministers as a negative influence on achieving Welsh Government top-level priorities such as climate change and mode shift. In so far as benefits for the Welsh economy resulting from faster travel for drivers may in some circumstances require to be weighed up against this negative impact, WelTAG users are advised to be aware that claimed economic value of faster travel for drivers “will be unlikely to be considered persuasive where it derives from aggregation of many small driver time savings.”

We felt the new Welsh arrangements well deserved a comprehensive examination for the benefit of the wider transport planning professional community in our feature this issue. And that the accompanying Ministerial Guidance itself worth reproducing in full as a model of clarity and simplicity about what those elected to be in charge of transport policy are seeking to hear from the practitioners.

No one doubts the good intentions and integrity of those working on the DfT models, forecasts and appraisal formulae. But there is surely a very strong and increasingly irresistible case to take a deep look at both the purposes and principles of the complex, unwieldy and opaque technical framework and methodologies that underpin the allocation of billions of pounds of expenditure and engage many thousands of hours of intense work by those in local transport authorities and their professional advisors to “meeting the needs of the system”, and thus gain access to the relevant funding.

Decision makers and the public at large have to take the outputs on trust, or, alternatively, find it easy to suggest they are not believable or inappropriate.

It is certainly a very difficult treadmill to get off - but one long overdue for fundamental review. Might the arrival of a new Prime Minister, seemingly ready to challenge economic orthodoxy, perhaps be a good time to start? If the DfT (and no doubt the Treasury) are empowered to look around for a suitable alternative, the new approach now being finalised in Wales is surely a highly appropriate starting point. 

Peter Stonham is the Editorial Director of TAPAS Network

This article was first published in LTT magazine, LTT852, 5 September 2022.