So the government choose Brexit debate day to quietly finalise its council cuts

Manchester Town Hall. Image: Getty.

In what’s becoming a bleak pattern, the government chose Tuesday – Theresa May’s second attempt to pass her Brexit deal – to finalise its next round of cuts to councils.

Ministers outlined the provisional local government finance settlement for 2019-20 last December. But they chose this week to announce its final plans for short-term local government funding – in a written statement, the subtlest form of government announcement, by the Communities and Local Government Secretary James Brokenshire.

After eight years of austerity, cash-strapped councils have been waiting for the government to use its final settlement this month to provide the resources they desperately need for funding public services in 2019-20. But the new settlement – sneaked out while Westminster is distracted by Brexit – doesn’t deliver what councils need.

As first announced in the Budget, the government is releasing extra chunks of funding for social care and potholes, as well as more money for high streets. The government calculates that its settlement adds up to a rise in core spending power for councils from £45.1bn in 2018-19 to £46.4bn in 2019-20: a 2.8 per cent cash increase. (It has also reiterated the £56.5m across 2018-19 and 2019-20 to help councils prepare for Brexit, which we can’t really count as extra funding as it’s to fill a Brexit-shaped hole.)

Firstly, this money isn’t enough – councils still face a funding gap of more than £3bn this year, according to the Local Government Association. The pressure to set legal budgets, with an average 49 per cent drop in real terms spending power since 2010 and rising social care demands, means councils need substantially more than a 2.8 per cent raise. Labour’s shadow local government secretary Andrew Gwynne has called the plan a “shoddy deal”, and warns it “means more cuts to our councils”.


Secondly, the funding announced is simply a short-term one-off. There’s no new system for funding social care – with the long promised green paper on adult social care repeatedly pushed back. Decisions on other structural concerns – business rates retention and a fair funding formula for local government – have been put off, with consultations being published instead.

Councils are desperate for a long-term, sustainable funding settlement. As the head of the National Audit Office, Amyas Morse, said last March: “Current funding for local authorities is characterised by one-off and short-term fixes, many of which come with centrally driven conditions.”

“It does not solve medium term financial pressures so tough decisions will still need to be taken and our members will have little choice but to raise council tax to meet demand-led pressures in services,” warned Paul Carter, chair of the County Councils Network.

Plans for 2020 and beyond are yet to be determined, according to the Institute for Fiscal Studies, which concludes that “current plans imply further cuts for unprotected services after 2019-20”.

This means councils will continue to operate in a financial void, unable to fund public services properly, while waiting for something to change in the promised Spending Review later this year.

 
 
 
 

The Réseau Express Métropolitain: the multi-billion dollar light rail project Montreal never asked for

Montreal from the summit of Mont Royal. Image: Getty.

The Réseau Express Métropolitain (REM) is the 67-kilometre, C$6.3bn light rail project Montreal never asked for.

It is the single largest transit project in Montreal in half a century. Not since the construction of the Métro has there been as bold a proposal: an entirely new mass-transit system that would have the effect of radically altering the city’s urban landscape.

Conceived, planned and costed by the Province of Quebec’s institutional investor, the Caisse de dépot et placement du Québec (CDPQ), the REM is currently under construction and slated to become operational between 2021 and 2023.

Once completed, it is supposed to provide high-frequency, intermediate-volume light-rail service on a regional level: connecting suburbs with the city centre along three axes and linking Montreal’s central business district with its international airport.

The REM may even connect to an as-yet unbuilt baseball stadium, and politicians have even proposed extending it over hundreds of kilometres to provide inter-city service. Indeed, the REM has been strongly endorsed – by both the federal and provincial governments that back it – as a panacea for all of Greater Montreal’s transit and traffic congestion problems.

Since it was first proposed in 2015, the REM has been championed above all else as a guaranteed-to-succeed “public-public partnership”. A win-win, where various levels of government cooperate and coordinate with an arm’s-length government agency to produce much-needed new transit and transport infrastructure.

Unlike the more commonly known public-private partnership (of which there are some notable recent failures in Quebec), the obvious insinuation is that – this time – there’s no private interest or profit to worry about.

PR aside, the pension funds managed by the CDPQ are private, not public, wealth. The CDPQ’s entire raison d’etre is to profit. It has even gone to the lengths of “mandating” the REM to provide it an annual profit of about 10 per cent, a cost to be assumed by the governments of Quebec and Canada in the event the REM isn’t profitable.

The law that has made the REM possible has other interesting components. The REM is legally distinct from and superior to other public transit agencies and the extant regional planning authority. It has exclusive access to publicly-funded transit infrastructure. There’s even a “non-compete” clause with the city’s existing mass transit services, as well as special surtax on all properties within a 1km radius of each of the 26 proposed stations.

This latter element takes on a new dimension when you consider the CDPQ’s real-estate arm, Ivanhoé-Cambridge, has a near total monopoly on the properties surrounding the future downtown nexus of the REM, and is invested in suburban shopping centres that will soon host REM stations.

It seems that Montreal isn't so much getting a new mass transit system as a pension fund is using a new transport system to stimulate growth in a faltering if not moribund commercial and residential property sector.

Quebec’s public pensions have historically invested in suburban sprawl. As this market becomes increasingly untenable, and populations shift back towards the city centre, the REM is supposed to stimulate growth in “transit-oriented developments” centred on its future stations. The new surtaxes are likely intended to force sales of land for immediate redevelopment, so that new homes are ready to move into as soon as the system becomes operational.

It’s important here to remember that the city of Montreal wasn’t given several billion dollars by the government with which to spend developing its mass transit system. Rather, Quebec’s former premier asked the CDPQ to come up with a way to integrate several long-standing yet unrealized transit proposals. These included a light-rail system over Montreal’s new Champlain Bridge, an express train to Pierre Elliott Trudeau International Airport, and a dedicated commuter rail line for the Western suburbs. It was the CDPQ that proposed a fully-automated light-rail system that would use existing technology as well as some of Montreal’s extant railway infrastructure as an inexpensive way of uniting several different projects into an assumedly more efficient one.

So far so good. Cities need more mass transit, especially in the era of climate change, and Montreal contends with regular congestion both on its roadways and various mass transit systems. Moreover, access to the city’s already generally-high quality public transit systems is an important driver of property values and new residential development.

Considering the evident need for more transit, the REM theoretically provides an opportunity to kill several birds with one stone. Better still, the REM will in all likelihood stimulate the transit-oriented developments and re-urbanisation necessary for a more sustainable future city.

A map of the proposed network, with metro lines in colour and commuter rail in grey. Click to expand. Image: Calvin411/Wikimedia Commons.

The REM is the business “test case” on which two new government entities are based; the CDPQ’s infrastructure development arm, and the Canadian government’s infrastructure development bank.

The REM is also intended to stimulate economic activity in important economic sectors – such as engineering, construction and technology – that could soon be in high-demand internationally. Both the governments of Quebec and Canada see tremendous value in the economic potential of infrastructure mega projects at home and abroad.

This aside, the actual development of the REM has been complicated by what appears to be a bad case of over-promising and under-delivering, at least in terms of how seamlessly it could be integrated into the city’s extant transit and transport systems.

Though the train as originally conceived was intended to use an existing electrified railway line as the backbone of the network, it now appears that the REM cannot in fact be adapted to the line’s current voltage. The entire line, and the tunnel it passes through, requires a thorough overhaul, something that had last been completed in the mid-1990s. The new electrification, as well as the reconstruction of the tunnel, will cut it off from the regional commuter rail network. Rather than have different types of rail systems share existing infrastructure, the REM will force the premature (and unnecessary) retirement of a fleet of high-volume electric trains.

Consider that while the REM will connect the city with its international airport, it’s not planned to go just one kilometre farther to connect the airport with a major multi-modal transit station. Dorval Station integrates a sizeable suburban bus terminus with a train station that serves both regional commuter rail as well as the national railways network.

It’s difficult to understand how and why such an obvious and useful connection wasn’t considered. Given long-standing interest in high-speed and/or high-frequency rail service in Canada, La Presse columnist François Cardinal has noted that a REM connection between airport and a likely future rail hub would extend access to international air travel far further than just downtown Montreal.


The REM was also supposed to integrate seamlessly into the Montreal’s built environment, its promoters insisting construction could be completed with minimal inconvenience to current transit users. By the end of this year, REM-related construction will force a two-year closure of Montreal’s most-used commuter rail line, and sever the most recently-built rail line off from the transit hubs in the centre of the city. Tens of thousands of commuters throughout the Montreal region will be forced to make do with already over-saturated bus and métro service.

Though public consultations revealed these and other flaws, concerns raised by the public, by professionals and even some politicians were largely ignored. The REM also failed its environmental assessment. The provincial agency responsible for such evaluations, the BAPE, stated baldly that the project wasn't ready for primetime and lambasted the CDPQ’s lack of transparency. In turn, the BAPE was accused of exceeding its mandate. The REM made a similarly poor impression, with transit users groups, architects and urban planners criticizing the project in whole and in part.

The main points of contention are that the REM won’t do much in the short term to alleviate congestion across the city’s existing – and comparatively expansive - mass-transit network. Quite the opposite: it is already beginning to exacerbate the problem.

Because the REM was conceived without the involvement of either the city’s main transit agency or the regional transit planning authority, its progress is hampered by a wide-variety of problems that would otherwise likely have been planned for. And because it’s a mass-transit solution to what is primarily a political consideration, the REM will provide higher-frequency service of dubious necessity to the city’s low-density suburban hinterland, much of which already has ample commuter-focused transit service. The high-density urban-core, which is most in need of transit expansion, will benefit perhaps least of all.

While it’s unlikely the REM will fail outright, it’s also unlikely to stimulate much new interest in using mass-transit services: it will first have to win back those who may abandon mass-transit while the REM is being built. Providing higher-frequency service to suburbia is the kind of thing that sounds good in theory, but doesn’t respond to commuters’ actual needs. Arguably the REM’s best feature – its real-estate development potential – has been somewhat obscured from public view because of obvious conflicts of interest. The REM’s limitations – and there are many – will for the most part only become known once the system is operational, at which point it will be too late.

The REM provides interesting theoretical avenues worthy of exploration – particularly the potential relationships between new transit development and how it may stimulate new growth in the housing sector. But building a new transit system – especially one this large and complex – ultimately requires the fullest possible degree of cooperation; with transit users, extant transit agencies and regional planning bodies.

Ignoring the recommendations of experts, the public and government assessment agencies for the sake of expediency is never a wise idea. When it comes to designing and implementing the mass-transit systems of the future, the needs, wants and opinions of users must be paramount. In Montreal, it appears as though they were an afterthought and an inconvenience.

Whether Montrealers will be able to vote with their wallets remains to be seen. Under the specific conditions set with which to integrate the REM into Montreal's overal mass transit scheme, other types of transit have either been replaced by the REM or will have their routes and schedules modified to better serve it. The REM removes operational redundancy between different systems in an effort to be more efficient, but this will likely have the effect of forcing many Montreal transit users to use a one-size-fits-all solution that doesn't suit anyone's needs

It’s difficult to imagine how forcing people to use a transit system they never asked for will encourage greater use.