28 November 2017

Road testing the government’s driverless-car strategy

By Florian Ranft and Martin Adler

Nine months since Article 50 was triggered the future of Britain’s economic model post-Brexit is still  something of a conundrum. One vision popular with the Government is that of the UK as a global trading hub freed from ties with Brussels and EU red tape, with a highly productive and innovative service and manufacturing sectors attracting talent from across the world and ushering in a digital transformation.

The budget announcement to allow road testing of fully autonomous vehicles on Britain’s road by 2019 plays into this narrative of a thriving Silicon Valley-cum-Singapore on the Thames. The Chancellor is right to realise that the driverless revolution is on our doorstep and that politics must quickly catch up with technological and commercial reality.

The proposed policy intends to support the Government’s industrial innovation strategy, seeking to produce national champions in the driverless race with competitors worldwide. But will these policies usher in the technological revolution so many expect? Only if the Government does not plan for the social and economic revolution that underlies the shift to driverless, it will not unlock its full benefits.

Asked about one positive benefit that Brexit will deliver, the Chancellor responded on Sunday that it will allow Britain to develop innovative regulatory frameworks that foster innovation. This might be true for  agriculture, data security or the environment. But it is not true for driverless cars.

It is entirely up to national governments to decide whether developers may or may not test latest equipment on their roads. Brussels is in charge of transposing admissibility and liability of new technology into EU law but here again, it does not set the regulations. That is, with a few exceptions, done by the United Nations where the most important car manufacturing nations gather around the table negotiating the rulebook of tomorrow’s cars.

Although driverless cars have the potential to deliver a huge boost to the British economy, any efforts spending more tax money on research and development must be well thought through. In a market that offers vast profits the private sector already has the necessary incentives to invest. And public funding might just subsidise an already prosperous industry. Without much evidence of market failure, the public’s taxes would be better spent elsewhere.

Instead of investing in product development, the Government should guarantee that it creates a digital infrastructure that allows driverless cars to operate seamlessly across the UK. A country-wide 5G wireless network and fibre-optic broadband would be a good starting point for a broad range of technologies, including autonomous driving. Such investments provide benefits for the economy as a whole and so should be the Government’s primary focus.

More importantly, instead of saying “bring it on”, the Government needs a proper plan to deal with the consequences of driverless – from the huge re-training necessary for those whose current jobs will disappear, to the integration of public and private transport from the very start.

The announced re-training partnership between stakeholders – the TUC, CBI and government – is a good start but they must ensure they enhance the dialogue with grassroots trade unions, such as the Independent Workers Union of Great Britain, that represent workers in the gig economy. More generally, citizens must be allowed to decide how to redesign the city of the future: what to do with the room freed up as parking spaces are able to give way to new housing, schools or parks.

Another key challenge will be ensuring investments in driverless technology is spread equally across cities and regions. There is a substantial risk of creating a “digital divide”, with some places receiving more of the benefits, exacerbating regional inequalities over the long term. Public policy can ensure autonomous technology creates hubs that link peripheral areas with city centres, making it easier for people to get to work, boosting employment and widening the circle of prosperity.

Unlike the internet, this tech revolution allows policymakers to get ahead of the curve and make smart policy choices that will create a safer and more efficient transport system. Merely lessening regulation without putting a social and economic agenda in place that deals properly with the consequences is not enough. It risks leaving businesses, public service users and transport workers behind.

Florian Ranft and Martin Adler are two of the authors of 'Freeing the Road', published by Policy Network