The new economy is placing a huge strain on London’s transport.  Transport for London has done a pretty good job in coping with this but its successes have been bought at a cost. Under Ken Livingstone’s high-spending regime, Tube fares rose to become the most expensive in the world, while the cost of bus operations rose to about £2 billion in current money, about half of this in subsidy.

And despite the congestion charge, which has contributed to a fall in road usage of more than a fifth in central London, traffic speeds have not risen. Our international congestion study showed that it is more congested than any other major city in France or Germany. The average vehicle in London spent 66.1 hours in 2011 not moving at all. This is a pretty savage indictment of the management of road space, given the fall in the number of vehicles on the road.

Livingstone’s anti-car ideology remains, meaning that rather than making the best of our crowded streets, road space is being reduced and sensible investments in underground roads ignored. Empty bus lanes combine with static lanes for other users. Roadworks abound and building sites jut out into already congested streets.

Although it will never be possible for London to provide space for everyone to travel by car or taxi, the movers and shakers who contribute two-thirds of income tax payments in the City use cars much more intensively than any other group. Their largest single complaint is traffic jams. These highest income groups are especially internationally mobile: if they leave, it will destroy the economic progress that underpins London’s world city status.

The future for transport in London has to be ideology-free and based on what works. So we will need underground roads. We will need carefully managed road space, with efficient congestion charging to manage demand. We will need better cycle lanes and segregation of cycles from other traffic on the main through routes to reduce cycling fatalities.

Although TfL has done a great job in providing public transport and is now doing an impressive job cutting that transport’s cost, it still sees its top priority as providing bus services. This creates a conflict of interest in managing road space between the demands of different road users: it is difficult to see it managing road space efficiently.

We need a new body to manage road space to supplement TfL, so that Londoners not travelling on buses can get around the capital quickly. This separate roads authority would have the priority of keeping the traffic moving, making good use of bus lanes, managing the cycling strategy, building underground roads when they are both possible and economic,  and regulating demand through congestion charging. That way, we can keep London moving to sustain its economic dynamism.

Douglas McWilliams is chairman of the Centre for Economic and Business Research and Professor of Commerce at Gresham College. He is giving a free Gresham College lecture, Sorting out Transport in London, at the Museum of London at 6pm on May 1st 2013, further details here