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What Does a Road Accident Cost?
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The following article was published in February 2003.

What Does a Road Accident Cost?  

When new road safety schemes are being considered, the projected savings are usually calculated. Most such schemes show a very quick “payback” period, at least when being designed! But how are the costs of the accidents that are saved actually worked out? Well the government publishes a regular report called the “Highways Economics Note No.1” which attempts to answer that question (available from the Department of Transport if you want to see the full details).   

   A Recent Accident in Sundridge Ave, Chislehurst

Research in the early 1990s was used to determine both the direct costs (medical treatment costs, lost output due to absence from work, associated police and insurers costs and damage to property) and indirect costs. The latter, the “human” cost is somewhat of a subjective item as it is worked out on a “willingness to pay” basis. It represents the “pain, grief and suffering to the casualty, relatives and friends in the case of injuries” for example.

The values calculated in the year 2000 were as follows as an “average per accident”:

Accident Severity

Lost Output £

Medical &

Other Direct £

“Human” £

Total £

Fatal

438,860

14,240

870,780

1,323,880

Serious

17,880

14,610

121,620

154,110

Slight

2,130

3,120

10,130

15,380

Note that a serious injury is defined in the UK by an overnight hospital stay, a slight injury is simply any accident involving an injury however trivial (such accidents should legally be reported to the police whereas non injury accidents don’t need to be). For all injuries therefore, the average total cost per accident is £52,070 of which 71% is the “human” cost and the rest are more direct costs. 

There are different figures for urban, rural or motorway road accidents (the latter tend to cost more), so for Bromley roads the likely cost is £63,000 per accident, after including a cost estimate for non-injury accidents which are not in the figures shown above. However one has to be exceedingly careful when using the average figures. For example, take the recently proposed road safety scheme for Elmstead Lane in Chislehurst. This road had an average of about 6 slight injury accidents per year in the last few years (there were no serious or fatal accidents). The proposals might save one accident per year at a cost of about £50,000 (for the speed bumps or alternative treatments as proposed). If you took the average cost of all injury accidents as £63,000 then it looks a “no-brainer” as the payback is less than one year. However, if the only accidents saved are “slight” ones, as is quite likely in this case, then the benefit is £15,000 for an expenditure of £50,000 which doesn’t look nearly as good.  

One point that clearly comes out from the above figures is that the cost of a fatal accident is many times more than that of a serious accident which is itself much more costly than a slight accident. Therefore road safety remedial measures that concentrate on fatal or serious accidents are clearly the most cost effective. 

The use of “willingness to pay” to evaluate accident costs does provide a good way of comparing the relative costs of slight or serious injuries, but it distorts the cost justification versus other expenditure. For example it is rarely taken into account when evaluating the cost of major road improvement schemes or other social expenditure such as NHS facilities. In these cases, even when the justification is clear and there is a clear “willingness to pay” by the electorate, the government typically says they can’t afford the cost, or that there are other priorities.   You can possibly see why UK roads are some of the safest in the world, but we spend more time in traffic jams than almost anyone else, and have one of the worst health systems in the developed world.

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