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Public Accounts Committee publishes its report into maintenance of strategic infrastructure, concentrating on roads. 

• Report: Maintenance of strategic infrastructure: roads
• Report: Maintenance of strategic infrastructure: roads (PDF)
• Inquiry: Maintenance of strategic infrastructure: roads
• Public Accounts Committee

The Rt Hon Margaret Hodge MP, Chair of the Committee of Public Accounts, today said:

"Public satisfaction with the condition of our roads is at the lowest level since the surveying of this began in 2008. In the last survey only 30% of the public were satisfied with the condition of the roads and the speed and quality of repairs. The greatest problems are in London and the South East, according to the Department for Transport.

The Department’s piecemeal and stop-go approach to funding for road maintenance in recent decades has made it difficult for highways authorities to maintain roads cost-effectively. There has been too much reactive work in response to flooding and other events and not enough focus on preventative work that is less expensive in the long-term.

The Department’s unpredictable and fluctuating budgets for road maintenance over decades have put value for money at risk.

It seems ludicrous that in 2010 the Department cut road maintenance budgets by £1.2 billion over the four years from April 2011, but then it has intermittently given £1.1 billion additional funding on nine separate occasions for various reasons, including in response to flooding or winter damage to the roads.

The Department must see that prevention is better than cure. It costs £52 to fill in a pothole, or £70 in London, yet it costs over £30 million to pay and process compensation claims from road users for damages arising from poor road conditions.

Infrastructure UK has said that savings of 10-20% are associated with certainty of funding, and the Department says it is taking steps to make its funding more certain in the future.

Whilst we understand the unpredictable nature of winter weather, too much road maintenance is inefficient because it is reactive and unplanned. Concentrating activity in the winter months is inefficient and costly. Some local highway authorities are far too reactive to events, rather than anticipating, predicting and preventing disrepair.

Routine maintenance is essential to deal with increasingly frequent severe weather and to prevent long-term damage to infrastructure, but a fall in the proportion of revenue funding to capital funding risks a reduction in this type of maintenance.

A good understanding of the state of the roads is absolutely essential for planning cost-effective preventative maintenance. Yet, there are too many gaps in highways authorities’ information about what road infrastructure assets they have and what condition they are in. The Highway’s Agency holds no information on 70% of its drainage systems, for example.

Better information, better planning of funding and a pro-active stance on maintenance are what the Department must promote to have a chance of pleasing unhappy road users."

Margaret Hodge was speaking as the Committee published its 15th Report of this Session which, on the basis of evidence from Philip Rutnam, Permanent Secretary, Department for Transport and Graham Dalton, Chief Executive, Highways Agency, examined the issue of strategic road infrastructure.

The Department for Transport (the Department) and the Highways Agency (the Agency) are making progress in improving the way in which road maintenance is carried out, but more needs to be done. The Department’s piecemeal and stop-go approach to funding for road maintenance in recent decades has made it difficult for highways authorities to deliver maintenance cost-effectively, with too much reactive work in response to flooding and other events and not enough focus on preventative work that is less expensive in the long-term.

Too many highways authorities are not basing their road maintenance programmes on good information and planning. Public satisfaction with the condition of our roads is at the lowest level since the survey assessing confidence began. However, we recognise that the Department is seeking to make funding more stable and predictable, which should help highways authorities to plan maintenance works more effectively. The Department is working to promote consistent good practice in local road maintenance but performance still varies between authorities.

Conclusions and Recommendations

The strategic and local road networks are England’s most valuable infrastructure asset. They are valued at approximately £344 billion, and are made up of roads and other infrastructure such as bridges, embankments and drainage systems. The Highways Agency, which is an executive agency of the Department, is responsible for maintaining the strategic road network (4,400 miles), which includes almost all of England’s motorways and its most important ‘A’ roads.

The remaining local roads (183,000 miles) are maintained by 152 local highway authorities. In 2012-13 public spending on maintaining England’s roads was £4 billion; of which the Agency spent £720 million (capital and revenue) and the Department provided £779 million capital for local highway authorities’ road maintenance. The remainder was paid for from local authorities’ other resources.

The Department’s unpredictable and fluctuating budgets for road maintenance over decades have put value for money at risk. Following the Spending Review 2010, the Department cut road maintenance budgets by £1.2 billion over the four years from April 2011. Since then it has intermittently made available a total of £1.1 billion additional funding on nine separate occasions for various reasons, including in response to flooding or winter damage to the roads.

Infrastructure UK has reported that savings of 10-20% are associated with certainty of funding. It costs £52 to fill in a pothole (or £70 in London), yet it cost £31.6 million in 2013/14 to pay and process compensation claims from road users for damages arising from poor road conditions. The Department is taking steps to make its funding more certain in the future. It is in the process of changing the Agency’s status to a limited company, with funding settlements of at least five-years and it has set out its capital allocation for local road maintenance: £976 million a year for the six years from April 2015.

Recommendation: The Department should hold the new Highways Agency to account for delivering the improved value for money that should be achievable given the certainty that will be provided by the planned funding reforms.

The Department should keep to the long-term budget allocations it has set out for local highway authorities to enable them and the supply chain to plan ahead confidently and efficiently.

The Department has promoted best practice in local road maintenance but performance still varies locally. The Department is funding a Highways Maintenance Efficiency Programme, which reinforces the need for authorities to plan long-term preventative maintenance based on good information on the condition of the infrastructure. The Department also encourages collaboration between highway authorities.

Two thirds of local highway authorities have formed alliances with other authorities which has reduced their costs. However, not all local authorities have adopted good practice and the Programme is not sufficiently targeted at assisting poor performing authorities. For example, 45 local highway authorities had not completed an asset management plan setting out the state of their roads. Public satisfaction with the condition of roads and the speed and quality of repairs stands at the lowest level since the survey began in 2008.

Recommendation: The most effective way in which the Department can influence practice is through its funding of road maintenance. The Department should use the way it allocates its funding to incentivise efficiency and collaboration and it should not fund poor performance.

The Department should identify those local highway authorities that carry out maintenance less efficiently and target the Highways Maintenance Efficiency Programme at them.

A lack of information and understanding of road infrastructure and the costs of maintenance hinders decision-making on when and where it is best to spend the money. A good understanding of the state of the roads is absolutely essential for planning cost-effective preventative maintenance. Yet the Agency holds no information on 70% of its drainage systems.

There are too many gaps in highways authorities’ information about what road infrastructure assets they have and what condition they are in; and there is an inadequate understanding of how different types of infrastructure (apart from road surfaces) deteriorate over time. Some highways authorities have taken steps to improve their information but further work is needed.

Recommendation: The Department should work with local highway authorities to ensure that they all develop appropriate data and understanding of their road infrastructure.

The Agency should also improve its understanding of its road infrastructure, how this deteriorates over time and the costs of maintenance interventions.
Whilst we understand the unpredictable nature of winter weather, too much road maintenance is inefficient because it is reactive and unplanned. At present too much road maintenance is carried out in the winter months between December and March at the end of the financial year.

The Highways Agency spent 3% of its maintenance budget in April 2013 and 21% the following March. Concentrating activity in a few months and doing the work in the winter is inefficient and costly. Long-term programmes of preventative work are the most efficient way of maintaining road infrastructure. While there will always be a need to perform some emergency and reactive maintenance, highways authorities need to plan and prioritise their maintenance activities over the whole life of their road infrastructure assets to get best value for money.

Some local highway authorities have built up their information and understanding so they can plan and prioritise work efficiently, but others are still far too reactive to events, rather than anticipating, predicting and preventing disrepair. In addition, the Department and the Agency recognise the need for a more even spread of maintenance work across the year.

Recommendation: The Department should ensure that Government funding promotes and supports the more even spread of expenditure over the year, with work carried out during the time when costs can be minimised.

The Highways Agency should develop longer-term plans for preventative maintenance and streamline its annual planning process to spread work more evenly across the year.

The Department should use the Highways Maintenance Efficiency Programme to help local authorities quantify the benefits of more preventative work and to anticipate problems rather than react to them. 
Routine maintenance is essential to deal with increasingly frequent severe weather and to prevent long-term damage to infrastructure but a fall in the proportion of revenue funding to capital funding risks a reduction in this type of maintenance.

Essential routine maintenance activities such as inspections, clearing drains and winter gritting can only be paid for from revenue funds. Maintaining good drainage, in particular, is vital to reducing flooding as well as preventing costly damage to road infrastructure from water penetration. The Agency’s revenue spending was 29% lower in 2012-13 than it was in 2010-11. Although local authorities’ capital funding has increased slightly, their revenue funding from central government reduced by around a third over the four years of the 2010 spending review, and it is set to fall by a further 10% from 2015-16 to 2020-21.

Recommendation: The Department should ensure the Highways Agency has the right balance of revenue and capital funding to enable it to carry out essential routine maintenance activities.

The Department for Transport and the Department for Communities and Local Government should examine the cumulative impact of their combined funding decisions on local authorities’ road maintenance, and they should adjust their approach accordingly to support essential routine road maintenance activities