Dominic Browne 03 December 2014

Autumn Statement: Local road funding reforms and allocations revealed

The National Infrastructure Plan (NIP) 2014 published in tandem with the Autumn Statement today has confirmed regional roads cash allocations for the next parliament together with controversial reforms to the local capital maintenance funding.

The document reveals more than a billion will be taken from the traditional needs based formula of local highways capital maintenance funding and divided between an asset management incentive fund and a challenge fund for major road maintenance projects. Under a recent consultation councils had expected such changes to be put in place from 2015 and the NIP today announced the Government’s final plans.

Treasury officials confirmed to Transport Network that out of the £5.8bn capital funding over the next parliament the Government will commit £4.7bn to the needs based formula.

A further £580m will be used to ‘incentivise good asset management and efficiencies, and £575m reserved to a challenge fund for large one-off maintenance and renewal projects’.

This is a slight change from the initial proposal to strip £653m for the asset management incentive scheme and £600m for the challenge fund.

The incentive cash is likely to be weighted between three levels of performance for local highways authorities as was outlined in the consultation last month.

Under these proposals councils will be banded in three groups based on self-assessment analysis including questions on the development of asset management plans, client and provider collaboration, the level of joint working with other local authorities and the nature of contract and procurement methods.

Treasury officials also reveal in the NIP: '(The) funding from the needs-based formula, before including incentive and challenge funding, will indicatively be allocated regionally as follows:

  • • North East – £270m
  • • North West – £630m
  • • Yorkshire and the Humber – £490m
  • • East Midlands – £540m
  • • West Midlands – £510m
  • • East of England – £640m
  • • South East – £780m
  • • South West – £850m

The move to create an asset management incentive fund was heavily opposed by council chiefs.

The Local Government Association (LGA) response to the consultation seen exclusively by our sister website Transport Network said: ‘The proposals put forward risk creating further delays, bureaucracy and removing decisions from the local areas that are best placed to make them. The consultation does nothing top tackle the estimated £12bn backlog of road repairs and threatens to slow down councils’ efforts.’

A Transport Network source at the LGA said the infrastructure plan revisions suggested the Government had listened but not enough to change the council members’ opinion.

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