How does a council, applauded for its local transport plan, faced with booming residential growth, and recognised for having the best roads in the country, uphold its success when the money it needs is in short supply?
Buckinghamshire County Council’s transportation service and politicians are asking themselves this very question. The council is faced with the unfortunate Catch-22 situation where its high aspirations – encouraged by Whitehall – cannot be realised, due to lack of government funding.
The home county, with more than 3,250km of roads and 7,000km of footways and pavements has, until recently, been able to keep up with its highways maintenance programme. In 2005, the county council was even given a national transport award for the best road network structure in the country, measured by best value performance indicators.
The council has also been commended for its local transport plans by central government, and which outline the ambitious projects that are to be accomplished.
Yet to achieve the projects, the council has had to drastically review its budgets and try to make savings in some areas.
During the last five years, Buckinghamshire County Council’s transportation revenue budget has increased by less than £1M – to £19.3M. Within that, £7M is spent on highway maintenance. Its capital budget stands at £12M, with £5.8M spent on hard infrastructure maintenance.
‘Our 2003-2004 revenue budget gross expenditure was £24M. This year our gross expenditure is £31M. That’s a 32% increase in expenditure in four years, but the base budget has only gone up by 3.5% during that time. That gap has been bridged by us working more efficiently,’ said Jim Stevens, the council’s highway infrastructure manager.
Inflationary costs – a 74% increase in streetlighting and energy costs in two years, an 8% annual increase in contractors’ costs, and above retail price index inflation in bus contracts – are the council’s biggest pressures, and have not helped in the challenge of efficiency savings.
‘Looking at the whole of the transportation service, the inflationary pressure from last year to this year was £1.2M. Because we are in a cash-limited budget environment situation, we have had to absorb these pressures by doing things differently, and becoming more efficient.
‘Our efficiency savings this year are £1.2M, so we have absorbed those inflationary pressures completely. Next year, our budget will be the same. It will be cash-limited to £19.3M, but will still have inflationary pressures, as well as other constraints that we may not be aware of,’ Stevens said.
The council is proud of the fact that it has managed to save money in several areas. It has resorted to recycling road materials, as well as slimming its transport area technician team down to one ‘multi-skilled’ technician in each area of the county, instead of having several in each locality – saving £200,000 a year. Reducing the number of managers in the service by 10% has also saved a further £160,000. It has also decided to repair its potholes with a hot fill, instead of a quick-fix, cheaper, cold fill, for a longer-lasting repair.
‘But we have gone as far as we can go, now,’ according to the council’s cabinet member for transportation, Cllr Val Letheren.
‘It’s beginning to mean that we are going to have to make cuts to our service, which is not at all popular with the public.’
The council has been struggling to repair the huge amount of potholes on the roads, left by a particularly wet winter. Said Letheren: ‘We are much slower maintaining those roads because we haven’t got the money to be doing it, so the programme gets held up.
‘The capital budget is restricted as well, so that means we haven’t been able to resurface at the rate we would like to.’
The council’s financial dilemma is worsened by the fact it has decided it cannot afford to borrow the money central government has allocated it, on the strength of its LTP. The council was allowed to borrow up to £12M, but for every £1M borrowed, it had to pay back £90,000 from its revenue budget.
Letheren ‘lives in hope’ that the Government will give the council what it needs during this year’s comprehensive spending review. ‘We certainly need some help because the budget is just not going to take it. We’ve always had supported borrowing, which was incredibly cheap. Now it’s £90,000 for £1M.
‘For that to suddenly happen last year, just at a point when we are getting increased population and growth, it was a tremendous double-whammy. It was never how it was played before, so it has really punished us.
‘To me, it’s heartbreaking that we have got an excellent LTP, which has had national recognition, which we cannot fulfil on the money we have.’
Between 2006 and 2026, Buckinghamshire’s population is set to increase by 32,800, with almost as many houses built.
‘The infrastructure is stretched because we haven’t got the space to build any more roads. We’ve got tremendous traffic growth all the time on a restricted road network, because we’ve got lots of historic towns, without much room to stretch. The Government, at present, doesn’t seem to be giving us money in line with the amount of houses we are expected to take,’ Letheren said.
Stevens believes if the Treasury does not provide the council with a real-term revenue increase this year, then the condition of road surfaces and the improving trend of public satisfaction will begin to decline.
‘Another consequence is that short-term decisions will be made over maintenance – it will be “short-termism” rather than long-term planning. We are almost there with the completion of our asset management plan, and one of the fundamental principles of the asset management plan is to enable forward-looking investment decisions to be made.
‘So if there’s no forward-looking financial plan, short-termism is inevitable.’
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