Region diverts cash to transport in bid to stimulate economy

15 April 2009

Ministers have backed Yorkshire & Humber region’s decision to divert £106M from its regional funding pot to local transport projects for the next two years, in order to stimulate the economy.

Local transport minister, Paul Clark, supporting Yorkshire & Humber’s advice that 40% of the regional funding allocation for major schemes for the 2008-2011 period should be diverted into local transport, said it would ‘support the Government’s fiscal stimulus measures’.

The regional development agency and regional assembly had sought to identify labour-intensive work, as well as a transport rationale, when deciding how best to spend the £263M earmarked for the region up to 2011.

The advice, submitted to ministers last month, said that ploughing extra money into clearing the highways repairs backlog, and delivering improvements for bus passengers, pedestrians and cyclists, would ‘bring about significant contract and employment opportunities’.

Mr Clark signed off the £46.9M extra for the integrated transport and maintenance block funding for 2009/10 – a 31% increase compared with the money allocated in 2008/09 – and also approved £11.7M for three major maintenance schemes for Wakefield and Rotherham.

The minister said that ‘the quick release of funds’ for the region – and a further £22.7M worth of sub-£5M schemes for three other regions – would allow work to start promptly.

Jonathan Jarvis, senior transport manager at Yorkshire Forward, said: ‘It’s a pragmatic response to the current economic conditions. This money can be spent quickly, and to great effect.’ He conceded that ‘smaller schemes often get squeezed out, given the bigger overall benefits of larger schemes’.

Major projects typically had a long lead-in time, Jarvis added, and were subject to the greater uncertainties, creating the risk of the region under-spending the allocation, and having to forfeit the money.

The Southeast, which also moved money out of the major schemes block to schemes which could be delivered quickly, received £12M in total.

John Smart, director of technical affairs in the Institution of Highways & Transportation, welcomed Yorkshire & Humber’s move, and urged the Government, as it prepared to unveil its Budget next week, ‘to follow suit’.

He said the size of a small uplift in the £650M maintenance block for local roads would ‘pale in comparison to the amount of money being invested into failing banks, but would have huge economic benefits’.

The Department for Transport, which had asked regions to consider what an extra 10% of funding could deliver, pledged to respond to the rest of the regional funding advice ‘in due course’.

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