The Department for Transport (DfT) is working to develop a ‘sector deal’, pin-pointing partnerships with industry on sector specific issues such as skills, supplies, R&D, collaboration and efficiencies.
Top officials at the DfT aim to have a sector deal ready in time for the expected Spending Review next year – a delayed announcement on medium-term funding positions, which due to the Brexit and parliamentary confusion was replaced this month by a one-year Spending Round stop-gap.
Steve Berrt, head of local roads maintenance at the DfT, told the Local Council Roads Innovation Group (LCRIG) this month that ‘we need a sector deal’ and called for stakeholders to work with the DfT, notably Highways Term Maintenance Association (HTMA).
He said: ‘It is complex. There is a lot of work we have to do. That means we have to work closely with colleagues across the sector. My view is that we need to work with private sector and highway authorities to gear up for what a sector deal means for everyone. We are going to be working very closely with private sector and local authority partners.
‘We will want to work closely with HTMA to align what a sector deal means for us. This work is very important. So we will want to come and work with you on this.’
Challenge and Pinch Point Fund
Mr Berry also discussed the nearly £350m for councils to improve local roads announced this summer under the Local Highways Maintenance Challenge Fund, with £198m available for 2019/20 and 2020/21 and the Pinch Point Fund, which has a total of £150m available in 2021/22 and 2022/23.
He apologised for the competitive nature of the funds saying: ‘I know you don’t like competitions; we don’t really like competitions.’
Addressing the guidance that had been released with the Challenge Fund, Mr Berry said the DfT was looking for ‘resurfacing projects, bridges, slope stabilisation projects, improvements to drainage and gullies’ but highlighted drainage and bridges as two key areas for bids.
‘We are not doing street lighting as part of this Challenge Fund,’ he added, but highlighted there were other organisations and means of securing street lighting investment, which is generally regarded as having excellent returns. These include interest free loans from Salix.
He also said the DfT had worked to make the bidding process as simple as possible for the Challenge Fund and now required a more basic business case and a reduced the level of information.
On the Pinch Point Fund, as Highways went to press, Mr Berry revealed that the DfT ‘may be sending out some further guidance in the next few weeks’.
This comes after the initial proposals suggested sustainable transport schemes could be included in bids.
He said Number 10 was ‘quite keen to see how we can tie that in with bus priority provision and cycling and walking infrastructure’.
‘We have not had full instructions yet but the mood music is they would like to tie that in with other initiatives so that is something we will probably be sending out more guidance on in the next few weeks to authorities.’
Capital and revenue
Raising the difficult and ongoing debate over the capital and revenue split in highways funding, Mr Berry pointed out that some in the sector promote the ‘totex’ approach – i.e. giving local authorities complete flexibility over the funding envelope to allow them to split the cash as they see fit.
‘At the moment we are not going down a totex route. However, this doesn’t stop authorities doing totex. We are working with the [communities department] MHCLG.
‘We have capitalised potholes and I still believe we can capitalise gullies because we preserving the life of the asset by preventing standing water on that carriageway. So I think there is more work to do with the Chartered Institute of Public Finance and Accountancy and auditors to try to capitalise some of the revenue service.’
Mr Berry also revealed that the DfT’s work with the UK Asset Management Board on developing a state-of-the-nation asset assessment of the network had yielded a draft report. Highways previously reported that the work had become protracted due to the fragmented and inconsistent nature of the sector’s data. Mr Berry pointed out one challenge is narrowing down the actual size of the maintenance backlog.
‘Using the current data we have a big range as to what actually is the current backlog. Is it similar to the Asphalt Industry Alliance’s (AIA) ALARM survey. Quite similar but we want to narrow it down. So we have done more data gathering; a health check on footways and road markings. We are also working with the LCRIG and digital mapping company Gaist. The Treasury wants a definitive number,’ Mr Berry said.
He added that there was ‘consistent inconsistency’ on the issue and it was hard to define how the backlog should be measured