Local Government Finance (England) Special Grant Report (No. 98) On Maintenance of Roads Grant 2002-03

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Mr. Clifton-Brown: I have a number of questions for the Minister on the statutory instrument, which we

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regard as non-contentious. We will not seek to divide the Committee, although others may seek to do so.

The Minister said that there has been considerable consultation on the order and that, under the White Paper, ''A New Deal for Transport: Better for Everyone'', 30 per cent. of the existing trunk road network should be detrunked. He said that, under the order that some of us considered last year, 440 km have already been detrunked and that this order detrunks a further 1,300 km. Will he say how many orders of this kind there will be, give the total amount of road that is to be detrunked and say over what period of time that is to take place?

What consideration was given to which roads should be detrunked, and have they all been agreed yet? Are there still a lot of roads to be discussed with local authorities? Cumbria, for example, has remarked that the distinction between trunk roads and other roads in the primary route network—PRN—is not apparent to the general road user. The common feature of both types of road is the use of green-backed signs. However, there is a fear that detrunking a route could be perceived as removing it from the premier road network, which could, consequently, demote the status of the area that the road serves. Clearly, that is not just the Opposition's concern. Cumbria—a serious local authority—relies on tourism in no small measure, and has had real problems from the foot and mouth crisis, followed by the events of 11 September. If it is concerned about the matter, I should be grateful for the Minister's reaction to it.

I should like to turn the Minister's attention to his comment that the funding mechanism will last as long as the present standard spending assessment system lasts and that thereafter it will be reviewed and included in the new system. As he said in his opening remarks, that will be done by special grant. The more that each individual budget is prescribed, the less discretion a local authority has. I cannot quite understand why we have to have the huge bureaucratic mechanism outlined in annexe C, conditions 4 and 5. That says that the local authority has to provide a certificate from the Audit Commission to say that the money has actually been spent on that particular road and that the

    ''authority shall supply to the Secretary of State such information as may be required by him for the purposes of determining whether it has complied with these conditions.''

That seems to me to be a hugely bureaucratic and unnecessary system for trying to ensure that the detrunked roads actually have the money spent on them.

If the current system allows discretion for local authorities not only to decide which money and how much money to spend on each road but to vire their budget between different local authority departmental budgets, such as between social services and highways and between highways and schools, why are the Government not giving them discretion over whether they spend this money on trunk roads or on what they might consider to be a much greater priority? How much will all the bureaucracy in annexe C cost? If one is giving money to local authorities, one should give it

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in full measure, not have it taken away by unnecessary bureaucracy.

I am concerned about how the individual sums in annexe B have been arrived at. I know that there has been consultation with local authorities, but has that been full and fair? Has a proper survey been done of each road so that local authorities know precisely what condition a road is in when it is handed over? Has a schedule of maintenance works and capital works been agreed with local authorities? Has a cost for those works been agreed with them? Cumbria county council points out that many of the roads that are being handed over have unsatisfactory alignments, widths and junction layouts.

One must look at whether sufficient money is being handed over. Gloucestershire is already one of the lowest funded authorities in the country. Part of the A38 there is being handed over, although the order does not tell us how much of it. The money in that case is £10,763, which does not seem very much; unless we are talking about mere yards of road being handed over, I would not have thought that that goes very far. It would be wholly unsatisfactory to hand over a road to such an authority, as I am sure the Minister would agree, if the money was not satisfactory for annual maintenance and future capital projects, because it would then have even less money to spend on the rest of its road network. I would be grateful for an assurance from the Minister that that will not happen.

I should also be grateful if the Minister assured us that if a previously agreed amount subsequently proves not to be adequate, either for maintenance or because a new capital project is agreed with the Highways Agency and the local authority, the amount can be adjusted up or down so that such projects can be properly funded. The Government might gain from that, if the initial amount were excessive.

It is no good the Minister just saying, as his predecessor did in the previous Committee, ''Ah, that will be part of the annual settlement negotiations.'' We have too much of a habit in this House of giving additional responsibilities to local authorities without adequately funding them. If this is the latest in the long line of such responsibilities being given to local authorities without adequate funding, the Committee should oppose the order. We cannot go on in that way. That has a worse effect on the lower-funded rural authorities than on the higher-funded metropolitan authorities and one sees, if one looks down the list, that it is largely rural authorities that will have to take responsibilities under the order.

I should like to return to annexe C and ask the Minister about condition 1. It says:

    ''No grant will be paid to an authority in respect of a length of road listed for that authority in Table 2 in Annex B to this report unless that authority becomes responsible for maintaining the length of road pursuant to a de-trunking order on or after 1 April 2002 and before 1 April 2003.''

The order was laid on 10 April. Have any of the roads already been transferred, or will they all be transferred from now on, assuming that the Committee approves the order? It seems totally wrong that we could be discussing the order this afternoon if there were any possibility that the Minister had already used its

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powers—he may have done so—to transfer the roads without proper discussion in the Committee.

Condition 2 says:

    ''Any grant payable to an authority in accordance with this report shall only be used by the authority for the purposes of expenditure on routine maintenance of roads for which the authority is the highway authority (including, but not limited to, the road or roads de-trunked in 2001/02 and 2002/3).''

For how long will that condition apply? There must come a point at which the local authority—for example, in five years' time—will be allowed discretion. I am sure that the Government will do that anyway. If the Minister answers that the amount of money will be subject to the annual negotiation, it must make sense for the money to come into one of the budgetary pots, so that the local authority then has discretion over how to spend it. I should be grateful if the Minister told us at what point the hugely bureaucratic procedure that I have described, and condition 2, will cease to have effect and the money for the trunk roads will go into the general roads budget, for which the local authority is responsible.

Condition 3 in annexe C says:

    ''Grant will be paid to an authority within 8 weeks after the authority becomes responsible for maintaining the length of road in question, pursuant to a de-trunking order, or within 8 weeks of Parliamentary approval of this Report if later.''

Does that mean that all the roads mentioned in the report will be handed over to local authorities within eight weeks? I suspect that it does not. In which case, can the Minister confirm whether all of those roads and the amounts have been agreed to by all the local authorities concerned? That is an important question. Can he also confirm, in light of his experience, whether the roads that were addressed in an order last year have been handed over, and whether the amounts that were calculated proved to be correct? If not, that does not bode well for this order.

Some of those questions are technical, so I do not expect the Minister to be able to answer all of them today. However, I should be grateful were he to write to the Committee and place a copy of the letter in the Library. Everything would then on the record in case there were any future problems with the order.

I appreciate your courtesy, Mr. Benton, in allowing me to speak, and I appreciate the Minister's courtesy in introducing the order. I assure him that even if I had been officially a member of the Committee, we would not have wanted to divide.

4.55 pm

Mr. Foster: I am delighted to serve under your chairmanship, Mr. Benton. I hope to be relatively brief.

Although departmental structure following the general election means that the DTLR no longer has responsibility for environmental issues, I am delighted that it has continued to take an interest in recycling. As I have done on previous Committees, I congratulate the Minister on using a well-worn speech, but I particularly congratulate him on making some subtle changes to it.

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The Minister referred to the motorway and trunk road network. If he refers to his notes, he will see that he mentioned the figure 10,500 km for the year since April 1999. Interestingly, his colleague, the Under-Secretary, told us that the figure was 10,000 km for the same year. I am amazed that the Government managed to find another 500 km of motorway and trunk road network.

Be that as it may, I fully understand today's order. I have no major criticism of the order, and like the hon. Member for Cotswold (Mr. Clifton-Brown), I shall not seek to divide the Committee. I shall just ask some questions about this year's procedure, and the Minister's thoughts for the future.

The hon. Member for Cotswold asked why there was so much bureaucracy associated with annexe C. However, that makes sense if it occurs over a short period. Last year, the Under-Secretary of State, the hon. Member for Southampton, Test, made it clear that the measure would be transitional until the new local government funding arrangement were in place. Will the Minister confirm that he expects this to be the last time that such an order comes before the House, and that future arrangements for detrunking along these lines will become part of the broader local government finance settlement?

I shall pick up another point made by the hon. Member for Cotswold by asking the Minister to confirm that when that happens, local authorities will have absolute freedom over how the money that enters through that route is spent; on highways maintenance, education or whatever. I should be grateful for the Minister's clarification.

The Minister is right to say that there has been consultation with the Local Government Association, but does he agree that worry still exists over the mechanism for calculating the amount of money for detrunking that will be transferred from central Government to local government? The hon. Member for Cotswold rightly pointed out that the method of calculation is based on an average, which, annexe B clearly states, is based on surveys that were carried out in several parts of the country; the south-west, East Anglia and Lancashire. Those places were considered to give a good cross-section of geographic and climatological conditions. However, a basic unit rate per kilometre does not take into account widely varying circumstances in different parts of the country and, therefore, is a crude mechanism.

Will the Minister confirm not that he intends to change the arrangements—I understand that they may well form part of the wider thinking of the financial review that will take place—but that none of the detrunkings will go ahead unless the local authority concerned has specifically agreed to the sum of money that is to be passed over? I believe I am right in thinking that. It is not just a case of agreeing an average. The local authorities have the discretion to say that they are not prepared to take on the arrangement.

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