Local Government Finance (England) Special Grant Report (No. 116) (HC494) Maintenance of Roads Grant 2003-04

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First Standing Committee on Delegated Legislation

Wednesday 26 March 2003

[Mrs. Marion Roe in the Chair]

Local Government Finance (England) Special Grant Report (No. 116) (HC 494) Maintenance of Roads Grant 2003–04

2.30 pm

The Parliamentary Under-Secretary of State for Transport (Mr. David Jamieson): I beg to move,

That the Committee has considered the Local Government Finance (England) Special Grant Report (No. 116) (HC 494) Maintenance of Roads Grant 2003–04.

It is a considerable pleasure to sit under your watchful eye this afternoon, Mrs. Roe. I think that it is the first time that I have addressed a Committee under your careful chairmanship and I look forward to many other such happy occasions in future.

This is the third report on this subject to be considered by the House of Commons. Special Grant Report No. 83 was approved on 17 July 2001 and Special Grant Report No. 98 was approved on 24 April 2002. This report will enable the payment of grant to local authorities in relation to the extra costs that they will incur for the routine maintenance of roads in 2003–04 under our programme of transferring non-core trunk roads to local highway authorities. It provides for continued payment of grant for roads that were detrunked in the financial years 2001–02 and 2002–03 and for the payment of grant for roads to be detrunked in 2003–04. It provides only the revenue funding for detrunking; orders to implement the transfer of the roads will be dealt with separately.

I direct the Committee's attention to annexe A of the report, on the reason for the special grant, annexe B, on the authorities to which grant is to be paid and annexe C, on the conditions attached to the grant.

Mr. Tim Collins (Westmorland and Lonsdale): As the Minister has just mentioned annexe A, he will recall that its first sentence refers to the two documents published by the Government in July 1998, the White Paper ''A New Deal for Transport'' and the report ''A New Deal for Trunk Roads''. Can we therefore take it that those documents remain Government policy?

Mr. Jamieson: In so far as they relate to this report, yes. Otherwise, we would not be discussing it today.

The methodology for calculating the amount of grant was agreed with the Local Government Association and is explained in paragraph 1 of annexe B. Table 1 of annexe B shows the grant that authorities will receive for roads that were detrunked in 2001–02 and 2002–03 and table 2 shows the maximum grant that authorities will receive for roads to be detrunked in 2003–04. I say that that is the maximum amount because the actual grant that authorities will receive under table 2 will depend on the date of detrunking and, if appropriate, the length of road detrunked, should that be less than the length

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originally proposed for any reason. That is specified in paragraph 4 of annexe B.

In response to comments made in Committee last year, we have been more specific in tables 1 and 2 of the report in descriptions of roads that have been detrunked and are to be detrunked. If all the roads shown in table 2 are detrunked in 2003–04, we shall be a long way towards completing our detrunking programme. It was confirmed in April 1999 that about 3,200 km would be detrunked, about 30 per cent. of the then trunk road network. About 450 km were detrunked during 2001–02 and just over 1,100 km in 2002–03.

Mr. Richard Bacon (South Norfolk): I was not going to intervene until detrunking in my constituency was mentioned, but the Minister has just referred to distances in kilometres. Later this afternoon I shall attend a hearing to examine a National Audit Office report on national weights and measures. That report states that very few of the old imperial or metric measures will be used in future, but two that will remain are pints—for beer—and miles. Why is the Minister referring to kilometres?

Mr. Jamieson: Because that is the unit used in the legislation. Like the hon. Gentleman, I have a fondness for the mile. Sometimes I have difficulty imagining what a kilometre is, but we have to use the terminology and the figures that are referred to in the legislation.

Mr. Bacon: Why are kilometres referred to in the legislation?

Mr. Jamieson: Probably because the Department made that reference.

I have referred to half of the programme. We plan to detrunk another 1,050 km during 2003–04, 300 km during 2004–05, and most of the remainder in 2005–06. We intend to complete the programme by 1 April 2006. The aim of detrunking is that roads of less strategic importance should be managed as part of the local road network. It enables decisions on detrunked roads to be taken with the knowledge of the role that the road plays in the economic and social well-being of the local area rather than having priorities determined by Whitehall, where national strategic factors always remain uppermost in determining investment decisions.

The factors taken into account in identifying the core network of trunk roads that would remain the responsibility of central Government and therefore be operated by the Highways Agency were whether the routes were linked to the main centres of population gave access to major ports, airports and rail terminals; gave access to peripheral regions; provided key cross-border routes to Scotland and Wales; or were classified as part of the trans-European road network.

The Government gave a guarantee that detrunking would be accompanied by a fair transfer of resources. That is achieved in this report. The Highways Agency negotiated the amounts of grant. My Department has confirmed the acceptability of the amounts offered with all the receiving authorities.

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We had hoped that it would be possible to incorporate the roads already detrunked into the new highways maintenance FSS formula. This new formula for highway maintenance within the formula spending share system is the responsibility of the Office of the Deputy Prime Minister. A wide-ranging consultation on the grant system was carried out by the ODPM last summer and the Government's conclusions were announced by my right hon. Friend the Minister for Local Government and the Regions on 5 December 2002 in the form of the provisional local government finance settlement. The Local Government Finance Report (England) 2003–04 was laid in the House of Commons on 3 February and approved on 5 February.

Mr. Collins: The Minister used wording that may not have been carefully chosen. He said that his Department had confirmed the acceptability of the amounts concerned with each of the relevant local authorities. Is that the same as obtaining agreement from each local authority that it regards the sums as adequate, and does he envisage that under the new funding formula each local authority will receive the equivalent in real terms for each of these roads?

Mr. Jamieson: I always choose my words carefully. The amounts in the order have been negotiated and agreed between the Highways Agency and the highways authorities. What will appear in the new FSS will be a matter for the ODPM and discussions are yet to take place. It is a sensitive matter and we are anxious that it should be devolved to local authorities, but we have to do that in a way that is fair to the local authorities. That is why we have not yet found a remit; more work needs to be done to ensure that it is fair to the authorities. We are passing a responsibility to local authorities and it is my Department's ambition that they are properly funded to carry out the work.

Mrs. Claire Curtis-Thomas (Crosby): On that very point, I note that my authority, Sefton Metropolitan, is to receive more than £500,000 to undertake the management of Liverpool city boundary junction with Coastal road, Liverpool road and Moor lane east of Woodvale. That stretch of road passes through my constituency. I have to tell the Minister, much to my delight, that it has recently been refurbished. Therefore, on what is the £571,749 to be spent? May I have the Minister's assurance that it will be on that stretch of road and for no other purpose?

Mr. Jamieson: I am pleased that my hon. Friend confirmed that the Highways Agency has kept the road in good condition. That is certainly the case for most of the roads for which it has responsibility. I am glad we agree on that. That is the good news.

Mrs. Curtis-Thomas: What is the bad news?

Mr. Jamieson: There is no bad news.

I was about to tell my hon. Friend of the even better news, which is that the amount of money to be transferred to her authority, agreed by the Highways Agency and the local highways authority, would be the revenue cost of maintaining that stretch of road. That money will go into the local authority's highways pot, which itself will go into the authority's general spending pot. It is for the authority to use its best

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judgment on how that money is spent. That sum of money does not necessarily need to be spent every year on every road, but over a period we should see an equivalent amount of money being spent on maintaining the roads.

I would like to think that Members and local councillors would be anxious to ensure, through the normal democratic processes, that the authorities were spending the money given them by the Highways Agency to maintain roads to the high standards that should be expected.

Mrs. Curtis-Thomas: On a point of clarification, did the Minister say that it is a sum of money per year for maintenance associated with the road?

Mr. Jamieson: Yes. The amounts in the table are annual amounts, and they will be uprated by 2.5 per cent. to take account of inflation. My hon. Friend seems very pleased.

Mrs. Curtis-Thomas: I am.

Mr. Jamieson: I am glad to hear it. Perhaps she will contact her local authority to ensure that the money is actually spent on the road in question. It is not simply a matter of allowing the authority to take the money. It has to meet best-value performance figures and other indicators and targets for road maintenance, but I am sure that those who have been elected locally will be extremely diligent in ensuring that the matter is followed through.

My Department and the ODPM considered whether to incorporate detrunked roads into the new highways maintenance formula in time for 2003–04, but to do so would have caused significant turbulence to the system. It remains the Government's policy that detrunked roads will eventually be incorporated into the FSS framework. Special grant is a transitional distribution method, and the integration of funding mechanisms is a desirable ambition.

My Department is in discussion with the ODPM on the arrangements that need to be made to achieve that incorporation without causing undesirable effects. In those discussions, our aim will be to minimise any adverse distributional consequences for local authorities that currently receive funding for detrunked roads via the special grant. I know that it is their wish so to do. It would in any event have been necessary to continue to provide special grant for roads to be detrunked in 2003–04, as the data for those roads could not have been incorporated into the FSS system until after they had been detrunked.

 

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Prepared 26 March 2003