Memorandum submitted by The Local Government
Association
1. In the limited time allowed by the Committee
to respond to this inquiry the Association is able only to comment
on some of the broad principles set out in its questions. It is
probable that individual authorities and officer societies will
be in a position to provide more substantive evidence on some
of the more specific issues and their local impact. Our comments
follow the questions set out in the Committee's press release
as far as possible.
BACKGROUND
2. Local Transport Plans are an important
tool for local transport authorities and a considerable advance
on the previous annual bidding process underpinning the Transport
Supplementary Grant system. However, the Committee is right to
question whether the ideals espoused when the new mechanism was
introduced have been maintained by Government in its subsequent
statutory guidance and the monitoring and funding processes which
have been put in place. This process is continuing and some major
changes in the funding principles are the subject of formal consultation
at the moment. Parallel policy developments emanating from other
Government Departments, affecting local government structures,
financing, spending reviews, reporting and monitoring systems,
and several innovative transport policy initiatives, have all
impacted on the LTP process.
CAPITAL SETTLEMENT
3. Individual authorities should be in a
better position to give information about whether capital settlements
have all been spent in recent years. The Association welcomed
the additional capital allocations in recent years associated
with the local transport element of the Government's Ten Year
Plan, although this has brought with it additional concerns about
the mismatch between capital and revenue resources at local level.
Our understanding is that transport capital allocations generally
have been spent on transport projects in the period since the
implementation of the single capital pot encompassing smaller
scale schemes. Fears by transport interests within and without
local government that this would not be the case appear to have
been ill founded. The Association believes in full discretion
for local government, trusted by central Government, to deliver
its full range of duties and local policies in line with local
needs and priorities, and that Government "silo" Department's
should not attempt to micro-manage authorities' spending patterns
on a year to year basis. For this approach to be effective Government
Departments will need to work together effectively to a common
agenda.
THE FORMULAIC
APPROACH
4. The Association acknowledges that there
are advantages in having a high degree of certainty for a number
of years when it comes to the delivery of longer term policies
such as five year Local Transport Plans. There is an over-arching
problem when it comes to the implementation of new formulas in
that they almost invariably do not provide levels of funding for
each authority which align with existing spending patterns. This
means that a number of authorities will feel that they will "lose
out" even if the quantum is not increased. Where local funding
is already under pressure, as it is at the moment in a number
of authorities, any income lost from formula distribution can
have severe consequences. An example of this has been the concessionary
fares revenue distribution formula for the extension to the statutory
free local bus based scheme which commenced this month.
POWERS TO
RAISE RESOURCES
5. The Association has commissioned a major
new academic report on how local transport policies can be resourced
more effectively and this will be presented to the Association
shortly. The Association can ensure that the Committee receives
a copy of this report upon publication. It will then be subject
to an intensive discussion within the Association. We expect that
the report will build on the recent corporate work undertaken
by the Association on funding sources, as set out in policy documents
new development and new opportunities and beyond the black hole
(2005). The key message of those documents, which apply to spending
on the delivery of local transport policies as well as other council
policies, is that a sustainable and long term solution to the
funding of local government is essential and that the Government
should commit to reform the local government finance system as
soon as possible. One-off solutions must be replaced by a longer
term sustainable funding regime.
6. The Association understands that a number
of authorities will have severe difficulties in funding their
LTP programmes because the new grant distribution system affects
authorities who are on the grant "floor", so that they
will not be able to obtain financial benefit from 2006-07 supported
borrowing allocations. Consequently in LTP terms the affected
councils face the choice of assuming the entire borrowing cost
if they are to set their plans in line with the allocation or
reign back their spending on the transport network.
BALANCE BETWEEN
CAPITAL AND
REVENUE
7. The Association has referred to the imbalance
between capital and revenue funding resources in evidence to this
Committee on a number of occasions in the past. The situation
has not changed markedly, and additional statutory pressures in
related areas such as concessionary fare funding can have consequences
for the support of bus networks which may use dedicated, and probably
more expensive to maintain, infrastructure provided through LTP
capital spending programmes. The annual survey of the Association
of Transport Co-ordinating Officers (ATCO) has found that in recent
years the cost of funding subsidised bus services to meet social
inclusion objectives generally has increased each year at a rate
considerably higher than retail inflation.
WASTING RESOURCES
AT BIDDING
STAGE
8. The experiences of many of the authorities
which have been proposing light rail schemes will be relevant
in connection with this question. Repeatedly submitting revised
scheme bids at the request of central Government, only for the
entire project to be shelved, is a problem which is not restricted
just to local transport projects. Difficulties faced recently
by high profile schemes such as the Manchester Metro extensions
will be well known to the Committee.
LTP GUIDANCE AND
PROCESSES
9. The DfT has involved the Association
and the relevant officer societies in the development of statutory
and non statutory guidance related to the delivery and monitoring
of LTPs and related plans. This has proven helpful in that the
content of the guidance has not, in general, come as a complete
surprise when published. This is just as well as there has always
been difficulties in receiving guidance in time for authorities
to taken it into account when carrying out consultations and preparing
submissions locally. Additionally, there has been a tendency for
guidance, on what originally was supposed to be a relatively light
touch, local priorities approach to transport planning in comparison
with the previous TPP system, to become longer and to be published
in disjointed pieces. At the same time corporate Government policies
and external pressures have tended to be for more guidance, with
more monitoring mechanisms to be put into place to ensure that
the guidance has been followed. There is a difficult balance to
be struck between; on the one hand, the needs of the LTP writers,
who may be new to the "joined-up" nature of the LTP
approach, and who may wish to follow a clear structure, particularly
if it is to receive a score which will influence subsequent funding
levels in a significant way; and on the other hand the general
wish of local government to be trusted to deliver a range of community
policies based on local needs and priorities without undue central
Government straight-jacketing.
HOW LTPS
HAVE DELIVERED
10. There was general agreement that implementing
a completely new transport planning structure, particularly for
authorities which had relatively recently been the subject of
reorganisation, would bring with it some teething problems. Nevertheless
LTPs have, in the main delivered more joined-up transport policies,
and, insofar as the capital/revenue issue allows, led to a greater
degree of integration between hard and soft policies and other
community strategies with transport implications. Authorities
designated as excellent under the CPA process generally concluded
that Annual Progress Reports should be prepared locally notwithstanding
their relief from certain aspects of that requirement. Given that
LTPs are relatively all-encompassing and follow outline guidance
on a wide variety of possible content, it is inevitable that various
special interest groups both within the transport and in other
related fields will have monitored LTPs and APRs closely to see
if their interests have received a "fair share" of column
inches and/or spending commitment. Also, there is a constant pressure
for additional duties and targets to be added to LTP content and
delivery, such as the questioning this month from the Commons
Environment Audit Committee about whether climate change should
have been given or be given greater emphasis, for very good external
reasons. The Association's agreement with Government is to reduce
the burden of reporting duties placed on local authorities, so
any additional requirement to monitor delivery of an existing
or new element of LTPs will need to be matched by the removal
of at least one existing requirement.
LTP PERFORMANCE MANAGEMENT
REGIME
11. As already mentioned there is a constant
pressure to add to reporting, monitoring, marking and league tabling
for various reasons, both political and financial. These pressures
have been felt in the field of LTP production. Performance monitoring
is particularly difficult to undertake fairly where content of
individual plans can vary so greatly because of geographical and
other reasons. For example the delivery of one large infrastructure
project over several years will have to be monitored in a different
way to the delivery of a continuous programme of small improvements
each year, and which will have very different local outcomes.
The Association is pleased that the APR process is to be simplified
in the second round of LTPs in line with the agreement to reduce
burdens.
April 2006
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