Transport and the economy
Memorandum from Hampshire County Council.
1. Hampshire County Council is working hard to maintaining a thriving Hampshire with strong economic growth. As a local authority responsible for the transport network it is clear to us that a strong and effective transport system helps to support economic growth within Hampshire, through the provision of a well-maintained and well-managed transport network (which functions as the arteries of the County for movement of people and goods), by connecting employment centres to labour markets. Therefore we consider this Inquiry to be both important and timely.
Have the UK's economic conditions materially changed since the Eddington Transport Study and, if so, does this affect the relationship between transport spending and UK economic growth?
2. Despite the economic downturn the County Council believes that the key principles and issues that underpinned the Eddington Transport Study still hold firm. There remains a need to accommodate growth in the future and the County Council remains committed to supporting and developing transport infrastructure that encourages growth, as local solutions are essential if sustained economic growth is to be achieved.
3. To maintain national economic competitiveness in global terms, a strong economy in the South East remains pivotal to achieve this for the whole country. It is vital that the South East is not starved of investment in transport, as this will have negative impacts and implications upon the economy across the whole country.
4. Priority needs to given to maintaining investment in the highway and transport asset to ensure a safe, well-maintained and managed network, that is resilient to extreme climate and traffic-related events and supports the reliable movement of people and goods.
5. Within Hampshire there remains a need to provide a well-connected transport network that links employment and business centres with labour markets and that ensures reliable access to and from international gateway ports and airports.
6. The economic downturn has resulted in a fall in traffic volumes on both strategic and local roads. The extent to which this has been experienced differs across the County. The fall in traffic volume has resulted in improvements in journey times, with congestion decreasing. Nevertheless it is important that efforts in this area do not diminish and that the likely temporary fall in congestion does not provide the false hope that congestion on our roads will not get worse.
What type of transport spending should be prioritised, in the context of an overall spending reduction, in order best to support regional and national economic growth?
7. It is clear that the dominant feature of the transport landscape over the next few years will be the substantial reductions in available funding from all sources, especially for capital schemes traditionally funded by central Government. In the short term it is perhaps inevitable that essential tasks such as highway maintenance will consume a higher proportion of available funding. However, if capital funding is constrained too much the effects of significant reductions will be felt for many years as the system catches up with what is likely to be years of national under investment.
8. Therefore whilst revenue funding will probably need to take up the greater balance of revenue and capital expenditure in the short term, capital expenditure must not be reduced too much.
9. The importance of maintenance has recently been emphasised by the severe weather during the 2009-10 winter, which had a devastating effect on the condition of Hampshire’s roads and created a significant problem in terms of highway maintenance. As well as routine repairs to the network, there is a need to deliver greater climate resilience (to flooding and heat as well as winter conditions) on the County’s roads. The importance of highway maintenance is consistently reinforced by customer surveys. The County Council has recognised that this has to be addressed; and hence has determined that maintaining the highway asset must be the single highest priority.
10. However it is vital that existing transport network are effectively managed, by minimising unnecessary congestion and works to continue to improve its efficiency of operation. In particular there is a need to offer more certainty and predictability about journey times, which can otherwise have a significant cost to the economy.
11. It is also important to tackle transport challenges through investment across a range of policy areas. For example, the emerging Partnership for Urban South Hampshire (PUSH) draft Economic Development Strategy has identified a number of sectors that are highly specialised in the South of Hampshire and offer opportunities to attract further growth and investment (Advanced Manufacturing, Aerospace, Marine, Financial and Business services, creative, transport and logistics, and environment technologies). A focus on developing the skills required to support these growth sectors and existing sectors through the education system could – in time – ease transport challenges such as congestion and air quality by reducing the need to import labour.
How should the balance between revenue and capital expenditure be altered?
12. The financial constraints in the short to medium term will necessitate a shift away from the delivery of major new transport infrastructure, such as new road schemes, in favour of maintenance and better management and use of the existing transport network. To achieve this, maximising levels of revenue funding will be of paramount importance.
13. Traditionally Government funding initiatives have been primarily capital funding. However, It is hoped that proposed new initiatives such as the Regional Growth Fund or Local Sustainable Transport Fund, whilst offering potential to deliver measures which require capital investment, will also be able to provide a revenue funding stream. This is essential to help ensure comprehensive and effective local strategies are developed, since significant revenue funding will be integral to their success.
Are the current methods for assessing proposed transport schemes satisfactory?
14. Local scheme prioritisation and assessment is rightly carried out at a local level by individual transport authorities and this approach should be maintained. The County Council is able to provide clarity about what it takes into account when formulating a prioritised list of schemes for inclusion within the Local Transport Plan and capital programme. The "Big Society/ localism and decentralisation agendas encourage decisions to be taken at a local level, and in a clear, transparent way. This can be met by the County Council’s approach to prioritisation of schemes.
15. There is currently a lack of clarity as to what will replace the Regional Funding Allocation system, for investment priorities for the South East region, especially with the suspension of non-contracted expenditure, pending the conclusion of the Comprehensive Spending Review.
16. Existing sub-regional partnerships can have a key role in bringing together potentially fragmented funding from the private sector. The County Council can work with a wide range of private sector organisations, for example via Hampshire Economic Partnership, or potentially the proposed Local Enterprise Partnerships, to consider priorities.
How will schemes be planned in the absence of regional bodies and following the revocation and abolition of regional spatial strategies?
17. With the removal of the regional tier of government and the revocation of the South East Plan, upper tier authorities are in a position to take on an increasing role and responsibilities in sub-national planning.
18. As highlighted in the evidence recently submitted to Select Committee Inquiry into the Abolition of Regional Strategies, Hampshire County Council’s view is that the county level is the most appropriate scale at which to undertake strategic planning, that planning at regional level by unelected bodies does not reflect the aspirations of local communities and does not deliver on the ground. The County Council therefore welcomes the abolition of Regional Strategies but does believe there is a need for a level of strategic planning between the national and local level. County and unitary councils are in the ideal position to take on this role and we would urge the Committee to include a recommendation of this sort in its report to Parliament.
19. Greater business involvement in shaping the development strategies for an area is to be welcomed and there is also clearly potential for Local Enterprise Partnerships (LEPs) to have a role in scheme planning and to work with transport providers to deliver new infrastructure. However the County Council has reservations about LEPs being directly given any planning functions, at least until there is greater clarity on the way LEPs are to be developed and will operate in practise.
20. LEPs could usefully identify the planning approach which they feel is needed to maximise economic growth and could champion this during the formulation of planning documents. However, the local authority should remain the accountable body, with decisions on which planning policies to adopt, resting with elected local councillors who need to take account of other considerations (environmental constraints, public opinion etc.) in reaching planning decisions.
September 2010
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