Transport Insights

The transport stories you won't see in the industry-friendly media

Author

Chris Ames

Tag: funding

  • No surprise! Reeves pulls pothole cash out of the hat

    Ministers have announced £7.3bn capital funding for local highway maintenance in England between 2026-27 and 2029-30, keeping the £500m annual “uplift” , now badged as “incentive funding”, with councils required to jump through as yet undefined hoops to get three quarters of the extra cash.

    As I reported, the Budget deliberately held back details of this cash to allow a new announcement, stating at the time only that there would be “over £2 billion” in 2029-30.

    The cash will gradually ramp up, from £1,617m next year to £2,134m with the largest increase around a quarter of a billion pounds coming in the final year.

    The Department for Transport (DfT) said that “as the case in 2025 to 2026, a portion of this funding will be designated as incentive funding”. This ranges from £525m next year to £540m.

    This funding will be subject to local highway authorities demonstrating that they comply with best practice in highways maintenance, for example, by spending all the Department for Transport’s capital grant on highways maintenance and adopting more preventative maintenance.

    The DfT said that at least 25% of the extra cash will be dependent on local highway authorities publishing transparency reports. Rather confusingly, it said all incentive funding will be withheld if reports are not published. 

    The DfT said that in 2026-27, (a further) 50% of the incentive funding will be subject to local highways authorities’ performance.

    Of course they don’t know how it will work yet:

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  • No pledge of more cash as climate change wrecks rail routes

    I’ve previously raised the question about whether the government is putting sufficient cash into our transport networks to fund climate change adaption, with ministers often just saying they are putting in more money rather than asserting that it’s enough.

    But a new written parliamentary answer from transport minister Keir Mather doesn’t even bother to address the question of whether there will be more money.

    Asked by Sarah Dyke, Liberal Democrat MP for Glastonbury and Somerton:

    To ask the Secretary of State for Transport, if she will provide additional funding to help mitigate ongoing soil moisture deficit effects for railway companies.

    Mather gave a long and rambling reply on behalf of Heidi Alexander that began with a description of the problem…

    The Department for Transport funds Network Rail to operate, maintain, and develop the nation’s railway infrastructure. As the climate changes, we expect to see hotter, drier summers, and therefore we will expect to encounter more instances of soil moisture deficit.

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  • Labour repents over pothole pledge repeat

    The Treasury has insisted that the Labour government remains committed to fixing an extra million potholes across England in each year of the Parliament, despite some very contradictory language in yesterday’s Budget document.

    And it looks as if funding for local authority highway maintenance may be restored to this year’s level to do this, with a funding announcement deliberately held back to get new headlines.

    Yesterday I noted that the Treasury’s official Budget document had redefined Labour’s manifesto commitment as “to fix an additional 1 million potholes per year by the end of the Parliament”, rather than every year along the way

    However, a Treasury spokesperson has told me that the “every year” commitment remains intact.

    I also noted, correctly, that none of the Budget documents had stated what funding would be for the years between now and 2029-30, when the commitment is over £2bn annually.

    This year’s funding is around £1.6bn, which is said to include an “uplift” of £500m on base funding of £500m.

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  • Labour postpones pothole pledge

    It looks as if Rachel Reeves has dropped the £500m “uplift” for local road maintenance (in England) and Labour appears to have ditched its manifesto pledge to “additional one million potholes across England in each year of the next parliament”.

    Here is what Labour’s manifesto said:

    We will fix an additional one million potholes across England in each year of the next parliament

    Here is what the Budget document says:

    By 2029-30, the government will commit over £2 billion annually for local authorities to repair, renew and fix potholes on their roads – doubling funding since coming into office. This record level of funding will enable the government to exceed its manifesto commitment to fix an additional 1 million potholes per year by the end of the Parliament.

    So the extra million potholes a year have been put back from every year of the Parliament to the last year of the Parliament, i.e. 2029-30.

    Despite promises of long-term funding settlements, the Budget document does not appear to give a total funding figure for 2026-27 or any year between now and 2029-30.

    And the extra £500m that went into 2025-26 allocations with great fanfare in last year’s Budget is not trumpeted today, suggesting that it has gone.

    The “doubling” claim  is dubious as it does not take five years’ worth of inflation into account but concentration on 2029-30 suggests that the next few years will be bleak.

    The Budget document also states:

    The implementation of eVED will provide revenues for this new higher level of roads maintenance funding to be continued for the long term.

    The focus on what happens at the end of the parliament reliance on eVED, which begins in 2028, again supports the idea that money will be tight in the meantime.

    The Department for Transport’s Capital Departmental Expenditure Limit (DEL) wobbles around for the next four years from about £23bn to a bit over £24bn but it’s impossible within that to pick out highway maintenance funding.

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  • Alexander gives mixed messages on resilience cash

    The transport secretary has declined to say that she is confident that Network Rail has the funds to keep the railway safe as landslips hit the rail and road networks, driven by climate change.

    Appearing before the Transport Committee, Heidi Alexander was asked by Rebecca Smith, Conservative MP for South West Devon, if she was

    confident that Network Rail has the resources to safely maintain the railway network during this control period.

    Her reply emphasized that spending has gone up, which it has, rather than answering what is the real question:

    We are spending more money in Control Period 7 on activities to address improving resilience connected to weather and climate change. So climate change adaptation, I guess, is the phrase that I’m searching for. So in Control Period 7, we’re spending 2.6 billion, which is significantly more than we were spending in Control Period 6. So I think it’s right that the Network Rail are doing that because they are very alive to the challenges that changing weather patterns have for the rail network.

    Smith had referenced a recent incident in Cumbria, i.e. the derailment of a train caused by a landslip onto the track. The Rail Accident Investigation Branch has said its preliminary examination found that a drainage channel running across the slope above the washed-out material, was unable to accommodate the volume of water present, saturating the material and initiating the landslip.

    But, as this BBC report points out in a detailed piece that looks at the wider issue, that was followed by a landslip affecting the A592 in the region, which Westmorland and Furness Council said could be closed for months. After Storm Desmond in 2015, the nearby A591 was blocked by landslips that both blocked the road and washed its base away.

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  • Going underground?

    The process of getting the £10bn Lower Thames Crossing under the ground is rumbling on without any sense of urgency, almost as though the government doesn’t want to do it, but can’t admit it.

    The story so far is that Labour has said that the clearly unaffordable project is to be paid for on the never never, sorry privately, and has granted a development consent order.

    The next step was apparently the submission of a full business case (FBC) for the scheme, in order for funding to be released. Well, two lots of funding have been released but there is no sign of an FBC.

    The Department for Transport (DfT) is hoping to work some magic on the FBC to improve the benefit cost ratio (BCR).

    According to the (hopelessly out of date) accounting officer assessment, the last investment decision point was the 2020 outline business case and the BCR currently gives low vfm at 1.46 and is expected to fall further following “the recent lowering of the future economic forecasts for the UK economy and the consequent fall in value of journey time savings”.

    But at FBC, there is an expectation that key strategic benefits not reflected in the BCR will be quantified.

    Is the government hiding the FBC or still trying to make the numbers look better, as it claims to be doing with smart motorway evaluations?

    In the meantime, the DfT is trying to get people in to help it progress the private financing model.

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  • We have cash to tackle toxic runoff, National Highways boss says

    The government is providing “substantial capital funds” for a programme to tackle toxic runoff from its network, a top National Highways official has said.

    The comment from Ivan Le Fevre, the company’s head of environment strategy and standards, follows a recent publication that identified “182 confirmed high priority locations where outfalls or soakaways present a high-risk of pollution”, with an expectation that a total of 250 would be mitigated by 2030.

    Le Fevre has published on LinkedIn a blog that he wrote in September “primarily for an internal company audience”. He wrote:

    Government is providing substantial capital funds, through to 2031, to deliver a programme of improvement – and expects to see efficient and effective results that dramatically reduces the level of pollution risk and provides value for money for the taxpayer. Getting this programme right disproportionately matters to the company’s reputation over the next five years.

    To illustrate the importance of the issue he referenced two hearings held by the Environmental Audit Committee.

    At one of these, at the beginning of September, National Highways chief executive Nick Harris said the company was “proceeding on the basis that we will be funded to do all 250” sites.

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  • Rail electrification shelved, Alexander confirms

    The transport secretary has confirmed that Labour has no plans for further electrification of the rail network, for affordability reasons, once again giving the lie to the rail minister’s claim that the government is giving rail funding it needs.

    The FT (paywall) reports Heidi Alexander as telling the Rail Industry Association summit that any further electrification is “not affordable right now” and that the government is “only supporting projects that are fully costed and affordable”.

    She said:

    We are keeping further electrification of the line under review, which I believe is the responsible thing to do.

    Alexander also said this had “allowed us to make commitments elsewhere,” the FT reported.

    It’s not clear whether her comments go further than what she said in July when claiming that the government was “greenlighting over 50 rail and road projects”.

    She told MPs in relation to the midland main line electrification scheme phase 3:

    The costs of the scheme were substantial, and we had to prioritise other schemes that deliver more tangible benefits to passengers sooner. However, we will keep the electrification scheme under review as part of our pipeline of projects for future funding.

    But because of ministers’ double speak where “under review” appears to mean shelved and “greenlighting” to mean not shelved, it seems to have been clear for some time that Labour has shelved electrification to spend money on other things.

    But what is clear is that Labour is not “backing rail with the funding needed”, as rail minister Lord Peter Hendy claimed.

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  • Councillors want half a billion thrown at poor value scheme

    Councillors in Northumberland are continuing to call on ministers to reinstate a National Highways scheme to dual a section of the A1 that Labour publicly scrapped last year and which was secretly shelved four years ago as poor value for money.

    National Highways had wasted £68m on the scheme by the time it was finally cancelled, with overall scheme costs expected to reach £500m.

    As I have written – at great length – the Tories secretly shelved the scheme following the 2021 Spending Review but ministers, National Highways and the Office of Rail and Road conspired to hide this fact from Parliament and the public.

    But the BBC reports this week that:

    Councillors have made renewed calls to reverse a government decision to widen a “dangerous” single carriageway main road.

    Liberal Democrat councillor Isabel Hunter said the road needed to be dualled as it was getting shut on an “almost a weekly basis” due to accidents.

    Hunter said: “We’re not particularly bothered which party does it, we just want the road dualled.”

    Conservative council leader Glen Sanderson said it was a “fundamental need” to have a “strong spine” between Northumberland and Scotland.

    “The fact that we don’t have that, the fact that we have a dangerous road… and the fact that it has cost people their lives makes it an appalling decision,” he said.

    “The A1 must be dualled, there’s no question about it.”

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  • Official: Lightwood got it wrong with Ely “closed” claim

    The Department for Transport (DfT) has rowed back on an apparently false claim from a minister that the previous government “closed” the Ely Area Capacity Enhancements rail scheme.

    As I noted last week, roads minister Simon Lightwood stated in a written parliamentary answer that:

    The Ely Area Capacity scheme was closed by the previous government…

    This was inconsistent with what has been said elsewhere, including by Lightwood, and Network Rail considers the scheme to be awaiting a funding decision.

    I asked the DfT to clarify Lightwood’s claim that the scheme had been “closed”.

    It did not do so. Instead, a spokesperson told me:

    We recognise the importance of the Ely Junction scheme, and we fully anticipate it will be part of a pipeline of projects to be considered as part of future funding decisions.

    There is a strong case for Ely Junction, and we are committed to working with a broad range of stakeholders to support its inclusion in the future pipeline.

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