Five million a day sees Highways England spending in rude health

Jon Masters
26 July 2017

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Highways England is now two years old and two years into delivery of the first five-year roads investment strategy. Jon Masters reviews the progress.

It’s the end of June 2017, at the time of writing, and Highways England chief executive Jim O’Sullivan is reflecting on progress, two years in. That is, progression of the organisation as a whole, as well as delivery of the circa £12bn, five year Roads Investment Strategy (RIS).

Highways England (HE) is now two years old as a government-owned company, with a five-year regulated spending settlement and regime of key performance indicators.

To that RIS total is added another £4.4bn for operating and maintaining the strategic road network from 2015/16 to 2019/20. The KPi targets the HE is working to include scores for safety and user satisfaction, among other things. So for a two-year status report, how’s the HE doing? 

“We’re doing very well. The move from the regime of our predecessor the Highways Agency, a delivery arm of the Department for Transport, to being Highways England Ltd, has been a huge success. Our business case and economic case analysis are now seen as industry best practice. And our safety performance improvement has been dramatic,” O’Sullivan says.

Safety performance improving

The reportable injury rate of the HE’s traffic officers has halved over the past two years. On its project sites, where around 22,000 people are working every day, a performance problem has been reversed, O’Sullivan says.

“Our contractors were telling us that their accident and injury rates were higher on HE sites than all of their other activities. Now they’re reporting that safety performance in roads is better than other sectors.” This has been achieved purely by becoming a more demanding client, he says.

"Our business case and economic case analysis are now seen as industry best practice. And our safety performance improvement has been dramatic."
Jim O'Sullivan, Highways England chief executive

The third area of safety, that of road users, is the more difficult to influence. On this, O’Sullivan claims HE to be making great improvements, but according to DfT’s statistics, numbers killed or seriously injured on Britain’s roads have remained largely unchanged, fluctuating marginally since 2011.

The HE faces a tough challenge to hit its target of cutting KSI figures by 40% by 2020, but, O’Sullivan says: “Our responsibility is just the motorway and major A-road networks.

We were given an additional £220m to focus on congestion and safety hazards in the last government spending review. We reckon that by implementing simple changes – better signs and wider sliproads etc – we can save 150 lives over three years.”

Major projects update

On major road upgrade schemes, the HE has now completed 12. About 120 lane miles have been added through the Smart Motorway programme and another 20 projects are currently under construction. These include the largest yet, the £1.4bn A14 improvement in Cambridgeshire. “At some point over the summer of this year, our spending will begin to exceed over £1m a day on that project alone. More broadly, we’ll be paying contractors and consultants about £5.5m every day,” O’Sullivan says.

During the current financial year, the HE’s annual spending will break through the £2bn mark. Progress with the investment plan has already started to ramp up. 

“A lot is made of the number of project starts we have planned in 2019/20, but the biggest step-change in our spending actually comes sooner, from this year to next, from 2017/18 to 2018/19. We’ll have a significant number of projects on site and a large quantity of lead-in work getting underway at the same time. We’ll have 31 schemes going from options to development stages over the coming year. It’s a major step-up in design work,” he says.

The HE’s list of major projects completed isn’t exactly as planned. The A21 Tonbridge- Pembury improvement in Kent is running about six months late, while another, the A43 Abthorpe Junction, started early. Not everything is going to go to plan, but overall the HE is “more or less” on schedule. “We’re managing all this as a portfolio,” O’Sullivan says.

Progress has not been so good according to the National Audit Office. In March this year an NAO report found that costs of the 112 projects of RIS were exceeding available funds by £841m. “The Department and Highways England need to agree a more realistic and affordable plan if they are to provide optimal value from the Road Investment Strategy,” said the head of the NAO, Amyas Morse.

Funding gap challenge

The NAO report pointed out that £652m of the funding gap was due to overprogramming the RIS – done to ensure all of the available money could be spent if a number of schemes did not pass successfully though statutory procedures and approvals.

According to O’Sullivan, a lot of what the NAO called for has now been done. The funding gap has shrunk, he says: “When we started out, we had a funding pressure of £1.2bn. We’ve reviewed the programme, looked at changes to the scope and got the risk of overspend down to £717m, so we’ve solved about £500m of the problem.

“It’s traditional and sensible to overprogramme, which now amounts to about £500m, so at present we’ve got a circa £200m risk of overspend, which out of a programme of £12bn, is not too bad a position.”

Projects planned and designed but not started by 2020 will go forward into the HE’s second five-year investment period, O’Sullivan says. Progress with developing RIS2 is also coming along, he says. HE has published 18 route strategies and is currently collecting feedback from all stakeholders. A RIS2 strategic business plan is due next year ready for a start in April 2020.

“What’s important here is that we want a real industry and public engagement process, beyond the normal consultation procedures,” he adds. “We want everyone to tell us how we’re doing, whether we’re doing things right and what they want to see done next.”