National Roads Maintenance Review

Economic, Social and Environmental Impacts of Changes in Scottish Road Maintenance Spend

Karl Johnston

Head of Road and Rail Economics

Transport Scotland

What I will cover

• Membership and terms of reference of the Wider Economic Issues, Costs and Benefits Working Group.

• Overview of framework and steps in research.

• Quantitative analysis – measuring and monetising impacts.

• Qualitative assessment - assessment of other impacts that cannot be or were not measured but may be of equal significance.

• Conclusions.

Road Maintenance Review Working Groups

Co-chaired by SCOTS (Jim Valentine) and Transport Scotland:

• Wider Economic Issues, Impacts, Costs and Benefits;

• Standards and Asset Management;

• Technology and Productivity Innovation; and

• Resourcing

Wider Economic Issues, Impacts, Costs and Benefits Working Group - membership:

•Transport Scotland

•SCOTS

•COSLA

•Institute of Advanced Motoring

•RAC

•Guide Dogs for the Blind (representing Mobility and Access Committee)

•Living Streets

•SUSTRANS

•Road Haulage Association Ltd

•Confederation of Passenger Transport

•Freight Transport Association

Terms of Reference

•1. Estimate the economic and social impacts of changes (focussing mostly on reductions) in trunk and local road maintenance expenditure over a ten and twenty year time period.

How did we go about this?

•Assessment of impact of reduction in maintenance spend on:

• Trunk roads

• Local roads

•Uses Scottish Transport Appraisal Guidance (STAG) criteria as framework for analysis:

• Environment

• Safety

• Economy

• Integration

• Accessibility and social inclusion

•Undertaken by TRL

} Basis for quantitative analysis

How did we go about quantifying this (half the story)?

Scenarios

•Scenario 1: Maintain 2010/11 spending

•Scenario 2: 20% reduction over 10 years, return to base level over next 5, real terms annual increase of 2.5% over following 5.

•Scenario 3: 40% reduction over 10 years, return to base level over next 5, real terms annual increase of 2.5% over following 5.

Subjective allocation of spending reduction

Steps

Model impact on condition

Translate conditions into impacts

Quantify impacts over time

Allocating reductions across budget lines: trunk roads

Activity

Activity spend as percentage of current budgeted activity spend

Scenario 2(Overall 20% cut)

Scenario 3(Overall 40% cut)

Inventory, inspection, testing, routine and cyclic activity

87 72

Miscellaneous 88 71

Structural maintenance – pavements (carriageways)

56 24

Structural maintenance – structures

96 86

Minor improvements 93 75

Total overall budget (%) 80 60

Allocating reductions across budget lines: local roads

Activity

Activity spend as percentage of current budgeted activity spend

Scenario 2(Overall 20% cut)

Scenario 3(Overall 40% cut)

Capital 75 50

Traffic Calming 96 92

Road Safety 96 92

New Road Schemes 89 77

Lighting 92 85

Structural Maintenance (Carriageway) 65 31

Other 81 63

Revenue 83 66

Road Construction 89 77

Structural Maintenance (Carriageway) 65 31

Environmental Maintenance 73 47

Winter Maintenance 96 92

Lighting 89 77

Safety Maintenance and Emergency Patching

96 92

Routine Repairs 67 33

Total Overall Budget (%) 80 60

Modelling the impact on condition(Analyses undertaken by WDM Ltd)

• Trunk roads:

‐ RCI to Residual Life conversion

‐ Treatment interventions are based on RCI

‐ Distribution of treatment remains constant for future years

• Local roads:

‐ SCANNER data (RCI used for condition)

‐ Spending Review budgets

‐ SRMCS condition reports

• Trunk road priority to motorways

‐ Remove priority rule after 10 years

• Valuation of network for trunk roads

• Calculation of depreciation for local roads

Translating these into impacts

Change in vehicle operating costs due to surface condition

Change in travel time costs due to surface condition

Change in accident costs due to surface condition

Change in delay costs at roadworks

Change in accident costs due to reduced lighting

1

2

3

4

5Change in the carbon emissions, local air quality and noise

Change in the (road) asset value (not part of NPV)

6

7

Scaling up the sample of Local Authorities

• 32 Authorities – time required and cost too high to model all 32

• Sample of 8 Authorities (SCOTS Categories - rural, urban, semi-urban, city) (Islands are rural for this study)

• Rural – Aberdeenshire, Dumfries and Galloway, Highland

• Urban – North Lanarkshire

• Semi-urban – Fife and South Ayrshire

• City – Edinburgh and Glasgow

• Road types – A, B, C, U each by rural/urban

Scaled up for all network based on a combination of authority type (rural, city etc), percentage of network in poor condition, traffic levels and amount of maintenance

Quantitative analysis – results

Cumulative discounted costs

(£m 2002 Prices)

Trunk Roads Local Roads All Roads

Scenario 1(Base Case)

Scenario 2

Scenario 3Scenario 1

(Base Case)

Scenario 2 Scenario 3 Scenario 2 Scenario 3

Financial Costs to GovernmentMaintenance works 2,152 -266 -568 5,677 -688 -1,459 -954 -2,027

Impacts on SocietyVehicle operating costs 73,223 +376 +625 274,246 +1,485 +2,966 +1,861 +3,591

Travel time (surface condition related)

362 +57 +94 1,572 +77 +158 +134 +252

Accidents (skid related) 345 0 +21 N/A N/A N/A 0 +21

Delays (through roadworks) 119 -25 -38 1,480 -354 -712 -379 -750

Lighting (accidents)

128 +1 +2 2,155 +18 +37 +19 +39

C02 Emissions 5,765 -36 -58 14,971 -14 -16 -50 -74

Overall impact on society

79,942 373 646 294,424 1,212 2,433 1,585 3,079

Economic analysisWorks costs reduction Base Case 266 568 Base Case 688 1,459 954 2,027

Increase in user costs Base Case 373 647 Base Case 1,212 2,433 1,585 3,080

Net Present Value Base Case -107 -79 Base Case -524 -974 -631 -1,053

Sensitivity analysis

Sensitivity tests

Trunk roads Local roads

Scenario 2(20% cut)

Scenario 3(40% cut)

Scenario 2(20% cut)

Scenario 3(40% cut)

Base analysis (20 years, standard growth and indexing assumptions)

-107 -79 -524 -974

Reduced (10 year) time period analysis 112 263 - -

Higher inflation rates on works costs -62 44 - -

Vehicle operating costs: No traffic growth or fuel price increases

307 983 332 743

Scaling up methodology for local road sample to network effects

- - -447 -806

Second half of the story –assessment of impacts that have not been quantified

• Biggest surprise (to me at least). These impacts arguably as significant as the quantified impacts.

• Some impossible or hard to quantify, some out of scope of the analysis.

• Literature review:

- 132 documents reviewed

- 65 relevant

• Workshop featuring guest expert presenters

• “Based on the literature review, the user group most affected by a reduction in road maintenance would be pedestrians. Pedestrians would be affected in every aspect including noise and vibration, global air quality, visual amenity, cultural and landscape, physical fitness, accidents, security, community and comparative accessibility.”

Economy

• Journey reliability and quality will both deteriorate

• Increasing road condition deterioration caused by delays in maintenance will mean a rise in temporary repairs and the final costs of roadworks

• Local economies may be disproportionately affected should there be an increase in emergency incidents (eg, A83 Rest and Be Thankful landslip)

• There is also an increased risk of emergency incidents on strategic infrastructure. Responding to these would likely divert further resources from maintenance budgets.

• Wider economic disbenefits such as reduced tourism or local economic activity.

• The last three, if quantified, would further reinforce the quantitative conclusions.

Safety

• Lower levels of spending on key structures are likely to increase the frequency of emergency incidents leading to, at a minimum, local economy disruptions and increased journey times.

• The balance of evidence suggests lower levels of street lighting increases accidents, increases the public's fear of crime and reduces the public's use of footpaths and cycle-tracks.

• Deterioration in footways and cycle-tracks will cause increased safety risk to pedestrians and cyclists

Accessibility and Social Inclusion

• Remote communities likely to suffer as priorities for spending a reduced budgets focus on where risks and traffic are most significant

• Community accessibility will face greatest challenges in the event of emergency closures where alternative access routes are limited or non-existent

• Vulnerable groups particularly those with a visual or mobility impairment are most likely to be affected from increased defects on footpaths

• Vulnerable groups are most likely to be affected by increased perceptions of crime caused by poorer levels of street lighting

• Pedestrians and residents will experience poorer amenity from increased roadside noise and reduced local air quality

• Cyclists are likely to face poorer cycling conditions

Environment• Landscape, visual amenity and cultural effects will be significantly affected -

poorly maintained streets and public spaces have a negative effect on quality of life

• Poor walking environments and transport links leave areas isolated and damage community cohesion

• Noise and vibration effects will worsen

• Lower levels of street cleaning lead to increased environmental pollution (dust levels), local flooding along with reduced amenity.

• Lower levels of street lighting make commercial areas less attractive to businesses

• Biodiversity will be negatively affected if vegetation control is reduced and weeds spread

• Global and local air quality may benefit from less planned maintenance activity, but this may then be countered by increased emissions arising from a greater number of unplanned interventions.

Integration

• Impacts relevant to numerous Scottish Government cross-cutting strategy documents.

• For example, lower quality footways and cycleways will act as disincentives to physical fitness aimed at increasing improved health outcomes

Conclusions• Savings on road maintenance spend would be

significantly outweighed by the wider additional costs. (E.g. 40% reduction saves £2 billion, but costs Scotland’s road users and communities £3 billion).

• A £1 reduction in road maintenance therefore results in a £1.50 cost to the wider Scottish economy and society. Impact greater for local roads.

• Biggest quantified impact: vehicle operating costs

• Findings reinforced by the non-quantified impacts.

• Public dissatisfaction with road conditions is likely to increase

• Investing in the maintenance of this significant capital asset clearly delivers economic and social benefits to Scotland.