The highways industry has leaner delivery in its sights

The Highways Term Maintenance Association’s executive director David Hutchinson balks at the sheer scale of the task of preventing predicted budget reductions harming the standard of services.

Senior county officials say they are bracing themselves for their budgets to be slashed by at least 25%, with some preparing for reductions in the spending for local highways and transport of 40%.

Hutchinson, who has a career in the industry spanning four decades working for consultants, contractors and metropolitan and county councils, tells LTT: “I have never had to deal with anything like this in my whole life. It’s going to be a huge challenge limiting the impact of cuts of this size on the frontline service.”

The Highways Term Maintenance Association, which represents the companies looking after three-quarters of Great Britain’s road network, is gearing up to respond.

The HTMA is to meet the UK Roads Liaison Group – representing those in Whitehall and town halls responsible for managing roads – next month to facilitate local highway authorities achieving further efficiencies.

Hutchinson is keen to limit an increase in highways defects due to the drying up of budgets. A priority for him is to standardise the specifications for work in contracts so that materials can be provided at lower prices. “Why does everything have to be bespoke? You could save money if we weren’t all using different kerb heights,” he says. Hutchinson wants simpler specifications, as well as common ones.

“Three-quarters of what’s in contracts is not necessary. It’s a waste of time and money to ask contractors to do things in such particular ways that add to costs.” The former county surveyor and metropolitan chief engineer says this over-complication “is about the client’s need to feel in control”.

“The client wants to anticipate every possible eventuality: we might get claims from residents about noisy roads somewhere, so let’s specify porous asphalt to cover ourselves.” Hutchinson would like councils to decide on broad outcomes and then leave it to contractors to decide how to meet them.

“I say to the local authority client: do you want to be a control freak, or do you want to sit down with your consultants/contractors and take a much more consultative approach?”

Asked if more outsourcing is inevitable, Hutchinson says there is “no one-size-fits-all delivery model” but that “everything must be on the table”.

He holds up collaborative contracts, including between a number of London boroughs and Transport for London, as one option that holds great potential. “Wouldn’t that be better? It must be worth the effort involved in getting something like that arranged.”

The executive director of HTMA, which has members including Amey, Colas, Jacobs, Mouchel, Ringway, Scott Wilson and WSP, is concerned that some public sector clients are passing on the pain of budget cuts to the private sector.

The Highways Agency made 15% savings in 2008/09 by asking contractors for a lower price. The Conservatives’ Transparency Plan suggests putting the spotlight on whether or not the public sector is getting good value from contracts.

“There can’t be any shortcut to avoid the effort of making efficiency savings,” he says, amid calls from some council leaders for wage deflation in private sector support services with re-negotiating contracts to reduce the cost of contracts to local authorities. “The client can’t simply pass on the pain, everyone has to do their bit.”

He is “very happy” with the suggestion that there be more transparency on contracts – as long as this covers contracts held by in-house teams as well as outsourced contracts. But he says that unit costs are only one part of the picture, and “what’s most important are outcomes for the customer”.

Hutchinson stresses that, ultimately, the aim should be “greater trust between the public and private sector”. “We can’t move back to the bad old days of an adversarial approach. We’re all in this together.”