Spending review: the winners and losers in the transport stakes

Which transport sectors did well and which did badly in the Comprehensive Spending Review? Throughout the linked articles LTT delves into the detail of the review and speaks to experts to see what the settlement means for transport policy and delivery

In the end it was bad but not quite as gloomy as some had expected. The DfT faces a 15% real terms cut to its budget between 2010/11 and 2014/15, slightly below the 19% reduction to Government spending overall.

Transport secretary Philip Hammond’s argument that transport infrastructure investment was vital for the economy played out well, with just an 11% reduction in the Department’s capital budget. The settlement ensures the delivery of a number of ‘big ticket’ infrastructure projects and programmes, notably Network Rail’s enhancement programme, London Underground upgrades and the capital’s east-west Crossrail route.

The Highways Agency’s trunk roads budget will, however, be heavily cutback and local authority capital funding will also suffer cuts. Many councils will learn in the New Year that their major transport schemes are unaffordable. London boroughs could see a 25% reduction to their Local Implementation Plan budgets.

Councils in England must also grapple with a 28% reduction in revenue support from central government. Staff cuts, new approaches to service delivery and reductions to tendered bus networks and road maintenance are all likely consequences.

The DfT itself faces a 21% cut to revenue spending. This will be delivered partly through rises in rail fares and cuts to bus subsidy. The latter will, in turn, force operators to reduce services or put up fares.

The relatively good capital settlement for the DfT is not mirrored in the devolved nations. Scotland, Wales and Northern Ireland all face capital cuts of 35-40% over the next four years with obvious consequences for transport investment.

For the environmental lobby there was some cheer with the news that the DfT’s Local Sustainable Transport Fund will provide £560m over four years for packages of low-cost transport improvements. 

DfT Expenditure Tables

Key:

1. The Government's spending review process allocated capital according to a bottom-up appraisal methodology; baselines for 2010/11 for individual programmes are therefore estimates and inflated baselines for subsequent years are not available. Therefore savings against baseline do not apply.

2. % reductions compared to the 2010/11 baseline adjusted for inflation

3. These payments transfer to CLG budgets and are therefore not included in DfT's total DEL. The baseline includes funding for demographic pressures on Concessionary Fares in later years

4. Private Finance Initiative (PFI)   

5. Vehicle Excise Duty (VED) Collection & Enforcement