2015 Autumn Spending Review reveals capital investment in transport

Chancellor George Osborne announced the Autumn Statement and Spending Review last week, and pledged to increase transport capital spending by 50 per cent.

Mr Osborne led the review on transport spending by announcing that the Department for Transport’s operational budget will fall by 37 per cent, making it one of four departments to have agreed to budget cuts that average out at 30 per cent over the next four years, as reported by the BBC.

However, he went on to reveal that transport capital spending will increase by 50 per cent to a total of £61 billion over the next four years. Mr Osborne described this as “the biggest increase in a generation” and “the largest road investment programme since the 1970s” in his speech.

London and the North appeared to be the regions that will receive the largest share of this capital spending, with the Chancellor announcing that London’s transport infrastructure will benefit from an £11 billion investment, and Transport for the North will have an unspecified amount of funds to launch and sustain the project.

In terms of highways development, he announced that £250 million will be invested in improving facilities in Kent to deal with the problems caused by Operation Stack. Over £5 billion will be spent on road maintenance this Parliament, including motorway maintenance and a permanent pothole fund. He has also committed £300 million to cycling.

In terms of rail development, Mr Osborne was able to confirm that construction of HS2 can begin. This major project will link the South to the Northern Powerhouse. As well as this, electrification of railway lines, including the Trans-Pennine, Midland Main Line and Great Western, will go ahead. This will ensure the UK’s rail network is faster, quieter and greener, resulting in a more reliable rail service. Network Rail has said that this will “provide Britain with a sustainable, world-class transport system.”

Some perspective on the transport spending review

In his speech to the House of Commons, Chancellor Osborne outlined his overall vision for the spending review was to make £12 billion of welfare savings, which is what they committed to during the election. As well as making these savings, they aim to deliver the resources to ensure that Britain “will meet its twin obligations to spend 0.7% of its income on development and 2% on the defence of the realm.”

The BBC’s political reporter, Brian Wheeler, states in his analysis of the Spending Review that the Department for Transport has faced and is facing one of the most difficult cost-cutting tasks, after having their budget cut by 13.4 per cent since 2010, and being tasked with finding an extra £545 million in savings in 2015-6 – the largest of any single department. The bulk of this came from selling off land close to King’s Cross station.

Despite these cuts to the department, capital investment in large projects shows an aim to build the foundations of long-term progress, to take large steps forward with the UK’s infrastructure. Some critics, such as Stephen Joseph for Better Transport , argue that this approach may actually be more damaging, whilst praising “small victories” like local and freight rail upgrades, a fund for potholes, and sustainable transport funding.

From the perspective of workforce recruitment, over the next four years we expect to see large-scale rail and highways recruitment in both the North and in the areas surrounding London to support these large projects. On a local scale, highways work will be consistent, but the nature of it will be focused more on making repairs and small improvements to keep transport going, but not making larger, long-term improvements.

Image Credit: altogetherfool (flickr.com)

 

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