Statutory guidance

Assessing and implementing lane rental scheme applications: statutory guidance for mayors

Published 12 June 2026

Applies to England

Local highways authorities (LHAs) can apply for lane rental schemes to charge works promoters for the time that street and road works occupy the highway.

Mayors will have new powers under section 27 and schedule 9 of the English Devolution and Community Empowerment Act to approve applications for lane rental schemes.

Department for Transport’s (DfT’s) guidance:

• support mayors of strategic authorities in exercising their new approval functions
• explains what mayors should take into account when assessing lane rental applications from LHAs

The guidance will come into force later in 2026, when powers in the English Devolution and Community Empowerment Act 2026 are introduced.

Using this guidance

Lane rental schemes enable local highway authorities (LHAs) to charge for works on busy roads at busy times with the aim of minimising disruption. The policy aims of lane rental as well as the guidance for applicants can be found in the Lane rental schemes: guidance for English highway authorities.

The English Devolution White Paper, published in December 2024, set out our plan to rewire England by devolving power and funding from central government to local leaders who know their area best. A central part of this is devolving the approval of lane rental schemes to mayoral strategic authorities (MSAs).

This statutory guidance is made under schedule 9, paragraph 7, of the English Devolution and Community Empowerment Act 2026 (EDCEA). This is issued to support mayors of strategic authorities in exercising those new approval functions under section 27 and schedule 9 of the EDCEA.

It explains what MSAs should take into account when assessing applications from LHAs, seeking approval to issue charges for the duration of relevant works under the Street Works (Charges for Occupation of the Highway) (England) Regulations 2012 (‘2012 regulations’), known as ‘lane rental charges’ and ‘lane rental schemes’. When exercising lane‑rental approval functions, MSAs must only approve schemes that are compliant with section 74A of the New Roads and Street Works Act 1991 (NRSWA) and the 2012 regulations.

This guidance sets out the Secretary of State for Transport’s expectations concerning some of the factors that mayors will take into account when considering an LHA’s application for an order.

Mayors have discretion to consider factors that reflect local circumstances. However, schedule 9 of the EDCEA states that mayors must have regard to this guidance. It is recommended that mayoral authorities maintain a clear audit trail explaining how decisions have been reached, particularly where a scheme departs from expectations set out in the guidance.

When exercising their lane rental approval functions, MSAs (and LHAs who are applying for approval) are legally required to have regard to this statutory guidance. Where circumstances change after an approval order has been made, the mayor may need to reconsider the decision or require changes to the scheme to ensure compliance with section 74A NRSWA and the 2012 regulations.

It is recommended that works promoters raise concerns about the operation of an approved scheme through the dispute resolution arrangements set out in the scheme and, where appropriate, through representations to the approving authority.

Under the changes brought forward by section 27 and schedule 9 of the EDCEA 2026, where the LHA forms part of the MSA, the mayor is the appropriate person to approve a scheme and make an order. LHAs outside an MSA area must continue to apply to the Secretary of State for an approval order.

Where a MSA has been established, but the first mayoral election has been delayed, applications for lane rental schemes should continue to be submitted to, and assessed by, the Secretary of State until such time as a mayor is in office and able to exercise the approval function.

Once a mayor has been elected and the relevant powers are exercisable, responsibility for approving new lane rental scheme applications within that MSA area will transfer to the mayor automatically, as legislated for in the EDCEA 2026.

DfT’s expectation is that where an LHA consulted on a lane rental scheme proposal before approval powers were transferred, that consultation does not need to be repeated as a result of the approval authority changing, unless there has also been a change in circumstances or significant time has passed. Mayors may have regard to such consultations when assessing applications, provided the proposal has not materially changed and remains consistent with the published guidance.

To ensure national consistency, this statutory guidance should be read in conjunction with the Lane rental schemes: guidance for English highway authorities. This outlines what an LHA should include in a lane rental application when this is being considered for approval by the Secretary of State.

Understanding lane rental schemes and where they can be used

Lane rental schemes aim to reduce disruption caused by street and road works by encouraging more efficient working practices. Under these schemes, utility companies and other works promoters are charged up to £2,500 per day for occupying the highway at times and locations where roadworks are particularly disruptive. The goal is to incentivise faster, better-coordinated works with less impact on road users.

Lane rental schemes may not be suitable for all areas. Their effectiveness depends on factors such as:

• traffic volumes
• the density of street works
• the capacity of the LHA to administer the scheme

Authorities must carefully consider whether the benefits of implementing a scheme outweigh the costs and administrative burden to both authorities and utilities. This statutory guidance supports mayors in determining whether a proposed scheme is appropriate for their area.

When assessing an application, mayors should consider whether:

• the proposal demonstrates a clear need
• it is proportionate in scale and scope to local conditions
• the anticipated benefits outweigh the costs and administrative requirements to the authorities, the utilities and the customers in the communities they serve

Mayors should also consider whether the proposal supports the strategic transport objectives for the mayoral area of responsibility.

Governance and decision making

Effective governance is essential to ensure that approvals of lane rental schemes are:

• lawful
• transparent
• consistent

Accordingly, it is strongly recommended that each MSA should establish a clear decision-making pathway describing how assessments progress from initial completeness checks, through legal compliance review, to taking into account the assessment guidelines in DfT’s Lane rental schemes: guidance for English highway authorities (the ‘2025 guidance’).

Who must make the approval decision within a mayoral authority

Under the EDCEA 2026, where an application for an approval order for a lane rental scheme is submitted by a LHA within a MSA, the mayor is the appropriate person to approve the order. This means that the mayor is the statutory approval authority for these schemes.

Overall approaches to delegating mayoral functions are set out in:

• section 30 of the Levelling Up and Regeneration Act 2023 for combined county authorities
• section 107D of the Local Democracy Economic Development and Construction Act 2009 for combined authorities
• section 38 of the Greater London Authority Act 1999 in London

Strategic authorities should consider these and take legal advice on their options for delegating this function.

Given that the law that applies is different for different MSA regions, mayors should take their own legal advice on:

• the legal options for delegating the approval function the lawful process for making any delegation
• how the delegation should be recorded within the authority’s decision-making framework

All approval decisions should demonstrate, among other matters, that the mayor has:

• given due regard to the statutory guidance
• considered the Lane rental schemes: guidance for English highway authorities
• assessed that the scheme proposed in the application complies with the 2012 regulations
• lawfully reached a determination to approve or not approve the scheme

Clear identification of the decision maker and maintenance of a transparent audit trail is essential to ensure the legal validity of the approval and of the subsequent mayoral approval order.

Standards of conduct and probity

Mayors must ensure decisions are taken impartially, transparently, and in accordance with the principles of good governance. Mayors must:

• properly manage conflicts of interest
• maintain a clear audit trail
• ensure that decisions are evidence based and legally robust

These expectations reflect the general principles set out in local codes of conduct and wider public law standards applicable to elected office holders.

Where a lane rental scheme has been designed or drafted by commercial consultants or other external contractors engaged by the applicant authority, those parties should be excluded from any role in assessing the adequacy, compliance or suitability of that scheme. Allowing a contractor to assess work they have produced would give rise to a conflict of interest and undermine the integrity of the approval process.

This does not prevent mayors from drawing on support from public‑sector bodies or internal teams to assist with assessment, provided:

• appropriate arrangements are in place to manage conflicts of interest
• the final evaluation and decision remain with the mayor or a lawfully delegated decision maker

Where an MSA lacks the internal capacity or specialist expertise to assess a lane rental scheme application, it should obtain appropriate professional or technical support. Such support may inform the assessment, but the responsibility for evaluating the evidence and reaching a lawful decision rests solely with the mayor or delegated decision maker.

Core assessment criteria

In assessing lane rental scheme applications, MSA’s should be satisfied that proposals are:

• consistent with the statutory purpose of lane rental
• proportionate to local conditions
• supported by appropriate evidence

In doing so, the expectation is that for national consistency, mayors will take into account the standards set out Lane rental schemes: guidance for English highway authorities 2025 (the ‘2025 guidance’), while retaining discretion to take account of local circumstances and evidence when reaching a decision.

Changes brought forward by the EDCEA mean that a person executing works for road purposes in a maintainable highway can be subject to lane rental charges by the approved authority. This reflects the ‘principle of parity’ set out in the 2025 guidance whereby the strong expectation is that an LHA will apply lane rental charges equally to works promoted by the LHA and utility companies.

It is recommended that MSA’s should take into account the 2025 guidance when considering an application and ensure the proposed scheme complies with the legal requirements in the 2012 regulations.

It is recommended that applicants be required to submit their application using the following example forms used by DfT:

• Apply for a lane rental scheme form
• Lane rental cost-benefit analysis form

Mayors may choose to add to or adapt the criteria set out in these forms to reflect local conditions, priorities or concerns.

When assessing lane rental applications MSAs should follow the Lane rental scheme assessment checklist in addition to ensuring applications follow the requirements laid out in the Lane rental schemes: guidance for English highway authorities. MSA’s may wish to add to this checklist to reflect local conditions, priorities or concerns.

These materials collectively draw attention to matters that are material to an approval decision, including:

• network coverage
• charging structures
• financial management arrangements
• shadow running where no charges are issued
• the use of surplus income

Where an application departs from established expectations in these areas, MSA’s should be satisfied that clear justification has been provided.

Reviewing the cost benefit analysis for lane rental schemes

This section sets out a list of considerations the Department for Transport (DfT) has previously applied when reviewing the cost benefit analysis (CBA) from a lane rental scheme (LRS) application.

It aims to support a systematic review of a CBA by helping mayoral strategic authorities (MSAs) to identify any issues that may affect the robustness or credibility of an assessment.

As set out in the Green Book, proportionate appraisal and review helps decision makers to:

• conduct objective, impartial and evidence-based assessments
• understand the relative costs, benefits and risks of a scheme
• determine how effectively a scheme contributes to achieving its intended objectives

Conducting a cost benefit analysis review

MSAs should review a scheme against the considerations outlined. Where issues are identified with a scheme, these should be discussed, clarified and resolved with the local highways authority that is making the application.

When engaging with an LHA, setting out each issue identified, with reference to the relevant guidance, may help the applicant to supplement or amend a submission.

Addressing issues at this stage will ensure findings are clarified before next steps, supporting a robust assessment and evidence-based decision-making.

The MSA should adopt the approach outlined in this guidance when reviewing a scheme to ensure consistency and alignment with established DfT practice. This guidance is not exhaustive, and additional issues may be identified during the review that fall outside its scope. These should also be taken into account where relevant.

List of considerations

Considerations are grouped into ‘major’ and ‘minor’ considerations.

‘Major considerations’ refers to factors that could fundamentally affect whether a scheme is likely to operate as intended and meet the statutory purpose of the LRS.

‘Minor considerations’ refers to factors that might require clarification or further evidence, but that do not necessarily undermine the validity of an overall scheme.

Major considerations

Unreasonably high revenue generation

LRS are intended to reduce congestion, not generate income. High projected revenue may indicate that the scheme’s design is misaligned with this objective. The MSA should consider whether:

• too many works are eligible for charges (for example, due to a disproportionately large network coverage or weak behavioural change assumptions)
• charges are set at unreasonable levels (for example, above the statutory maximum of £2,500 per day)

Inappropriate or unrobust inputs and assumptions

All methods, inputs and assumptions should be transparent, evidence-based and proportionate to the scale of the scheme. Particular scrutiny should be applied to behavioural change assumptions:

• greater behavioural change should generally lead to lower congestion, higher benefits and lower revenue

Excessive number of eligible workdays

The proportion of eligible works subject to lane rental charges should not be excessively high. Schemes should be targeted at the busiest roads during peak periods, where disruption is greatest.

Unmonetised impacts

Where impacts can reasonably be monetised, they should be included. If monetisation is deemed unfeasible or disproportionate, a clear qualitative assessment should be provided.

Unreasonable net present value (NPV)

An LRS should demonstrate that the expected benefits sufficiently outweigh costs, ensuring the NPV is positive. The costs and benefits included should be relevant and not significantly under or overestimated.

Failure to achieve the policy objective

The CBA should clearly show how the scheme supports the policy objectives (for example, reducing congestion on the busiest roads at the busiest times and highlighting any unintended consequences).

Minor considerations

Missing Information

Sections of the CBA template are missing, incomplete or inconsistent with the published guidance, but these issues are not considered material on the overall decision of the scheme.

Non-compliance with transport analysis guidance and Green Book best practice

Examples of non-compliance with Transport analysis guidance (TAG) and Green Book include:

• incorrect application of discounting, optimism bias or price-based adjustments
• limited or absent sensitivity or scenario analysis
• lack of quality assurance

Impacts inconsistent with the LHA context

Impacts should reflect the LHA’s environment. For example, urban authorities typically have a greater potential impact and network coverage than rural areas. Ensure impacts appear proportionate to the LHA’s context.

Information is inconsistent with wider documentation

Information and assumptions used in the CBA should align with wider information provided in the bid. For example, the charging schedule in the policy submission should directly inform lane rental charge assumptions in the CBA.

Consultation standards and stakeholder coverage

While consultation is not a statutory requirement, it is good practice and a requirement of an applicant applying to the SoS for an approval order, as per the 2025 guidance. Therefore, it is recommended that applications should include a consultation bundle demonstrating that the authority has engaged appropriately with stakeholders on the draft scheme.

DfT guidance emphasises that consultation should cover:

• the proposed charging regime
• the evaluation approach
• the cost–benefit analysis
• permit scheme evaluation reports
• any supporting evidence used to define chargeable locations or time periods

The 2025 guidance recommends that the consultation should include engagement with statutory undertakers that have apparatus in the affected streets. It should also include other stakeholders likely to be impacted, such as:

• neighbouring authorities
• emergency services
• businesses
• road user groups

Evidence should show that consultees were given a meaningful opportunity to comment on the full draft scheme and that the applicant has clearly set out how representations were taken into account in the final proposals.

To determine adequacy, the assessment should consider whether:

• the consultation encompassed the entire draft scheme
• the period offered was reasonable
• changes to traffic-sensitive street designations were addressed with the relevant utilities
• the final bundle provides a transparent account of issues raised and any amendments made

Applicant engagement

Where an application is incomplete, inconsistent, or does not meet the requirements set out in the guidance or regulations, the MSA should engage directly with the submitting LHA to ensure issues are identified and resolved as early as possible. This engagement should:

• clearly explain the concerns identified, referencing the relevant elements of the guidance where appropriate
• give the authority the opportunity to clarify their position, provide missing evidence, or revise their submission so that it can be properly assessed

Engagement should be constructive, consistent and aligned with wider policy expectations. All interactions with an authority should be recorded, including:

• discussions
• requests for additional material
• any commitments made

Clear timeframes should be set for the authority to respond, balancing the need for thoroughness with the need to maintain an efficient assessment process.

If an authority is unwilling to engage, fails repeatedly to address identified shortcomings, or declines to make the necessary revisions, the MSA should pause the assessment and inform the authority that the application cannot progress until the required changes are made.

Should nonengagement persist, the MSA may also advise the authority that it would be more appropriate to withdraw and resubmit their application once they are in a position to meet the expectations of the guidance. This helps to:

• ensure that all schemes considered for approval are complete, robust and compliant
• reduce the risk of downstream legal, analytical or procedural issues arising from weak or incomplete submissions

Notification of decision

If the scheme is refused, the notification should:

• state clearly and precisely the full reasons for refusal
• identify the specific requirements or expectations that the scheme failed to meet
• provide sufficient explanation to allow the LHA to understand what would be needed in any revised application

If the scheme is approved, detailed reasons are not required in the decision notice. However, the internal decision record and any supporting documentation should clearly demonstrate:

• how the statutory criteria and expectations in this guidance were assessed
• the basis on which the decision was reached
• any conditions, expectations or follow-up actions

This promotes transparency, supports good governance, and ensures that decision-making remains robust, impartial and auditable.

Once you have notified the applicant that their scheme has been approved, please inform DfT at lane.rental@dft.gov.uk. We can then help them with any additional requirements to update Street Manager.

Applying the correct guidance version

To maintain fairness and consistency, it is strongly recommended that mayors take into account the factors set out in DfT’s Lane rental schemes: guidance for English highway authorities that were in place at the time the LHA submitted its application for Secretary of State approval.

Mayors should consider and take into account any changes in the national guidance.

Handling requests to vary a scheme

Once a lane rental scheme has been launched, any changes to it should be managed in a clear, transparent and proportionate way.

It is recommended that mayors require applicants to explain in their original submission how they intend to handle future minor changes, and mayors require this explanation to form part of the approved scheme document.

The DfT 2025 guidance distinguishes between material and minor variations. Material variations are significant changes to how the scheme operates, such as:

• altering the charging principles
• expanding the scheme beyond its originally approved scope
• introducing new categories of chargeable works

Because these changes would affect the fundamental design of the scheme and the expectations of works promoters, they should be treated as a new application. This means the authority should:

• prepare a revised scheme proposal
• undertake consultation where required
• submit the updated application to the mayor for a fresh decision

If the mayor approves the revised scheme, a new formal approval order will need to be made.

Minor variations are changes that adjust the operation of the scheme without altering its underlying design or purpose. These may include:

• small adjustments to the total road length included in the scheme
• changes to street lists resulting from routine network management
• shifts in the proportion of streets in each charge band

However, these changes can only be treated as minor where they do not exceed 3 percentage points of the scheme’s overall network coverage in kilometres per annum. Authorities should monitor their network updates over time to ensure they remain within this limit.

Applicants should set out a simple process for handling minor variations, explaining how they will track annual changes to the network, update scheme documentation and notify stakeholders, including the MSA. It is recommended that they should also ensure that any variation does not disproportionately affect particular works promoters or locations.

The 2025 guidance states that where the cumulative impact of network changes approaches or exceeds the 3-percentage‑point threshold of the lane rental network, the authority should pause further adjustments and prepare a full, material variation application instead. See guidance for highway authorities for how to make this calculation and what this is based on, for more information on this.

For both material and minor variations, applicants remain responsible for:

• keeping clear records of the changes made
• the rationale for the changes
• any engagement undertaken

This ensures that mayors, works promoters and the public can understand how the scheme has evolved and can be confident that changes have been made fairly and transparently.

Where 2 or more approved authorities wish to operate a combined or jointly administered lane rental scheme, the scheme should be submitted and assessed in line with the same principles and requirements set out in this guidance. It is recommended adherence is given to the Lane rental schemes: guidance for English highway authorities. The mayor remains responsible for approving the scheme within their area of responsibility, and authorities should ensure that governance and accountability arrangements for any joint scheme are clearly set out in the application.

Where credible evidence is raised that an approved scheme is operating in a manner that is inconsistent with section 74A of NRSWA, the 2012 regulations, or the terms of the approved scheme, the MSA should engage with the authority to seek clarification and, where appropriate, direct that steps are taken to remedy the non‑compliance.

If an authority fails to address the non‑compliance, the MSA may consider exercising their power to revoke the approval order. Works promoters should raise any concerns through the dispute resolution mechanisms set out in the approved lane rental scheme.

Making an approval order

This section outlines how mayors should make an approval order to bring an authorised lane rental scheme into legal force.

The purpose of an approval order

Through amendments brought forward by the EDCEA 2026, under section 74A(2), an order must be made by the appropriate person before lane rental charges can be brought. Where the mayor is the appropriate person, the mayor must issue an approval order and publish this, in the manner the mayor sees fit. No lane rental charges can be applied until the order is in force.

Pre-order requirements

Before drafting an order, the MSA should ensure:

• a complete and compliant scheme application has been assessed
• a formal approval decision has been recorded, including the rationale
• all required consultation and statutory checks have been completed

Drafting the approval order

A mayoral approval order is intended to be a simple legal document, whose sole purpose is to:

• state that the lane rental scheme is approved and who this is approved for
• specify the date on which the scheme (or a revised scheme) becomes operational

The scheme document, rather than the approval order, should contain all operational details. Operational details include:

• the charging schedule
• governance arrangements
• exemptions
• maps
• cost benefit information
• the evaluation framework

Accordingly, mayoral approval orders should be brief, declaratory instruments that confirm approval and commencement, while the substantive detail is provided in the accompanying scheme documentation.

Approval orders could follow the wording of previous statutory orders made by DfT – see an example of an existing order on legislation.gov.uk.

An Approval order template has been published alongside this guidance, to provide an example of how a mayoral administrative order should be drafted.

Making a formal decision

A formal mayoral decision must:

• approve making the order
• approve any minor drafting changes
• authorise sealing, dating and publishing the order

DfT recommends that the order be published on the corresponding LHA’s website, at a minimum. It is a legal requirement that the order is published under schedule 9, paragraph 9 of the EDCEA 2026.

Once finalised, DfT recommends that the order is formally sealed and a public notice issued confirming the making of the order and the intended commencement date.

Commencement and implementation

Following the making of the order:

• the LHA must be notified that scheme implementation may commence
• the commencement date must be set and published
• supporting materials (for example, scheme maps, charge tables, guidance) must be made publicly available
• enforcement and reporting mechanisms must be operational

Conclusion

Mayors of strategic authorities play a central role in ensuring that lane rental schemes are designed and implemented in a way that is lawful, proportionate and aligned with national policy.

In exercising these approval functions, MSAs must have regard to this statutory guidance. It is also strongly recommended that they take into account and apply the criteria found in the Lane rental schemes: guidance for English highway authorities to ensure national consistency. MSAs should also ensure that each decision is evidence‑based, transparent and consistent with section 74A of NRSWA and the 2012 regulations.

A well-designed lane rental scheme can:

• deliver meaningful reductions in disruption for road users
• support better coordination of works
• improve the efficiency of local networks

By following the processes and assessment criteria set out in this guidance, MSAs can ensure that approved schemes are targeted, fair and capable of delivering these outcomes.

MSAs should keep their decision-making arrangements under review and, to support the effective operation of the lane rental framework, they should continue to work closely with:

• DfT
• LHAs
• utilities
• other stakeholders

This will help maintain public confidence in the system and ensure that lane rental meets its core purpose of reducing congestion and improving journeys on England’s busiest roads.