Written statement to Parliament

Government response to consultation on transforming the Highways Agency into a government-owned company

This speech was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

Announcing publication of the government's response to a consultation on changing the Highways Agency into a government-owned company.

In October 2013 the government began a period of public consultation on proposals for transforming the Highways Agency into a government-owned company.

Today (29 April 2014) I am publishing the government’s response to this consultation. This document summarises the main views and issues raised by respondents on the consultation questions and explains the government’s final decisions made as a result of the views provided.

Following the broadly positive response to most of the proposals we consulted on, today’s (29 April 2014) publication confirms our intention to:

  • set up the Highways Agency as a government-owned strategic highways company – with the legal powers and duties to manage and run the roads, appointed by licence from the Secretary of State for Transport which sets clear conditions about how the company must act
  • put in place a robust system of governance for this company – giving the road operator the flexibility needed to operate, manage and enhance the strategic road network effectively, while ensuring clear accountability to the Secretary of State, Parliament and road users - we intend to make drafts of the governance documentation, including licence, the framework agreement and the articles of association, available over the summer to support the legislative process
  • establish – for the first time – a ‘Road investment strategy’ which will detail the performance standards the company will achieve and an investment programme it will deliver over the next 5 years, we will publish this before the end of the year
  • set up new, discrete units within Passenger Focus and the Office of Rail Regulation – to represent the interests of all those who use and rely upon the strategic road network, and to monitor the efficiency and performance of the company

This change represents a clear break from short-term thinking and the stop-start culture that has characterised the sector in the past, enabling the operator to deliver the biggest-ever upgrade of our road network while saving the taxpayer at least £2.6 billion over 10 years.

It will put in place the structures, commitments and relationships to support a more ambitious infrastructure programme, and allow the strategic highways company to operate more like the best-performing infrastructure companies in other sectors. It will allow government to adopt a more strategic role in managing the road network, meaning those running the roads day-to-day can be better held to account for the services they deliver, ensuring that the roads are run responsibly and in the public interest.

We believe these reforms will deliver significant benefits to road users and to the country as a whole, including:

  • a longer term investment programme, which is vital for the many companies who help plan, build and maintain our roads who can start thinking about the skills and equipment needed well in advance
  • enabling delivery of national road infrastructure fit for the 21st century, to support jobs and growth up and down the country
  • providing road users with a better quality service
  • driving down the cost of improvements
  • creating a more transparent system with clearer accountability
  • ensuring effective scrutiny and a stronger voice for road users

Transforming the Highways Agency is an essential component of success in delivering these benefits. It will give the road operator the ability to develop a more business-like approach, attract and retain skilled staff and to deliver more efficiently – as proposed by Alan Cook in his 2011 review.

Taken together, these reforms will provide a strong, certain framework for managing our roads. It will strengthen accountability, drive efficiency and increase transparency. It will also create far more certain conditions for investment, enabling the supply chain to gear up for the government’s ambitious plans for the future. This will support the economy, promote jobs and skills and ultimately transform the quality of our national infrastructure. We look to move to the new model with minimal disruption.

A copy of the government’s response to the consultation will be placed in the libraries of both Houses. The document is available on GOV.UK.