Highway maintenance in funding crisis

Surface treatments are cost-effective maintenance processes that can facilitate monetary savings as well as increasing road safety, says the Road Surface Treatment Association

For the seventh year in a row, the Annual Local Authority Road Maintenance Survey (ALARM), produced by the Asphalt Industry Alliance (AIA) from information supplied by approximately two-thirds of local authorities in England and Wales (responsible for 95 per cent of the road maintenance in the UK) has reported a significant under-spend on highway maintenance.
The figures for all England show a shortfall in the structural maintenance budget of £566m in 2002, £533m in 2003, £678m in 2004, £1,052m in 2005, a massive £2,240m in 2006, £937m in 2007 and another £861m in 2008; an aggregate total of £6,867m in just seven years. The survey also reports that £8.5b is currently required to bring the UK’s roads ‘up to scratch’.
The trend is a major cause for concern and more than 80 per cent of Highway Authorities consistently report that the situation constitutes a threat to road user’s safety. Given the pressure on government finances and the cost inflation in construction materials, matters seem set to go from bad to worse. According to the ALARM survey, much of the £6bn expenditure on roads, announced by the government in January 2009, has been allocated to projects that ‘might not see the light of day for six years, if at all’.
Over the past six years inflation in the cost of construction materials has far exceeded the Retail Price Index (RPI) with levels of 8-11 per cent per annum being experienced, as against an average of about two per cent for the RPI. As most people are aware, crude oil prices have fluctuated wildly over the past couple of years from under $40 per barrel up to around $145. As a consequence, fuel oil and diesel costs have become a particular problem for highway maintenance, where transportation represents a significant part of the cost package.

Volatile oil prices    
Exceeding the crude oil price increase is the cost of bitumen, which is the single largest cost input into many highway maintenance processes. Although the oil price has fallen back significantly from its 2008 peak, bitumen input prices remain volatile and many financial analysts expect the price of oil to remain on an upward trend over the longer term. Just as significant, for the high friction surfacing sector, are the unprecedented increases in the cost of calcined bauxite imported from China, which further adds to cost-push pressure.
HM Treasury has not done much to help. Many of the specialist vehicles employed in highway maintenance lost their fuel tax concession (red diesel exception) in 2008 and the aggregates levy also increased around April this year to £1.95 per tonne, increasing the cost of primary aggregates used in road surface treatments by 35 pence per tonne i.e. 22 per cent increase.
Such input cost pressures are creating significant problems for contractors seeking to recover these costs, or attempting to forecast future increases at the contract tender stage. A significant proportion of the highway network is operated under Term Maintenance Contracts and whilst these do have sophisticated variation of price clauses, they do not assure full recovery of cost and there is a lag in recovery. For the specialist contractor, indices-based formulas are often linked to asphalt prices, which do not reflect the specific cost profile and can lead to significant under recovery. In a period of cost instability these risks have to be built into prices, creating a further hidden cost price pressure on clients. Variation of price clauses, which accurately reflect the cost structures, will have to be developed for all significant maintenance processes if price inflation is to be mitigated.
Increased input costs and smaller client budgets imply a significant reduction in highway maintenance activity, with the real risk of further rapid deterioration in an already poorly maintained network. To alleviate the problem it will be necessary for all players in the market to innovate. Alternative cost effective materials and processes will have to be found or redeployed and clients will have to give consideration to the greater use of locally available aggregates in an effort to reduce the transport cost inputs. After all, why move significant tonnages of high PSV aggregate (to use in asphalt) across the country, when most of the stone content is not actually in contact with the tyre? A move in this direction could also result in more sustainable practise.

Surface treatments
Innovation along these lines could have significant implications for the use of surface treatments. Durable micro asphalts have been developed that will give retained macro textures similar to thin asphalt surfacings. They are widely used on the continent, so why not here?
Many authorities that have abandoned the use of surface dressing will have to reconsider their policies. Surface dressing is the most cost-effective maintenance process. It restores skid resistance and seals the pavement, significantly extending its performance life.
Early intervention with surface dressing can significantly reduce the frequency of structural maintenance required and offers the potential to generate significant reductions in cost over time. Unfortunately, surface dressing is still (wrongly) perceived in many quarters as ‘tar spray and chip’. It isn’t. Modern surface dressing is a sophisticated process with a success rate of 99 per cent. It is time for a reappraisal! Likewise highway patching can now be completed effortlessly using the latest velocity patching techniques that eliminate time and labour on site.
Similarly, other cost-effective surface treatments, such as mechanical retexturing or water jet retexturing, will have to be more widely used. Mechanical retexturing, as a means of restoring skid resistance on concrete roads, has significant potential and linear retexturing (used in America and on the continent) does not result in a noisy surface.
The use of surface treatment techniques, vis-à-vis full scale structural maintenance, is less energy intensive and generates less waste to be transported to landfill sites, thus helping local authorities meet their NI 185 and NI 186 carbon reduction obligations. Their deployment also makes economic sense since they represent better value for the road maintenance funds available. Surface treatments are entirely aligned with government policy aimed towards creating a more sustainable ‘low carbon’ transport system.

Value of prevention
The UK highway network is the nation’s single greatest asset and is used by virtually everyone. It is an essential element and a critical contributor to the economic health of UK p.l.c. If it is to remain so, a fundamental re-assessment of maintenance policy, as well as the identification and promotion of innovation, is required by the highways authorities and the industry.
The Department for Transport’s own ‘Value of Prevention’ statistics (see Highways Economics Note No. 1, January 2007, www.dft.gov.uk) declare that each road accident related fatality costs approximately £1.7m and prevention of all highway accidents would save UK PLC around £20b per annum. It follows, therefore, that if we adopted the willingness to afford sufficient resource toward keeping our highway infrastructure safe, the investment would quickly fund itself – to say nothing with regard to the morality of saving serious injury and lives.
As we all know, central government takes significant sums of money in road and transport taxation (£45.9bn in 2008/09). Yet, despite this, very little is reinvested on maintaining the highway network that is struggling to cope with traffic and in supporting the economy.
Based on such sound economic and road safety grounds it’s about time the government started ploughing back more of this pot. Given the current situation and the immediate outlook, the highway maintenance industry challenges the government to provide appropriate funding, or justify to the taxpayer why they should not see improvements in highway maintenance to protect their asset and their families’ lives.

About the road surface treatment association
In 2008, four trade associations merged to create the Road Surface Treatments Association (RSTA). The new organisation is now the authoritative voice for the UK highway maintenance industry sector.

The RSTA brings together the Road Surface Dressing Association (RSDA), the Slurry Surface Contractors Association (SSCA), the High Friction Surfacing Association (HFSA) and the Allied Industries Sector (AIS).

Its members now number more than 60 organisations including contractors and installers, material manufacturers, local authorities and consultants; the vast majority of companies involved in the day-to-day maintenance of the UK’s highway infrastructure.

For more information

Please register to comment on this article