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North Yorkshire County Council Business and Environmental North Yorkshire County Council Business and Environmental Services Executive Members 3 July 2015 Highways Capital Programme 2015/16 and 2016/17 Report of the Assistant Director – Highways and Transportation 1.0 Purpose Of Report 1.1 The purpose of this report is to seek Members’ agreement for the: a. Allocation of the residual and carry-over funding for the Highways Capital Programme for Street Lighting, Bridges and Structures, Integrated Transport and Structural Highway Maintenance for 2015/16; b. 2016/17 Highways Capital Programme; and 1.2 To update Members on NYCC’s approach to the principles and practice of asset management in seeking to ensure the authority secures maximum available funding under the Department for Transport’s (DfT) new incentive based budget allocation methodology for capital works. 2.0 Background 2.1 The Highways Capital Programme is made up of Street Lighting, Bridges and Structures, Integrated Transport and Structural Highway Maintenance. They are each subject to their own prioritisation methods based upon an assessment of the problem that is being addressed. The method adopted to prioritise schemes within the different works categories was reported to members in January 2013. The same criteria have been applied to the development of the 2016/17 programme of works. 2.2 Business and Environmental Services (BES) Executive Members considered reports on 30 January 2015 and 27 February 2015 when the headline allocations and distribution of the 2016/17 budget for the various works categories were agreed, along with essential changes to the 2015/16 works programme. 2.3 This report sets out the detailed 2016/17 programme of works for Structural Highway Maintenance, Integrated Transport, Street Lighting along with an indicative Bridges and Structures programme for agreement by BES Executive Members. 2.4 Setting the 2016/17 works programme at this stage has significant benefits including the ability to carry out advance design and works programming. It also provides an opportunity to bring forward schemes into the 2015/16 works programme should there be a service need. 3.0 Proposed Funding Changes 3.1 From 2016/17, the DfT has introduced an ‘incentive’ element to the allocation methodology for capital funding. This means that the financial settlement for councils that do not meet a given level of performance, based on highway maintenance efficiency and adoption of an asset management approach, will reduce over time so NYCC 3 July 2014 – BES Executive Members Highways Capital Programme 2014/15 and 2015/16 that in the worst case for North Yorkshire by 2020/21, the authority could lose over £14M. Alongside the existing formula based allocation, Table 1 below also sets out details of the indicative allocations for the proposed new ‘incentive’ element of the funding: Total Indicative extra incentive element by “band” of self- needs/formula assessment ranking (£) allocation (£) Band 3 Band 2 Band 1 2015/16 100% 29,650,000 2016/17 100% 100% 90% 27,182,000 1,645,000 1,645,000 1,481,000 2017/18 100% 90% 90% 26,359,000 2,468,000 2,221,000 1,481,000 2018/19 100% 70% 30% 23,858,000 4,969,000 3,478,000 1,491,000 2019/20 100% 50% 10% 23,858,000 4,969,000 2,485,000 497,000 2020/21 100% 30% 0% 23,858,000 4,969,000 1,491,000 0 3.2 The process for introducing the funding changes, which is based on a self- assessment questionnaire, has already commenced with authorities currently compiling answers to 22 questions across the following themes: Asset Management; Resilience; Customer; Benchmarking and Efficiency; and Operational Service Delivery. 3.3 There is a particular emphasis on asset management with policy and strategy, communications and lifecycle planning set as three threshold questions. Although the County Council considers itself to be in a strong position with respect to the questions, there is no room for complacency as there is a need to evidence the answers so that we can demonstrate clearly that the work undertaken over previous years and indeed are continuing to undertake, will be enough to secure maximum available funding for the authority. 3.4 The deadline for the completion of the dry-run questionnaire is 31 July. Over the summer months the DfT will then review the feedback from local authorities with a view to issuing a final self-assessment questionnaire in the Autumn. The current programme suggests that councils will then have until the end of November to return the completed questionnaire, with confirmation by DfT of 2016/17 funding settlements in early 2016. BES Executive Members will be kept updated on progress, with the necessary approvals sought, throughout this period. 4.0 Commitment to Asset Management and Lifecycle Planning 4.1 The work in ensuring the County Council is able to make a persuasive case for securing maximum funding through completion of the DfT self-assessment questionnaire is on-going and will be completed over the forthcoming weeks and months. High level answers have already been discussed with the Highways Maintenance Efficiency Programme (HMEP) Advocate. Nevertheless, further to paragraph 3.1 above, the County Council considers itself to have a strong track NYCC 3 July 2014 – BES Executive Members Highways Capital Programme 2014/15 and 2015/16 record in delivering against the principles of asset management and lifecycle planning. Notable examples include: i. Use of HMEP (Highways Maintenance Efficiency Programme) Lifecycle Planning Toolkit: In 2013, the County Council commissioned TRL/APPIA to configure the HMEP Lifecycle Planning Toolkit for use in North Yorkshire. Specifically, the Toolkit and its deterioration model were used to test various investment scenarios to help inform the successful bid in 2014 to the Local Enterprise Partnership (LEP) for £24M of Local Growth Fund (LGF) monies for use on highway maintenance around the main growth centres of Catterick Garrison, Malton and Norton, Scarborough, Selby, Skipton, Harrogate, Northallerton and Thirsk. The model provided a strong evidence base on which to develop the bid; ii. Street Lighting: Since the capital replacement programme commenced in 2005, over 25,000 lighting columns have been replaced across North Yorkshire. As a result, NYCC is reaping the rewards of a pro-active approach to asset management and lifecycle planning. For example, on-going maintenance requirements have reduced significantly; in 2005/6 there were 12,500 (25.77%) defects on the County Council’s 48,500 street lighting columns. In 2014/15 the defect rate had fallen to 3,600 (7.15%) on the 50,350 columns that the County Council is now responsible for. The increase in column numbers is generally due to de-trunking and the adoption of new housing developments. In addition, the use of high specification materials has also allowed the Council to reduce the number of maintenance visits from 30,000 units per year to 10,500 units per year. The resulting savings are approximately £360K per annum for defects and over £300K per annum for routine maintenance at current contract rates. Moreover, all new lanterns now use light emitting diodes (LEDs) as standard, which brings a number of benefits: a) Reduced energy consumption therefore reduced energy costs. These can save up to 65% energy compared to a standard street light; b) Reduced carbon emissions; c) Longer life with low maintenance requirements. New LED units have up to 20 year guarantee with maintenance only required once every 6 years; d) Instant lighting: LEDs brighten up immediately when switched on whereas older lanterns can take up to 10 minutes to reach full brilliance; e) LED lights are free of toxic materials and are 100% recyclable. iii. Surface Dressing: As part of our continuing migration towards Life cycle costing based Highway Maintenance; Surface Dressing is being used increasingly as a maintenance treatment to prevent further expensive structural damage to roads. The application of a dressing to roads improves skid resistance but of equal importance is the sealing of the surface to prevent further water ingress which causes accelerated structural deterioration. NYCC 3 July 2014 – BES Executive Members Highways Capital Programme 2014/15 and 2015/16 On-going analysis of road surface condition data suggests that 3.5 million sq metres of road should receive this type of treatment to reduce the likelihood of advanced road failures. iv. Subject NYCC processes to internal and external audit: Following an internal challenge of our strategic approach towards structural highway maintenance and capital programme and budget setting, we will shortly also be seeking a root and branch audit of our approach to asset management and lifecycle planning by a competent industry expert. We hope to include the recommendations of the HMEP review of the National Code of Practice on Highway Maintenance Management (Well-maintained Highways), but chiefly, the purpose of the audit will be to provide an external challenge of existing practice against the Highway Infrastructure Asset Management (HIAM) guidance recommendations. It is our intention to use subsequent outputs from this audit to inform the requirements of the DfTs ‘incentive funding’ self-assessment questionnaire. v. LEAN review: In November 2014, NYCC carried out a review of its approach to basic maintenance based on LEAN principles; the objective of which was to achieve a 10% reduction in the budget without compromising service delivery. Turning a budget cut into an opportunity to improve the efficiency of our operations could only be achieved with the support and close cooperation of our Highway Maintenance Contractor. Following the workshop, which involved both the client and the contractor, a 52 point action plan was drawn up along with an associated communications document. Since this time, progress against the action plan has been subject to an external audit and efficiencies are already being seen in the way in which client officers identify and order works, the process of scheduling works delivery and in contractor productivity.
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