Utility companies paying £2,500 a day to dig up the road

Section 74A of the New Roads and Street Works Act 1991 and the Street Works (charges for occupation of the highway) (England) Regulations 2012 have enabled Transport for London and Kent County Council to operate lane rental schemes on their road networks, charging utility companies for digging up the road. The government is now considering the removal of the ‘sunset’ clause that requires lane rental schemes to close in March 2019 unless the regulations are amended.

Lane rental schemes charge those carrying out works on the highway, with charges focused on busy streets and times. The scheme is designed to reduce the congestion caused by lane closures and the local highway authority can impose charges of up to £2,500 per day during the works.

The charge was set to reflect the cost of congestion and incentivise utility firms to carry out work faster and outside peak times, improve planning and standards, and reduce the need for works to be revisited for remedial work. Charges are waived for joint works and for carrying out the works in the evening or at the weekend.

Councils already issue permits to utility companies for roadworks, but the trials in London and Kent saw severe congestion fall by 56%. The 2.5 million roadworks carried out annually costs the economy an estimated £4 billion every year in business costs due to lost time as people are unable to get to work and delays to deliveries.

The government would like to continue the current schemes until a long-term solution is implemented and consultation over the removal of the sunset clause is now underway. New schemes might also be permitted with the Secretary of State’s approval, allowing other local authorities with heavily congested roads to introduce the scheme – although this would not be compulsory.

In the trial, Transport for London and Kent County Council are required to ensure that surplus revenue is spent on roadworks or on reducing and preventing disruption. London earned £3 million in charges in 2016 but it estimates that the wider economy benefits by £30 million. Current projects include the installation of service ducting along roads (to reduce the future impact of utilities works) and providing pedestrian and cyclist access.

Transport bodies are encouraging the roll out. Although road users would see some improvements from the implementation of charges (such as joint works being carried out) they would also likely find that the additional costs borne by utility companies would be passed on to them as customers.

The consultation process ends on 28th October 2017.