Highways & Transport Scrutiny

Committee 18th January 2016

Budget Proposals 2016/17

Budget Proposals 2016/17

• Executive put forward budget proposals 5th January for

consultation

• Only proposing a one year budget due to significant reduction

in grants, increased cost pressures, eg national living wage,

National Insurance increases , inflation and ASC demography

• Executive have considered all areas of spending looking at

mandatory and discretionary servicers and the budget is a

mixed approach of savings , increased council tax, use of

reserves (£38m for 2016/17).

• Proposed Council Tax increase of 3.95% generating £9.2m.

Ceiling on Council tax not raised but Adult Care authorities

allowed to levy an additional 2%

Budget Proposals for 2016/17

for Sustaining & Developing

Prosperity Through Infrastructure –

Highways & Transport

Proposed Revenue Budget for 2016/17

SUSTAINING & DEVELOPING PROSPERITY

THROUGH INFRASTRUCTURE

Original

budget

2015/16

Savings

2016/17

Cost

Pressures

2016/17

Proposed

Budget

2016/17

% Change

£000 £000 £000 £000

1Transportation including conessionary fares

and other government grants 14,783 -2,063 94 12,813 -13.32%

2 Highway asset maintenance 22,693 -3,084 139 19,747 -12.98%

3 Highway network management 9,402 -915 132 8,619 -8.33%

4

New transport investments including highways

improvements and bypasses, growth corridors

and programmes 681 -156 52 577 -15.34%

5 Economic infrastructure and regeneration 220 -36 8 191 -12.88%

6 Heritage & Tourism operation & development 1,714 0 47 1,761 2.76%

Total 49,492 -6,255 471 43,709 -12%

• Highlighted activities relate to Highways & Transport

• Cost Pressures relate to 1% Pay Inflation, and the increase in

employers National Insurance contributions

Passenger Transport Unit

• Public Transport

• Education Transport

• Social Care Transport (Adults and Children’s)

• Community Transport

• Concessionary Fares (ENCT)

• Bus Service Operator’s Grant (BSOG)

• Accessibility and Smarter Choices

• Transport Policy and Planning

• Transport initiatives and projects.

Public Transport (Savings = £2.53m Net)Service Reductions

• Loss of fixed route/ad hoc bus services

• Reduced publicity (i.e. no printed leaflets)

• Savings from an alternative RTPI system

• Changes to the CallConnect network

• Removal of the Castle Shuttle Park & Ride service.

Impact/Risks

• Loss of Workers/School/College time services (c.130 services)

• Additional financial burden on Children’s budget (c. £750k)

• Loss of dedicated market day and weekend services (c. 30 services)

• Over 100 communities without a fixed bus route

• Potential impact on commercial services (loss/reductions/fares increases)

• Rural isolation and social exclusion with the loss of approx. 1.8 million pax. journeys

• Vulnerable groups/individuals at heightened risk (potential implications for other

service areas i.e. Adult’s, Health etc.)

• Contentious – likely legal challenges and public outcry

• Lack of resources to respond to increase in complaints etc.

• CallConnect will not be able to cope with the increase in demand.

Public Transport (Current Budget = £4.43m)

• Supported “socially necessary” local bus services

• CallConnect and other DRT operations for other LA’s

• Community Transport support and a CT helpline

• Punctuality Improvement Plans (PIPS)

• Funding bids

• Inspection and contract compliance

• Online and face to face driver training

• Maintain network database and national datasets

• Publicity and Realtime passenger information

• DBS checks and Driver/PA licensing

• EU procurement processes

Community Transport (Current Budget = £65k)

• Dedicated Officer working to develop CT schemes

• Grant aid DAR schemes (Lincoln area)

• Provide reimbursement for car scheme admin costs

• Handle all DBS checks (FOC)

• Provide online and face to face Driver/PA training

• Organise a Community Transport Forum

• Generic CT literature

Service Changes

• No direct reduction, but reassign funding into Total Transport initiative

• Introduce SLA requirements for any funding given

Impact/Risks

• Individual schemes won’t receive automatic funding

• Schemes will be encouraged to join the Total Transport initiative to provide

them with a funding stream (for work undertaken).

• Some schemes may cease if they do not wish to follow this route.

Concessionary Fares (Current Budget = £7.21m)

• Prescribed National Concessionary Travel Scheme

• Statutory administration of scheme (DfT funded)

• Entitlement validation and pass production

• Reimbursement tool calculates payments due based on

numbers travelled

• Not permitted to cap expenditure for scheme unless

operators agree.

• Current discretionary element = pre 09.30 (c. £400k)

Service Reductions/Changes

• None permitted for statutory scheme

• New reimbursement tool and guidance (Oct 15) likely to increase cost

• CMS and associated services due for retender

• Members could consider changes to the pre 09:30 concession???

Impact/Risks

• Scheme costs could come in higher than budget

• Attempts to negotiate a “voluntary” capped agreement with operators may

fail.

• Impact on other service areas if additional money is required.

• Formal appeal process through the Sec. of State if operators consider

scheme does not meet the “no better/no worse off” rule.

• Loss of pre 09:30 and loss of bus services could be “a perfect storm” for the

most vulnerable.

Concessionary Fares (Savings = £0)

BSOG (Current Grant = £467k)

• Ring fenced and specific criteria for spend on transport

• Currently LA’s administer BSOG for supported services on behalf of DfT

• Commercial BSOG under review by DfT currently

Service Reductions/Changes

• Formula for distribution of commercial BSOG likely to change (+/- impact)

• Potential for DfT to top slice payments before disseminating to LA’s?

Impact/Risks

• Additional administrative burden if commercial BSOG passes to LA’s

• Funding received may not meet current spending profile.

• Reduced monies may result in further loss of services (commercial)

• Fares could increase

Accessibility and Smarter Choices (Current

Budget = £912k Net inc. staffing)

• Promotion of smarter travel choices (walking/cycling/car

share etc.)

• Bikeability Scheme (100% grant funded c. £156k p.a)

• Travel Plan work with schools and businesses

• Bus Stop infrastructure

• Other capital infrastructure schemes (i.e. cycle paths,

PIPS)

• LSTF, ERDF and SLGF bids and projects (e.g. Hirebike

Scheme and Personalised Travel Plans).

• Special projects e.g. Rural Gain Grant, Wheels to Work

• Planning application appraisal input.

Accessibility & Smarter Choices (Savings = Share of £1.28m)

Service Reductions/Changes

• Remove discretionary travel plan work with schools and businesses.

• Reduce promotional work e.g. Golden Boot Challenge, incentivising smarter travel

choices.

• Maintain Bikeability Scheme whilst it remains 100% externally funded.

• Cease bus stop infrastructure programme (both new/planned maintenance)

• Capitalise staffing resource involved in capital infrastructure schemes.

• Evaluate the merits of schemes such as Hirebike, Wheels to Work and Rural Gain

Grant when not externally funded

• Consequential reduction in staff numbers due to reduced activities.

Impact/Risks

• Less emphasis and resource on championing accessibility/smarter choices and

potential impact on modal shift.

• Negative impact for active lifestyles/health agenda.

• No new accessible bus stops (does not support DDA requirements).

• Heightened risk of infrastructure not being fit for purpose when all vehicles become

wheelchair accessible by 2017.

• Lack of resource to react to bidding opportunities and to provide external

engagement when required.

Transport Policy and Planning (Current Budget

£598k inc. staffing)

• LTP

• Policy review/development and advice

• Strategic rail role including lobbying

• Appraisal of planning applications

• Traffic impact assessments

• Planning authority liaison re: developer contributions.

• Commission traffic data monitoring.

Transport Policy & Planning (Savings = Share of £1.28m)

Service Reductions/Changes

• Reduced data capture i.e. traffic monitoring.

• Potentially reduce resource for planning application appraisals (if market

allows)

• Explore potential for charging for other permits/schemes.

Impact/Risks

• Sways in the market can have significant impacts on the work and income

attracted by this team.

• Lack of data capture will mean the data used may not be current.

PTU Other Expenditure

• Resourcing required:;

– to plan, procure and contract manage 4000+ contracts for over 20,000 scholars.

– to plan, procure and contract manage adult and children social care transport.

– for inspection, risk and passenger assessments plus ongoing contract

compliance.

– for specialist SEND travel training.

– to proactively address health and safety in the travel behaviour of scholars.

– to undertake driver/PA vetting role.

– for data capture and statistical analysis for own and client service areas.

– for management of the Transport Operations Centre scheduling DRT services

and meeting of SLAs.

– for key role in emergency planning activities

– to undertake development of initiatives for service improvements and efficiency

savings e.g. Total Transport

PTU Other Expenditure (Savings = Share of £1.28m)

Service Reductions/Changes

• Reduction in staff numbers and restructuring

• Suspend all Greener Buses/alternative fuel trials

Impact/Risks

• Unable to meet current SLA’s and potentially LCC’s statutory duties (i.e.

transport within 5 days)

• Unable to meet peak demands i.e. transport not in place for start of Sept.

• Increased complaints and legal challenges.

• Health and well being risk to remaining staff.

• Reduced inspections may increase risks for passengers

• Potential for consequential increased costs.

• Significantly reduced ability to deliver a responsive service and respond to

members, client services and the public.

Transport alternatives and options • DfT Total Transport initiative - £400k external feasibility funding

– Joint planning, procurement and delivery of public sector transport (inc. health)

– Development of a “one stop shop” for transport

– Increased use of CT in transport solutions

– Appropriate IT solutions including software and telematics

– Smart ticketing (PT and Scholars) – invest to save business case?

– Alternative procurement methods

– Alternative contract models especially in high spend areas (e.g. SEND)

– Market Development

– Market Moderation inc. own fleet options

• Seek to attract commissions for the PTU from Academies/Colleges

• Extend external consultancy and scheduling services provided by

PTU (currently Rutland, Peterborough, Nth Lincs., Northants,

Stratford-Upon-Avon c. £558k income)

• Develop a Centre of Excellence

• Explore alternative options for acquiring vehicles.

• Explore opportunities for community “self help” initiatives.

Highways Revenue Budget

The Highways Revenue Budget has been held at its

current level for a number of years butM

• Construction Inflation Averaged 1.8% pa equivalent to a

reduction circa £400k pa

• Asset Growth circa £100k pa

• Street Lighting Energy cost increase circa £1.2m

Highways Maintenance and Network

Management

• Structural Maintenance

• Environmental Maintenance

• Safety Maintenance

• Winter Maintenance

• Other

Structural Maintenance (Current Budget = £6.32m)

• Divisional AMT Gangs

• Tree Inspections

• Emergency Response

• Structures and Safety Barrier Maintenance

• Contractual Payments (Fixed Costs)

• Contingencies

• Quality Control & Materials Trials

• Payments to 1/3rd parties

• Systems support

• Depot Costs

Structural Maintenance (Savings = £1.7m)

Service Reductions

• Divisional AMT's. Approx. 4-5 No out of 20 (circa £800k)

• Reduction in Bus stops, Tree Inspections, Inventory Data Collection,

Structures Maintenance. (circa £400k)

• Transfer of costs to Capital Grant for Structures and Safety Fencing, Quality

Control, Trials and Skid Resistance Treatments (circa £500k)

Impact/Risks

• Significantly reduced ability to deliver responsive service.

• Reduction in minor maintenance work including Signs

• Potential increased costs for Winter Service through loss of drivers

• Impact on partners (Kier) and sustainability of Term Contract prices

• Potential increased risk/liability for trees falls

• Potential long term increase in costs through lack of routine maintenance

• Reduction in flexibility to respond to events and unforeseen costs

• Reduction in Capital Maintenance

Environmental Maintenance (Budget = £3.32m)

• Amenity Grass Cutting

• Safety Grass Cutting

• Public Rights of Way

• Weed Control

• Tree Maintenance

• Contractual Payments (Fixed Costs)

Environmental Maintenance (Savings = £1.6m)

Service Reductions

• Removal of Amenity Cutting (circa £600k)

• Reduction in Public Rights of Way Maintenance (circa £200k)

• Safety Cut reduced from 3 verge cuts to 1 and maintain visibility splays

(circa £500k)

• Reduction in weed control from 3 cycles to 1 (circa £250k)

Impact/Risks

• Increased complaints from Public/Parish Councils.

• Potential increased safety risk and liability for claims

• Potential increased insurance premiums

• Potential impact on tourism from reduction in PRoW service

Safety Maintenance (Budget = £9.34m)

• Gully Emptying and Drainage Cleansing

• Street Lighting Maintenance and Energy

• Signals Maintenance

• Signs and Lines

• Traffic Regulation Orders

• Contractual Payments (Fixed Costs)

Safety Maintenance (Savings = £2.4m)

Service Reductions

• Reduction in Drainage Cleansing from 1 full and 1 part cleanse to targeted

cleaning and emergencies only (circa £750K)

• Reduction in Street Lighting of 33% from switch offs, part night lighting and

dimming (circa £1.2m). Part of Street Lighting Transformation project.

• Reduction in signing and transfer of some signs maintenance costs to

capital grant funding (circa £500k)

Impact/Risks

• Increased risk of localised flooding and complaints

• Reduction in signing and replacement signs

• Increase in complaints

• Potential increased risks and liability for claims

• Potential increased insurance premiums

Winter Maintenance (Budget = £4.87m)

• Winter Gritting and Snow Clearing

• Emergency Response

Winter Maintenance (Savings = £0.76m)

Service Reduction

• Reduction in gritting routes from 33% of the network to 25%

(further work is being undertaken to review option of treatment based on Route

Based Forecasting).

Impact/Risks

• Delays on the network

• Increase in complaints

• Increased risk of accidents

• Impact on capacity/resources and ability to respond to emergencies and

severe weather events

Other Maintenance (Current Budget = £8.95m)

• Departmental Operating Costs

• Highway Condition Surveys

• Insurance Premiums

• Structures Maintenance and Inspections

• Cross Keys Bridge

• Technical and Engineering Support

• Income

Other Maintenance (Savings = £1.3m)

Service Reductions

• Reduction in staffing of approximately (circa £1m approx. 20% of budget)

• Reduction in Structures inspections

• Reduction in Technical Support to the department

• Transfer of some structural condition surveys to capital grant

• Significant reduction in Traffic Regulation Orders

Impact/Risks

• Significantly reduced ability to deliver responsive service and respond to

members and the public.

• Impact on technical skills within the department

• Reduction in supervision and control of works

• Long term impact on condition of structures and other assets

• Limited ability to attract significant additional income and external funding

Options

Options

• Transfer more costs to capital where possible but would impact on

long term costs.

• Further reductions in AMT’s

• Offer communities basic support for highways

• Consideration of different operating models for service delivery

Alternatives

• Zero maintenance for some unclassified roads

• Ask communities what they would be willing to do

• Use of alternative technology to assist (e.g. Street Lighting)

• Generating additional income through review or introduction of

charges for Tourism Signs, Dropped Kerbs, S278 design and build

and on street parking

Lincolnshire Future Highways 2020

Business Case Development (v3.1)

33

Simon Wilson

s.wilson@provingservices.co.uk

+44 (0)7970 773496

Paul Rusted

Paul.Rusted@lincolnshire.gov.uk

Assumptions, Prerequisites &

Enablers• A simpler, leaner structure will replace the current operating model.

– A 7-District orientation will supersede the 2 Divisions and 10 Areas.

• The future approach requires functional and processes discipline and co-ordination.

– The current approach is distributed, inconsistent and reactive.

– Each person will have clearly defined roles and responsibilities.

• The asset plan for the entire county will be the only plan.– District Managers’ will liaise with local politicians to agree the district-level priorities.

• 90% of enquiries will serviced by either the web portal or the contact centre.– Too many enquiries are processed by highways engineers.

• AMT activities will be programmed and GPS tracked by the services hub.– AMTs may be moved to hot spots across the county.

– An AMT sweep approach is being considered (following the Surrey model).

• Non value-added activities will cease or be charged.– Highways engineers will provide a visible field-based service.

• Works will be properly commissioned.– Work will no longer be shared with the contractor (i.e. works orders preparation).

22 January 2015 35

Lincolnshire 2020: Future StructureConsolidation of Analysis To-Date (Model v19)

22 January 2015 36

Services Design

& Services

Portfolio

Management

5

Programming

& Job

Management(Budget & Resources

Management)

4Services

Commissioning(Performance

Dashboard & VfM

Assurance)

2

Network

Management(Permits & Parking)

Highways &

Transportation

Services(Design, Consultancy, Lab)

Local Community

Engagement

i

7

10

Job QA(By Sample)

vi

Job

Execution

v

Services Hub

α αSatisfactory or

Work In Progress

Requires

Improvement

Good

Performance

In-House

Capability

Commissionable

(JV) Capability

Failing Services

(or To Be Defined)

Communications

& Public Relations

8

Reactive Job

Profiling(Job Request)

iii

Asset

Management(Defining Asset Works

Programme)

Enterprise Services

(Services Overhead)

Budget

Control(Budget Setting &

Spend Efficacy

Management)

Asset Resilience

(Winter Maint., Flood,

Emergency Management)

6

A

3

9

Political

Commissioning

& Briefing

1

Field Operations

Se

ve

n D

istr

icts

Conclusions

Relatively easy to

implement reduced

spending on many services:

• Indirect demand

• Relatively easy to stop

doing things

BUT

• High risk of critical failure

of some services/assets

• Risk of legal challenge

• Likely to be knock-on

effect on other services

over time

• High levels of public

dissatisfaction

• Discussion on timing of

implementation with

partners required

Next Steps• Feedback from today will to fed into the Executive for their

consideration on 2nd February when they will recommend a budget for

approval by full Council on the 19th February.

• Public budget engagement events are being held around the county.

• The Winter edition of County News published in December has given

the public the chance to comment on their preferences for service

reductions given the present financial context. Scrutiny Committees

will be formally consulted on proposals for their service areas during

their January meetings. Consultation meetings will also be held with

other key public sector partners and stakeholders.