Why long term devolved funding, can ensure delivery on a local and national scale

Transport Knowledge Hub logo Published on: 4th December 2018 by Laura Shoaf.

If you work in public transport and you live outside of London, chances are you have been asked at some point, ‘Why can’t we have a system like London?’

When devolution was first tabled, the aspiration was for ‘Transport for London-style bodies operating at city-region or city-county level, integrated highways and rail functions and long-term funding settlements.’

While its true most Combined Authorities are operating region wide, with mostly integrated functions, transport spending per head has doubled in London and hasn’t been matched in other areas and long term funding for transport isn’t always certain. It is possible to have a similar system to London, even in a deregulated environment, but the only way it can be delivered is with long term funding.

How do we get there? Instead of asking what central Government can do for your region, consider what can your region do for central Government? How could the certainty of an integrated transport system in the West Midlands, help central government achieve its industrial strategy for productivity, housing and environment?

Many of the UK’s largest cities are underperforming on a range of economic indicators, suggesting they are not living up to their full potential.  £100bn could be generated for the UK economy every year if we brought ourselves up to the economic average of other comparable Europeancities. Collectively we are living longer, working longer hours and commuting further, so why are we underperforming?

One reason is more of us are living in urban areas than ever before. By 2050, 68% of the world population will be living in an urban area and we’re already seeing the affects, transport and roads are overcrowded and congested. In the West Midlands, 68% of people are unhappy with congestion and nationally, congestion is set to cost the UK approximately £307bn by 2030, an average of £2,057 per household.

Uncertainty in infrastructure projects is also a major factor; preventing invaluable and much needed investment from the private sector. Long and varied lead times for business case approvals combined with a complex political agenda can delay projects due to a lack of confidence, Heathrow’s third runway being a prime example. To drive national economic growth, the government needs to empower the UK’s cities to drive growth in their area which is why devolution came about in the first place.

In 2016 Transport West Midlands established the Midland Metro Alliance, to ensure local contractors had certainty over the future of the extension of the tram network. The certainty gained from the funding has been beneficial for leveraging wider investment and for providing confidence for businesses, investors and employers.
The Transforming Cities Fund which will see £250m invested in the West Midlands over four years and forms part of the government’s Industrial Strategy, sets out a very welcomed, long-term plan for Britain. It has been invaluable in enabling freedom and flexibility around the constraints which are typical of more centrally prescribed funding pots and in leveraging additional funding from other sources including Local Enterprise Partnerships and Local Authorities. This has resulted in an additional £54.6m investment on the Wednesbury to Brierley Hill Metro extension, bringing the overall funding to a total of nearly £100m.

The local determination of where the money can be spent, means our decision-makers have been able to select projects that are most appropriate. It has improved decision making and partnerships and demonstrates an understanding of the importance of cities and the need for major investment and funding to address city-specific issues and support economic growth.

Early estimates have already pinned Brexit at costing the UK economy £100bn by 2030, but in the West Midlands we have an opportunity to support the economy. Our region is set to grow by almost half a million people by 2043.  Between now and then, 100 extra people a day will be living, working and travelling in and around our cities. Housing is being delivered in the region four times the rate of the national average,  70% of the UK population is with four hour drive of the West Midlands and the UK’s first large scale 5g autonomous test bed spans Birmingham, Solihull and Coventry.

Devolution works because it lets local people make decisions about the area they understand best. But without being able to allocate funding flexibly, the knowledge is redundant. Devolution ensures openness and transparency, involving the views of people from communities where decisions affect them. Importantly it makes government policy more accountable and more relevant to voters. While we are making good progress in the West Midlands, a concrete commitment from Government, with clear timetables and funding arrangements for transport infrastructure will offer the region security, maximise our opportunities and benefit the whole UK.

About the Author

This post was written by Laura Shoaf. Laura Shoaf is Managing Director for Transport for West Midlands