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Active travel: increasing levels of walking and cycling in England Contents

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5Funding for active travel

51.As with most areas of local authority spending, investment in active travel is not ring-fenced and money for improvements for pedestrians and cyclists comes from the overall local authority funding settlement. Local authorities must therefore decide how to prioritise investment in active travel against other local services. We have been told that the funding framework for active travel remains challenging given that the wider framework for local transport funding is complex, short-term and under severe pressure.103 This reflects the evidence we received to our inquiries into bus services and local roads.104

52.Because the Cycling and Walking Investment Strategy (CWIS) is a central government plan—rather than a strategy set out by local authorities—we have focused our inquiry on how the Government is supporting local authorities outside London to deliver its plan,105 rather than looking in detail at how local authorities decide to prioritise their own budgets.

Funding for the Cycling and Walking Investment Strategy

53.When the Government published the CWIS it described it as a £1.2 billion plan.106 This included just over £300 million of ring-fenced funding for walking and cycling schemes—including funding for Bikeability, Cycling Ambition Cities, Highways England and the Access Fund—with the remainder coming from a variety of sources that are not earmarked for active travel. The vast majority of the £1.2 billion was expected to be allocated to capital spending (89%) with only £132 million expected to be allocated to revenue spending.107 In the previous Chapter we highlighted the importance of revenue spending to realising the benefits of capital investment. In this Chapter we look at funding in the round—covering both capital and revenue spending.

54.Living Streets raised concerns that only £314 million of the funding for the CWIS had been ring-fenced for active travel, and that only one of the ring-fenced funds was set to operate for the full five-year period of the strategy.108 Chris Boardman, the Cycling and Walking Commissioner for Greater Manchester, also questioned the Government’s figures on investment in active travel, saying:

£1.2 billion is what was claimed; £800 million of that is up to local authorities to how they spend it. It could be spent on cycling, but at the moment with so many hard decisions to make a lot of councils just won’t because they have so many other fires to fight. I think it is rather disingenuous to just roll up all the numbers that could be spent on cycling.109

55.Since the CWIS was published in 2017, the Government has said that additional funding streams have been made available to local authorities, including the £1.7 billion Transforming Cities Fund, £220 million through the Clean Air Fund and £5 billion through the Housing Infrastructure Fund.110 As a result the Government has now estimated that spending on active travel will be higher than originally stated, and in January 2019 the Government said:

Almost £2 billion is projected to be invested over this parliament to 2021 to deliver increased levels of active travel, including through the Transforming Cities Fund and Local Growth Fund.111

The Government has provided a detailed breakdown of expected investment in active travel between 2016 and 2021, shown overleaf.

Table 2: Projected investment 2016/17–20/21 (£ millions)

Ring-fenced
Access Fund	80
Bikeability	50
Cycling Ambition Cities	101
Cycle Safety Fund	7
Cycle Rail	12
Highways England Designated Funds	84
National Outreach Projects & Innovation	14
Total (ring-fenced)	348
Non-ring-fenced
Local Growth Fund	597
Integrated Transport Block	114
Highways Maintenance Fund	283
National Air Quality Plan	16
National Productivity Investment Fund	77
Highways Maintenance Challenge Fund	8
Cross-Government Infrastructure Funds	500
Total (non-ring-fenced)	1,595
All
Total	1,943

Source: Correspondence from the Minister of State for Transport, 11 February 2019

We raised concerns above about the lack of priority that is afforded to walking by policymakers, and it is notable that most of ring-fenced funding for active travel relates to cycling.112

56.A common theme in our evidence was that too much funding for active travel is bid-based and short-term in nature. The Urban Transport Group has said that “local transport funding is complex, short-term and far too dependent on one-off competitions which are wasteful and inefficient given costs and uncertainties around bidding as well as troughs and peaks in spending depending on the outcome of competitions”.113 The Local Government Association (LGA) stated that “Too often funding is provided in the form of short-term capital grants linked to bidding processes with strict criteria. This stop-start funding, developed for specific policy interventions, does not allow councils to develop long-term sustained plans”.114 We have been told that funding pressures—including those created by short-term, bid-based funding—create challenges for local authorities when it comes to long-term planning and resourcing, and recruiting and retaining skilled planning officers.115 We were told that guaranteed long-term funding would mean local authorities would be able to prioritise active travel and raise skills for how walking and cycling should be designed for.116

57.The LGA told us “More rounds of competitive bidding is unlikely to achieve the increase in uptake we would like to see nationwide”.117 Weighing up the case for competitive bidding for walking and cycling grants, Dr Rachel Aldred told the Committee:

The competitive aspect at least ensures that places know that they are going to be judged. They are not necessarily automatically going to receive funding for whatever they put in. There are advantages to competitive funding. The disadvantages, of course, are that some places lose out. Sometimes, a lot of places lose out, depending on how much funding is allocated and how it is judged.118

Phil Jones, an independent transport planner, proposed an alternative where any proposal that met a certain threshold was funded, but questioned whether this would be possible:

Ideally, you would say that any authority that wants to do one, and demonstrates sufficient commitment to quality in their schemes, by passing some kind of quality test, should receive the funding. Whether that can work in a Treasury world where there has to be some kind of limit, I do not know, but it should be a quality threshold rather than capping them at a certain number of authorities almost arbitrarily.119

58.One of the problems with bid-based funding is that local authorities that are unsuccessful have spent money and staff resources on developing a proposal that then does not result in any improvements being made. Liverpool City Region Combined Authority has suggested that the DfT should offer feedback on unsuccessful funding bids to allow better bids and programmes to be developed in the future.120

59.We have heard that the routes for local authorities to secure funding for active travel are extremely complex, with local authorities bidding for funding from several sources—the DfT, Local Enterprise Partnerships (LEPs), Highways England, and regional transport authorities.121 This reflects evidence we heard during our inquiries into buses and local roads about the challenges local authorities face bidding for grant funding.122 Dr Ben Still, representing the Urban Transport Group, questioned how the Government’s approach to funding active travel compared with that for roads, saying:

It is worth asking why active travel funding is not treated in the same way as road maintenance funding, for example, and why there isn’t simply a clear allocation year on year that can enable local partners to plan better and develop longer-term programmes.123

60.There are also concerns about the extent to which funding has been distributed across the country. The Local Government Association has stated that the Government’s focus has been on funding for ‘cycling demonstration towns’, ‘cycling towns’ and then ‘cycling ambition cities’, but this has not been replicated nationally.124 Others have agreed that funding for active travel needs to be made available to all local authorities.125 The LGA also said that the lessons from the concentrated activity that have been funded by the Department now need to be applied nationally.126 Liverpool City Region Combined Authority has noted that “significant funding seems to be available for areas who have already demonstrated success” and has said that “Lessons learnt from these areas need to be cascaded more proactively with additional funding for other cities to roll out these lessons”.127

61.The proportions of local transport budgets that are spent on active travel vary hugely. In county councils that have not received dedicated funding—like Hertfordshire—this can be below 5%,128 whereas in areas that have received dedicated funding from local government grants—such as Birmingham—up to 40% of transport capital budgets are spent on active travel,129 although the short-term nature of most of these grants means these higher figures are not sustained over time.

62.In October 2018 the Government stated that it would encourage local authorities to increase investment in cycling and walking infrastructure to 15% of total transport infrastructure spending—up from around 12% at present.130 The then Minister told us that the Government would be providing local authorities around £3 billion for local transport infrastructure improvements in 2019/20, and that combined with locally-sourced funding 15% of this would represented some £500 million.131

63.The underlying message from our evidence was that the short-term, bid-based, complex nature of funding for active travel does not align with, or provide a good base for achieving, the long-term goals set out in the CWIS. This was a point well made by Cycling UK, who said that they had “a great deal of sympathy for the DfT officials who were tasked with building a ‘Strategy’ for Cycling and Walking Investment” when it comprised so few budget lines. They said that “Unsurprisingly, it falls some way short of amounting to a joined-up package.”132

64.Funding for active travel is too piecemeal and complex, and the Government has not given local authorities the certainty they need to prioritise active travel and make long-term funding commitments. The lack of dedicated funding for active travel means there is no guarantee that the £2 billion the Government has estimated will be spent on active travel this Parliament will actually be spent on increasing levels of walking and cycling. The Government appears to be relying on local authorities choosing to prioritise active travel in their own bids for central Government grants, rather than committing the investment that is necessary to achieve the targets it has set out in its own strategy. This is not good enough.

65.We recommend that the Government bring together the funding it expects to be invested in active travel into a dedicated funding stream for local authorities to deliver improvements—such as those set out in Local Cycling and Walking Infrastructure Plans—that will increase levels of walking and cycling. This new funding stream should make money available for resource as well as capital spending to both develop and maximise the benefits of infrastructure improvements. Creating a single fund for active travel will make it easier for local authorities to apply for funding and would give them give the confidence to prioritise active travel, in the knowledge that bids for these funds would not be in competition with bids for other purposes.

66.We welcome the Government’s statement that it will encourage local authorities to increase investment in cycling and walking infrastructure to 15% of total transport infrastructure spending. However, it is not clear that this encouragement will, on its own, be effective—particularly when local budgets are under increasing pressure. We recommend that, as part of the annual progress report we have recommended they produce on delivery of the Cycling and Walking Investment Strategy, the Department publish figures on the proportion of each local authority’s transport infrastructure budget which is spent on active travel. This would show that the Department is monitoring local authorities, and it would provide a basis for those local authorities who are not meeting this target to be held to account.

Spending on active travel compared with other modes

67.The amount of money spent on walking and cycling pales in comparison to spending on other modes of transport. In 2017/18 the Government spent over £26 billion on transport in England. The majority of this (59%) supported the rail network, and the next largest share (31%) was spent on the road network. While some spending on the road network will deliver improvements for pedestrians and cyclists, the DfT’s breakdown of expenditure by function does not include spending on walking and cycling—which is evidence of the priority afforded active travel. The £2 billion the Department has said will be available to increase active travel in England from 2016–21 equates to £400 million per year, around 1.5% of the public expenditure on transport in England last year.

Total identifiable expenditure on services in England by sub-function (£ billions), 2017/18

National roads	Local roads	Local public transport	Railways	Other transport	Total	Cycling and Walking Investment Strategy133
3.4	4.7	2.1	15.5	0.6	26.4	0.4

Source: HM Treasury, Country and regional analysis: 2018, November 2018, Table B.1, page 48

This low level of investment in active travel is despite the often excellent value for money of many active travel schemes. Cycling UK has cited Government estimates of the benefit-to-cost ratios (BCR) for active travel investment ranging from around 5:1 to 13:1.134 The DfT categorises improvements with a benefit cost ratio of above 4.0 as “very high”.135

68.We have heard that the DfT’s guidance on appraising transport projects—WebTAG—prioritises motorists over pedestrians and cyclists, which often means that the business case for active travel improvements fails because of the apparent disbenefits to motorists.136 The then Minister noted the deficiencies of WebTAG when it came to measuring the benefits of active travel projects, and suggested that local authorities should rely less on this model when appraising improvements for pedestrians and cyclists.137

69.The increase in spending on active travel this Parliament is welcome, and the £2 billion the Government has said will be spent on walking and cycling from 2016 to 2021 is a start, but it equates to only £400 million a year. This is a tiny sum compared with spending on other areas of transport—and is just 1.5% of transport spending in England. The evidence indicates that this level of investment is insufficient to fulfil the Government’s current targets, which we’ve said already are not ambitious enough. Increasing levels of walking and cycling will help the Government tackle congestion, improve public health and reduce damage to the environment. These are benefits that merit greater priority and increased funding. The Government needs to invest more in active travel.

70.The then Minister recognised that WebTAG—the Department for Transport’s guidance on appraising transport projects—has defects when it comes to measuring the benefits of active travel. Given that this is the main tool local authorities use to determine the value of money of transport infrastructure improvements, it is important that it reflects the benefits to all road users, including pedestrians and cyclists. We recommend that the Department review its WebTAG guidance by the end of the year, with a view to improving its usefulness to local authorities in assessing walking and cycling schemes.

Increased future funding

71.Cycling and walking stakeholder groups, and local authorities, have called for increased and more stable funding for active travel. The Bicycle Association, British Cycling, Cycling UK, Living Streets, The Ramblers and Sustrans have called for walking and cycling to receive a set percentage of overall transport spend of 5% rising to 10% over the 5 years of the next spending round (from 2020/21 to 2024/25).138 This would amount to £17 per person annually in 2020/21, rising to £34 per person in 2024/25. An increase in spending along these lines is illustrated below.

Figure 3: Illustration of increased spending on active travel compared to current spending

Source: PQ 205816 [on Walking], 10 January 2019, and the Bicycle Association, British Cycling, Cycling UK, Living Streets, The Ramblers and Sustrans (ATR0076) paras 14–15

72.Several of our witnesses underlined the importance of long-term, stable funding streams. Phil Jones, an independent transport consultant, told us that the most important thing for funding is consistency, and stated: “With guaranteed long-term funding in place local authorities and the profession will begin to take active travel more seriously, leading to a raising of skills in how cycling and walking should be designed for—not just in dedicated active travel schemes, but in all highway improvements.”139 This point was emphasised in the oral evidence from local authorities.140

73.We have been told that, as a further Spending Review—setting Government spending limits—will be agreed shortly, now is the right time to revisit how the Government funds active travel. A joint submission from the main walking and cycling stakeholder groups said: “The Government should strengthen its Cycling and Walking Investment Strategy as part of its forthcoming Spending Review, adopting a second CWIS (CWIS2) with resources that are consistent with its stated aims and ambitions”.141 Rachel White, from Sustrans, told us: “It is a good time to revisit the strategy because there is supposedly a spending review at the end of the year. One of the big things missing from the strategy is funding to push out projects across the nation.”142

74.The then Minister said that the quality of the data on the effectiveness of investment in active travel has improved immensely, and this meant that he could make a “much tougher, stronger pitch to Government for the benefits of investing”.143 He also said that the Government had developed a model that estimates the cost and benefits of achieving the 2025 CWIS targets under a range of different scenarios. He said that DfT would be using this model to estimate the costs and value for money of targeting future active travel interventions towards achieving different government objectives—such as improving health, economic growth and regional development.144

75.The Government needs to increase spending on active travel if it is going to deliver the increases in walking and cycling that it should be aiming for. As well as more funding, certainty that this funding will continue over the long-term is essential if local authorities are to make active travel a priority. We recommend that the Government increase funding for active travel in future Spending Review periods. The Department for Transport should propose a long-term funding settlement for active travel, increasing over time. This would give the signals necessary to local authorities to make active travel a priority. The Department for Transport should seek appropriate funds from the Treasury to ensure the delivery of new, ambitious targets in the revised Cycling and Walking Investment Strategy that we have called on the Department to adopt.

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