HOW IMPORTANT IS TRANSPORT INFRASTRUCTURE ASSET MANAGEMENT?
The underinvestment into the UK’s road and transport infrastructure has been increasingly under the spotlight over recent years. The World Economic Forum ranks the UK 28th in the world for the quality of its road infrastructure. In order to remain competitive internationally, the UK must invest not only in new infrastructure, but also maintain the country’s existing assets.
An ageing UK transport network and inadequate management of roads leads to serious negative impacts for the economy, society and the environment. Poor road surfaces contribute to increased maintenance costs and fuel consumption. This impacts motorists directly by increasing the cost of driving, but it also has broader implications. Increased fuel consumption means increased emissions, both in terms of localised emissions, such as oxides of nitrogen (NOx) and particulate matter (PM); heightened levels of which are associated with negative health impacts such as asthma, and carbon dioxide (CO2), which contributes to climate change. Furthermore, poor road conditions lead to slower speeds and increased congestion.
Evidence from a recent YouGov survey showed that the poor condition of local roads were costing Small and Medium-sized Enterprises (SMEs) in England and Wales approximately £5bn each year through operational inefficiencies, production delays, delivery delays and vehicle repair costs. The Confederation of British Industry (CBI) found that “94 per cent of business leaders surveyed cited road surface quality as a key concern”.
Asset management allows key decision-makers to answer questions relating to optimising the service level of the transport network. The UK government and Department for Transport are acknowledging the need for investment and maintenance of our transport assets. The roads minister, Mr Goodwill, this month commented that the government is committing £10 billion of investment in road repairs between 2015-16 and 2020-21. Goodwill said “we need to understand how our roads need to be managed in a way that is cost effective. Running around mending potholes may not be the most cost effective solution, so in some cases they need to understand when to resurface rather than continue to repair.”
The Chartered Institute of Public Finance and Accountancy (CIPFA) reinforces Mr Goodwill’s point by estimating that successful implementation of asset management can create savings of at least 5% over the long term. With the vast socio-economic gains to be made, organisations need to ensure the implementation of an effective and consistent infrastructure asset management strategy.