Budget Process 2005-06
For our consideration of the Scottish Executive's transport budget, I welcome, in addition to the minister and John Ewing, Claire Dunbar-Jubb and Frances Duffy. I invite the minister to give an introduction.
To start, I will check that the committee has the documents to which I will refer. If the committee referred to different documents from those that had been placed in front of a minister, it would not be the first time, unfortunately. I have "Building a Better Scotland: Spending Proposals 2005-2008: Enterprise, opportunity, fairness", which has the level 2 expenditure figures; the draft budget 2005-06; and the annual evaluation report, which looks back at the targets that applied to transport and at the budget before the announcement of the draft budget and the spending review 2004, which carry us forward to 2006-07 and 2007-08.
"Building a Better Scotland" and the draft budget are the two most recent and up-to-date documents. The most up-to-date objectives and targets for transport are referred to in "Building a Better Scotland".
Most committee members will refer primarily to the draft budget 2005-06, but some members may well refer to the other documents.
That is fine.
We have had a busy time in transport. We had the consultation document "Scotland's Transport—Proposals for a New Approach to Transport in Scotland", which was followed by the Executive white paper, "Scotland's transport future", back in June. That confirmed that we would seek an early opportunity to introduce legislation to create regional transport partnerships, to establish the national concessionary fares scheme that we talked about and to tighten the regulation of utility company roadworks. We introduced the Transport (Scotland) Bill on 27 October. The bill contains several measures to help to support and grow the Scottish economy and to strengthen our communities.
Spending on transport has increased considerably since the Scottish Parliament was established. The transport budget has had a further boost to reflect some of the ambitious proposals in the white paper. The 1998-99 budget plans allocated more than £300 million in funding to transport, only 23 per cent of which was for public transport expenditure. The budget for 2004-05 provides £935 million of funding for transport. That will rise to nearly £1.4 billion a year by 2007-08. Spending has shifted significantly towards public transport—70 per cent of spending is now on that.
The spending review process has allowed us to look forward at the next three years of spending and to focus on some of our priorities and key spending areas in transport. At the recent spending review, transport in Scotland received a major funding increase on the current 2004-05 levels of an additional £122 million in 2005-06, £389 million in 2006-07 and £444 million in 2007-08. Those increases take us up to the figure of almost £1.4 billion that I mentioned.
That is a major funding boost in cash and real terms that will enable us to increase substantially our investment in transport infrastructure; in improved public transport—our buses, rail services, ferries, trams and park-and-ride facilities; in better freight facilities; and in targeted improvements to the trunk roads network. It is important to emphasise that roads do not lose out as a result of the budget proposals. There will still be an expansion of the roads budget. We also want to encourage greater use of our sea routes and canals and to continue to develop the success of the air route development fund, with increased funding for new route developments to and from Scotland.
The planned capital expenditure for transport will increase from £52 million in 2002-03 to £297 million by 2007-08. That represents a significant commitment to increasing transport infrastructure across Scotland. Our priorities for delivery during the spending review period are to invest to maintain the momentum of our 10-year capital investment programme and our commitment to spend around £3 billion on transport infrastructure capital projects over that period. That includes investment in public transport schemes such as the new rail and tram projects that we have been discussing, as well as investment in major road improvements.
We want to extend the benefits of concessionary travel by introducing national schemes for elderly and disabled people and for younger people. We will deliver our partnership agreement commitment to deliver a new transport agency for Scotland and a network of new regional transport partnerships. We intend to allocate funding to those new statutory regional transport partnerships from the time that they are formally established.
We also want to improve the day-to-day management of our roads network; to invest in improvements to the trunk roads network; and to tighten up the management and maintenance of Scotland's roads by allocating additional money to local government. That falls outside the transport budget, but I know that it has been welcomed by COSLA and the local authorities. We are investing through the GAE line in the local government budget.
Our other legislative proposals, such as those that relate to the tightening up of utility company roadworks and the establishment of a new Scottish roadworks commissioner, are also significant.
I look forward to discussing all the transport spending plans with the committee. Before answering members' questions, I want to draw their attention to some of the changes that have been introduced to the transport budget. Some of the changes relate to issues that were raised by the committee at some of my earlier appearances and which have caused us all some frustration.
It is good to have a straightforward budget that contains figures that are directly comparable with previous figures. However, I draw your attention to the fact that we have published some new annual targets, which are more consistent and easily comparable; I believe that they represent a significant improvement in relation to some of the previous targets that I have had to defend before the committee. I hope that those changes are welcomed.
The draft budget for 2005-06 includes a detailed annex on the transport targets that have been updated. For example, the Highlands and Islands Airports Ltd target has been changed to measure specifically the growth in passenger numbers through the network of lifeline airports and to move to a target of a set year-on-year increase, which is consistent with methods used in relation to other modes of transport. In addition, I have reclassified the transport spending plans in the level 2 tables to reflect the various modes of travel, such as air, ferry, rail and bus.
The challenge that we face is to maintain the momentum of our £3 billion programme of new infrastructure and service improvements and to deliver on those targets. We must deliver on the successes that have started to be built since the establishment of the Scottish Parliament.
We have started a major programme of investment in our transport infrastructure and we are building up the new projects that we are committed to. We are working in close partnership with the committee and Parliament in relation to those projects and, over the next three years, we will develop the new Scottish transport agency, the new regional transport partnerships and a new approach to transport in Scotland that will be broadly welcomed by local authorities, business and industry, transport operators and passengers. I am confident that those structures will attract the right people with the right skills and the right experience back into transport in Scotland. I am determined that we should deliver our ambitious programme and the service improvements that people across Scotland expect from a high-quality transport system.
Frances Duffy will probably pick up the technical points as we consider some of the comparison figures, but there are some technical changes and adjustments that could be explained up front so that we avoid some of the questions, or we could just take the questions as we turn the pages.
We will move on to questions.
My first question refers to one of our earlier lines of inquiry on the bus industry. In table 8.01 on page 108 of the draft budget document, we see that the line for bus services increases only modestly; in real terms, it shows a marginal decline. I acknowledge that, on the next line, there is a substantial enhancement in money for concessionary fares.
We explored whether the Executive would be inclined to give any financial support in partnership with local government to the development of bus quality contracts, but it would seem from the budget line that the Executive does not have the flexibility to make any financial contribution to such contracts. Is that interpretation correct, or is there flexibility in other areas of the budget that would allow you to do that?
We have some flexibility in relation to the other public transport budget line. Expansion in the bus services in Scotland line reflects the increase in investment that we are making through the bus operators grant and the bus route development fund. There is growth in investment there.
We have some discretion in relation to the other public transport investment and if we were to support a quality contract proposal from a local authority or SPT, I am convinced that we could offer an appropriate level of support. Clearly, the primary responsibility would rest with the relevant local authority.
I welcome the fact that you have the flexibility to respond to such developments.
I have a second point on which you could expand. The same table shows an increase of approximately £38 million in the line containing other grants to local authorities. What will that cover?
I can expand on that, but I had better check with my official that I have got it right.
The line is slightly misleading, so perhaps we should clarify it for the future. It does not simply cover grants to local authorities; it includes support for the regional transport partnerships. From the start of the regional transport partnerships in 2006-07, we intend to allocate to them £34 million of support per year. That is quite a significant and fresh injection of new funding to the regional partnerships, and an important reassurance for local government that we are committed to those partnerships. Local authorities have been nervous about the powers of requisition, but the Scottish Executive will give a significant financial commitment to the new partnerships and they will be able to deliver substantial improvements in transport in their area. It is intended that those improvements should be in public transport projects and roads projects if the partnerships believe that that is an appropriate use of those new funds.
Is it intended that those new funds be used for the costs of setting up the partnerships, or are they intended to be delivered as enhanced projects?
We already help to fund some of the operational costs of the existing voluntary partnerships and we do not intend to withdraw that support. However, we want the vast majority of the new investment to be used in projects and for delivery on the ground. We do not think that the new partnerships will require significant additional resources for new staff and new structures. Nevertheless, we will consider each case. There are differences between the partnerships in different parts of Scotland, and we will try to reach an agreement that is fair in relation to all the partnerships.
The west of Scotland is obviously a separate case, as substantial resources already go into the funding of staff and management of the west of Scotland transport partnership and SPT. The local authorities carry that cost at the moment, through the funding arrangements that they have in place. However, in other parts of Scotland the costs are in the order of hundreds of thousands of pounds rather than millions of pounds. I would not expect that situation to change significantly unless the regional partnerships were to take on significant new powers and to require additional staff and resources.
In those circumstances, the Executive would perhaps seek to utilise the existing resources and staff of local authorities.
Exactly. We would have to reconsider the structure of things.
I have asked the minister before about the major transport infrastructure projects. Will we have the necessary skills base to carry forward those projects? Might there have to be some staggering of the programmes to deal with the skills shortage?
I ask John Ewing to give you the rationale behind the agency and the sort of approach that we want it to take.
As we said, the rationale behind the setting up of the agency is that it will enable us to have more of a focus on the delivery of major projects. We will be gearing ourselves up to do that. Inevitably, a balance will have to be struck between projects on which the Executive takes the lead and projects that are not being delivered by the Executive but which are funded by the Executive and other bodies.
As the committee will be aware, earlier this week the minister launched the consultation on the proposed Glasgow airport rail link. That is an SPT project. SPT will continue to lead on it and the Executive will continue to fund it. Fergus Ewing referred to the Edinburgh trams project. That is a City of Edinburgh Council project, which we are funding. We are working with the council on the project and it is being delivered through TIE. Different mechanisms will be available for different projects.
The timing of the projects will depend on a number of factors, including the decisions that this committee and the other parliamentary committees make on the bills that come before them. There will be interaction between the different projects, with some proceeding faster than others, and we will monitor that carefully.
You identify matters such as timetables, committee work and parliamentary schedules that will determine when the projects come on stream. However, I asked specifically whether sufficient skills could be accessed in order for the projects to proceed. Or have you identified a skills gap, which would mean that we would have to stagger the projects in some way?
Sufficient skills should be available in the market in the UK as a whole, so that will not be a major drain on the projects. However, factors such as the Parliament's capacity to handle the processing of the bills will impact on the timetable.
Target 4 in the draft budget states that the Scottish Executive should
"achieve key milestones in the delivery of the major infrastructure projects set out in the long-term investment plan, subject to projects receiving the necessary public or Parliamentary approval".
Can you give us some indication of what those milestones are? Do they exist in a document that is easily accessible to the public, so that they can be made available to everyone?
The committee has asked for that sort of information previously, in relation to public transport projects. We delivered information relating to the projects to SPICe in the autumn of last year, and we have updated that information for November 2004. I am not sure whether the updated information has been submitted yet, or whether the intention was that that would be done following today's evidence session. Our intention is to keep the committee well informed about the projects' costs, timetable and key milestones.
I appreciate that target 4 is slightly different from some of the others, but I thought it was important to have a target that led us into the major projects and allowed them to be a clear high priority. The targets for 2 per cent passenger growth are clearly important in the overall rail network, but I know the importance that the committee attaches to the major capital projects. One of the key reasons for establishing the agency is to enable us to deliver the projects on time and on budget, so I thought that it was important that the projects be part of the targets that are set.
Frances Duffy (Scottish Executive Enterprise, Transport and Lifelong Learning Department):
We have technical notes that support each target and those are available on the website, which gives a bit more information on the major milestones for the key projects.
The document that Frances Duffy is talking about contains such information as the target for the beginning of the procurement and design phase for the Edinburgh airport rail link, which is October 2005, and the target for the beginning of construction, which is October 2006. For each project there is a milestone that we can use to monitor progress.
It is important that everyone understands that the document will change in relation to the projects, issues and timetable over a 10-year period. I am committed to trying to keep the document updated regularly, to allow the committee to know early on about any changes that we encounter and to be as open and transparent as possible. It would be wrong to fix the document in the objectives and targets section of the transport budget and to cast in tablets of stone the approach to a significant major capital programme. We will ensure that we manage the programme as effectively as possible, but one of the key challenges of the new agency will be to ensure that we have the right project management skills and expertise in place so that we can ensure that the investment to which we are committed is delivered to an achievable timetable.
I do not question for a second the fact that the information is available in the way that you have described. I suggest that if the budget is going to be published every year and the targets are going to move every year, other documentation should be provided at the same time so that people who are interested—who want the information to be more accessible—do not have to go on a paper chase through SPICe or to search endlessly around the web. Given that we are producing budget statements, it might be helpful if we could produce the figures that go with the documents.
That is a fair comment, which relates to the way that capital projects are handled throughout the Executive. Transport is no different from any of the other departments, some of which have significant capital budgets.
Perhaps you should set an example, minister.
I will feed that back to the Minister for Finance and Public Service Reform. I assure you that if there is no change in the style or structure of the budget documents, we can certainly provide that information to the committee for future meetings such as this.
That would be helpful. Thank you.
Each technical note is about two and a quarter pages long. Given that we have 10 targets, including the technical notes would increase the transport chapter by 20 or 30 pages. The Finance Committee might have views on that suggestion, but we can probably find a way round that.
I welcome the fact that some of the targets are a bit more precise than they were previously. There are targets to increase rail use by an average of 2 per cent each year and bus use by 1 per cent each year. Are those targets ambitious enough? We reported last year that there were significant drops in rail passenger usage post-Hatfield as well as in the period following the industrial dispute that took place in the early part of the current decade. It is likely that certain factors—for example, economic growth, the Executive's plan for more concessionary schemes, or people choosing to use public transport to avoid congestion—would naturally increase demand for both modes of public transport. Given those points, what is the rationale behind the setting of the targets?
We want the targets to be both ambitious and achievable. There is no point in setting targets that are inappropriate or which have no basis in the reality of what can be delivered on the ground.
You are correct in what you say about rail. The highest volume of passengers on the rail network was back in 2000-01, when we had 63.2 million passengers. In 2003-04, we had 62.3 million passengers—that is a fall of about a million passengers. However, there are two points to make about rail. There is a smaller overall volume of passengers, which makes growth more achievable. We are turning the situation round post-Hatfield and, if we get the new franchise right, if we introduce the new rolling stock, if we have longer platforms, if we get a better quality of service and if we improve cleanliness and reliability, there is more potential for growth in rail passenger numbers. I have no doubt that there is strong potential to attract more people to the rail network.
I hope that the annual targets are part of a more iterative process. If, next year, we have achieved 7 per cent or 9 per cent growth and we are still on a rising curve, of course we will adjust the current target because 2 per cent would seem inappropriate. However, a target of 2 per cent seems achievable at the moment and if we were to have year-on-year growth of 2 per cent, that would be a significant achievement for the rail network.
In contrast, the bus industry has experienced decades of decline although it carries a much greater number of passengers each year. In 1998-99, we had about 413 million passengers. In 1999-2000—the key breakthrough year, in which we achieved an increase for the first time—that figure rose to 434 million. In 2000-01, there was an increase in passenger numbers to 435 million; the figure increased to 441 million in 2001-02; and in 2002-03 there was an increase to 445 million. The situation in the bus industry is much more stable than that in the rail industry and the growth figures are less dramatic. That is a good justification for the target figure of 1 per cent. If we can achieve the suggested year-on-year annual growth of between 4 million and 4.5 million passengers, that would continue a positive trend in the bus industry.
I will bring in other members in a second. The other target that I recall from a few years back was the long-term target on road congestion that was given by your predecessor, Sarah Boyack. At that time, there was an aspiration to stabilise road congestion at 2001 levels over a 20-year period. Is that still one of the Scottish Executive's targets? Are the envisaged levels for increased use of public transport sufficient to make progress towards achieving that road congestion target?
The short answer is yes; that is still a target. As I understand it, that is one of the Executive's overarching sustainability targets rather than a target that appears in the transport section of the draft budget. We are committed to achieving that target, if at all possible, through new investment—by using the carrot rather than the stick. We believe that the new investments that we are making in rail and tram services and in improvements to bus services can make a significant impact over the next 10 to 15 years.
In the medium to long term, the City of Edinburgh Council is progressing its proposals for congestion charging, and we are in discussion with the UK Government on its proposals, which relate to a shift away from the current vehicle licensing system—the road tax system—and the introduction of some sort of technology-based system that would allow charging for roads based on the level of congestion in particular locations and on particular routes. Those proposals are for the future, but they could bring significant benefits for rural Scotland, where the charge would be low; there would be a higher charge in congested areas, although it is unlikely to be as high as the charges in the south-east of England, given congestion levels in London. We would have to consider the relationship between the charging method that is proposed for Scotland and the current London charging system. It is speculated that the earliest that such a system might be introduced would be 2015. We will continue to keep members informed about developments. I have no doubt that Alistair Darling will also make announcements on progress in relation to all that.
Here's hoping that you are able to report back to us in 2015 and that we are here to hear it.
2015—we will see.
In the meantime, target 8 in the draft budget states that 70 per cent of Scottish Executive transport spending should be allocated to public transport over the period of the long-term investment plan. What does that mean? Is it 70 per cent of the investment? Is it 70 per cent of the spending and resource accounting? Or is it 70 per cent of the cash? It would be interesting to understand that, particularly given the figures for motorways and trunk roads depreciation and motorways and trunk roads cost capital. Where are we with that? What does target 8 mean?
It is 70 per cent of the DEL expenditure as opposed to the AME. Members will see that from the total figures that are given in the summary charts. As you say, the AME involves a notional depreciation charge, which is money in and money out of the Scottish budget. It is not real money that is there for us to spend on projects and on programmes. It relates, for example, to the notional capital value of the trunk roads network. That is the figure that we concentrate on.
Perhaps you could expand those acronyms for the benefit of members of the public who are listening.
DEL is departmental expenditure limit and AME is annually managed expenditure.
But it is not real money.
It is not money that is available for us to spend on other things.
Page 8 of the draft budget sets out a chart for the DEL expenditure; a second chart shows the AME. Some Executive departments have no AME, but transport has some of the most significant. About £400 million to £500 million of the expenditure that is allocated in relation to transport is allocated to the AME. That is not money that we have available for expenditure on roads programmes. We have considered the DEL expenditure, and we have calculated the split between the trunk roads and motorways budget and the other expenditure. It is on that basis that we make the 70:30 split, and that we have that target.
There is no correct split between roads expenditure and public transport expenditure, but we believed that the emphasis needed to shift towards public transport investment, because the evidence is that simply building more and more roads does not tackle congestion levels as effectively as an integrated package of investment that involves public transport and roads improvements would. We thought that a significant shift towards public transport investment was the right approach and during the past few years we have made substantial commitments to that approach. The recent target is 70 per cent, but we will keep that under review when budgets are being considered and we will discuss with the committee how we strike the right balance.
Let us consider the real money, rather than the notional money that is floating around. Spending on other public transport elements will be £384 million in 2007-08, according to the draft budget, in which the figure is broken down in table 8.08. The table indicates that the integrated transport fund will account for more than £321 million, a figure that is exceeded only by expenditure on motorways and trunk roads for that year. Is that budget based on real projects or are the figures guesstimates? If the budget is based on real projects and the Executive knows what the money is expected to be used for, could the committee be informed about the projects? We are talking about big sums of money and we need to scratch beneath the surface to understand what the money is intended for. There should be transparency and openness.
I will bring in John Ewing to comment on that. You will have noted a dramatic increase in integrated transport fund expenditure since 2002-03.
Does the 70:30 split apply in that context, too?
Expenditure on the integrated transport fund is classed as public transport expenditure. Let me first admit that the figure of £321.291 million in 2007-08 reflects a degree of spurious accuracy to which I immediately confess—expenditure will not be tied to such a level of accuracy. John Ewing will talk about the trend and about the kinds of projects that are included.
The figure includes the forward estimate of the major costs of the major projects. There will be varying degrees of accuracy in the budgets for those projects as the costs are refined, but the estimates will account for the bulk of the expenditure. There is an upward trend because we expect by the end of the period that the budget covers to have significant spend on projects that are currently being planned or developed or that are going through the legislative process.
When can the committee expect to receive detail about how the figure was built up? At this stage, such detail might be indicative, but it would be interesting to find out how the money will be spent.
We can provide a more indicative breakdown. The figure includes commercially sensitive information, but we can flag that up for the committee. We are in negotiation for ferry services to the northern isles and we need to put by money somewhere to fund those services. Members will understand that we do not want to tell the world how much money is being put aside for the franchise negotiations, but there should be no problem in breaking the figure down for the committee.
It would be good to receive the information that you can give us.
The minister mentioned a number of important flagship projects that have one thing in common: like the new Scottish Parliament building, they have a nine-digit price tag. I suppose that politics is about distinguishing between what is important and what is essential. What is the justification for having both a new rail link and a new tram link to Edinburgh airport?
The arguments for those projects will be fully scrutinised by the Parliament and it would be wrong of me to prejudge the matter. However, the case that has been made to the Executive for substantial funding of those projects relates to the transport and value-for-money benefits that the projects will accrue. The tram proposals would bring significant benefits for the road network in the Edinburgh area, which include significant journey-time benefits.
The rail project will have similar benefits, but the important difference between it and the tram project is the national significance of the scheme. In effect, it will divert the east coast main line to Edinburgh airport and will allow for new linkages and direct services to the airport from Aberdeen, Inverness and Glasgow and the west of Scotland. The benefits to the UK and Scottish rail networks have been quantified and are significant.
Both the projects will deliver good value for money and the business case for them is solid. I believe that that will continue to be the case, but as with all big projects, we must continue to examine the costs, monitor the timetable and manage the projects actively. That is why we will report back to the committee regularly, why we will have the new agency and why we will create the new skills to ensure that we have the required quality of project management to deliver the projects. If Fergus Ewing requires more information about the business case for the rail link, the information can be provided to him and other committee members, although it will be lodged with the Parliament and will be a key part of the scrutiny of the private bill on the matter.
The committee has taken a long-standing interest in the funding of non-trunk road maintenance and has received evidence from a body of whose acronym I am quite fond, the Society of Chief Officers of Transportation in Scotland—also known as SCOTS—that the backlog of repairs to road surfaces and maintenance of associated non-trunk road infrastructure will cost about £1.5 billion. I do not wish to break the embargo on the Audit Scotland press release on the matter—it will be published tomorrow—but I cannot help but notice an obvious lacuna in the Executive's thinking: there is no target that applies directly to tackling that crisis in our rural road network. I do not use the word "crisis" with undue hyperbole—in my area, there are tracks that are unfit even for goats, and what little work is done to those goat tracks is done only in winter; the structural maintenance that is required to maintain the roads as fit for use by vehicles with an internal combustion engine has been neglected.
As you know, if a £1,000 repair is not done this year, next year it will cost £2,000 and the year after that the cost will double again. The need for structural work increases exponentially as ice, wind, snow and heavy lorries do their business. Has the Executive failed in not providing a target for reducing the backlog of maintenance that is needed on our non-trunk roads? Will more resources be used to tackle the backlog?
We must consider the issue in the context of the significant funding that local authorities are investing in the maintenance and repair of local roads. Through the GAE formula, the Executive allocates more than £150 million a year to the matter, although some authorities spend more than their allocated GAE funds and others spend less. Highland Council is one council that chooses to spend less than its allocation. Responsibility for local roads rests with local councils, which is the way that things should be—local decisions are made by local councils based on local priorities.
We acknowledge the case that SCOTS has made. However, the Audit Scotland press release suggests that we agree with the figure, which had escalated from £1.5 billion to £1.7 billion in the draft that I saw. It is wrong to say that we have agreed that figure, because we have not worked with SCOTS on the detail. We have discussed the figure, we recognise that there is a backlog and we have listened to the case that COSLA has made, but we have not worked with SCOTS on the issue, because primary responsibility for the local network lies with local councils themselves. However, we have responded to COSLA with an additional £60 million per year for local roads in the budget settlement.
As I have said, that goes through the local government line, rather than through the transport budget, but it is an increase of more than 35 per cent compared with the previous GAE and will take the allocation to more than £200 million per year. With that sort of annual investment, we can make inroads into the backlog of more than £1 billion—if that is the correct figure. However, we will need consistent spending over a significant period, which requires action not only by the Scottish Executive, but by our local councils. They, as well as the Executive, must give the issue a high priority.
I began with the first question, on whether it is justifiable in the world of tough choices to choose new train and tram flagship policies, because there must be a strong argument that while there might be a strong case for one or t'other for Edinburgh and the economy of Scotland, both perhaps cannot be justified in view of the crisis facing rural Scotland. Do you accept that that is at least a valid argument?
Will the Executive reconsider whether the capital cost of one or two of those flagship policies could be better applied to the fleet, because while every navy requires one flagship, it must have other boats as well? Will you reconsider in particular the timescale, because some people have opined that if the congestion charge referendum falls, and no extra cash comes into the City of Edinburgh Council, it will be unable to subsidise the massive shortfall between the Executive's contribution of £370 million for trams and the estimated total capital cost of lines 1 and 2? Will the Executive reconsider its commitment to the tram and the rail link in the light of the result of the referendum, whenever it takes place, although I understand that it might take place in the spring?
There was a lot of speculation in those questions. I am not sure what Fergus Ewing, as a politician, thinks about answering hypothetical questions, but I would prefer to get on with delivering the projects. There is a strong argument for them. If Fergus Ewing, as the transport spokesperson for his party, wants to make a case for dropping one or more of the projects, I would be interested to see his proposals. However, as far as I am aware, as with many parts of the transport budget, there is a good level of agreement on the projects with which we want to proceed. As far as I am aware, all the public transport projects are strongly supported on an all-party basis. If that is going to change, I would be interested to see Fergus Ewing's proposals. My commitment to the projects will not waiver. I am determined to deliver them.
I am also determined to see improvements to the local roads network, which is why we responded to COSLA's request for additional funding. Indeed, the bid from COSLA was for £60 million of additional funding. It knew about the SCOTS report and about the backlog in relation to local roads. I do not think that COSLA has spoken about there being a crisis, but there is a significant issue to be addressed. COSLA requested £60 million, and the Executive delivered an increase of £60 million. That is a major part of the transport proposals that Andy Kerr announced, as Minister for Finance and Public Services, and it will make a significant difference to the quality and condition of our local roads, provided that we keep up the momentum, because the problem will not be solved overnight.
Does Fergus Ewing want to come back briefly on that?
Thank you, convener. On a point of information, can I assume that the minister thinks that it is correct for there to be no target for the maintenance of trunk roads? Secondly, if the backlog figure of £1.5 billion, as estimated by SCOTS, is wrong, what is the Scottish Executive's figure for the cumulative cost of the backlog?
The point that I am trying to make, as strongly and clearly as I can, is that responsibility for local, non-trunk roads in Scotland rests with local authorities. Over the years, we have worked hard with local government to devolve responsibilities, to ensure that local authorities have wide discretion over their budgets and to avoid tying them to particular levels of expenditure on different aspects of their budgets. We do not set targets for how much an authority should spend on education, on local roads or on other aspects of its services; we are concerned with the quality of education and of local roads.
We recognise that there are problems with local roads and that they need more investment. We are committing £60 million more, through the budget allocation to local government, for local road improvements. That is an increase of more than one third; I am pretty confident that that is the biggest increase that we have had since the establishment of the Scottish Parliament—I would need to check on that figure, but it is a significant response to COSLA's request. I believe that since we made that allocation, local councils, including Highland Council, are well placed to make the decisions that are needed to improve the condition and quality of the local road network.
So you have no alternative figure for the backlog.
The work on the backlog is being done by SCOTS; it is appropriate for it do that work. If work was being done by another group of directors in local government on other aspects of the local government service, we would not want to intervene and cut across that work because it would be appropriate for it to be done at the local level by the chief officers. They have the information and expertise to deliver their assessment. We want to ensure that we fund local government fairly to make progress on local roads, and the £60 million of additional investment is a significant injection of new funds.
At the end of the day, it is worth saying that SCOTS and local authorities regard the figure that they have identified as their best estimate, but we can all agree that the backlog is substantial and that tackling it will require concerted action for a number of years. We are allocating extra resources and we are in a significantly better position to tackle the problem than we were a month or six weeks ago, before the new Scottish budget was introduced.
A while ago, we talked about milestones. One project that I concede has reached many milestones, which are invariably subject to press releases by various people, is the Borders rail link. As you know, you have been questioned about the project several times by this committee, but there remains a lack of clarity about the Executive's funding commitment to it. I would appreciate it if you could take the opportunity to clarify where the Executive stands on the project. You will appreciate that concerns arose when, in the announcement of the Executive budget, a number of projects were specifically referred to—such as the airport rail links, which I support—but there was no specific mention of the Borders rail link. Will you clarify exactly what the Executive's funding commitment to the rail link is? If you are committed to it, why are you so reluctant to make a formal announcement?
First, I am always fascinated when I am grilled on those issues by MSPs from parties that do not have the proposals in their manifestos and are not committed to funding them.
I do not think that you have read the Conservative manifesto for the previous Scottish Parliament election, because it was clear on that.
If it is clear, I accept what David Mundell says, but that is not the case for all the parties that are represented on the committee. The commitment to the Borders rail link in the partnership agreement is clear and specific, and we are committed to supporting and progressing the project. We are currently examining the business case and considering the consequences of the delay in the parliamentary process, of which all committee members will be aware. It is almost certain that we would have made our view clear had it not been for that delay, which has been unfortunate, but I expect that we will be in a position to make an announcement on the business case soon.
Will that be after a specific milestone has been reached?
I am not sure what specific milestone you have in mind.
We heard earlier about the several pages of milestones that you have. Will funding be announced when the Waverley Railway (Scotland) Bill Committee has concluded its preliminary stage consideration?
It is clear that, when I appear in front of the Waverley Railway (Scotland) Bill Committee, as the Minister for Transport, I should be in a position to indicate whether the Executive supports the Waverley Railway (Scotland) Bill. That will be a fundamental part of that committee's consideration of the Borders rail link project.
You said "soon", which implies earlier than that, does it not?
It does, and I hope to be in a position to make an announcement earlier than that. From what I recollect, I would have been giving evidence to the Waverley Railway (Scotland) Bill Committee round about today if we had kept to the previous schedule, but we are now told that the bill's progress will be delayed into the new year, so I would like to make the Executive's position clear before that.
What impact will the current delay have on costs and the ability to deliver the rail link?
I do not envisage any significant consequences for cost, but unless the Waverley Railway (Scotland) Bill Committee is able to take action to catch up with its previous timetable, there could be a delay in the Parliament's approving the bill and knock-on effects for the schedule for the acquisition of the land and the letting of contracts. That is why it is important to make progress as quickly as possible.
It is also important to flag up to members the fact that if the consideration of one bill does not proceed according to schedule, that could have a knock-on effect on other bills. That refers back to my point about our desire to keep to our timetable. We will have to continue to inform the committee regularly and to let you know about any problems of that nature, because not everything in the delivery of the projects will be in the Executive's control. The Parliament has a central role in the key approval stage of all the major public transport projects, because of the requirement for a private bill for each of them.
That brings us to the end of questions on the budget, so I thank the minister for attending and contributing. I also thank all the Executive officials who have supported him.
Meeting continued in private until 17:54.