First ever full economic analysis of the impact of potholes in the UK evaluates the full cost in damage, accidents (especially to cyclists), time wasted and higher emissions.
Anyone who drives or cycles will be aware that Britain’s pothole crisis is serious. Having completed the most recent ‘Peking to Paris’ car rally from Beijing to Paris, my take is that our roads are now worse for potholes than anywhere on that rally apart from the Far West of China and Mongolia (where we had to drive across the Gobi desert where the unsurfaced tracks are even more boneshaking than British roads) and notably worse than in both Russia and Kazakhstan, let alone Western Europe.
The RAC’s annual pothole report was released last week and confirmed that their ‘Pothole Index’ – the risk of a driver breaking down as a result of a pothole compared with the 2006 base – had risen from 1.60 in 2022 to 1.69 in 2023[1].
The crisis seems to be mainly caused by reduced spending on road maintenance. English local authorities’ spending on ‘routine maintenance’ fell in real terms from £1,756 million in the financial year ending in 2006 to £1,276 million in that ending in 2023[2], a fall of 27.3%. Interestingly, consistent with a trend in many parts of the public services, so-called spending on ‘Highways Maintenance Policy, Planning & Strategy’ (ie local authority staff) rose by 28.2% over the same period.
Anecdotal evidence, however, suggests that part of the problem seems to be the use of cheap fillers by private contractors to fill potholes which ‘gets ripped out the first time a bus or a heavy lorry drives over it’. The private contractors can then get paid a second time to fill the pothole their own filler has created.
Despite the increased number of potholes, the number of potholes mended in England and Wales has fallen from 1.7 million in 2022 to 1.4 million in 2023[3].
The government has announced with some fanfare a new ‘Pothole Fund’ to provide £500 million a year to fill potholes, increased in the 2024 Spring Budget to £700 million a year. This replaces the previous ‘Pothole Action Fund’ which also allegedly provided anti pothole funding. But as the House of Commons library researcher has dryly noted the Department for Transport stated that it is ‘up to the respective highway authority how best to spend this funding’[4]. Certainly there seems little evidence that the fund has ended up as actual spending on road maintenance.
The economic damage done by potholes is in three areas: damage to vehicles, accidents and reduced speeds, due to road users having to drive more slowly or due to congestion that is pothole related.
KwikFit prepare an annual Pothole Impact Tracker which estimates the annual cost in damage to vehicles in 2023 as £1.49 billion in the latest report released in the past week. This estimate seems consistent with data from AA and RAC on pothole related damage for their service users.
Evidence on pothole related accidents is less easy to find. An oft quoted estimate from the National Accident Helpline is that between April and June 2020 1,766 accidents were caused by potholes[5]. But this quarter was when the whole country was locked down because of Covid so the number would not be representative. There is also data showing that between 2018 and 2022 451 people were killed or seriously injured because of potholes[6] of whom just under half were cyclists.
Data from India shows an even bigger impact on accidents[7] suggesting that as the UK’s road conditions get closer to those in emerging economies, the impact on accidents will rise.
Applying official valuations to the damage from accidents and scaling up from the 2020 estimate suggests a likely human cost of £0.2 billion per annum from pothole related accidents, deaths and injuries.
In addition local authorities in England have paid out £22.7 million in compensation for pothole related damage to vehicles.
There appear to be no UK based studies on the impact of potholes on driver behaviour. But there are some international studies, notably a dissertation in the civil engineering department of the University of Southern Queensland[8] and an article in Applied Sciences[9]. There is also an article[10] that directly estimates the impact on speed for potholed segments. Translating engineering into economics is even harder than translating economics into English but what these studies appear to be saying is: that speeds are reduced by 55% over a 100 metre segment of potholed roads compared with a road with no potholes and environmental emissions are boosted by 2.9% over the segment.
The RAC data claims 6 potholes per mile for the million estimated potholes in England. As potholes tend to be clustered rather than evenly distributed, our estimates assume that this means 20% of segments of non-motorway road are impacted by potholes. Using the DfT webtag values of time[11], this implies that nearly 1.3 billion hours are added to travel time because of potholes costing £12.7 billion using a weighted average cost of time. This estimate excludes time lost from added congestion and from delayed freight.
In addition, emissions are boosted by cars slowing down and speeding up. In total this study suggests that emissions are about 0.5 tonnes of CO2 higher because of potholes. Using a shadow price for CO2 emissions of £50 this gives a cost range of these higher emissions of £25 million.
So the total annual cost of potholes in England amount to £14.4 billion. As it happens, the cost of rebuilding the roads to abolish all the current potholes and make it harder for new ones to appear is estimated by the Annual Local Authority Road Maintenance and Repair Survey[12] to be £16.3 billion.
This means that every road in the country could be rebuilt for the cost of the economic damage in under fourteen months from potholes. It looks like a no brainer. But no brainer cost benefit analysis rarely guides policy decisions in government…..
[2] House of Commons Library, Department for Transport table code: RDC0310 (TSGB0723)
[3] ibid
[4] ibid
[5] National Accident Helpline
[9] Ali, Khan, Khattak & Gulliver, 2023
[10] Setyawan & Kusdiantoro, 2015
For more information contact:
Douglas McWilliams, Deputy Chairman
Email: dmcwilliams@cebr.com Phone: 07710 083 652
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