It's not just about the money

 

Brian Fitzpatrick of Fitzpatrick Advisory comments on the findings of the latest FiTZ INDEX survey of highways professionals, which shows almost unanimous support for a five-year investment strategy for the local road network and strong support for fewer highways authorities.

Our previous FiTZ INDEX identified a sector ready and willing to accept the significant technology changes of the next few years, and already braced for the Brexit impact.

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This time it reveals a deeply held frustration about the way the sector is currently organised, annually funded, and the negative role that public sector procurement plays in constraining innovation, at a time when productivity and optimum returns from investment in highways services are more needed than ever by the Government.

The arguments around the flawed economics of the sector’s funding model, which influenced the 2017 Wolfson Prize, do not appear to have resonated with the respondents. On whether road charging or government funding is the future for highways our industry looks divided on a scale similar to Brexit!

Even more surprising perhaps is the high number who believe there are far too many local highways authorities. Remember that this FiTZ INDEX response contains a significant percentage of local government clients; is this result actually turkeys voting for Christmas? Or is it perhaps a deep frustration felt by professionals working at the sharp end of the industry that we could simply do better by rationalising the geography and realising that journeys cross many boundaries?

I think it’s time to stop pandering to politicians’ vanity about local representation and start to get on with bold ideas such as joint asset and joint network management, over a fit for purpose network.

The last question in the survey also elicited a vigorous response, especially those who identified themselves as SME’s in the industry – 80% felt strongly that procurement rules were not optimising new thinking and innovation (and remember this is a sector where the Government believes significant productivity gains can be made from innovation).

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Many public sector organisations will talk about getting SME’s involved at the top table, and encourage participation in bids, but many smaller businesses then fail to get through the procurement qualification for reasons of lack of scale or financial robustness, no matter how good their offer.

The client might then still claim to want access to these skills or products through one of the qualifying bidders (usually international players), which sounds great. Or the tier ones will come to you to involve you in their bid, which also sounds attractive. A lot of detail about the potential innovation and offer is supplied for the bid yet the potential value of the offer can become diluted, distorted or even appropriated if the worst stories are to be believed.

This sentiment is echoed in some of the responses to the question, and the current procurement rules appear to act as a real disincentive for smaller suppliers. In many cases it can drive innovation completely away.

What seems clear from the FiTZ INDEX is that a large proportion of the experts working in the industry agree that if we want to make the sector work efficiently we need to think differently. This includes changing the way the sector is organised and funded, and how skills are procured and subsequently deployed.

 

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