The pothole crisis is costing £14.7 billion a year in economic damage in England alone Updated 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 says a study by Douglas McWilliams for FairFuel UK Introduction I first estimated the economic damage from the cost of potholes for Cebr, the economics consultancy which I founded, in April 2024. Because the crisis shows no signs of going away and interest continues to increase, I have updated the estimates I prepared a year ago for my regular blog and podcast, View From the Tent. The estimated annual cost in 2023 was £14.4 billion; despite an increase in the number of potholes mended, the cost in 2024 has still managed to rise to £14.7 billion. Anyone who drives or cycles will be aware that Britain’s pothole crisis is serious. Having completed the 2019 ‘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. Current progress with potholes The RAC’s annual pothole report was released on 15 January 2025 and confirmed that their ‘Pothole Index’ – the risk of a driver breaking down as a result of a pothole compared with the 2006 base – fallen back from 1.69 in 2023 to 1.39 in 20241. But the fall appears to be only temporary. RAC also observed a 17% jump in pothole related breakdowns in the final quarter of 2024 over the previous quarter. Although there is now a £1.6 billion fund for additional local spending on potholes announced in the October 2024 budget2, this follows a period where 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 20233, 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. It appears that the amount spent rose in 2023/24 to £1,727 million4 but this figure remains an estimate. 1 https://www.rac.co.uk/drive/advice/driving-advice/rac-pothole-index-statistics-data-and-projections/ 2 https://www.gov.uk/government/news/seven-million-more-potholes-to-be-filled-next-year-as-publicurged-to-report-roads-in-need-of-repair 3 https://researchbriefings.files.parliament.uk/documents/CBP-9975/CBP-9975.pdf and Department for Transport table code: RDC0310 (TSGB0723) 4 Page 5 from https://researchbriefings.files.parliament.uk/documents/CBP-9975/CBP-9975.pdf
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 20235. Tarmac have claim to have mended 2 million in 2024, which if consistent with previous figures suggests an improvement6 and (see below) is backed up by the ALARM survey. The ALARM survey is an annual survey of potholes carried out by the Asphalt Industry Alliance. The most recent ALARM survey makes two points: the money spent on filling potholes and the number of potholes filled have largely recovered on an annual basis from the huge cuts in spending during the Covid and post Covid era. Figure 1 Figure 1 from Page 9 of the ALARM survey shows that spending on potholes is back (in nominal terms) to its 2015 level. In real terms, using the ONS’s Construction Output Price Index for non housing repair and maintenance7 to deflate the figures, this equates to a fall of 20.9% over the 5 Source: RAC pothole report 6 The ALARM SURVEY claims 1.985 million potholes filled by local authorities in 2023/24. https://www.asphaltuk.org/wp-content/uploads/ALARM_Survey_2024.pdf 7 https://www.ons.gov.uk/businessindustryandtrade/constructionindustry/datasets/interimconstructionou tputpriceindices/current
period. The figure also shows the number of potholes filled, which has fallen 27.0% from the 2.7 million filled in 2014/15 to the 1.985 million filled in 2023/24. Figure 2 Figure 2 from the ALARM survey8 estimates the one off total catch up costs. Which continues to grow – this is partly inflation but more a reflection of the backlog over previous years and the additional damage that emerges when road surface problems are neglected. What creates potholes? Which vehicles cause damage to road surfaces? A recent article in the Daily Telegraph suggested that the Dutch tax on heavier cars was the main explanation of their less potholed roads9. Sadly this is fake news. While heavier vehicles do cause more road damage, the bulk of road damage is, not surprisingly, caused by buses and lorries, with vans making an increasing contribution. The standard short cut for estimating the road damage done by a vehicle is to take the axle load (weight divided by number of axles on which it is spread) to the power of four. This is called ‘the 8 Again from Page 9 of the ALARM report https://www.asphaltuk.org/wpcontent/uploads/ALARM_Survey_2024.pdf 9 https://www.telegraph.co.uk/money/netherlands-taxes-electric-cars-solve-pothole-crisis/
fourth power law’10. In practice the extent of stops and starts is also important which is why buses and vans ‘punch above their weight’ in road damage. A recent study11 has applied this theory to calculate the road impact factors for various categories of vehicles, multiplying the damage per vehicle by the number of vehicles. The study looks at the whole of Scotland and compares different methods of propulsion, noting the additional damage done by heavier vehicles, especially those using batteries. What is clear from Figure 3, though, is that for all methods of propulsion cars and motorcycles do not, even if powered by batteries, have a significant or even noticeable impact on road damage. Figure 3 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. Economic costs of potholes KwikFit prepare an annual Pothole Impact Tracker12 which estimates the annual cost in damage to vehicles in 2024 as £1.48 billions. 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 10 Velske, Siegfried; Mentlein, Horst; Eymann, Peter (2002). Straßenbautechnik (in German). Düsseldorf: Werner Verlag. p. 4. ISBN 3-8041-3875-6. 11 Low, J, Haszeldine, RS & Harrison, G 2022, 'Hidden cost of road maintenance due to the increased weight of battery and hydrogen trucks and buses – a perspective', Clean Technologies and Environmental Policy, vol. 25, pp. 757–770. https://doi.org/10.1007/s10098-022-02433-8 12 https://www.kwik-fit.com/press/potholes-cost-nations-drivers-over-a-billion-pounds-in-repairs#
potholes13. 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 potholes14 of whom just under half were cyclists. The National Accident Helpline claims 15% of cycling accidents are due to potholes15. Data from India shows an even bigger impact on accidents16 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 in 2023. But most claims for pothole related damage are refused. The RAC points out that ‘the chances of making a successful claim for pothole compensation are very limited, as 76% (13) of the 17 councils that paid drivers any compensation for pothole damage refused more than three-quarters of the claims they received in 2023’17. 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 Queensland18 and an article in Applied Sciences19. There is also an article20 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 DTp 13 https://www.national-accident-helpline.co.uk/news/post/potholes-uk-serious-and-dangerousproblem 14 https://www.thisismoney.co.uk/money/cars/article-12757963/Potholes-kill-18-Britons-five-yearperiod.html 15 https://www.national-accident-helpline.co.uk/news/post/potholes-uk-serious-and-dangerousproblem 16 Kerala News, 1481 Deaths, 3103 Injured: Pothole-Related Accidents on the Rise, Says Report. Available online: https://english.mathrubhumi.com/news/kerala/1-481-dead-3-103-injured-union-govt-reportshows-pothole-related-accidents-on-increase-1.8187782 (accessed on 11 May 2023). 17 https://www.rac.co.uk/drive/news/state-of-the-roads/council-pothole-compensation-claims-doublein-a-year/ 18 The Effect of Road Roughness on Traffic Speed and Road Safety A dissertation submitted by Miss Bernie-Anne King 19 Evaluating the Effect of Road Surface Potholes Using a Microscopic Traffic Model by Faryal Ali, Zawar Hussain Khan, Khurram Shehzad Khattak, Thomas Aaron Gulliver https://www.mdpi.com/20763417/13/15/8677 20 Setyawan, A. and Kusdiantoro, I., 2015. The effect of pavement condition on vehicle speeds and motor vehicles emissions. Procedia Engineering, 125, pp.424-430.
webtag values of time21, this implies that nearly 1.3 billion hours are added to travel time because of potholes costing £13.1 billion using a weighted average cost of time22. 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. Conclusions – what should we do? So the total annual cost of potholes in England amount to £14.7 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 Survey23 to be £16.3 billion. This means that every road in the country could be rebuilt for the cost of the economic damage in roughly thirteen months from potholes. It looks like a no brainer to do this. But no brainer cost benefit analysis rarely guides policy decisions in government….. Douglas McWilliams View From The Tent February 2024 21 https://www.gov.uk/government/publications/tag-data-book 22 Updated from the £12.7 billion estimated last year using the webtag data 23 https://www.fleetnews.co.uk/news/pothole-repair-bill-hits-163bn-half-of-roads-15-years-from-failure
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