The Transport Committee has said the government’s transformation of the Highways Agency (HA) into something akin to Network Rail is an unnecessary and potentially costly mistake.

Publishing its Better Roads report in response to the government’s Roads Command Paper from July 2013, the cross-party committee of MPs gave the plans, which will see the HA become a state owned private company or 'GoCo' (government company), the thumbs-down.

“We are not convinced by the case for establishing the Highways Agency as a GoCo. Its remit will not be extended; it will not have new funding streams; and it will still be subject to changes in government policy, while incurring ongoing oversight costs.

“The proposed benefits, including the implementation of the five-year funding plans [which the committee welcomes], seem achievable through better management of the existing Highways Agency,” the Transport Committee stated.

The committee added that it had not been persuaded that increasing salaries of those within the new private structure will be a value-for-money way of increasing skills in the company.

“If the Highways Agency becomes a GoCo, it will need a strong system of scrutiny: The current proposals for this are inadequate,” the committee stated.

The critique flies in the face of the government’s claims for the project, which were revisited last week when transport secretary Patrick McLoughlin approved a series of reforms setting the transformation on course to complete within a year.

The government maintains that the transformation will save taxpayers £2.6bn during the next ten years, because the HA will be freed from politically dictated, short-term funding, making it able to extract better value from contractors by offering them longer-term deals.

McLoughlin said: “The reformed Highways Agency will be more transparent and more accountable, driving down costs as it increases efficiency.

“This means taxpayers get a better deal and road users get a network that is fit for the future economic demands of this country, helping to create more jobs and support business growth.”

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