Why we’ll be paying for our roads until 2057
‘My fear is that lessons won’t be learned’
By Dan Hayes
I’m at the top of Greystones Road and the views over Sheffield are incredible. Over the valley, the brand new Hallam Towers glows, lit by the winter sun. In this golden hour light even the Royal Hallamshire Hospital looks beautiful. Beyond that I can just see parts of the city centre if I strain my eyes — but the buildings are so small I can barely make them out.
I’ve not come all the way up here just to admire the view. As I walk down the steep hill towards Ecclesall Road, each step I take is accompanied by a crunching sound. It’s not an unpleasant noise, and reminds me a bit of walking on a pebbly beach, but it’s still incongruous — we’re a very long way from the nearest coast.
My companion, local Green Party activist and candidate for Ecclesall in the forthcoming council elections, Peter Gilbert, bends down and picks up a handful of gravel that has been dislodged from the road surface. As I look, the entire road is covered with the same material. As a steady trickle of rain runs down the hill, the whole surface is slowly being washed away.
As well as the ubiquitous gravel, several deep gouges can be seen on the road as well. “You need your hiking boots for this one,” Peter tells me as he climbs into a deep gully in the centre of the road. He’s exaggerating, but only just. Some parts of the road have been patched up only to deteriorate again. The condition of the road is all the more surprising given that Greystones Road itself has already been fully resurfaced back in 2014.
Over the other side of Ecclesall Road South, it’s a similar story. Dunkeld Road and Banner Cross Road haven’t been resurfaced for over a decade. The two parallel streets are less steep than Greystones Road, so patches of ice have formed in the many potholes which pockmark their surfaces. Every time this happens the potholes get bigger.
Two residents we meet tell us that workmen from Amey do come to their road occasionally, fill in one of the holes and then leave. Peter Gilbert tells me residents have figured out that the work teams only fill in holes that have been reported to them, so even if there’s a patch of several potholes together on the road, they still only ever do one at a time.
Jobsworth workmen are an unfortunate fact of life. But could there be even darker motives for the current state of roads in Ecclesall? Some streets in the area saw angry confrontations during the long-running Sheffield tree saga, when workmen who turned up to fell trees were met by protesters. One local councillor, no doubt looking ahead to this May’s local elections, has even claimed that people on Dunkeld Road are being “punished” for taking part in the protests. There remains no evidence for such accusations.
We certainly don’t want to relitigate the Sheffield tree saga in this piece. We’ve covered it multiple times before (here and here), and I don’t think anyone is in the mood for another story about the strange arboreal war which gripped our city during the mid to late 2010s. But the deterioration of some of Sheffield’s roads has again raised the issue of the SCC Streets Ahead private finance initiative or PFI contract.
This agreement, which was signed with giant outsourcing company Amey in 2012, would provide Sheffield with investment to update and maintain its roads and pavements, street furniture including lights, bollards, barriers and benches, and crucially its roadside trees and verges. But it would also tie Sheffield City Council into a contract that would last for 25 years over which they had little control. The consequences of which we are still dealing with today.
PFIs were a form of public-private partnership (PPP) which used private sector investment in order to deliver public sector infrastructure or services. Seen as a neat way of paying for public projects while keeping the cost of the government’s balance sheet, they paid for everything from schools to hospital wards. The Sheffield highways deal was seen as a logical extension of the principles of PFI to local government.
An inquiry into the PFI has been taking evidence from stakeholders since late last year. In October, former Sheffield City Council chief executive John Mothersole told chair Sir Mark Lowcock that in the 2000s, Sheffield’s roads were so bad it was given the unenviable title of “pothole city”. This, he said, was a legacy of the debt Sheffield had incurred by building sporting facilities for the World Student Games in the early 1990s. However, appeals to the then Labour government for financial aid were turned down. “We were told it was this — or nothing,” Mothersole told the inquiry. The government said PFI was “the only show in town”.
Negotiations initiated by Labour continued when the Lib Dems took control of Sheffield City Council in 2008. By the time the contract was finally signed, Labour had regained power, but the PFI was voted through enthusiastically by both the administration and its opposition. Only the council’s two Green councillors, Jillian Creasy and Rob Murphy, spoke out against the contract. Paul Scriven (now Lord Scriven), the Lib Dem leader at the time the contract was being negotiated, didn’t respond to our request for comment on this story.
For Sheffield Green leader and City ward councillor Douglas Johnson, the most puzzling thing is that people knew about the problems of PFIs before the contract was signed, yet still went ahead with it. In November 2011, the powerful Treasury Select Committee published a report which concluded that the deals were poor value for money for the taxpayer. This report, Johnson says, was the subject of some debate in Sheffield, including in the council chamber. However, because Labour and the Lib Dems had shared responsibility for negotiating parts of the deal, Johnson tells me the PFI was not properly scrutinised. “They were both tied into it and just lost sight of everything,” he says.
Most people agree that the city’s roads have improved over the last decade, something that you would expect given the amount of money that has been invested in them. But the fact the PFIs were discontinued by the government in 2019 would suggest that they didn’t deliver the benefits they promised. “I remain committed to the use of public-private partnership where it delivers value for the taxpayer and genuinely transfers risk to the private sector,” said former Chancellor Philip Hammond in 2019. “But there is compelling evidence that the Private Finance Initiative does neither."
In a statement to The Tribune, a spokesperson for Sheffield City Council accepted that Amey had not met some of the contract requirements with regards to surfacing for roads and footpaths included in the programme. However, they added an “improvement plan” was now in place with Amey having pledged to increase the resources for surfacing works to achieve contract compliance.
They added: “The planned resurfacing to sections of Greystones Road will commence in the Easter holidays to minimise disruption to residents and local bus services and to reduce the impact on local schools. This was agreed following consultation between Sheffield City Council and The Bus Partnership. As explained in the report, section 1.3, the quality of our road surfaces in Sheffield still compares very well nationally. Each year the Department for Transport gathers survey results from Local Authorities and Sheffield is in the top 20 in the country for the condition of our principal roads.”
Councillor Joe Otten, chair of Sheffield City Council’s waste and street scene committee, said: “As with all the outstanding roads from the Core Investment Programme of the Streets Ahead contract, Amey and the Council are working with the Sheffield Street Tree Partnership to review options to retain trees whilst ensuring we have accessible and safe footpaths and roads. Specifically with Dunkeld Road, we will be contacting residents in February to begin our consultation process. We understand that the delay to resurfacing works is frustrating, but we are committed to making progress whilst engaging with those directly impacted by the works.”
However, this isn’t just about the roads themselves — when it comes to PFIs, there is also the question of democracy. Now the contract is freely available on the council’s website it’s easy to forget how big a deal the secrecy was. “During the tree campaign, the slogan for a long time was ‘show us the contract’,” says Johnson, who gave evidence to the inquiry last September. “There was a sense of frustration that we didn’t know who was running our city. Was it the elected councillors or some men in suits from a massive company?” This frustration would eventually lead to a revolution in the way the council is governed as a result of the It’s Our City! Campaign. It’s unlikely any of this would have happened without the PFI.
Former tree campaigner Paul Selby has also given evidence before the inquiry. He tells me he originally became involved in the campaign “because of one tree”, but quickly realised that the PFI was the bigger story. As a civil servant, he tells me he couldn't even think of doing anything illegal during the protests as he would have lost his job. Instead, he used his professional skills to “harangue” the council into releasing information about the contract.
An economist by trade, he understood PFIs from his time in government, and what had gone wrong in other deals, such as the one for London Underground which was scrapped in 2012. The failure of this deal and the critical Treasury Select Committee report should have rung alarm bells for Sheffield City Council, but for some reason it didn’t. “They signed it after PFIs had started going out of fashion,” he tells me. “It was bonkers.”
So what went wrong in Sheffield? From his investigations, Selby tells me he realised that PFI contracts are devilishly difficult to performance manage due to their complexity and the sheer range of things you can measure. “Even central government struggles to monitor these things, and they've got a lot more expertise,” he says. Local government, especially in its pared down state after austerity, hadn't got a hope of monitoring them successfully.
This complexity is still causing problems today. The council has recently blamed the Street Tree Partnership formed in the aftermath of the protests for the delays in resurfacing roads, but Selby totally rejects this. On Dunkeld Road, for example, one of the sticking points are several redwood trees which should never have been planted there in the first place. Selby tells me that the campaign has no issue with these trees being felled but that the council’s worries about its effect on the contract has led to paralysis. “They dither and dither,” he says.
The SCC Streets Ahead deal has still got 14 years of its scheduled 25 to go. Are we going to have these problems for the duration of the contract, I ask. Amey are currently getting big fines every month for the roads they are behind on (although exactly how much is still kept secret due to the contract). PFI contracts do have a track record of causing operators to go bust, with outsourcing company Carillion the most high profile casualty. What would happen to the contract in that situation is anyone’s guess. “If they can’t improve the quality of the service they will run at a loss,” Selby says. “And you can't do that for 14 years, can you?”
With this May’s elections on the horizon, it’s understandable that the Sheffield Greens are keen to talk about the PFI again. They’re the only political party in Sheffield who came out of the whole saga with clean hands, and were rewarded at the ballot box with more councillors than they’ve ever had as a result. But speaking to Douglas Johnson I get a sense that it’s more than that. The PFI has been a huge part of his political life: he was just starting to become more active in local politics when it was being finalised and by the time he finally became a councillor in 2016, the Sheffield Tree War had begun.
He says the inquiry is an opportunity for the people involved to explain their side of the story. “You might not agree with it at all,” he tells me. “But if you can understand how people acted the way they did, it goes a long way to understanding both what happened, but also how disputes can be avoided in the future.” One of the flip sides of the contract’s obsession with secrecy is that where councillors and officers had genuine reasons for acting the way they did, they weren't really able to say that because of the catch all “commercial confidentiality”.
Selby tells me he agrees. “Some want retribution, private prosecutions even,” he says. “But I’m not interested in that.” Instead, what he and others in the tree campaign really want is for the council to learn from its mistakes — but he remains concerned that won’t happen. “The report will be brilliant, but my fear is that it will be filed on the shelf and the lessons won’t be learned,” he tells me. “That it will be a sham.”
PFIs were first created by former Conservative Chancellor Norman Lamont way back in 1992. They were then championed by New Labour as a way of getting public projects built without it counting towards the balance sheet. But this came with huge hidden costs. The SCC Streets Ahead contract lasts until 2037, but the interest payments will actually last for another 20 years after that. Like the debt from the World Student Games in 1991, which will only be fully paid off in 2024, the Sheffielders of 2057 will know little about city’s politics in the 2000s and 2010s. But they’ll still be paying for the decisions made more than half a century beforehand.
I arrived in Sheffield just as the street tree saga was winding down. As I attended one particularly crazy protest on Abbeydale Park Rise in March 2018, I remember thinking how have the council got themselves into this level of mess? But now I have a better idea of how it happened. I understand why the council signed the PFI (they didn’t have any other option), and why the government pushed them into it. But arguments about long term value for money and (crucially) democratic oversight were ignored for too long.
I also had some personal insight into the pressure councils can find themselves under. In a previous life I worked in local government at a time of funding cuts. What stays with me are the memories of 2010, when the coalition government came in. All of a sudden everything changed, our budgets disappeared and redundancies started. It felt like it changed from being a public service to being more of a business overnight, a process which ultimately led to me taking voluntary redundancy in 2014. As such, I can understand how difficult it can be to maintain services at a time when budgets are being stretched. Having an angry public criticising their every move can’t have helped either.
Still — lots of money has been spent and many of our roads are still a mess. It’s a sorry tale. But the biggest vindication for those who campaigned against PFIs is the fact they are no longer used. And that’s a happy ending of sorts…right?
People should report potholes or any issues on the roads to SCC Streets Ahead by calling 0114 2734567 — or online here.