14/05/2012 02:01 PM
The Welsh government is to lend local councils across the country £60 million to help repair the damaged roads.
Ministers believe that by allowing authorities to borrow this money on a 22-year "mortgage-style" agreement, it will enable the country's highways maintenance services to benefit from £170 million over the course of the work in the next three years. The BBC reported that if the scheme goes according to plan it will allow the Welsh government to use the system in other areas which public spending has seen drastic cuts in the past years of economic downturn.
The government is unable to borrow funds so ministers are providing the money so that councils can pay it back in a mortgage-like arrangement. The repayments will cost the country £240 million over the 22-year period and the Welsh Government Association (WGA) believes that this "prudential borrowing" could be a blueprint for other public sector projects in the future. It also plans to set aside £4 million as part of the first year of its Local Government Borrowing Initiative.
Finance minister Jane Hutt said: "By providing £4 million in the first year of the scheme local authorities will be boosting their capital spending by £60 million this year resulting in immediate improvements to our roads and highways, and creating or safeguarding around 900 jobs. Without our effective collaboration, this kind of investment would, quite simply, have been unaffordable."
The price of owning a car is becoming increasingly expensive for UK motorists, and potholes have caused more misery for not only the country's drivers but the government and highways maintenance services. A report by the Asphalt Insurance Alliance (AIA), published in March, revealed the government spent £800 million repairing the 1.7 million potholes across England and Wales over the past year. The harsh winters and warm summers were highlighted as a contributing factor for the highways wear and tear, as many roads had to be resurfaced after heavy snowfall and ice following by intense sunlight.
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Ministers believe that by allowing authorities to borrow this money on a 22-year "mortgage-style" agreement, it will enable the country's highways maintenance services to benefit from £170 million over the course of the work in the next three years. The BBC reported that if the scheme goes according to plan it will allow the Welsh government to use the system in other areas which public spending has seen drastic cuts in the past years of economic downturn.
The government is unable to borrow funds so ministers are providing the money so that councils can pay it back in a mortgage-like arrangement. The repayments will cost the country £240 million over the 22-year period and the Welsh Government Association (WGA) believes that this "prudential borrowing" could be a blueprint for other public sector projects in the future. It also plans to set aside £4 million as part of the first year of its Local Government Borrowing Initiative.
Finance minister Jane Hutt said: "By providing £4 million in the first year of the scheme local authorities will be boosting their capital spending by £60 million this year resulting in immediate improvements to our roads and highways, and creating or safeguarding around 900 jobs. Without our effective collaboration, this kind of investment would, quite simply, have been unaffordable."
The price of owning a car is becoming increasingly expensive for UK motorists, and potholes have caused more misery for not only the country's drivers but the government and highways maintenance services. A report by the Asphalt Insurance Alliance (AIA), published in March, revealed the government spent £800 million repairing the 1.7 million potholes across England and Wales over the past year. The harsh winters and warm summers were highlighted as a contributing factor for the highways wear and tear, as many roads had to be resurfaced after heavy snowfall and ice following by intense sunlight.
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