Potholes and local road maintenance funding

Local authority managed roads make up 99% of road length in 2024 and carried 66% of motor traffic vehicle miles in England in 2023.

Funding for the maintenance of local roads is provided by the Department for Transport (DfT) and the Department for Levelling Up, Housing and Communities (DLUHC) to local highways authorities, who are responsible for maintaining their road networks to an adequate standard.

In Scotland, Wales and Northern Ireland the responsibility for maintaining the roads is with the respective devolved administrations. In London, councils receive transport funding from Transport for London. This briefing paper focuses on England, excluding London.

What condition are roads in?

There are ongoing concerns about the conditions of the local road network, the backlog of repairs and the cost of bringing these defects up to standard.

In 2025, an annual industry report estimated that 17% of the local road network in England and Wales are in poor condition. It predicted that the one-time catch-up cost to clear the backlog of maintenance issues would cost £16.81 billion and take 12 years to complete.

The Department for Transport reported that in 2024 4% of local A roads should have been considered for maintenance but hadn’t been, compared to 7% of B and C roads and 17% of unclassified roads.

Where does road funding come from?

Local road maintenance expenditure can be classified as ‘capital’ or ‘revenue’:

• Capital maintenance expenditure is primarily for the structural renewal of highway assets (including roads, footways, bridges, drainage and lighting); essentially extending the life of the asset. This is funded by the Department for Transport (DfT).
• Revenue maintenance expenditure mainly covers the routine works required to keep the highway serviceable and reactive measures to rectify defects. It also includes the cost of providing street lighting, footway repair and cyclical maintenance such as cleaning activities (of assets such as the drainage system), grass cutting and vital services such as snow and ice clearance, and salt spreading. This is funded by the Department for Levelling Up, Housing and Communities (DLUHC) through the revenue support grant.

Capital expenditure and funding

Capital funding from central government for highways maintenance are generally comprised of four streams:

• Highways Maintenance Block (HMB) - needs element
• Highways Maintenance Block (HMB) - incentive element
• Integrated Transport Block (ITB)
• Potholes funding

More recently, additional funding has been allocated through:

• The 2023 Budget: the government provided an additional £200 million in funding for highways maintenance for 2023/24.
• Network North: the previous government’s Network North policy paper (October 2023) set out their plans to “reinvest” £36 billion saved from the cancelled phases of HS2 to other transport projects, including £8.3 billion for highways maintenance over the period 2023/24 to 2033/24.
• The Autumn 2024 Budget: the government said it would provide £500 million more funding than in 2024/25.
• Other programmes, including the Local Transport Grant (LTG).

How much capital funding is allocated?

The table below shows the amount of local highways maintenance funding in England from 2020/21 onwards.

Notes: 1) Funding for potholes in 2020/21 includes the £500 million Pothole Fund for 2020/21, the £100 million Challenge Fund for 2020/21, and the £50 million Pothole Action Fund allocation for 2020/21, totalling £650 million. 2) The Network North total for England (excluding London) has been calculated by taking the funding assigned to London in 2023/24 and 2024/25 (£7.531 million) away from the England total for these years (£150 million). 3) The ITB total for 2020/21 was calculated by adding up each of the region totals. These regional totals may have been rounded. 4) Baseline figures for 2025/26 have not been broken down by Potholes funding, HMB needs and HMB incentive element 5) The Budget 2024 includes London in its £500 million of additional funding

Source: Department for Transport, Highways maintenance funding allocations, 23 January 2025

Revenue expenditure and funding

In 2023/24, local authority road maintenance expenditure was £4.8 billion. Of this, £3.0 billion was spent on structural treatment, £1.3 billion on routine and other treatment and £0.5 billion was spent on highways maintenance policy, planning and strategy.

Where to find local authority funding allocations? Capital expenditure

• HMB and ITB funding, 2020/21
• HMB and ITB funding, 2021/22
• HMB and ITB funding, 2022/23 to 2024/25 (3 years)
• Additional 2023 Budget funding, 2023/24
• Additional Network North funding, 2023/24 to 2033/34 (11 years)
• HMB funding, 2025/26

Other local transport funding:

• Integrated Transport Block allocations, 2025/26
• Local Transport Grant (LTG) allocations, 2025/26
• Additional LTF funding, 2025/26 to 2031/32 (7 years) – now withdrawn

Revenue expenditure

• Outturn data of local authority revenue expenditure and financing (2023/24)
• Local Government website LG Inform collates revenue expenditure data back to 2009/10