MT 37/8

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Effect of Road Fund Block Grant on Committee's recommendations

Date range1928-1935
LocationNational Archives (see all files stored here)
CatalogueSee entry
File baseSeries MT, subseries MT 37

Context

In the late 1920s the London and Home Counties Traffic Advisory Committee, working with the MOT, was making good headway in dealing with London's traffic problem by implementing traffic management measures like one-way systems and white lining schemes.

The work was brought to a sudden and unexpected halt in 1930 when the Treasury suddenly stopped authorising expenditure - an unexpected side effect of the Block Grant system. This was a new way of the Treasury supplying funding to local authorities, by which they took all the many different and variable payments that had previously been made, calculated the total amount of funding provided to each in 1929, and then provided a similar level of funding for each subsequent financial year as one single allocation of money - hence the "Block Grant". This simplified the Treasury's processes and, not coincidentally, provided a means for controlling expenditure in tough financial times.

Unfortunately one of the old types of grant that was now rolled up into the new Block Grant was classification funding - the means by which the Road Fund paid for the upkeep of roads. This was the end of road tax revenues being ringfenced for road upkeep and the start of the present situation whereby road tax simply goes into the general taxation pot. However, because the Block Grant was calculated on the basis of 1929 expenditure, anything the MOT now wanted to do that amounted to anything more than maintenance was impossible to pay for, and local authorities (who, prior to the Trunk Roads Act, were responsible for all roads in the UK) refused to carry out improvement works unless they were provided with funding.

The Block Grant system thus brought all road improvement works in London to a sudden standstill, and for the best part of a year nothing was done.

This file contains the run-up to the Block Grant, in which the MOT belatedly realises what the implications would be, and a lengthy series of correspondence between the MOT and Treasury, and between the MOT and LHCTAC, in an attempt to resolve the problem.

People with camera copies

Chris Marshall has a partial copy.