Councils across England will face tough new requirements on how they spend money to fix potholes and maintain local roads, as the government sets out measures to ensure taxpayers see real, lasting improvements.
These changes mean local highway authorities that fail to demonstrate effective road maintenance could lose around a third of their funding from a £1.6 billion package for the year ahead.
The government said pothole damage already costs the average driver around £500 a year in avoidable vehicle repairs, adding pressure to household budgets during the cost‑of‑living crisis.
Ministers said the new rules are designed to ensure record levels of road investment are used as intended, easing the financial burden on motorists and tackling what has been described as England’s “pothole plague.”
Under the measures, a total of £525 million will be withheld from councils unless they can prove they are delivering effective road maintenance.
To retain full funding, councils will now be required to:
- Publish clear reports showing that all highways funding is spent solely on road maintenance
- Set out long‑term plans for maintaining and improving road conditions
- Demonstrate better training and capability within highways teams
The government said this approach will allow residents to see exactly where their money is going, while ensuring councils focus on preventative maintenance rather than short‑term repairs.
The funding reforms build on the government’s first‑of‑a‑kind red, amber and green rating system, used to assess 154 local highway authorities.
Authorities are graded based on:
- The current condition of their roads
- How effectively they are using the government’s £7.3 billion record investment in local roads
For the first time, the public can also view an interactive map showing how well councils are performing in their area, providing greater transparency and accountability.
Alongside tougher expectations, the government has confirmed additional support for the 13 local highway authorities rated red.
Each will receive £300,000 worth of expert planning support over two years, aimed at helping them raise maintenance standards, fix more roads efficiently, and deliver better outcomes for road users.
The support is designed to help struggling authorities improve performance rather than simply penalising them.
Ministers said the reforms are backed by record multi‑year funding, giving councils the long‑term certainty they have consistently called for. Roads and Buses Minister Simon Lightwood commented:
“Drivers deserve smooth, safe journeys, and we’re making sure every pound goes straight into fixing roads and tackling potholes, not being spent elsewhere.
“Potholes aren’t just an inconvenience – they cost drivers hundreds, if not more, every time they cause damage to a vehicle. Fixing our roads is one of the most impactful things we can do to reduce the cost of owning and driving a car, and we’re making sure every pound goes straight into doing exactly that.
“We’ve made it crystal clear that councils that fail to maintain their roads will now risk losing up to a third of their funding.
“And for the first time, we’re giving councils multi-year funding so they can plan properly and reverse a decade of decline in our roads.”
By combining sustained investment, clear performance expectations, and public transparency, the government said it is ensuring councils can get on with delivering safer, smoother, and more reliable journeys for drivers, cyclists, and pedestrians alike.
The government said the new measures mark a decisive shift towards results‑driven investment, where funding is directly linked to performance and transparency.
By holding councils to account while offering targeted support where needed, ministers believe the reforms will finally start to deliver noticeable improvements to road conditions in communities across England.
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