The Department for Transport (DfT) has launched a consultation on proposals to turn the Highways Agency into a government-owned company, which could save taxpayers £2.6 billion over the next 10 years.

Under the proposals a new watchdog would also be set up “to better reflect the views of motorists”, encouraging greater transparency of the Agency and its performance.

The proposed changes are the next steps in the ‘Action for Roads' command paper that was published earlier this year, and sets out the future challenges and detailed plans for the management of our roads.

Robert Goodwill, roads minister, said: "This government has committed to the biggest ever investment in our road network worth £50billion over the next 15 years, but we need to make sure it is spent wisely.

“Efficiency savings are there to be made, but to secure these means changing how our motorways and trunk roads are managed and maintained.

"Transforming the Highways Agency into a government-owned company means long-term savings for the taxpayer, and making sure our roads are fit for the 21st century - supporting jobs and growth across the economy.

"I also want motorists to have a greater say in how their roads are run and that is why I have proposed an independent watchdog - free from government - is set up to make sure the Highways Agency is delivering the wants, needs and expectations of motorists."

The new company will have a lot more freedom in day-to-day operational decisions, but will remain fully accountable to the Secretary of State, Parliament and, more importantly, to motorists.

As set out earlier this year, the reforms to the Highways Agency are underpinned by legislation so future governments cannot walk away from this commitment.

The DfT said that the changes will give the Highways Agency and its suppliers the confidence to recruit skilled workers and agree longer-term contracts that will save the taxpayer money.

Next year, the Department will set out the delivery expectations of the new government-owned company up to 2021.

The consultation closes on Friday December 20, 2013 with outcomes reported by spring 2014.

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