Studies from the Asphalt Industry Alliance have shown that extra money allocated to local authorities for road maintenance has been used to fund compensation claims from drivers.
The number of claims against local authorities has doubled in the last 10 years according to the survey with £85 million paid in compensation last year alone.
Jim Crick, chairman of the Asphalt Industry Alliance which conducted the survey, said: 'If local authority engineers continue to receive just half of the funds they need to maintain roads properly, insurance claims will continue to spiral out of control. Local councillors must wake up and see that by not allocating adequate funds for road maintenance they are throwing taxpayers' hard-earned money down a pothole of ever-increasing compensations claims.'
The survey found that despite a 25% increase in highways maintenance funding there is still a shortfall of £5.6 million per authority in England, between what engineers receive and what they claim they need to maintain roads adequately.