Infrastructure plan sets out national priorities into next decade
A new national infrastructure plan containing information on over £375bn of planned public and private sector infrastructure investment has been announced by the government.
The plan sets out investment for energy, transport, flood defence, waste, water and communications infrastructure up to and beyond 2030.
Today’s announcement coincides with news that six major insurers - including Aviva, Scottish Widows and Legal & General - are to invest £25bn in UK infrastructure over the next five years.
The Treasury believes the National Infrastructure Plan provides the ‘visibility and improved certainty industry has been looking for in order to commit to big investments.’
Danny Alexander, chief secretary to the Treasury said: ‘This is great news for the people of the UK because after years of neglect, the UK’s energy, road, rail, flood defence, communications and water infrastructure needs renewal. It will boost the UK economy creating jobs and making it easier to do business.’
Welcoming today’s announcement, Nick Baveystock, director of the Institution of Civil Engineers said: ‘The National Infrastructure Plan plays a critical role in enabling the UK to compete in a modern world, creating jobs and growth and providing the stability for the UK to grow its engineering skills and capacity.
‘Previous editions of the Plan have set out a much needed and welcome vision for infrastructure, but the need for it to evolve into a robust delivery plan - aligned with the UK’s strategic goals – has become more pressing.
‘The new 2013 Plan, with its updated pipeline of projects, further £25bn investment and evidence of a shift to “delivery mode”, is a positive step and presents us with an opportunity to drive this agenda forward.’
A note of caution was sounded by Nick Prior, head of infrastructure at Deloitte who said: ‘The additional infrastructure funding announced by the chief secretary today is welcome but we need much clearer sight of where this money will actually be spent
‘The government guarantees scheme is making a difference. This has been the most impactful announcement on infrastructure to date. But, the reality is, little of this money will be spent this side of 2015, so we won’t see shovels in the ground on new projects for some time.
‘The £25bn commitment from insurers is good news in demonstrating the attractiveness of UK infrastructure to investors. But they still need to see a clear pipeline of opportunities to put their money into and this will require some upfront commitment and ongoing funding from government. The intention is there but the funding is still aspirational.’
Building on the announcement at the Spending Round 2013 of £100bn of capital investment in infrastructure projects, the government also announced that it will:
- confirm strike prices for renewable energy, so that energy providers know how much they will receive for electricity generated in the future
- sign an agreement with Hitachi and Horizon to support the financing of the development of a new nuclear power station at Wylfa in North Wales through a UK guarantee, subject to final due diligence and ministerial approval
- confirm that a UK guarantee has now been agreed for the £1bn Northern Line extension to Battersea
- create a new court for infrastructure to avoid unnecessary delays in the planning process for major projects
- double the target for the sale of corporate and financial assets from £10bn to £20bn between 2014 and 2020, which could include the government’s shareholding in Eurostar
- the government will also look at options to bring private capital into the Green Investment Bank to enable it to operate more freely in delivering its objectives
- aim to make the UK a world centre for the testing and development of driverless cars. The government will conduct a review to ensure that the legislative and regulatory framework to support this aim reporting late 2014. It will also create a £10 million prize fund for a town or city to develop as a testing ground for driverless cars