Government ‘must invest in long-term infrastructure plan’

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A report published today urges the government to invest in a long-term infrastructure plan for the UK or face putting its economic future at risk.

Tackling the Infrastructure Puzzle, published by the Business Infrastructure Commission, sets out a number of recommendations for improving the UK’s transport, energy supply and digital communication networks.

The UK is claimed to suffer from some of the most congested infrastructure in the developed world, yet improvements could increase GDP by an additional 0.7 per cent.

According to Prof David Begg, chairman of the Business Infrastructure Commission, savings of between £2bn and £3bn could be realised through more efficient procurement alone.

The report urges the government to rise to the challenge and focus on the five pieces of the so-called infrastructure puzzle, which include a detailed long-term infrastructure strategy, procurement reform and improvements to the planning system for major projects.

These must go hand in hand with attracting private finance and ensuring that the UK has the right skills to deliver national and regional infrastructure projects.

Commenting on the report, Tom Foulkes, director-general of the Institution of Civil Engineers, said: ‘The government has rightly recognised infrastructure as a central plank in its strategy for growth, and there have been significant steps towards achieving this — from the creation of Infrastructure UK within the Treasury to the launch of the UK’s first National Infrastructure Plan.

‘But as the Business Infrastructure Commission rightly points out in its report, the need to think strategically and secure targeted investment in our infrastructure networks is becoming ever-more pressing.

‘Government must now focus on attracting inward investment and translating its plans into actions that pave the way for infrastructure to become the economic driver it promises.’

The five pieces of the infrastructure puzzle:

1. Long-term planning

• Complete a 10–40-year National Infrastructure Plan as a matter of urgency, giving confidence to investors, providers and users.

• Drive the implementation of the National Infrastructure Plan through a strong, independent and empowered Infrastructure UK.

2. Procurement reform

• Task the cabinet secretary to complete a review of infrastructure procurement capacity in government to drive down complexity, inflexibility, over-specification and unnecessary costs.

• Revise Green Book appraisal processes to privilege innovation in infrastructure procurement while retaining a focus on whole lifecycle costs.

3. Planning reform

• Subject ministerial decisions on nationally significant infrastructure projects to parliamentary scrutiny where a minister’s decision goes against a positive recommendation from the Major Infrastructure Planning Unit.

• Encourage the cost-effective use of planning performance agreements (PPAs) to secure local-authority engagement and speed up the planning process for some major infrastructure projects.

4. Attracting private finance

• Extend the Regulated Asset Base model to additional infrastructure sectors and networks in need of long-term investment.

• Enable the pensions and insurance industry to increase levels of investment in infrastructure by introducing a stable and regulatory framework and appropriate incentives.

5. Skills provision

• Develop a responsive skills strategy for infrastructure and incentivise colleges and businesses to deliver the skills required to build national and regional infrastructure projects.

• Simplify the bureaucracy surrounding apprenticeship schemes to make it quicker, easier and more cost effective for infrastructure providers to take on apprentices.