Call for action over infrastructure

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Despite the establishment of a body to specify the UK’s infrastructure requirements, the Public Accounts Committee has warned that strategy is lacking

Readers of The Engineer will be familiar with the coverage given to Britain’s major transport and energy infrastructure projects, both in terms of the engineering challenges they present and the climate in which they are to be delivered.

At a glance HS2, airport expansion, plus nuclear and renewable forms of energy have come to the fore as prominent examples of ways in which infrastructure projects will replace ageing assets, improve public services and stimulate economic growth.

The front end engineering expertise exists to make them happen and in 2010 the back end received a boost with the establishment of Infrastructure UK.

Acting as an advisory unit to the Treasury, Infrastructure UK’s remit is to specify what economic infrastructure is needed in Britain, identify barriers to achieving that investment and mobilise systems and resources – public and private – to make it happen.

The unit published its first National Infrastructure Plan in 2010 and by December 2012 it had provided an update that identified over 500 prospective programmes and projects. According to the Public Accounts Committee (PAC), the price tag for these would be in the region of £310bn with around 64 per cent of this spent on infrastructure owned and financed by the private sector.

The overall aims are laudable and include financial mechanisms, such as the UK Guarantees scheme, to get projects moving more quickly.

A report from PAC, however, says it is ‘not convinced that the current proposals represent a rigorous plan with clear priorities for action or with a clear programme for delivery’.

In their report – Planning for Economic Infrastructure – they say the Treasury has identified 40 key projects and programmes with the latter including 200 individual projects.

This, they say, does not suggest a properly targeted and prioritised infrastructure plan; adding, that as a matter of urgency, the Treasury ‘will need to work more forcefully with departments, regulators, contractors and investors to agree the priorities for the projects that will be undertaken and the ways in which the costs both for consumers (through bills) and taxpayers (through various forms of support) will be identified and contained.’

Legislative and regulatory frameworks will similarly need to provide sufficient certainty to secure private sector investment at a time when competition for capital is internationally competitive.

Commenting today, John Cridland, CBI director-general, said: ‘We need ministers to pick three or four big infrastructure projects that demonstrate to investors what we can achieve and then do everything in their power to see them through.’

‘Never has investment in infrastructure been more important,’ added Roger Salomone, head of business environment at EEF. ‘With the UK stagnating and global competition intensifying, it can help give the economy a shot in the arm today and lay foundations for our competitiveness tomorrow.’

This call for more focus – both in terms of readying projects and creating the right environment for investors – comes with a further warning from the Association of Professional Staffing Companies (APSCo), which has weighed in with the all too familiar reminder of potential skills shortages.

They issued a statement today that highlights the rise in temporary employment across the engineering sector, something they attribute to the government’s continued investment in infrastructure which has led to a demand for highly specialist engineers and project managers.

Contract placements in Scotland are said to have risen by 33 per cent since March 2012. In contrast, the South East has seen a 15 per cent fall in assignments, which they say is in line with the government’s National Infrastructure Plan schedule.

Ann Swain, chief executive of APSCo cautions that the engineering sector faces ‘a possible retirement cliff’ and has called on the government to do more to ensure that the future growth of the sector is not impeded by a skills shortage.

‘The government’s commitment to pump an additional £18bn towards infrastructure projects by the end of the next Parliament – including programmes to improve major highways, upgrade rail links, and develop onshore wind farms – is welcome news for the jobs market. In order to prevent future skills shortages, the UK must look towards encouraging more individuals into the sector before it is too late.’