National Infrastructure Plan is essential for North East business growth

A HIGH-LEVEL commission has called for greater investment in economically critical infrastructure to stop the UK sliding down the world rankings.

 The Business Infrastructure Commission, an independent group of industry figures including NECC president Martyn Pellew, believes that a dedicated National Infrastructure Plan is urgently needed to give confidence to investors, developers and planners to get the economy back on track.

 In addition, the group is seeking assurances that planning decisions are not inadvertently politicised following recent changes to major infrastructure planning policy.

 The commission has produced a report, “Tackling the Infrastructure Puzzle”, which illustrates how Britain has historically under-invested in its public infrastructure relative to other European countries. Net public investment as a proportion of GDP declined from approximately 8% in the 1970s to less than 1.5% in the late 1990s and has only recently begun to recover. However, with a growing population expected to reach 71.6 million people by 2033 there is spiralling demand for already stretched infrastructure services.

 The report highlights that the low level of expenditure on infrastructure reflects a tendency in Britain to ‘patch up’ existing assets rather than to systematically deliver upgrades and renewal programmes in areas with greater capacity for economic growth – such as the North East. Numerous international studies show Britain consistently lacking in the quality of its infrastructure. The World Economic Forum’s Global Competitiveness Report ranks the UK 33rd for its overall quality of infrastructure, behind many of its existing and emerging competitors

 Mark Stephenson, policy adviser at the North East Chamber of Commerce (NECC), said: “If the private sector is to truly hit its potential we need to see a step-change in the Government’s approach to infrastructure investment, both in terms of strategy and the funding that backs that up”.

 This is particularly critical in the North East, where if we take investment in transport infrastructure as an example, we see that per capita investment in upgrades to our roads is still below the national average.  What this report illustrates is that the Government’s National Infrastructure Plan has to be backed up with meaningful action as opposed to piecemeal procurement of infrastructure projects”.

 The Commission believes that there are five pieces to the infrastructure puzzle that need to be addressed urgently:

 Long-term Planning

  • Complete a 10-40 year National Infrastructure Plan as a matter of urgency giving confidence to investors, providers and users.
  • Drive implementation of the National Infrastructure Plan through a strong, independent and empowered Infrastructure UK.

 1. 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 life-cycle costs.

 

2. 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.

 

3. 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.

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

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