More speed less waste: The second National Infrastructure Assessment

The good news is that modern, reliable infrastructure can support economic growth, help tackle climate change and enhance the natural environment.

We stand at a pivotal moment in time, with the opportunity to make a major difference to this country’s future. But we need to get on with it.

Sir John Armitt, Chair

Thus, spoke Sir John Armitt at the launch of the second National Infrastructure Assessment (NIA) yesterday (Wednesday 18 October) as the government advisory body set out its suggested programme for the next 30 years. Throughout the hefty publication there is an air of optimism, something which seems to accompany Sir John to almost any project he touches, but with one solid disclaimer: that it will only work if government and regulators act quickly. The Commission reiterates time and time again that the key to success is pace.

The NIA sets out, unsurprisingly, that infrastructure is pivotal to addressing some of the biggest strategic challenges facing the UK, namely decarbonising the economy, boosting economic growth, and improving resilience and the environment. But in order to deliver this, we need rapid delivery on the ground and significant investment in economic infrastructure - and the transition should be affordable and fair.

Of course, this begs the question of whether the UK is up to the challenge? Our confidence for taking on big infrastructure projects has taken a big dent following Rishi’s cancellation of the northern leg of HS2, hampering both the release of much-needed capacity on the network and economic growth.

The Commission states that it really is possible and cites the building of the electricity ‘supergrid’ in the 1950s and constructing the strategic road network in the 1960s and 70s to drive our belief that the seemingly impossible is, in fact, possible.

The NIA says we should focus on these key areas:

Journey to net zero:

• Changing the way we generate power through flexible renewables – largely getting power from onshore and offshore wind and solar, but also underpinning this with a strategic energy reserve which could come in the form of hydrogen
• Electrifying and decarbonising the way we heat our homes through the introduction of heat pumps
• Moving to electric vehicles
   

Supporting growth across the regions:

• Investing in transport and digital networks in our cities to support economic growth
   

Improving resilience and the environment:

• Preparing for a drier future. Building additional infrastructure, repairing and maintaining the infrastructure we have and reducing the demand for water
• Reducing the number of properties at risk of flooding
• Introducing a more sustainable waste management system. Reducing the impact of wastewater and encouraging recycling so we can hit the target recycling rate of 65% by 2035

Delivering this will need an increase in investment. The assessment states that the last decade has seen £55bn investment in infrastructure per year, around 10% of UK investment. The Commission asserts that this will need to increase to £70-£80bn per year in the 2030s before it is reduced to £60-70 billion in the 2040s. But it is keen to point out that if the expenditure is increased it needs to be spent.

The report shows that overall household expenditure on infrastructure should fall by at least £1,000 from today’s £7,300 per household to around £5,500 to £6,600 by the mid-2030s.

The push to move all households away from gas boilers has also been costed. For the majority of homes to move to heat pumps by 2050 would cost the public purse between £3 billion and £12 billion per year over the next 15 years. Lower income households should not be paying any upfront costs, whilst others should have access to a £7k subsidy with 0% finance available for costs above the £7k grant.

The gauntlet has been thrown down, but who will have the mettle to pick it up? A formal response from government is expected within 12 months, but with constant change across nearly all government departments and a general election in the offing, the NIC needs a political champion to ensure both focus and pace are maintained. 

Dr Janet Young, ICE director general and secretary, has backed the need for action saying:

If the UK continues its stop/start approach to infrastructure planning and fails to commit to long-term goals, it will not only miss the much-needed opportunity to attract private investment to deliver needed projects, but the problems being faced by the public will also get bigger.

 Today’s National Infrastructure Assessment from the National Infrastructure Commission reinforces the central role that infrastructure plays in meeting the big challenges that the UK faces - namely, regional inequalities, decarbonising society, and improving climate resiliency.

It’s a call to action, and this call needs investment from both the public and private sectors. As we wait for government to reply to this call, with a degree of trepidation following its recent withdrawal from a major infrastructure project, surely the question is not if we should act, but can we afford not to.