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Time for action to shore up confidence

UK business gave government a resounding message this week: speed up the pace of delivery on infrastructure projects.

Ninety-four per cent of respondents to the 2015 CBI/Aecom Infrastructure Survey – published yesterday – see infrastructure as a decisive factor when considering where to invest.

While the chancellor’s £100bn pledge on infrastructure spending by 2020 is welcome news, confirmation of funding for all existing programmes currently in their early stages would help boost confidence.

With business taking the hit when infrastructure decisions are deferred, government needs to deliver a clear and consistent vision.

And no sector feels the pain of delays more than construction.

Clarity can boost skills

Longer-term clarity of the UK’s future pipeline of projects is vital to the companies tasked with delivery.

“Greater clarity would help them develop the skills required to deliver critical infrastructure”

Importantly, greater clarity would help them develop the skills required to deliver critical infrastructure.

Eighty-six per cent of construction firms responding to the survey say clearer sight of the national pipeline of projects is a key factor in allowing them to upscale skills in the workforce.

This percentage is much higher than any other sector, indicating the significance of the skills challenge to industry.

In the same vein, apprenticeships are clearly a critical issue for construction, with 88 per cent of firms citing improved apprenticeship funding from government as either significant or very significant.

Again, this is a higher percentage than other sectors, indicating strong feeling that passing extra costs on to employers via the new apprenticeship levy is not the answer to filling the gap.

Recent improvement

Of course there have been positive steps from government.

Recent moves such as the creation of the National Infrastructure Commission and the government’s decision to underwrite Chinese investment in Hinkley Point C nuclear power station provide business with enhanced certainty around accelerated project delivery.

“Industry is understandably worried about further budget constraints delaying major schemes”

Support for pro-growth planning reforms is particularly strong in the construction sector, with initiatives such as the National Infrastructure Plan and National Planning Policy Framework helping to ensure a more strategic approach to the delivery of projects.

Yet with 89 per cent of businesses concerned about the link between local planning decisions and national priorities, the focus must now turn to delivery at a local level.

Given the crucial role of local planning departments in pushing through growth-stimulating projects, industry is understandably worried about further budget constraints delaying major schemes.

Such is the concern that three-quarters of construction firms are prepared to consider paying more in planning fees if it leads to quicker decisions.

This is hardly surprising given the impact of delays on companies responsible for on-the-ground delivery.

It remains to be seen whether moves like this will be encouraged by government.

However, one thing is clear: government must take decisive action now if it is to build business confidence in its ability to facilitate accelerated delivery of the UK’s major infrastructure projects. 

Richard Robinson is the chief executive of civil infrastructure, Europe, Middle East, India and Africa at Aecom

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