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Detail demanded on infrastructure strategy

Businesses have called on the government to produce a clear infrastructure strategy in order to boost international investment.

According to survey of business leaders by the CBI and KPMG, the need for a detailed strategy remains the number one priority in order to improve funding of projects in the infrastructure sector, nearly a year after the government produced a planning document on the subject.

Although the CBI welcomed the publication of the National Infrastructure Plan in October, its research shows concerns remain.
“The lack of detailed vision for the roll-out of major government-led projects… risks undermining private sector confidence in the UK as a place to invest in infrastructure,” it said.

The government’s plan said the UK requires £200 billion of infrastructure investment over five years. Seventy per cent of the finance needs to come from the private sector, making the confidence of international investors in the UK market essential to the spending pipeline.

However, only 26 per cent of business leaders saw the UK as a favourable destination for infrastructure investment, according to the CBI/KPMG survey of 477 responses from businesses of all sizes, including investors in and providers and users of infrastructure.

This “underlines the importance of further detail being provided on the government’s National Infrastructure Plan, which is expected in the autumn 2011”, the report said.

Both the NIP and recent research from the Department for Business, Innovation and Skills (CN, 8 Sep, p6) criticise the government for wasteful procurement, which includes short-termism and perverse contractual incentives.

The government has promised to address these problems, but CBI director-general John Cridland emphases the scale of the task.

There is an awful lot to be done to get this right,” he said. “We’ve seen through [government chief construction adviser] Paul Morrell’s work a real desire to strip out some of the unnecessary bureaucracy.”

He said the political debate over the decision by Thames Link Trains to award a contract to Siemens rather than UK-based Bombardier was likely to cause the government to review how it applies EU procurement rules.

 

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