Making investment plans work.
Do you know your IUK from your MPA or your NIC from your IPA? The government recently streamlined the bodies that plan and procure the UK’s critical infrastructure, but what sits behind the acronyms and where is the detail?
Firstly, a recap. In October 2015 the government created the National Infrastructure Commission (NIC). To be chaired by Lord Adonis, the NIC is to be independent of government and will make recommendations about the UK’s long term infrastructure needs. This is to help overcome the problem that the proposed 30 year plan for infrastructure investment is incompatible with our five year parliamentary cycle. Lord Adonis will be assisted by six other commissioners, including experienced heavyweights from the industry such as Sir John Armitt.
Secondly, in November 2015, the government announced that Infrastructure UK (IUK) – a Treasury body – and the Major Projects Authority (MPA) – a Cabinet Office body – would be merged to create the Infrastructure and Projects Authority (IPA). The IPA will deliver and help find funding for the UK’s major infrastructure projects such as High Speed 2 and Thames Tideway Tunnel. IUK’s previous planning role will be taken over by the NIC.
Under the new structure, the NIC will suggest a plan, seemingly independent of political interference, and then the IPA will help fund and deliver it. The IPA reports to Treasury and the Cabinet Office, apparently to avoid critical projects falling victim to political infighting. It all seems sensible on paper but will it work?
The NIC commissioners are very credible but it is not yet clear what powers they will have. It seems unlikely that any government would let an independent body fix investment decisions for 30 years. But if the body cannot make binding recommendations, then does it take us any further forward in terms of long term infrastructure planning?
When the NIC was launched, the chancellor said that its work would start immediately, but that it would eventually become a statutory body. Currently there is no sign of the legislation required to make the NIC a statutory body so its powers are not yet clear.
In the meantime, all we have to go on are sound bites from the chancellor and Lord Adonis at the NIC launch and subsequent comments from the commissioners. These tend to confirm that the commissioners don’t know what their powers are either. The picture may become a little clearer at the next Budget (due Spring 2016) when the NIC is required to make its first recommendations on:
n strategic transport infrastructure for northern England
n large scale transport infrastructure improvements in London
n how the UK can better balance supply and demand in the energy sector.
It will be revealing to see how such a small commission tackles such complex problems in just five months. The tone of the report, and government’s response to it, will show if the NIC can deliver the much needed long term vision for infrastructure investment that the industry, and the UK as a whole, is crying out for.
- Will Gard is a chartered civil engineer and a partner at Burges Salmon
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