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Comment | The money is there, now let’s deliver

We are the builders. So said chancellor George Osborne of his government when he set out plans to spend £73bn on roads and rail over the six years to April 2021 last week.

Osborne’s first post-election Spending Review was widely expected to be infrastructure-friendly and it did not disappoint: £34.5bn was allocated to Network Rail; £15.2bn for the roads investment strategy, £15.8bn for High Speed 2; and £11bn for London transport infrastructure.

Department for Transport capital spending will soar from £6.1bn in 2015/16 to £11.4bn in 2019/20.

OK, the day-to-day spending pot for operations and maintenance will plummet from £2.6bn to just £1.8bn over the same timeframe, but it is unquestionably a big boost for the industry.

Now it’s about delivery. As National Infrastructure Commission chairman Lord Adonis immediately said, Osborne’s Spending Review is just the first step.

We now need a coherent delivery plan. That’s Adonis’ top priority - to complete his Commission’s first three studies - of transport infrastructure for the north, transport infrastructure for London and energy generation - and begin the work leading to the UK’s first National Infrastructure Assessment.

Then we need to deliver differently. First we need to recognise the importance of whole-life cost at the outset. The marked gulf between rising capital spending and reduced operational spend means the industry just has to get better at delivering schemes that deliver best value in the long term. Cheap to build, expensive to maintain will not cut it. Innovation in materials and methods has to come to the fore.

As outgoing chief construction advisor Peter Hansford tells us this week, the industry has got to be less timid about technology and innovation.

We also need to deliver what we say we are going to do. Network Rail is the barometer here. Under intense fire from all quarters after the electrification cost over-runs debacle, it’s vital that it steps up its performance.

New chairman Sir Peter Hendy’s review into the deliverability of the infrastructure operator’s five-year funding plan was quietly published in the publicity storm following the Spending Review.

He concludes -unsurprisingly - that Network Rail’s original plan was unrealistic and undeliverable.

But he believes that most of the enhancement project programme up to 2019 can be completed by raising £1.8bn in non-core asset sales - and by having abetter plan.

His 44-page report details how the enhancement projects for CP5 can be delivered when estimated costs have risen from £11.8bn in 2012 to the latest figure of £15.3bn.

His plan, he says, is “more robust and deliverable”, but not without its own “risks and challenges” which, he says “Network Rail will work tirelessly to address”.

It must, and the industry must support it. By focusing on the long-term; by being more innovative; and by being less timid. Let’s be builders. 

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