Infrastructure leaders have expressed disappointment at the government’s interim response to the National Infrastructure Assessment.
The National Infrastructure Commission (NIC) published its first National Infrastructure Assessment (NIA) in July, and as part of Monday’s Budget, the government published its interim response.
David Leam, executive director for infrastructure at business body London First said: “There’s nothing there. I’m not quite sure what the point of the document was. It wasn’t really worth the wait. I didn’t see anything new beyond what they are already doing or have done in the budget.”
Leam said he particularly wanted to know whether the government would commit to spending 1% to 1.2% of GDP on infrastructure each year from 2020 to 2050, in line with the NIC’s fiscal remit.
Law firm Bircham Dyson Bell’s partner in the government and infrastructure department Angus Walker added: “It is singularly disappointing – it does not answer the NIC’s recommendations head on but just says what related things the government is doing. If they take the same approach in their final response, due by January preferably with a backstop of July, then the whole exercise will have been a waste of time.”
In its first NIA, the NIC warned against a rush to agree support for multiple new nuclear power stations and proposed that the government should only support Hinkley Point C and one other nuclear power station before 2025. The assessment said the new approach would give flexibility to move towards newer low-carbon energy sources in future. It also put forward policies for expanding digital technology, getting roads ready for autonomous and electric vehicles, tackling floods and cutting waste.
The government has said it will respond formally to the NIA in 2019, by publishing a National Infrastructure Strategy, which will set out its priorities for economic infrastructure and give an in-depth response to the NIC’s recommendations.
“What the Budget really confirmed to me was that the big thing for infrastructure is the Spending Review next year and not the Budget now, assuming the Spending Review and National Infrastructure Strategy are aligned,” said Leam.
The government’s interim response to the National Infrastructure Assessment
On increasing investment:
“The government is taking action to address historic underinvestment in the UK. Overall public capital investment is set to reach levels not consistently sustained in 40 years. Much of this increase is driven by a step-change in infrastructure spending – in 2021 we will spend £9bn a year more than in 2015 on the transport networks, digital infrastructure and flood defences our country needs.” This, says the government, includes an increase in the Transforming Cities Fund, taking it to £2.5bn from £1.7bn.
On low carbon energy:
“The next (Contracts for Difference) auction round, due to be opened by May 2019, will keep us on track to deliver on our commitment for one to two Gigawatts of offshore wind [capacity] to be built annually through the 2020s. In committing to holding further auctions around every two years, as set out in July, the government is providing the certainty to industry necessary to continue to drive efficiency and achieve cost reductions.”
On heating and energy efficiency:
“The government agrees with the NIC that reducing emissions from the burning of natural gas and other fossil fuels used for heating and hot water is crucial to meeting our long-term targets under the Climate Change Act…The government recognises the scale of the challenge and will publish a review of evidence on the options for decarbonising heat in due course.” Government policies include new schemes to improve efficient energy use in business and industry.
On waste and recycling:
“The Budget announced that the government will introduce a tax on plastic packaging which, subject to consultation, will apply to plastic packaging with less than 30% recycled content. This, together with forthcoming reforms of the Packaging Recovery Note (PRN) system will transform the economic incentives of producers to encourage more use of recycled plastic and drive up recycling rates.”
On transforming roads:
Alongside the Budget’s publication of the draft RIS2 strategy, the response said: “The government supports the NIC’s assessment that the government needs to support the rollout of ultra-low emission vehicles to put the UK at the forefront of their design and manufacture.”
Regional infrastructure budgets:
“To ensure the government’s multi-billion-pound investment is tailored towards local priorities, we have given Mayoral Combined Authorities control of consolidated, multi-year transport budgets. The government supports the NIC’s continuing work with selected city-regions to support the development of infrastructure strategies, and help develop a long-term approach, greater coherence and better prioritisation.”
“The government is already investing £2.6bn over six years to better protect the country from flooding. This will improve the resilience of communities, and is set to provide £30bn in benefits for the national economy, and better protect over 300,000 homes by 2020-21.”
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