Your browser is no longer supported

For the best possible experience using our website we recommend you upgrade to a newer version or another browser.

Your browser appears to have cookies disabled. For the best experience of this website, please enable cookies in your browser

We'll assume we have your consent to use cookies, for example so you won't need to log in each time you visit our site.
Learn more

NIC spells out how economy could drive sector

Infrastructure

The National Infrastructure Commission (NIC) has released a paper looking at economic growth as a driver for future infrastructure in the UK.

The paper – Economic growth and demand for infrastructure services – is part of a series which will look at the drivers of future infrastructure supply and demand in the UK, the NIC said. The conclusions of the report are designed to help it assemble plausible scenarios for infrastructure development up to 2050.

The eventual aim, the NIC said, is to outline a strategic vision over a 30-year time horizon and set out recommendations for how identified needs should begin to be met. Themes covered will be transport, digital, energy, water and wastewater, flood risk and solid waste, assessing the infrastructure system as a whole and identifying important interdependencies.

The paper says that economic growth is a key driver of infrastructure service demand – in effect how the financial situation of consumers reflects their ability and willingness to pay for infrastructure, and how this results in the overall demand for trains, aircraft and other transport. In addition, it says investment in infrastructure has positive effects on economic growth. But the report says there is an inherent uncertainty in forecasting long term growth rates, so that ”relatively small differences in annual growth rates compounded to substantial differences in incomes by 2050”.

It said that in the period to 2050, significant changes in household incomes could be expected and understanding these changes would help the Commission to develop scenarios reflecting the range of possible futures.

However, the report goes on to say that even though demand for most infrastructure services appears to rise less than proportionately with income, there would be a tangible impact of changes in economic growth on demand in many sectors.

“Where – as with air travel – demand appears to rise more than proportionately with income, the effect is larger still and hence more sensitive to the possible path of future incomes,” the report said.

“Infrastructure choices in turn can affect the rate of economic growth.”

It said that it would now consider this feedback loop when deciding on policy options.

Have your say

You must sign in to make a comment

Please remember that the submission of any material is governed by our Terms and Conditions and by submitting material you confirm your agreement to these Terms and Conditions. Please note comments made online may also be published in the print edition of New Civil Engineer. Links may be included in your comments but HTML is not permitted.