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Spring Statement | Industry awaits rail, road and energy decisions

s465 cx govuk

Industry leaders are waiting for rail, road and energy decisions in today’s Spring Statement.  

In his “mini-Budget” announcement, chancellor Philip Hammond is expected to address energy and transport concerns as well as providing an update to the industry on Brexit.  

After backing the development of Northern Powerhouse Rail and East West Rail in last year’s Autumn Budget, Crossrail 2 was earmarked to receive support in the Spring Statement. 

New Civil Engineer now understands that Crossrail 2 bosses are not expecting government support until the Autumn Budget later this year

Instead, Railway Industry Association chief executive Darren Caplan said the rail sector will be hoping for government support for upgrade projects this year.  

“The rail industry’s primary ‘ask’ for the Spring Statement is around the visibility of rail improvement projects, known as enhancements,” he said. “For the next five yearly funding cycle, known as Control Period 6, the government has moved the decision-making process for enhancements to a new pipeline, where individual projects progress through different stages before coming to market – known as the Rail Network Enhancements Pipeline (RNEP). 

“Unfortunately, this new pipeline has greatly reduced visibility of the actual upcoming work required on the network and includes no new construction-ready schemes we did not already know about over hanging from CP5. This means real uncertainty for rail businesses, with the knock-on effect of reducing investment, jobs and growth in the industry. We urge the government to commit to full visibility of projects in the RNEP.”  

In the roads sector, Highways England will be hoping for an update on what will replace PFI/ PF2 funding for major projects. Funding for Highways England flagship projects, the Stonehenge Tunnel and the Lower Thames Crossing, has been thrown into doubt after Hammond axed the private finance model that was to be used. 

Highways England chief executive Jim O’Sullivan has previously told New Civil Engineer that Highways England – and the industry at large needed an answer on the future of the projects by the end of January. More than two months later, it is hoped Hammond will give an update.   

Meanwhile, Civil Engineering Contractors Association chief executive Alasdair Reisner said that while many big spending announcements have already been made, the Spring Statement would hopefully clear up details about Brexit.  

“What we might see are details on the forthcoming Spending Review, as well as maybe specific funding for Brexit-linked projects such as access to ports or congestion relief around Dover, and information about how projects that would previously have been European funded will be funded post-Brexit,” he said.  

Energy and Climate Intelligence Unit head of analysis Jonathan Marshall told New Civil Engineer that due to the recent Offshore Wind Sector Deal, renewable energy wouldhave a lower profile. But Marshall was hopeful that the chancellor could announce new building emission regulations.  

“[Prime Minister] Theresa May previously said in a speech that the government wanted to halve energy use in heating new buildings and emissions from buildings. If this was announced this would become one of the government’s frontline energy and climate policies,” he said.  

“One other area requiring immediate attention is the UK’s future participation in the European Union’s emissions trading scheme (ETS). So far there have been suggestions that the UK is variously keen to stay in, set up a system that mirrors the ETS, or replace it with a flat charge on emissions.” 

WSP head of public affairs Charles Malissard added that the consultant was hoping for continued support and increased funding for sub-national statutory transport bodies, especially with regard to the major roads network and long-term commitment to Northern Powerhouse Rail

WSP is also looking for continued support for HS2’s transformational benefits with greater regional focus, in line with the creation of the £2M fund to help with the development of the East Midlands Development Corporation.

Government incentives to encourage air rights developments over railway lines to alleviate the housing crisis is also on the consultant’s wish list.

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