We need long-term infrastructure investment to drive growth, says trade body
George Osborne has been urged to take bold steps to reduce the cost of delivering long-term, sustainable infrastructure in the UK, and to speed up the process.
The Infrastructure Alliance is calling on the government to make long-term commitments in the spending review to deliver the infrastructure that will drive growth in the economy. The spending review will take place on June 26 and will set the level of government spending from April 2015.
Mark Roper, managing director at the Civil Engineering Contractors Association, said, “There is a very clear link between the creation of new infrastructure and economic growth. Yet our industry is impeded in the ability to deliver this growth where there is uncertainty over the future of the sector.”
The Infrastructure Alliance said that currently UK infrastructure delivery suffers from short-termism and uncertainty. As a result, this is risking the future of the sector’s 200,000 employees as well as the companies they work for.
According to the organisation, this lack of commitment has led to the build up of an infrastructure deficit that costs the economy an estimated £78 billion a year in lost activity.
Dr Diana Montgomery, chief executive at the Construction Products Association, said, “We have recently seen figures from the Office of National Statistics indicating that new infrastructure orders fell by nearly 50% in the first quarter of the year.
“Given the essential role that out transport and utility networks play in the creation of growth and the fragile nature of the UK economy, such volatility is extremely worrying.”
The Infrastructure Alliance’s calls for action include a five-year commitment funding certainty for the English strategic roads network and providing a long-term capital investment commitment to Transport for London.
In addition, the group urged the government to support local bodies to deliver small projects needed by communities nationwide.
Infrastructure was one of the three I’s, as described by James Cameron of Climate Change Capital at the recent FT/IFC Sustainable Finance Conference – the other two being innovation and information-sharing.
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