UK infrastructure: Gotta Go Fast?

Can you speed up the delivery of UK infrastructure projects?

The Government certainly thinks so. Today the Department for Transport (DfT) has launched its new Acceleration Unit, under the control of Darren Shirley. The aim is simple: deliver infrastructure projects in a more timely fashion. This dream is not new – it has been the frustration of every government for years. It’s why the Blair administration became obsessed with Public-Private Partnerships, and why Boris Johnson announced billions of pounds of additional infrastructure expenditure earlier this year. But the speed at which these projects are delivered is the real test.

The Budget in March this year earmarked a total of £640bn in government spending on infrastructure over the next five years (an increase of £100bn compared to commitments in the Conservatives’ December manifesto). In other words, that’s £1,000 for every person living in the UK. The express aim is to help “level up” Britain, creating a legacy for the Government ahead of the anticipated General Election in 2024. The investment will cover a range of projects from road upgrades to high-speed broadband, mobile signal coverage to rail links, and flood defences to housing projects. Now all it needs is the right delivery framework. Enter the Acceleration Unit.

The timing of this announcement is key. The Heathrow third runway seems a lost cause. HS2 is expensive and will face further cost pressures and delays, not least due to its complexity and the additional complications as a result of COVID-19. The Lower Thames Crossing, the road tunnel at Stonehenge and the Silver Town tunnel could all be subject to environmental scrutiny as the Government attempts to “build back better”. The Unit offers a new focus for the Government’s infrastructure ambition and will help to inject optimism into future projects. The fact that it was announced at the upgraded A14 – a government project delivered on budget and ahead of time – is no coincidence either, and is a clear signal of intent.

The other significant factor is that Darren Shirley brings with him two vital ingredients to his new job. He is an outsider who will use his experience at Which? and the Campaign for Better Transport to put the consumer first. Secondly, he is a collaborator and willing to bring in other radical thinkers to help him develop ideas.

There are several hurdles which the Unit will need to overcome if it is going to deliver on its aims:
• Brexit: It is likely that the trade talks with the EU will leave the UK with only a set of small deals, rather than one comprehensive package. This will deliver uncertainty within the business economy.
• Funding: HMT is running out of affordable lending given the ambition of the Government and the lack of confidence in the economy. The country now has record levels of debt. The return of high borrowing costs could affect overall interest and inflation rates.
• Regional balancing: The infrastructure problems that are shovel ready are disproportionately in the South. This creates a choice: spend now to focus on the bounce back, or delay spending and risk the economy’s recovery.

In other words, it will have its work cut out. More than this, Government will not be able to deliver these projects alone and will need the expertise of business to deliver. This presents a huge opportunity for the companies which can demonstrate their ability to not only help the Government deliver on its vision, but overcome the issues which are getting in the way of progress. Those who are looking to be a friend to Government would be well advised to make their value clear to the likes of Darren Shirley, and quickly.