THE Government must act now to attract vital new investment into the UK's ageing infrastructure. Swift investment across Britain’s road and rail networks, digital, waste and energy would ensure we remain internationally competitive and kick-start UK growth.
A major new survey of 477 businesses, conducted in partnership with KPMG, shows that 58% rate the UK’s infrastructure worse than other EU countries, when judged on quality, value for money and reliability. And worryingly, just 26% of firms saw the UK as a favourable destination for infrastructure investment.
Last year’s World Economic Forum Global Competitiveness Report placed the UK 33rd for quality of infrastructure, alongside Slovenia and behind Tunisia and Cyprus. But competitors France and Germany both made the top ten.
The CBI is calling for swift action to help secure critical business investment and urges the Government to raise its capital investment to pre-recession levels as soon as possible.
We need ministerial decisions that get spades in the ground and people working now. There are large amounts of business capital waiting to be unlocked if the Government achieves a step-change on transport, for example with the introduction of road tolls. Capital investment must return to pre-recession levels at the earliest opportunity.
The report, called Making the right connections: CBI/KPMG infrastructure survey 2011, assesses the state of the UK’s infrastructure and highlights how critical quality infrastructure is to companies’ decisions about where to invest and their ability to compete.
Half of companies think the UK’s transport network has got worse in the last five years, while less than a fifth (18%) say it has got better. Nine in ten express concern about the security of energy supply over the next ten years.
The link to sustained economic recovery is clear, as the survey shows, most companies rank the quality and reliability of energy and transport infrastructure as significant or very significant to future investment decisions. The Government’s own National Infrastructure Plan acknowledges that £200billion of infrastructure investment is needed in the next five years alone, with 70% expected to come from the private sector.
Businesses are clear about the solutions needed – a clearer strategy from Government, faster planning approvals and less red tape.
In the survey, firms gave the coalition Government a mixed report on its policies to attract infrastructure investment and deliver the necessary improvements to our networks.
According to the survey, what businesses want most from the Government is a clear overall strategy. Next on their list is action to tackle delays and costs in the planning system. Their third highest priority is reducing regulation and ‘red tape’. Almost all see the current planning system as a barrier to the development of new infrastructure.
The CBI has formed an Infrastructure Board, comprising CEOs and Chairs from across the international infrastructure supply chain. The Board will be chaired by Mark Elborne, President & Chief Executive of GE UK and Ireland and Heidi Mottram from Northumbrian Water will represent the water industry and the North East. It will help shape a future vision for the UK’s infrastructure and policy decisions designed to deliver the resilient, reliable and smarter infrastructure the UK needs.
:: Sarah Green is regional director of CBI North East
