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Infrastructure blog

Long awaited National Infrastructure Strategy finally published – was it worth the wait?

25 November 2020

The government’s National Infrastructure Strategy (NIS) was published today as part of the spending review. In this blog we set out ICE’s take on the NIS and what it means for the UK’s infrastructure sector.

Long awaited National Infrastructure Strategy finally published – was it worth the wait?
Chancellor of the Exchequer Rishi Sunak. Image credit: Shutterstock

Almost two and half years since the National Infrastructure Commission (NIC) concluded its assessment of the UK’s long-term infrastructure needs, the government has responded by putting forward its plans for investing in the nation’s key transport, energy, and water networks.

But how does the strategy stack up against what the Commission recommended in 2018?

Government making good progress in key policy areas

The NICs 2018 assessment called for the nationwide rollout of full fibre broadband by 2033 and for preparations to be made for 100% electric vehicle sales by 2030.

Prior to the publication of the NIS, the government had already set itself an ambitious target of achieving the nationwide rollout of gigabyte-capable broadband by 2025, with encouraging announcements then made last week on phasing out the sale of petrol and diesel vehicles by 2030.

Neither of these interventions follow exactly what the NIC recommended, but both reappear in the NIS and provide significant encouragement.

There is less concrete progress in the strategy on the frameworks and governance arrangements that will inevitably be required for regions (specifically across England) to better plan and deliver sub-national infrastructure provision. This is key if the government’s ‘levelling-up’ agenda, for which it has announced a new £4bn fund, is to come to fruition.

More clarity and government action will be required as we head towards the mayoral elections in 2021.

New bank a positive for financing infrastructure

Today’s confirmation alongside the NIS that a new national infrastructure bank will be set up is a welcome development. ICE has consistently advocated for a bank of this nature to be created since 2017.

As the UK loses access to European Investment Bank (EIB) finance, as a consequence of Brexit, it has always been a necessity that we find a way of replicating the critical role that the EIB has played in supporting nascent infrastructure investment.

It is not necessarily the volume of finance that the EIB has provided to infrastructure projects and programmes that has been so important, but rather its ability to act as a first mover to crowd-in other institutional investment into emerging markets and technologies. This has been key, for example, in growing the UK’s offshore wind sector.

In the same vein, the government’s new bank will have a major role to play in supporting the transition of the UK’s economy to net-zero emissions by 2050.

Delivering the net-zero emissions target

A crucial part of the puzzle that is lacking, following today’s flurry of announcements (and from the Prime Minister’s 10-point plan for climate change which was announced last week), is a joined-up plan that maps out the steps that the infrastructure sector must take as a whole in order to help deliver the UK’s net-zero emissions commitments.

There remain policy choices and trade-offs that the government must make in relation to decarbonising power, heat, and transport, alongside reaching the harder to abate industries.

On net-zero specifically, disparate policies and spending commitments from across departments fall short of the joined-up plan that is needed. As the UK economy emerges from the Covid-19 pandemic in 2021 it is increasingly important that one is put in place.

Some final reflections

Notwithstanding the need for more clarity on how the government intends to deliver on the UK’s net-zero commitments, the publication of the NIS should still be considered as an important moment for the infrastructure sector.

It certainly goes some way to providing the long-term visibility and confidence that investors in infrastructure and the construction supply chain both need, which again is all the more important as preparations are made for the economic recovery from the Covid-19 pandemic.

But as importantly, the publication of the NIS, which does take on board a number of the NICs recommendations, is a satisfying moment for those who support the principle of policy making guided by evidence.

The NIC was created almost five years ago to provide expert and impartial advice to the government. Following the major infrastructure assessment that it completed in 2018, today’s NIS completes the Commission’s first cycle as the government’s key infrastructure advisor.

ICE has for a long time been involved in the public debate surrounding the NIS. Read ICE’s 2018 policy paper What should be in the National Infrastructure Strategy?

Related links

  • Ben Goodwin, lead policy manager at ICE