The National Infrastructure Commission’s latest review suggests decisive action to get the UK back on track to meet national objectives.
The National Infrastructure Commission (NIC) has released its latest Infrastructure Progress Review.
This annual report reviews the steps made by the UK government towards delivering on the vision set out in the National Infrastructure Strategy and on implementing the NIC’s recommendations.
The report doesn't paint a positive picture.
In its Infrastructure Progress Review from last year, the NIC said slow advancements were being made, but this year’s shows progress has stalled even further.
Across a range of measures such as planning, funding and delivery, the UK government is off track to meet many of its infrastructure targets and ambitions.
This halt in progress has come just as the need for acceleration to meet national objectives, such as net zero greenhouse gas emissions by 2050, has never been more urgent.
Stable policies have led to some improvements
However, the NIC report is not all bad news.
Even with recent decisions on delaying transport projects, the UK government has continued to commit to infrastructure investment. This represents £100 billion to support economic infrastructure from 2022-23 to 2024-25.
This commitment must continue beyond 2025 if the UK is to remain internationally competitive.
The past year has seen positive progress towards nationwide coverage of gigabit broadband by 2030, continued growth in renewable electricity deployment, and on starting to devolve further powers and funding to metro mayors.
The primary reason for progress is that these areas typically have stable policy frameworks, such as the Contracts for Difference scheme for low carbon electricity generation.
Targets are in place, but little sign of delivery
The NIC’s review highlights “negligible advances” over the past year in improving the energy efficiency of UK homes, the installation of low-carbon heating solutions, and securing a sustainable balance of water supply and demand.
This lack of progress is due to the exact opposite reason of the successes above – there are no stable policy frameworks in place for these areas.
Across these and many other areas there are high-level targets, but little policy detail.
The clock is ticking to ensure a stable policy environment is in place.
To give one example, while progress on decarbonising electricity generation has been positive, there are only 12 years to realise the government’s aim of an entirely decarbonised electricity system by 2035.
Much more progress on transmission and distribution needs to be made, in addition to generation.
Getting back on track
The NIC is calling for four principles to be embedded in the UK government’s infrastructure policymaking so that improvements can be made:
1. Long-term certainty on infrastructure policy
With a few notable exceptions, there’s been too much chopping and changing on the UK’s infrastructure policies and projects in recent years.
A stable policy environment will reduce uncertainty that otherwise adds cost for business, and delays or deters investment.
2. Fewer, but bigger and better interventions from central government
In a nutshell, the NIC is saying the government is spreading itself too thin in trying to keep all its infrastructure policy options open.
Instead, the government needs to pick a lane and focus on the areas it can make the biggest difference.
For example, rather than provide multiple small funding interventions for low carbon heat technologies, the government should take a ‘strategic bet’ on a single option.
3. Greater devolution of infrastructure funding and decision-making
Some progress has been made in this area, but the NIC continues to call for a shift away from competitive bidding processes for local and combined authorities.
This will allow local leaders to prioritise and fund their own infrastructure solutions with long-term devolved budgets, while central government focuses harder on national objectives.
4. Unblocking delivery barriers
The NIC highlights that the planning system for nationally significant infrastructure projects is slowing down the delivery of much-needed infrastructure.
It points out that decarbonising the electricity system will require at least 17 transmission projects to receive development consent in the next four years.
This represents a fivefold increase on current rates, which is frankly unachievable under the current system. The first step to enable this is for the government to publish updates to National Policy Statements.
As well as these four principles, the NIC suggests 10 actions the government needs to implement in 2023. These include:
- significantly quickening the pace of energy efficiency improvements in homes;
- ensuring that the regulator Ofgem has a specific duty to promote the delivery of the 2050 net zero target; and
- implementing schedule 3 of the Flood and Water Management Act without delay, something the ICE has also called for.
The ICE's view
Last year when the NIC issued its Infrastructure Progress Review, the ICE observed that the lack of progress toward meeting long term objectives was ‘concerning’.
This year, the lack of progress can best be described as ‘alarming’.
The need for action to meet the challenge of climate change has never been clearer – carbon emissions need to fall by 57% by 2035 in order to meet the Sixth Carbon Budget – yet we seem to be going backward.
One positive in the report is that in areas where clear policy frameworks exist, such as renewable electricity deployment and digital infrastructure rollout, progress has been made.
The government needs to establish clear policy frameworks for other areas to get us back on track. There is no more time to waste.
The NIC report also echoes the ICE’s concerns from the recent UK Budget about the UK being left behind its global peers.
It’s important that the NIC’s warnings are heeded.
To that end, the ICE recommends the Treasury Select Committee hold a one-off evidence session so that ministers can respond to the recommendations made by the NIC on the record.
In case you missed it
- A new ICE report calls for more decisive action on UK infrastructure climate resilience and adaptation.
- The latest Infrastructure Policy Watch covers the IPCC’s most recent warnings on climate change.
- Andrew Jones MP, chair of the All-Party Parliamentary Group on Infrastructure, gives his thoughts on the UK Budget.