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UK government is off-track on key infrastructure projects - NIC

‘Go big where it counts to hit economic and climate goals,’ says National Infrastructure Commission

Mark Moran
27 March 2023
NIC Infrastructure Progress Review 2023

 

From rail to electric vehicle chargpoints and domestic heating, the UK government is failing to deliver on a number of key initiatives intended to meet its own net zero commitments, the UK’s independent advisers on infrastructure have warned.

The National Infrastructure Commission (NIC) suggests that the government must develop stronger staying power and focus on fewer, bigger, better targeted initiatives to deliver the infrastructure needed to meet its long term goals for economic growth and a lower carbon economy.

The last year has seen progress towards major infrastructure objectives “stutter further just as the need for acceleration has heightened”, says the NIC, which warns that “in a range of areas government is off track to meet its targets and ambitions”.

The commission’s annual Infrastructure Progress Review highlights positive progress towards nationwide coverage of gigabit broadband by 2030 and continued growth in renewable electricity, both of which it notes have enjoyed a relatively stable policy environment.

The NIC report meanwhile criticises “negligible advances in improving the energy efficiency of UK homes, the installation of low carbon heating solutions or securing a sustainable balance of water supply and demand,” which have been subject to a more short-term and changeable approach in recent years.

The progress report points out that the government expects 300,000 public electric vehicle chargepoints to be in place by 2030; but only 37,000 public chargepoints are currently installed.

The commission also calls for a “greater sense of certainty” around progressing HS2 and Northern Powerhouse Rail, stressing that delays inevitably push back the economic benefits for communities.

Similarly, government has set an ambition for at least 600,000 heat pumps to be installed each year by 2028, while only 55,000 were fitted in 2021 – meanwhile, 1.5 million gas boilers were fitted.

In its proposals for “getting back on track”, the commission calls for:

  • Policy staying power to deliver long-term goals and reduce the uncertainty that adds cost for business and delays or deters investment
  • Fewer, but bigger and better interventions from central government, with tighter strategic focus on the areas it can make the most difference rather than “expending too much effort on many small scale funding interventions and repeated consultations, trying to maintain optionality in all areas”
  • Greater devolution of funding and decision making, moving away from competitive bidding processes and building on the multi-year funding settlements for combined authorities with long term devolved budgets for all local transport authorities, while also allowing greater revenue raising powers at a local level
  • Unblocking delivery barriers, specifically the planning regime for nationally significant infrastructure projects, where updated National Policy Statements for key sectors are the first big step.

Drawing on the commission’s past recommendations which have been accepted by government, the report identifies ten specific priorities for the year ahead, including an acceleration of home energy efficiency improvements – including tightening minimum standards in private rented sector homes – and faster roll-out of electric vehicle public chargepoints.

The commission also highlights the need for government to urgently finalise proposals on water efficiency labelling and new building regulations within the year to help achieve the 110 litres per day consumption target by 2050.

The NIC does credit government for continued investment in infrastructure in the short-term – with a commitment of £100bn to support economic infrastructure from 2022-23 to 2024-25 – but warns “private sector investment is also critical for meeting the government’s long-term targets on infrastructure.

The commission states the UK must remain an internationally competitive place to invest, at a time when the Inflation Reduction Act in the United States and the REPowerEU plan and the Net-Zero Industry Act in the European Union make the investment environment more challenging. The NIC states: “Ambitious and stable policy from government, alongside effective regulation, is critical for providing the private sector with the certainty it needs to invest.”

The commission will publish a review on how to accelerate the planning system for major infrastructure projects later this spring. This will be followed in the autumn by the second National Infrastructure Assessment, setting out costed recommendations on infrastructure priorities for the next 30 years.

10 things government can do now

The commission’s top 10 short term priorities for government, based on past recommendations accepted by ministers:

Theme Targeted action for the year ahead
Supporting growth across regions Move away from competitive bidding processes to give local areas more flexibility and accountability over economic growth funds, and implement flexible, long term devolved budgets for all local transport authorities
Demonstrate staying power by progressing the Integrated Rail Plan for High Speed 2 and Northern Powerhouse Rail and remaining committed to the £96 billion investment required
Follow through on commitments made in 2018 to the Cambridge-Milton Keynes-Oxford growth arc, by setting out how the road and rail infrastructure to support new houses and businesses will be delivered
Net zero and energy security Deliver a significant increase in the pace of energy efficiency improvements in homes before 2025, including tightening minimum standards in private rented sector homes, to support delivery of the government’s target for a 15% reduction in energy demand by 2030
Remove clear barriers to deployment in the planning system by publishing National Policy Statements on energy to accelerate the consenting process for Nationally Significant Infrastructure Projects
Accelerate deployment of electric vehicle public chargepoints to reach the government’s expectation of 300,000 by 2030 and keep pace with sales of electric vehicles
Ensure that Ofgem has a duty to promote the delivery of the 2050 net zero greenhouse gas emissions target
Building resilience and enhancing nature Implement schedule 3 of the Flood and Water Management Act 2010 this year and without delay
Rapidly put in place plans to get on track to reduce per person water consumption to 110 litres per day by 2050, starting by finalising proposals on water efficiency labelling and water efficient buildings this year
Initiate a step change in recycling rates, including for food waste, by proceeding with the Consistency of Recycling Proposals, and finalising the Extended Producer Responsibility and Deposit Return Scheme

 

Electric vehicle charging infrastructure

On the subject of EV chargepoints, the NIC report states

“Achieving net zero greenhouse gas emissions means helping drivers transition away from petrol/diesel engines – which account for a quarter of UK emissions – and towards electric vehicles (EVs). EVs are becoming an increasingly familiar sight on roads and offer real benefits for drivers and the environment, and the government has committed to the phasing out of the sale of new petrol and diesel cars to encourage drivers to make the switch.

“However, a rapid transition to EVs needs the right infrastructure support. The National Infrastructure Assessment explored how to give drivers the confidence they need to switch to an electric vehicle.

“A national rapid-charging network is crucial. While much of this is best delivered by the private sector, government will need to act ensure the chargers are also installed in rural areas where the demand is likely to be lower. Allocating more council parking spaces to charge points, and increasing investment in a smarter electricity network to support innovations like smart charging, are also crucial.”

The chairman’s view

NIC chairman Sir John Armitt is concerned about slow progress on key infrastructure projects

“The task of the NIC annual review is to assess progress towards implementation of the Commission’s past recommendations adopted by government.  In doing so it would be remiss not to take a wider view on progress towards major infrastructure objectives government has set itself, and behind which there is broad political consensus – such as creating a net zero economy by 2050 and promoting economic growth across all regions of the UK.

“During 2022 there were some steps forward: greater devolution to West Midlands and Greater Manchester to implement their own ambitious infrastructure strategies, and progress to keep the UK on track to achieve nationwide coverage of gigabit broadband by 2030.

“But if the commission saw 2021 as a year of slow progress in many areas, in 2022 movement has stuttered further just as the need for acceleration has heightened. There have been negligible advances in improving the energy efficiency of UK homes, the installation of low carbon heating solutions or securing a sustainable balance of water supply and demand.

“The risk of a mixed scorecard is that readers take their pick based on their own experiences or purposes. Residents in the north of England, for instance, could hardly be blamed for focusing on the appalling state of current rail services within and between the places pivotal to supporting growth. Others will cheer the further expansion of cheap renewable energy generation at a time of severe concerns about energy security and the high costs of fossil fuels.

“But taking a strategic view on the recent pace of planning and delivery suggests a significant gap between long term ambition and current performance. To get back on track, we need a change of gear in infrastructure policy.

“This means fewer low stakes incremental changes and instead placing some bigger strategic bets, backed by public funding where necessary – after all, the risk of delay in addressing climate change is now greater than the risk of over correction. We must have the staying power to stick to long-term plans, to spare cost increases that come with a stop-start approach and to give investors greater confidence in the UK. We must also accelerate and expand the devolution of power and funding to local leaders, who are best placed to identify their infrastructure needs and economic opportunities.

“Getting our infrastructure right for the second half of this century is a journey that, by definition, will go on being plotted over the coming decades. But a further year of prevarication risks losing momentum on critical areas like achieving the statutory net zero target. Rarely has the need for speed been more evident.”

Extracted from the forward to the Infrastructure Progress Review 2023

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