Government publishes new infrastructure plan

Insurance industry announces £25 billion investment in infrastructure as government publishes UK plan

A NEW National Infrastructure Plan containing information on more than £375 billion of planned public and private sector infrastructure investment was announced yesterday by the Government.

The plan, which sets out investment for energy, transport, flood defence, waste, water and communications infrastructure up to 2030 and beyond, came on the day six major insurers announced plans to collectively invest £25 billion in UK infrastructure over the next five years.

According to the Government, the National Infrastructure Plan will provide the visibility and improved certainty industry has been looking for in order to commit to big investments.

The Infrastructure Pipeline published alongside the plan is said to be the most comprehensive overview of planned and potential UK infrastructure investment ever produced.

Danny Alexander, Chief Secretary to the Treasury, said: ‘The announcement today that six major insurers will invest £25 billion over the next five years is a massive vote of confidence in the UK economy.

‘It supports the wider £100 billion public investment to rebuild Britain over the next seven years that I announced at the Spending Round 2013. Underground, overground, on shore, offshore, wired or wireless, tarmac or train track; you name it, we’re building it right now.

‘This is great news for the people of the UK because after years of neglect, the UK’s energy, road, rail, flood defence, communications and water infrastructure needs renewal. It will boost the UK economy creating jobs and making it easier to do business.’

Lord Deighton, Commercial Secretary to the Treasury, added: ‘The fourth National Infrastructure Plan shows that the Government is delivering on infrastructure, with a long-term strategy to make sure the UK tackles decades of underinvestment and gives us the infrastructure we need to compete in the global race.

‘Investment is increasing to around £375 billion over the coming years, with 45% of our prospective infrastructure already under construction. We’ve set out government priorities with clear delivery milestones and reformed planning rules to drive forward the most important projects, making sure we are building the strong, modern economy of the future.’

The future Infrastructure Pipeline, which only includes projects and programmes worth more than £50 million, shows that planned investment in infrastructure has increased to more than £375 billion from £309 billion last year. Of the 646 projects and programmes in the updated pipeline 291 are already under construction.

Commenting on the infrastructure plan, Paul Fleetham, managing director - contracting with Lafarge Tarmac, said: ‘It is encouraging to see support for a new tranche of projects, but it is now critical that the Government uses this momentum to deliver on its long-standing infrastructure promises.

‘Despite continued vocal support from Ministers, infrastructure activity in the third quarter of this year was 3.7% down on 2012 – a year during which overall work volumes plummeted 13%.

‘Delivery of this plan and the projects within it are conditional upon securing appropriate funding mechanisms. While I welcome news that the insurance industry is committed to investing £25 billion over the next five years into transport and energy projects, we must be mindful that similar statements were made a year ago by pension funds, and, to-date, only £1 billion of the £20 billion that was promised has been delivered.’

Mr Fleetham continued: ‘Against a backdrop of protracted delays for many large projects, it is disappointing that the updated National Infrastructure Plan fails to provide support for smaller schemes such as essential highways upgrades.

‘The Government has previously said that it will provide additional funding for maintaining local roads from 2015–2020. However, we’ve not seen anything today which gives councils and contractors assurance that there are funds in place to maintain this rapidly deteriorating asset now.’