A match-fit economy means moving from strategy to delivery - and quickly

Steve Wooler
02 February 2017

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Infrastructure politics

Industrial strategy and regional strategies both highlight the need for better infrastructure. As the UK finds a new way in the world it needs to think big, argues Steve Wooler.

Say what you like about the UK economy, but the one thing we’re not short of is strategy.

Last week the government finally unveiled its initial thinking on an industrial strategy for the future. The Northern Powerhouse has a strategy, and a strategy for the Midlands Engine will follow in the coming months.

Let’s not be cynical about this – planning is good. You don’t go asking for money without detailed evidence that you’ve got an investable proposition.

So is the sense that there’s some co-ordination behind this. The Northern Powerhouse and the Midlands Engine may have different identities and separate strategies, but they need to join up their investments. Boundaries are one thing we need to start looking beyond if we’re going to make our way in the world in the years to come.

The reoccurring theme in all of these strategies is a pressing need to upgrade our infrastructure. I’m preaching to the converted here, because Infrastructure Intelligence readers already know that money spent on road, rail, air and technology connectivity is the gift that keeps on giving. It provides employment and revenue during construction, it connects people to opportunities and delivers a better-functioning, more sustainable economy in the long-term.

Broadly, these strategies tick some sensible boxes - investment in R&D, developing skills relevant to the future, upgrading all forms of infrastructure, supporting business growth across the country, encouraging international trade and inward investment.

But in a world likely to soon be dominated by digital technologies and empowered attitudes, government also has to buy in to a mind-set as well as physical assets, because one follows the other. If there’s one thing that defines BWB it’s an attitude that everything we do for clients is about the art of the possible, and that if conventional solutions aren’t appropriate we’ll find an unconventional option.

If you apply that innovative mind-set to some of the challenges that the UK economy faces you begin to realise that we can think big. We know that one of the key challenges we face is just keeping the economy moving when many of its transport networks operate beyond theoretical capacity and regularly suck up eye-watering maintenance bills. And a post-Brexit economy can’t compete with the world if it’s held back by clapped-out infrastructure.

"We know that one of the key challenges we face is just keeping the economy moving when many of its transport networks operate beyond theoretical capacity and regularly suck up eye-watering maintenance bills. We can't compete if we are held back by clapped-out infrastructure."

So let’s consider initiatives like the Great Britain Freight Route (GBFR), a 450-mile rail route prioritised for freight and connecting key UK industrial centres to Europe. Just as HS2 is a massive opportunity to unleash regional economic potential by radically improving connectivity and reducing journey times between key cities, so GBFR could transform the movement of freight - nationally and internationally.

The case for a dedicated GBFR network is compelling. It would largely employ rail routes that are under-utilised or have lain dormant since Beeching sounded their final whistle. Its model is based on transporting loaded road trailers rather than rail containers, so they can roll-on/roll-off with HGV tractor units at either end of the journey. And because the trains would be compatible with the European loading gauge, it would unlock significant long-distance transport efficiencies.

It would also do something else very important - reduce the punishing impact of long-distance HGV freight on the UK’s battered motorway network, and significantly decrease the carbon footprint of business (CO2 emissions on a like-for-like basis from rail freight are 76% lower than road freight). A preliminary budget cost for the project has been estimated at circa £6 billion. This would be far outweighed, however, by the direct and indirect benefits of construction spending, the long-term economic opportunity it unlocks in a post-Brexit world, and the significant financial and environmental advantages that accrue from decreased HGV traffic and consequential reduction in highway maintenance.

The Great Britain Freight Route is one of a number of strategic investments that could do so much to unlock regional economic potential. It’s consistent with the stated ambitions of both the Northern Powerhouse and the Midlands Engine – and the prime minister herself.

Theresa May’s announcement about her industrial strategy says that it will, among other things, “drive growth right across the United Kingdom, using major new investments in infrastructure…to drive prosperity”. Last week in Parliament the prime minister even appeared supportive of major investment in rail freight when, in answer to a question from Kelvin Hopkins MP about government support for GBFR, she replied “We want to encourage rail freight, we have been encouraging it, and we will continue to do so”.

It often seems that the single biggest challenge we face in the UK is pushing the start button. Well, prime minister, we’re ready and waiting. We have the projects, we’ve developed the business case, and we have the skills and ambition to make them happen. Let’s quickly move from strategy to delivery.

Steve Wooler is the chief executive of BWB Consulting.