Infrastructure department could push delivery to next level

Peter Campbell
16 March 2015

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Last month Stephen Hammond MP and ACE published a paper designed to start a debate around the need for a fully-fledged Department for Infrastructure at a breakfast event hosted by Arup. Peter Campbell runs down some of the recommendations.

As the election approaches, those involved in infrastructure should be happy. It has never enjoyed as high a profile, yet all the main parties are vying to brandish their credentials, and demonstrate why they are the party of our transport, utilities, and communications networks.

The Conservatives and Liberal Democrats will run on their record of pushing forward with new power generation, High Speed Two, and a £15bn Road Investment Strategy. Labour, for its part, is trumpeting ambitious new house building targets and a new National Infrastructure Commission to determine the UK’s future needs.

This last policy is a particularly interesting one. The brainchild of Sir John Armitt, one half of the dynamic duo who oversaw delivery of such a successful Olympics in 2012 (the other being Lord Deighton), the NIC promises to address the problems that result from the inconsistency between the time horizon of individual governments and that required for planning major infrastructure.

The view of this new paper, however, is that this is only half of the story, and a NIC could be most effective as part of a dedicated Department for Infrastructure (DfI). By placing it at the very heart of government, infrastructure would enjoy the kind of influence and have the kind of voice currently only enjoyed by the ‘Big Four’ offices of state.

Clear leadership would be provided, with a single point of contact for everyone involved in strategic infrastructure, which would lead to better interfaces across central, devolved national, and local policy makers. In addition, bringing all the infrastructure under one roof will ensure a better understanding of the interdependencies of our infrastructure, and better planning.

This could also lead to more effective programme management, and the adoption of more of a ‘whole life cost’ approach to infrastructure provision, as greater knowledge and expertise is developed through closer collaboration across different infrastructure modes. Ultimately, this could lead to cost savings through reduced maintenance costs, greater innovation, and the elimination of duplicate departmental functions within Whitehall.

The global precedent for this is clear, and if the UK is to move to a more federated structure in the coming years, there are a number of countries from whom we can learn. Australia, Canada, and Japan all have something akin to a DfI as described above, with the equivalent position of Secretary of State a key cabinet position in each. There is no doubt of the benefits of this approach to planning, with both Canada (19th) and Japan (9th) above the UK (27th) in the World Economic Forum’s table ranking ‘Quality of Infrastructure’.

The hope is that, in the run up to the election, this paper will spark a debate among the main parties about how our strategic infrastructure is developed. This is just one solution that could work and we will be watching to see what others come to light as we approach Thursday 7 May and beyond.

Some of the report’s key recommendations include:

• Establishing a DfI with responsibility for long term strategic planning of our national networks, ensuring a cross-party consensus can be developed more readily,
• The proposed NIC would sit within DfI fulfilling a similar role to the Office of Budget Responsibility (OBR) at Treasury, providing a rigorous assessment of the UK’s needs and analysing the efficacy of government infrastructure policy.
• Once developed, this assessment would then be implemented via the National Infrastructure Plan (NIP), and through the various sector regulators (Ofwat, Ofgem, Ofcom, ORR, etc.) via the investment cycles they oversee.
• Infrastructure UK would move to the new DfI to provide oversight of financing and delivery, and continue to have strong links with its former landlords at Treasury.
• Existing infrastructure departments would operate and maintain any new infrastructure once delivered, as well as continue to have responsibility for non-strategic infrastructure.