BCIS urges government to provide clarity and commitment to infrastructure sector

BCIS has welcomed a call for ‘clarity and consistency of policy and regulation’ in the government’s approach to overseeing major infrastructure projects. 

The National Infrastructure Commission, which provides the government with impartial advice on major long-term infrastructure challenges, made a series of recommendations in its second National Infrastructure Assessment, with an emphasis on investing in infrastructure projects to help stimulate the wider economy and lower long-term costs for the public. 

The Commission also stated the UK must ‘get better at controlling the costs of major infrastructure projects overall’, citing the approach to procurement, project management, and capability of government and other infrastructure operators to ‘act as an intelligent client’. 

Dr David Crosthwaite, Chief Economist at BCIS, said: ‘As Sir John Armitt suggests in the foreword to the assessment, infrastructure spend is not just about plundering the public purse. Investment in infrastructure can support and spark wider economic growth. Done right, it can also help us to tackle climate change and reduce the impact of the built environment.  

‘The last few years have provided proof, if needed, how vulnerable our industry is to a multitude of external factors. Beyond the impact of, for example, inflation on materials prices, or the additional costs that can be incurred when delaying a project, the infrastructure sector is absolutely crying out for clarity and consistency. It needs long-term commitment to a pipeline of projects that aren’t dependent on the changing whims and priorities of the government of the day.  

‘The Commission states the case for the government to be transparent with the public about the costs of infrastructure projects, not just because their money is being spent, but because it can aid understanding of what investment in infrastructure means and where the long-term gains lie.   

‘We would go a step further and say there needs to be better transparency around infrastructure projects full stop. We need to share cost data. We need, on new projects, to be able to learn from previous projects, and to use that data to help inform future cost estimates. We need projects not to exist in silos, to which nobody from the outside is granted access.  

‘The principle of sharing data, knowledge and experiences, for the benefit of all, was at the heart of the creation of the Built Environment Carbon Database (BECD). In that case, the driving purpose is to reduce emissions from the built environment, but it’s something we need to think about across the board, not least when we are talking about getting value for public money.  

‘But infrastructure investment isn’t just about public funding. We rely heavily on private investment and, with recent events, investor confidence has been knocked. We are still looking for clarity in the flurry of schemes badged as “Network North”, which further prolongs uncertainty for everyone trying to operate in an already uncertain world.  

‘When the National Infrastructure Commission talks about government being an ‘intelligent client’, we see wherein part of the problem lies, particularly in relation to recent criticisms over the cost of external consultants engaged on HS2. Government departments and councils, at various levels, formerly employed its own specialists – quantity surveyors, architects, engineers and various other professionals – but this is no longer the case. Without this in-house expertise, which would otherwise provide continuity in knowledge, you also lose the capacity for useful retrospective analysis of spending, and with it the opportunity to inform future projects. 

‘Of course, through any talk of giving the sector some much needed clarity and confidence, any investment by government will only work if there is sufficient supply-side capacity too. The shortage of skilled labour in civil engineering has long been documented. In its 2Q2023 Workload Trends survey, the Civil Engineering Contractors’ Association reported 70% of respondent firms had issues with the supply of skilled operatives and 48% had issues with the supply of staff.  

‘As the Commission states, we need a clear pipeline of investable projects around which firms can plan, invest in skills, and develop long-term relationships with suppliers. The onus is also on government to apply some strategic thinking to how we invest in the skills needed so output from the sector isn’t limited by available labour input.’

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