Good infrastructure is key to a functioning economy

2nd October 2020

What role will infrastructure take in reinvigorating the UK economy?

This article was first published in the London Chamber of Commerce, London Business Matters October 2020 edition.

The ‘build, build, build’ agenda and infrastructure budget of early 2020 have, arguably, aged very quickly. What appeared to be a no brainer approach to reviving the economy has been complicated by the pandemic. Promises of “levelling up” and the delivery of “shovel ready” projects have been eclipsed by lockdowns and the need for COVID-19 testing.

Meanwhile the construction industry has soldiered on with HS2 construction officially commencing last month. HS2 promises to generate over 22,000 jobs, with the Balfour Beatty Vinci joint venture expecting to be one of the biggest recruiters in the West Midlands in the short term. Its focus on getting younger people into work, with apprenticeships for the under-25s being named as the core focus for recruitment and skills, investment in infrastructure is essential. But with its estimated completion date of 20 years the impact of HS2 will take time to influence the wider UK economy.

Turnaround

Localised infrastructure projects with a bottom up approach, may actually see a more rapid turnaround in economic growth. Transport for Wales’ railway transformation programme for the South Wales Core Valley Lines will improve facilities and connectivity linking communities to improving access to jobs and leisure. Working with the existing infrastructure, less grandiose, but still changing lives.

Will recent reforms to the planning system make life easier for contractors in the fiercely competitive construction market? It’s difficult to see how the introduction of extensions to construction hours and planning permission deadlines will be a game changer. The only permanent planning reform relates to planning proceedings which raises the question as to whether these reforms will be sufficient to stimulate the on-going delivery needed to encourage economic recovery.

Investment in infrastructure requires vision and long term commitment.

Commitment

But do people want their lives changed? As I write, one of the main challenges to business is getting people to leave the safety of their houses. Does this mean that a reliance on infrastructure to facilitate change is an anachronism? In my opinion, almost certainly not. Yes, lifestyles have been fundamentally changed over the last six months and while this will inevitably act as a reset button, to suggest that the role of infrastructure is in some way diminished, is to me a far too short term approach. Investment in infrastructure requires vision and long term commitment. We still use Bazalgette’s sewers and drive over Telford’s viaducts. While there is the inevitable balance to be stuck, and clearly investment in green energy schemes should be a priority as we look to society’s obligations to future generations, good infrastructure is key to a functioning economy.

Tags: coronavirus, Coronavirus construction