By Richard Johnstone | 2 December 2013
The Treasury has been urged to set out more details about the development of a host of infrastructure projects in this week’s Autumn Statement as part of efforts to raise private finance to pay for some schemes.
Think-tank CentreForum said today that the lack of a long-term finance plan for upgrades to the transport, energy and communication networks was hindering Whitehall attempts to secure outside investment. Ministers are keen to get both local government and private sector pension funds to back capital developments.
However, CentreForum’s Build the infrastructure report stated that the Treasury’s National Infrastructure Plan, covering more than 550 schemes and 40 priority projects, does not provide enough detail to investors on how their money would be repaid.
CentreForum research associate Quentin Maxwell-Jackson said ministers must make clear what the UK can afford and prioritise projects based on the funding available from both taxpayers and users.
Once this was done, projects in the NIP could receive financial backing from investors, as institutions such as pension funds are ‘queuing up’ to invest in funded projects, Maxwell-Jackson said.
‘It’s time for the government to inject much more realism into the UK’s infrastructure plans. That means making it absolutely clear how essential infrastructure projects are going to be paid for, and prioritising projects so that we get the greatest benefit from what we can afford to pay.’
A review of the NIP, being undertaken by Commercial Secretary to the Treasury Lord Deighton, will be published as part of Chancellor George Osborne’s Autumn Statement on Thursday.
This must set out the long-term funding for nationally significant developments, including what taxpayer or user charging would be available across a range of sectors, CentreForum stated.
If the NIP, which has been criticised as lacking a strategic vision and clear priorities, provided greater clarity, investors would be able to make choices about their financial involvement, the think-tank said.
