Major transport infrastructure projects Contents

Introduction

Inquiry

1.We launched our inquiry, ‘Major transport infrastructure projects: appraisal and delivery’, on 4 December 2020. The inquiry examined the Government’s transport infrastructure strategy and priorities, including the appraisal and funding of major transport infrastructure projects, oversight, accountability and governance, and governmental capacity and workforce skills. We held three oral evidence sessions. We received 73 written evidence submissions from the public, private companies and other organisations. We are grateful to everyone who contributed to and engaged with our inquiry.

Barriers to effective project delivery

2.Successive Governments, comprised of all political parties, have launched large transport infrastructure projects before the true cost and delivery date being finalised by the agencies responsible for their construction. Delivering major transport infrastructure projects is challenging and complex. Major transport projects are vast undertakings with complex technical and operational elements. Effective delivery is contingent on their gaining and sustaining public and political support. They are often delivered to budgets and timescales set early in their lifecycle. Their delivery by the Government and its agencies is increasingly impeded by litigation (see paragraph 39). Despite those challenges, the public expect them to be delivered to pre-announced timescales and budgets. When overruns occur, politicians blame those who delivered the project, despite these delivery bodies not being responsible for setting budgets and timescales. Where such overruns are the responsibility of the delivery agency, there is little accountability or incentive for delivery to time and budget.

National Infrastructure Strategy

3.The Government has placed the construction of major transport infrastructure projects at the centre of its programme for government. It argued that infrastructure investment will support its top-level policy objectives of “levelling up” the country, reaching net zero greenhouse gas emissions by 2050 and “building back better” from the coronavirus pandemic. The Prime Minister’s foreword to the National Infrastructure Strategy stated that the Government will build infrastructure to “redress long-standing inequalities, particularly in transport, between different parts of the UK” and “in the period covered by this strategy … significantly shift spending to the regions and nations of the UK”.1

4.The National Infrastructure Strategy is the Government’s plan for future infrastructure development.2 It was published on 25 November 2020. It set out five priorities:

5.The strategy described a range of major transport projects aimed at supporting an “infrastructure revolution”. Those projects included delivering HS2, investing some £27.5 billion in the strategic road network during the current Parliament and spending £500 million to restore railway lines lost to the Beeching cuts.4 The Government developed the National Infrastructure Strategy to help the economy to recover from the coronavirus pandemic and “to address the long-term issues that have held back UK infrastructure”.5 Increased investment in infrastructure may spur increased economic activity by reducing costs in manufacturing industries, creating jobs and improving productivity.6

Coronavirus

6.On the effect of the coronavirus pandemic on transport usage, the National Infrastructure Commission (NIC), the authoritative independent advisory body on infrastructure development, cautioned that it is “too early to assume that long-term behaviour change will lead to wholly different patterns of infrastructure use”. It stated that it is “far too early to draw conclusions about which behavioural trends may emerge in the long term as a result of the pandemic”.7 The Department for Transport stated that

“it is not yet clear how individuals will respond once restrictions on travel and activities are fully lifted and whether the extent to which reductions in travel we have observed during the pandemic will persist in the medium to long-term … the uncertainty around how current trends will play out remains significant”.8

Due to ongoing uncertainty caused by coronavirus, the NIC recommended that infrastructure policy should focus on “low regrets interventions” that address public need regardless of how particular patterns of travel change as a result of the pandemic.9 Institution of Civil Engineers fellow Jonathan Spruce explained that as a result of the coronavirus pandemic, “priorities will change … it is how you might accelerate certain things, like active travel, to help achieve your net zero ambitions. Just because a strategy is set does not mean that the programme of delivery should be set”.10

7.Despite the coronavirus pandemic, the NIC stated that the “importance of a continued commitment to infrastructure remains high”, particularly in the contexts of achieving net zero greenhouse gas emissions by 2050 and of balancing economic growth across the UK.11 The NIC concluded that “the potential impacts of behaviour change on infrastructure demand are likely to be less significant than changes from other trends over the past thirty years”, such as urbanisation.12 The Secretary of State for Transport advanced a similar argument, highlighting that “neither the two world wars, the recessions and depressions or the Spanish flu—none of these things—stopped the inexorable growth in the need, ultimately, for people and goods to travel”.13

8.In response to the ongoing uncertainty caused by coronavirus, the NIC recommended building “optionality” and “flexibility” into transport infrastructure investment by adopting a portfolio of infrastructure investments to encourage “balance across different levels of risk” and by creating “a complementary mix of programmes which cover different scenarios as well as low regrets options applicable across multiple scenarios”.14 To account for contingencies in a transport context, the Department published an “uncertainty toolkit” for transport modelling and appraisal.15 Such a toolkit will be crucial in evaluating business cases for major transport infrastructure projects as the UK recovers from the coronavirus pandemic.

9.Subject to devolved responsibilities, the National Infrastructure Strategy’s top-level objectives of supporting the UK economy after coronavirus, addressing regional inequalities and facilitating adaptation to climate change are welcome. However, the Government is yet to articulate the detail on how it will achieve those objectives.

10.The Government may need to amend the National Infrastructure Strategy to account for the evolution of the coronavirus pandemic in the 10 months since the strategy’s publication. To assess whether and how the strategy requires revision, the Government must examine whether the major transport projects in the strategy will still deliver their intended strategic benefits and the Government’s policy objectives, particularly in the context of declining public transport usage, higher levels of home-working and resulting shifts in travel patterns.

1 HM Treasury, National Infrastructure Strategy, November 2020

2 Ibid.

3 Ibid.

4 Ibid. The ‘Beeching Cuts’ refer to the closure of approximately 8,000 kilometres of rail track and over 2,300 stations in the 1960s, following the publication of ‘The Reshaping of British Railways’, one of the two-part Beeching Reports.

5 Ibid.

6 Rafiu Dimeji Seidu, B.E. Young, Herbert Robinson and Michael Ryan, “The impact of infrastructure investment on economic growth in the United Kingdom, Journal of Infrastructure Policy and Development, vol 4 (2020); Alicia H. Munnell, “Infrastructure Investment and Economic Growth”, Journal of Economic Perspectives, vol 6 (1992); Tatyana Palei, “Assessing The Impact of Infrastructure on Economic Growth and Global Competitiveness”, Procedia Economics and Finance, vol 23 (2015)

7 National Infrastructure Commission, Behaviour change and infrastructure beyond Covid-19 (May 2021), p 6

8 Department for Transport, Appraisal and Modelling Strategy: TAG update report, May 2021, p 13

9 National Infrastructure Commission, Behaviour change and infrastructure beyond Covid-19 (May 2021), p 4

10 Q9 [Mr Spruce]

11 National Infrastructure Commission, Behaviour change and infrastructure beyond Covid-19 (May 2021), p 6

12 Ibid.

13 Q137 [The Secretary of State for Transport]

14 National Infrastructure Commission, Behaviour change and infrastructure beyond Covid-19 (May 2021), p 33

15 The Department for Transport, Uncertainty Toolkit, May 2021




Published: 29 September 2021 Site information    Accessibility statement