National Infrastructure Commission Autumn Statement Response: Government acceptance of NIC recommendations most welcome - Armitt
Deputy Chair of the National Infrastructure Commission responds to announcements made in the Autumn Statement
The Autumn Statement, Wednesday 23 November 2016, saw the Chancellor announce that:
- The government accepts the NIC’s recommendations to fund the next phase of East West Rail and the Oxford-Cambridge Expressway
- The next NIC study will focus on how emerging technologies can improve infrastructure productivity
- The government has set the NIC’s fiscal remit between 1% and 1.2% of GDP each year from 2020 to 2050.
Responding to the Autumn Statement, Deputy Chair of the National Infrastructure Commission, Sir John Armitt, said:
The government’s acceptance of the National Infrastructure Commission’s recommendations for the Cambridge, Milton Keynes, Oxford corridor is most welcome.
The growth corridor between Cambridge Milton Keynes and Oxford could help fire the British economy, but only if we back it with the homes and infrastructure it needs to thrive. Last week the NIC presented the compelling case for investment in East West rail and the Oxford Cambridge Expressway, as part of a wider joined up plan to help this region succeed. This is a once in a generation opportunity and the government is absolutely right to accept those recommendations.
On the launch of the National Infrastructure Commission’s Technology study he said:
From electric vehicles to the Internet of Things and artificial intelligence, the technologies of the future could have an enormous impact on the UK’s economic infrastructure and the ways in which rely upon it.
As new technologies develop, Britain must do everything it can to ensure that we are best placed to reap the benefits - and that includes incorporating innovative new systems and practices into the infrastructure that keeps our country moving.
Britain should seek to lead the world in harnessing the emerging technologies that can make our lives easier and our economy more productive. This study will consider how we make that happen.
On the announcement of the NIC’s fiscal remit he added:
Today’s announcement represents a crucial step in the formation of the NIC. Providing a clear remit and a long-term funding guideline for British infrastructure will help this country plan for the long term and deliver the systems and networks we need to compete.
Background
The Cambridge – Milton Keynes – Oxford corridor
In relation to East West Rail and the Oxford-Cambridge Expressway, the NIC recommended that:
Recommendation 4: The government should commit to delivering the Western Section of the East West Rail project before 2024 (the end of the rail industry’s Control Period 6).
- To achieve this, the government should bring forward £100m in funding to accelerate design and development, and commit construction monies as necessary to: avoid abortive cost (subject to the development process demonstrating rigorous disciplines in planning, cost management and value management); and integrate construction of the East West Rail Western Section with work on HS2.
- To fully maximise the benefits of the project local authorities should recognise the potentially transformational benefits of East West Rail and develop and agree, working with national government, an ambitious strategy for housing development and delivery around stations and station towns.
- The Commission will support this process as part of the second phase of the Cambridge-Milton Keynes-Oxford study.
Recommendation 5: The government should commit up to £10m in development funding to continue work on the Central Section of the East West Rail link.
- Government should provide clear guidance that a core objective for the development of this scheme should be to support the provision of new housing and connect it to local and regional labour markets.
- Local partners and national government should work together to develop a plan for the Central Section which links development work on the East West Rail Central Section to options for local housing development.
- Government should explore the potential for alternative delivery and financing mechanisms for the railway. This should include consideration of how third party contributions could be leveraged.
- The Commission will support this process as part of the second phase of the Cambridge-Milton Keynes-Oxford study.
Recommendation 6: The government should commit £27m to the end of 2018/19 to fund the next phase of development work on the Oxford-Cambridge Expressway study, allowing the detailed design process to begin as soon as possible.
- Highways England should work with relevant local authorities to develop and assess the potential Expressway options and develop a proposal which maximises the scheme’s potential to unlock housing growth and connect it to local and regional labour markets, alongside delivering wider benefits.
- The Commission will support this process as part of the second phase of the Cambridge-Milton Keynes-Oxford study.
The full interim report can be found here
Text from the Autumn Statement
The section of the Autumn Statement relating to the National Infrastructure Commission can be found here. It is reproduced in full below.
4.5 National Infrastructure Commission
Economic infrastructure (transport, energy, flood defences, water, waste, and digital communications) is crucial for the economy and for people’s daily lives. The government has put infrastructure at the heart of its economic strategy and has set up the National Infrastructure Commission (NIC) to provide expert advice on the country’s strategic infrastructure needs and independent recommendations on how to meet them. At Spending Review 2015, the government announced it would increase transport spending by 50% to invest £61 billion in this Parliament. Including the additional investment provided by the NPIF, annual central government investment in economic infrastructure will increase by almost 60% from £14 billion in 2016-17 to £22 billion in 2020-21.13
The government’s long-term investment decisions will be informed by the NIC to ensure they are targeted at the UK’s most critical infrastructure needs. To ensure the NIC’s recommendations are affordable, the government has set the NIC a fiscal remit. Government investment in the areas the NIC covers will rise to over 1% of GDP by 2020-21. The fiscal remit invites the NIC to set out recommendations on the assumption that spending on infrastructure will lie between 1% and 1.2% of GDP each year from 2020 to 2050. This would mark a sustained, long-term increase in infrastructure investment. The government will take all final spending decisions.
NIC study on Cambridge-Milton Keynes-Oxford corridor – The government welcomes the NIC’s interim report into the Cambridge-Milton Keynes-Oxford growth corridor, accepts the recommendation for an Oxford-Cambridge expressway,14 and will provide £27 million in development funding. The government will also bring forward £100 million to accelerate construction of the East-West Rail line western section and allocate £10 million in development funding for the central rail section. The government welcomes the NIC’s work looking at a range of delivery models for housing and transport in the corridor, including development corporations, and will carefully consider its final recommendations. Following a successful public call for ideas, the government has also asked the NIC to undertake a new study on how emerging technologies can improve infrastructure productivity.