Unprotected government departments – many of which are responsible for infrastructure delivery and upkeep – have been asked to produce plans to save 25% and 40% from their budgets ahead of November’s Spending Review, in a bid to find £20bn of public spending savings.
In its Spending Review submission, the Institution of Civil Engineers (ICE) praised Government’s commitment to invest £100bn in infrastructure over the next five years, placing it at the heart of its economic strategy. ICE challenged industry to play its part by driving innovation, upskilling the workforce and finding ways to deliver more with less. But it urged Government to support industry’s transformation by taking a strategic view when making decisions on spending.
ICE said the six year £2.3bn investment plan for flood defences should be protected to build the UK’s resilience to flooding and ensure that communities, business, transport networks and power supply do not suffer the same catastrophic effects. The cost to the economy from the 2013-14 floods was estimated at £1.1bn, with damaging impacts on national productivity. ICE also recommended protecting the £15bn investment for the road network, which supports long term growth by enabling access to work, education and the movement of essential goods into and around the UK.
But it stressed that protecting investment for new infrastructure was only part of the solution, and called on Government to ensure the maintenance of existing infrastructure is also factored into spending plans. ICE said a new ‘prevention is better than cure’ approach is needed, breaking away from the false economy of reactive patch-up work.
ICE Director General, Nick Baveystock, said: “Government recognises that robust, effective infrastructure benefits society and the economy - boosting growth, jobs, productivity and resilience. It also gives us the edge over our international competitors. Government has made solid progress and commitments, and our industry must gear up to respond to the opportunity.
“While Government must make some tough decisions in November, I hope the progress made on infrastructure - and its contribution to the UK’s long term goals - isn’t compromised by the race to clear the deficit. Spending choices should be strategic.
“As part of this, we would like to see a move towards a ‘whole life’ or ‘total expenditure’ approach to infrastructure investment, covering both capital and maintenance spend over a multi-year basis. Maintenance budgets for local roads and flood defences are not only insufficient, but are allocated annually which means spending is reactive and piecemeal, often failing to tackle the root of the problem.
“If we believe in supporting long term growth and productivity we have to recognise false economies for what they are. With infrastructure investment, prevention is better than cure.”
View ICE’s 2015 Spending Review submission: www.ice.org.uk/spendreviewsub