This blog examines the Public Affairs and Constitutional Affairs Committee’s (PACAC) findings for how the Government should run its major infrastructure projects.
The Government has promised the largest investment in infrastructure for decades. The £640bn promised in the Budget speech and £5bn of Coronavirus 'bounce-back' investment is earmarked for transport, schools, housing and other key infrastructure across the country. The Government hopes that this investment will boost growth and lead to a 'levelling up' of the national economy.
It’s in this context that the Public Administration and Constitutional Affairs Committee (PACAC), has released its report on delivering the Government’s infrastructure commitments through major projects. Given major projects remain the primary mechanism through which the Government seeks to deliver key societal and business outcomes, the Committee has put forward recommendations that it believes would result in the most effective use of infrastructure investment.
This report follows an interim report published by its predecessor committee in late 2019, which identified a number of factors that impact the delivery of major infrastructure projects, including: central government oversight, Civil Service capability and skills, churn and conflicts of interest, political pressure in planning, and evaluating benefits. ICE provided both written and oral evidence to the inquiry that informed the interim report.
Findings of the PACAC report and ICE’s ‘levelling-up’ consultation
The PACAC Committee calls for government’s investment to be well thought through, responsive to local need, and delivered through effective, efficient and transparent major projects if it is to achieve its economic and “levelling up” goals.
The Committee states that the Government needs to define what it means by “levelling up” and set out a coherent plan for coordinated infrastructure investment that will deliver long-term benefits.
This is welcome, particularly as ICE is currently running a consultation examining what the Government’s ‘levelling up’ agenda means for the infrastructure sector. Similarly, ICE has consistently called for the publication of an evidenced-based and joined-up National Infrastructure Strategy to ensure that communities and businesses in the UK get the infrastructure that they need.
PACAC also highlights the importance of investing more time in early project development, including on the business case, before announcements are made. According to the Committee there is a tendency to commit to estimates of time, costs and benefits too early that later transpire to have been optimistic or unachievable. Similarly, a greater focus on benefits, better reporting of benefits throughout the life of a project, and proper follow-up after completion could help to ensure that projects are set up and run with a focus on achieving benefits.
There are welcome synergies with ICE policy work that has recommended infrastructure projects are designed and procured on a range of benefits that go beyond lowest capital cost, alongside a requirement for should cost modelling and estimating ranges to be used in determining project costs as part of the procurement process.
Covid-19 White Paper
The publication of PACAC’s report is timely. It makes some critical recommendations for the delivery of major infrastructure projects. This is incredibly important as the UK rebuilds from the Covid-19 pandemic. ICE will shortly be publishing a White Paper setting out the future shape of the infrastructure sector as the UK emerges from the pandemic. This will be published on the Policy Archive in due course.