In this fortnightly blog, ICE's Director of Policy Chris Richards looks at developing policy landscape for infrastructure, what decisions mean, and their implications, so that infrastructure professionals can play their part in shaping the discussion.
1. UK government commits to second active travel strategy
As required by law, the UK government will publish a second cycling and walking investment strategy later this year. The first strategy, published in 2017, was set to run until the end of this year.
In July 2020, an updated ‘vision’ for walking and cycling was published based on the themes of making streets better; incorporation into decision-making; giving local authorities more power and motivation and; enabling and protecting cyclists. This included additional funding to support active travel as local government looked at how to repurpose road space to support social distancing.
The new strategy will look at 2022 and beyond, and come with multi-year investment as part of the Comprehensive Spending Review expected later this year.
Our study last year highlighted that prioritising active travel as part of the recovery from Covid-19 is important as economic activity returns, but social distancing means public transport capacity in cities is reduced. The alternative is increased car use which doesn’t align with the need to decarbonise transport.
2. 26th annual survey of UK local road conditions show billions still needed to catch up
The Annual Local Authority Road Maintenance (ALARM) survey of local highways maintenance engineers highlights that even though budgets have increased for highways maintenance, they are still lower than two years ago and road conditions still haven’t improved. The maintenance backlog in England and Wales now stands at an estimated £10.24bn.
The report also highlights 23% of local authorities have a quantified target for reducing the carbon footprint of road surfacing materials and on average, spend 5% of their maintenance budget addressing 'premature maintenance arising from utility openings'.
Effective strategic infrastructure planning starts with a clear understanding of a nation’s existing infrastructure assets. The total local road network in England is the largest infrastructure asset by value. The National Infrastructure Commission has committed to do more modelling and analysis of local and regional issues as part of the next National Infrastructure Assessment later this year. Incorporating the condition of local highways would be a good inclusion.
3. Singapore turns to borrowing for infrastructure development
A newly tabled law in Singapore aims to increase the Singaporean government’s ability to borrow for long-term infrastructure to 90 billion Singaporean dollars (SGD).
Over recent decades, infrastructure projects have been funded through rising tax and other revenues achieved due to economic growth. However, as with most countries, Singapore has significant investments it needs to make to ensure sustainable development, including climate change mitigation and adaptation.
These investments require considerable upfront financing, which can’t be spread over several fiscal years. Low-interest rates for borrowing and budget deficits caused by the Covid-19 pandemic are also key considerations.
Unlike other countries, strict criteria are being put in place to guide how borrowing is raised and spent.
Money can only be spent on government-owned and controlled infrastructure; projects have to cost at least 4 billion SGD. The assets created should be usable for at least 50 years, and projects have to support productivity or economic, social or environmental sustainability. To limit the burden on future generations, total borrowing will be capped at 90 billion SGD, and if combined interest payments for loans raised under the new law exceeds 5 billion SGD a year, then no more borrowing will be allowed.
Across the world, there is a sizeable gap between the estimate for required infrastructure investment and what is expected based on current trends (as we reported in this previous article). All countries will be looking at various sources to raise new finance to invest in infrastructure to meet both the Sustainable Development Goals by 2030 and the Paris Climate Agreement.