Investing in infrastructure, zero emissions, dealing with Brexit - everything is on the table
As the Conservative Party whittles down its leadership contest to the final two, the candidates’ Brexit strategies continue to dominate the race. While their plans to navigate the UK’s exit from the EU must be the priority, a long-term focus on the future is still required. Looking beyond Brexit, there are other vitally important issues the incoming Prime Minister can ill afford to ignore.
It is critical that the domestic agenda is not further sidelined while the current period of disruption continues. Focus must remain on progressing the UK’s ambitious infrastructure pipeline. Schemes such as HS2, Crossrail 2 and Northern Powerhouse Rail are vital to the country’s ability to compete on a global stage. Building certainty around the future pipeline will allow industry to plan ahead and commit to recruiting, developing and maintaining the necessary skills to support project delivery. Industry upskilling now will also better position UK-based firms to export homegrown expertise down the line, securing the long-term strength of industry.
Part of the problem affecting the progress of major projects is a fixation on headline costs. There needs to be a shift in the political narrative to highlight the wider value and benefits of growth-stimulating infrastructure projects. While public scrutiny is necessary given the significant investment required to fund major schemes, all too often politically charged projects are kicked to the long-grass. Capturing and communicating growth opportunities that show how projects will unlock housing, employment, mobility and other opportunities is key to gaining public support for projects from their earliest stages. Promoting infrastructure as a path to economic growth and a better standard of living for large numbers of people will be essential for getting projects off the ground. Removing political bias from project business cases is required if the UK is to accelerate the infrastructure pipeline.
Indeed, the new Prime Minister must create the right business environment. Government encouragement for new delivery models and innovative financing initiatives will be essential. Bridging the UK’s infrastructure funding gap requires private investment, but there is currently no framework in place that supports the various means of delivering projects. There is plenty of private money seeking investment opportunities, and the government must be receptive to new proposals. After all, the private sector is well-positioned to bring ideas, expertise and innovation to new schemes. The proposed Heathrow Southern Railway, for example, is an opportunity identified and financed by the private sector, including investment in part from Aecom. This project and other proposals remain on the desks at Whitehall pending a decision on their way forward. A commitment from the new Prime Minister on the future of private infrastructure investment will help provide clarity to industry and plug the gap left from the abolition of PF2.
Enabling more private investment to accelerate public transport improvements that provide trouble-free and cost-effective sustainable travel options would also help encourage a modal shift among the travelling public. Accelerating climate action will need to be another top priority for the incoming Prime Minister. As one of her final acts, Theresa May accepted the Committee on Climate Change recommendation by setting a legal target for the UK to reach net zero carbon emissions by 2050. The target is welcome news and will help our industry drive innovation and accelerate progress towards a zero carbon future. However, clarity on climate policy will need to quickly follow, providing a clear pathway for reaching the target.
Eliminating the UK’s carbon emissions will require radical innovation and the built environment sector has an important role to play in the development and implementation of climate action measures. There is already important research underway that will help shape future policy. The Aecom-led research project Building for 2050, funded by the Department for Business, Energy and Industrial Strategy (BEIS), is combining technical and building performance reviews with social research to identify the barriers and drivers of building low carbon new homes at scale. The vital contribution of our sector in tackling the climate emergency must not be underestimated. The challenge for the new Prime Minister will be to maintain momentum and ensure the UK delivers on its commitment.
The UK’s long-term productivity problem and its potential to stifle continued growth is a well-recognised issue. Similar to achieving the net zero 2050 target, improving productivity requires a focus on innovation. For the built environment sector, new public procurement routes will encourage increased innovation. There must be a shift away from procurement based on price so that companies in the sector are incentivised to pursue new ways of working and digital advancements. Offsite construction is just one approach that has the potential to drive up productivity. To maximise the benefits that offsite construction can bring, transforming the contractual landscape to favour new delivery models is key.
While the incoming Prime Minister will be required to lead the country through a continued period of change, they must set out a long-term infrastructure plan that looks beyond Brexit. On this, the growth and economic health of the UK and future generations depends.
David Barwell, chief executive – UK & Ireland, Aecom