Get politics out of construction
- Published on Monday, 30 September 2013 15:46
- Written by Roderick Pettigrew
Wouldn't it be refreshing if we could get out of the 'boom and bust' cycle that leads to inevitable recessions and makes it impossible for contractors to plan for the long-term? What could do it? Well, finding a way of separating the knock about five-year political timetable from public infrastructure planning would be a good place to start.
That is why the Armitt Review – commissioned by Ed Balls – is a tantalising glimpse of a more stable future and particularly relevant in light of the controversies surrounding political interference in HS2 and energy pricing during the Labour Conference in Brighton.
Sir John Armitt, former Network Rail chief executive and chairman of the 2012 Olympic Delivery Authority, has taken a long, hard look at the country's crumbling transport, energy, telecoms and water infrastructure. He recommends setting up a politically independent National Infrastructure Commission with the remit to plan and deliver projects over a 25 to 30-year timescale.
This is increasingly important because, according to the World Economic Forum, the UK ranks 24th for infrastructure structure – we are well behind most other developed economies. This is largely to do with political interference. Ministers have the final say and will only eventually approve something once their department has exhausted all the potential for political controversy. 'Is it a vote winner – or loser' being the main criterion.
Our energy infrastructure is so far behind schedule we are staring at the very real possibility of rolling blackouts across the country from the middle of 2015, according to the energy regulator Ofgem. We got into this mess because, while some politicians were pushing ahead with European rules to decommission ageing, pollu
ting coal-fired power stations, others were delaying investment in proposed new nuclear and renewable generation.
Similarly, the small-scale solar market was pole-axed over night when the Government suddenly changed direction and slashed the Feed-in Tariffs on which many companies had based their recruitment, training and purchasing decisions for years ahead. That whole issue betrayed a lack of understanding of how the market would operate on the part of government officials; and a change of administration led to a sudden knee-jerk decision that had a disastrous effect on our industry.
The Green Deal is suffering from a similar attack of political jitters. A number of crucial decisions that could have made all the difference were ducked – not least the inexplicable decision to cut 'consequential improvements' from the new Part L of the Building Regulations. This would have kick-started the scheme by making it the means of paying for much needed energy upgrades backed by legislation.
Armitt's idea is that the new Commission would assess Britain's needs every 10 years, with the Government obliged to put the key recommendations to a parliamentary vote within six months.
The relevant departments would then have a year to put the funding and planning in place – no shilly shallying.
As well as energy, there are huge opportunities in rail; hospitals; and schools with thousands of facilities now desperate for investment yet many possible investors and project partners are sitting on their money until they have a better idea of the Government's long-term plans. Corporate balance sheets are in better shape, but confidence in the decision making process is missing.
Infrastructure projects need long-term certainty if they are to be delivered on time, to budget and to an acceptable standard. We have known about likely energy shortages for over a decade, but the brave decisions were ducked and so we are where we are.
To deliver the projects, contractors need to make plans for training; new technologies; labour forces and raw materials – they can't just pluck these things out of the air at short notice. A new non-political approach is essential to make sure future generations don't end up in the same 'pickle'.