Money Makers – How will the Infrastructure Bank change UK construction?
There is a great deal of responsibility resting with the UK’s Infrastructure Bank (UKIB). It has been trusted with a relatively large pot of money – £22 million to be precise – and tasked to fulfill two key mandates: Levelling up on inequality and helping the public and private sector reach net-zero targets. Of note is that the home of the new Infrastructure Bank is not London, its Leeds, which supports the push to develop the North and other parts of the UK.
Can the UKIB make up what was lost through Brexit?
While amount of funding made available to UKIB may seem significant, it’s less than third that was previously available through the EU Investment Bank. According to Chris Grigg, the newly appointed Chairman of UKIB, the vision is to secure additional private funding to support efforts. But he recognises that this will largely depend on the bank’s ability to deliver on its promises.
Grand infrastructure ambitions
The UK Government has stuck its neck out and set very ambitious net-zero targets which will be almost impossible to achieve without significantly greater investment. The UKIB is seen as the vehicle to make that possible. Currently infrastructure in the UK is largely privatised which makes it segmented and difficult to manage. It is the hope that the UKIB will help fill the gaps where private investment is not possible and steer infrastructure development in a direction that will achieve both of its mandates.
The roadmap for better infrastructure
The development of green infrastructure projects is sorely needed. With the target of banning the sale of all non-electric vehicles by 2030, the pace of EV charging infrastructure will need to be significantly accelerated. Tying together wind and solar projects with grid infrastructure to ensure there is sufficient capacity and security will be another challenge.
It’s acknowledged that infrastructure outside of London and other major cities is in dire need of an upgrade. With many more people working from home and a hybrid model set to continue for at least the near future, there’s an opportunity to re-evaluate commuter needs, recognising that not everyone will be returning to city offices.
What’s the impact for construction?
The construction industry is on a growth path and additional funding can make a significant impact. However, in order to secure that funding main contractors will need to be able to demonstrate that they understand what levelling up and net-zero involves and have the capacity and expertise to be able to deliver on those expectations. Having the right senior people with the right skills in place is going to be critical.