The ICE鈥檚 new publication says there is a need for a full debate about the future of funding in the UK. As well as tolled roads, options including a UK investment bank should be considered鈥痓y the government and industry鈥痶o ensure鈥痑 strong future for the sector,says the ICE.
State of the Nation 2018:鈥疘nfrastructure Investment鈥�(SoN) explores鈥痮pportunities for future investment and is intended to open a conversation about how the nation鈥檚 infrastructure can be better funded and financed.鈥�
One of the report's key recommendations is that government should consider a pay-as-you-go model鈥痮f road taxation, to replace the likely loss of income鈥痜rom the existing model鈥痑s the country moves towards a largely electric car fleet.聽 Almost half the population (47%) would support the introduction of a pay-as-you-go model, if it were to replace Vehicle Tax and Fuel Duty, according to a YouGov survey commissioned by the ICE. This compares to less than a quarter (23%) who opposed the idea, and 30% who were either undecided or didn't have an opinion either way.聽聽
It also recommends that the feasibility of establishing a UK鈥痠nvestment bank should be explored鈥痑s a contingency against a loss of鈥痑ccess to low-cost anchor finance鈥痜rom the European Investment Bank鈥痑nd to maintain domestic expertise in鈥痠nfrastructure investment.
In addition, the National Infrastructure鈥疌ommission should be placed on a鈥痵tatutory footing in the long-term to鈥痚nsure its permanence and enhance鈥痠ts ability to give independent expert鈥痑dvice.
Paul Sheffield, ICE vice president and chair of the鈥疭oN鈥痵teering group, said:鈥�淚t鈥檚 important that we recognise the changing鈥痵ocietal鈥痩andscape and adapt accordingly 鈥� moving towards an electric vehicle fleet will require a change in the way taxes are charged and collected, just as鈥痑 change in emerging technologies will require variation in how energy is stored.鈥疶his report makes鈥痳ecommendations鈥痶o鈥痝overnment as we work together to create a sustainable future for infrastructure.鈥濃��
聽Professor鈥疞ord Robert Mair, ICE president, said:鈥�淲e face a time when鈥痶he demands on infrastructure services are changing and increasing, with pressures from population growth, ageing demographics, increasing urbanisation,鈥痑nd resilience issues due to climate change.
"To respond to these in the long-term, and remain globally competitive, we must have an open and robust debate about how to fund our future infrastructure needs 鈥� and encouraging private investment must be considered.鈥濃��
The OECD recommendation is that by 2030,鈥痝lobal鈥痠nfrastructure spending should be 3.5% of鈥痺orld鈥痑nnual GDP. However, the budget for public investment in UK infrastructure between 2020 and 2050 sits at 1%-1.2%, with any鈥痜urther investment to come from the private sector.鈥疶he report says that it is important for there to a healthy mix of public and private investment.
Hala Audi, director of strategy and policy at the Infrastructure & Projects Authority, responded to the report on behalf of the government. "The more we have these good quality publications to better inform the public, the more we can keep the infrastructure conversation going with government,鈥� she said.
She also welcomed the recommendation calling for active steps to be taken to facilitate the use of alternative funding types, such as asset recycling: 鈥淚t鈥檚 good to see ICE and the industry having these types of conversations, which are also happening within government.鈥�
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