Political uncertainty holding back UK infrastructure, says CBI

Political uncertainty ahead of the 2015 general election is holding back UK infrastructure improvements, according to a new report published by the CBI and URS.

More than half of business leaders surveyed by the two organisations expect UK infrastructure to worsen in the next five years, with 67% and 57% of respondents predicting deterioration in the key areas of energy and transport respectively.

When asked what stands in the way of progress, almost all businesses said political intervention is part of the problem, with 96% saying political uncertainty is discouraging investment and 93% identifying political rhetoric as a problem, damaging confidence in markets.

To tackle this, businesses show overwhelming support for the creation of an independent infrastructure commission (89%), as recommended by Sir John Armitt earlier this year.

However businesses did say they back certain current government policies, with two-thirds of infrastructure providers supporting the UK Guarantee Scheme and pro-development planning reforms.

The two organisations surveyed 443 business leaders.

Katja Hall, CBI deputy director general, said: “Progress on infrastructure has been a case of two steps forward and three steps back for far too long.

“While the policy environment has improved, businesses still don’t see upgrades to mission-critical parts of our infrastructure on the ground in practice – and don’t expect to anytime soon. 

“Politicians are too often seen as ducking the big, politically difficult questions looming large on businesses’ risk register, like runway capacity and long-term road funding, rather than grasping the nettle.”

John Horgan, URS managing director in Europe, Middle East, Africa and India, said: “There is a strong desire for a new approach to infrastructure that extends beyond the five-year electoral cycle.

“Business is overwhelmingly calling for the establishment of a neutral body to assess the UK’s long-term infrastructure needs.”