Infrastructure and Devolution

At last month’s annual Highways UK conference in Birmingham, there was much discussion on the opportunities for investment in UK infrastructure as well as innovation in the way it is delivered. Director Judith Sykes reflects on key points from her panel discussion, hosted by ICE Midlands and Burgess Salmon, focusing on how devolved powers can foster regional approaches to sustainable infrastructure delivery.

A systems problem

The challenge with infrastructure delivery has always been that infrastructure system boundaries never align with political or economic geographies. We see a gap between the national and local level, and a need to work across administrative boundaries. Devolution alone does not completely resolve this either. Hence, within the ICE’s 2016 State of the Nation report on the subject of devolution, we recommended the creation of regional strategies to reflect the need for a subnational approach. This reflects, to a certain extent, the role already being taken by Transport for the North and Midlands Connect in prioritising investment. Extending this thinking beyond transport, to consider the interdependencies between water and energy systems, will help the UK to develop a more integrated and more resilient infrastructure platform.

Skills pipeline

Our industry has long recognised the skills shortage in engineering, but we are increasingly seeing the need for a more multidisciplinary way of working too. It is not sufficient to say we need more engineers; it is a much more sophisticated problem. We need people with a range of different skills and experiences to work alongside economists and planners and to be able to engage with communities and understand their needs, to take advantage of new technologies and construction techniques.

Innovative examples to developing skills are emerging, like Fusion 21, which links the public procurement process to job creation and skills development. Experiential learning platforms such as Nuclear Island and the BIG RIG are initiatives aimed at stimulating interest in this sector. Regional strategies and devolved powers will enable us to be much more deliberate about developing the local skills that are required to deliver our infrastructure needs.

Flexible financing and dealmaking

Within the State of the Nation report, we talk about the need for more flexible financing. This will provide the ability to pool business rates, make greater use of the community infrastructure levy, and to benefit from value capture mechanisms such as tax increment financing.

Working with the private sector is also important; however, many public authorities have been burnt by private financing initiatives. It’s clear that public-private partnership (PPP) will remain a source of financing, but it must move towards a more performance based agreement which is consistent with the circular economy. A great example of this is the A12 in the Netherlands where by the motorway has been leased to BAM for 20 years on a Design Build Finance Maintain model (DBFMO), but where BAM are incentivized to keeping lanes open through payments.

With devolution, public sector bodies need to, and indeed are, becoming more skilled in the ways in which they do deals with the private sector and in leverage financing. Earlier this year I helped facilitate the UKGBC City Summit in Birmingham where we discussed the need for cities to become deal makers, bringing together different partners to create the right conditions for development.

Assessing the value of outcomes

Another factor we need to consider is how we articulate the whole life value of infrastructure investment. This is an area where our industry has struggled. Appraisals are dominated by capital cost and wider opportunities around sustainability and innovation can be missed or are often value engineered out.

Devolved bodies should be better able to both identify the need for infrastructure, and communicate benefits to those it serves. Manchester’s New Economy model is a good example of how authorities can appraise outcomes in terms of the value to society, for example, reduced healthcare bills from cleaner and more active transport solutions.

Integrated place-based approaches

Through the devolution of power, we can already see how place based approaches can be developed. Closer connections to the issues can facilitate tailored solutions which align with local needs. There is a real opportunity for different stakeholders, delivery partners and government agencies to come together to prioritize investment and to leverage wider benefits. The Sheffield Grey to Green project is a great example of how investment funds were pooled to improve the Riverside Business District. Improving the quality of the urban realm by improving green infrastructure will start to regenerate this part of the city and have a positive impact on microclimate, reduce the risk of flooding, create a sense of well-being and improve the local ecology.

The Centre for Cities’ Fast Growth Cities initiative, along the Oxford Cambridge Arc, is another great example. The programme is driving the need for investment in infrastructure to link Oxford and Cambridge via Milton Keynes to enable growth in the knowledge economies of these cities.

Digital as an enabler

The technological transformation that will enable us to deliver these more integrated approaches is also timely. The Glasgow Future Cities demonstrator has shown how public services can be brought together, through an integrated platform, to plan and operate our cities more effectively. This creates greater efficiency in service delivery at the same time as providing a more rapid response to city issues. Glasgow is also using the platform to capture data and create a better understanding of how the city works. They are providing real time information to citizens on, among others, pollution levels and traffic management. This improves user experience and provides more reliable services. Furthermore, people can use apps to provide feedback and engage more fully in how their city evolves.

Future city deals should include funding to allow cities to fully utilize the best of technology. The recently published Autumn Statement includes welcome support for investment in digital infrastructure. The ultimate aim should be to provide a better service to citizens, and, more broadly, improved quality of life for all.

 

Judith Sykes is Director of Expedition Engineering and Useful Projects and a Fellow of the Institution of Civil Engineers. She is also Editorial Chair of Engineering Sustainability journal and a contributing author of the ICE’s State of the Nation: Devolution 2016.