National Infrastructure Commission
Phil Graham: speech to UK Infrastructure Show
This is the full text of a keynote speech on delivering transformed urban transport by National Infrastructure Commission Chief Executive Phil Graham at the UK Infrastructure Show at the NEC, Birmingham.
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It’s great to be here today and to see that so many of you are grappling with some of the big strategic questions on infrastructure.
I’m here as the Chief Executive of the National Infrastructure Commission. We were set up, with cross party support, for the express purpose of giving the long term strategic view to government for its decisions on infrastructure.
Not so long ago, politicians always used to tell us civil servants that the number one issue they hear about from their constituents was infrastructure, although that did mostly mean complains about potholes!
Even if politicians aren’t talking about infrastructure so much at the moment, it’s really enthusing to see so many people gathered here to think a bit more abut how infrastructure can be one of the long-term drivers of a better future for the country.
That’s very much what we do at the National Infrastructure Commission. We were set up by the government to give it independent, evidence-based advice on how to take forward the country’s infrastructure, into the future.
And that’s just what we’ve done – publishing last year the UK’s first-ever National Infrastructure Assessment. We have made recommendations to the government on how it can meet growing demand for energy, water and other resources, without harming the environment. For instance, by taking advantage of the falling costs of renewable energy and be ensuring electric cars can be charged by drivers anywhere in the country.
But here in the West Midlands – with the new Metro Mayor’s ambitious agenda, HS2 on the horizon and the Commonwealth Games acting as a catalyst for change – I want to focus particularly on our recommendations to transform transport in our cities and city regions.
To address the structural weaknesses that continue to make progress difficult, and to build a legacy for the future.
Three parts of the transport system are critical to driving economic growth and productivity – urban networks, intercity network, and international gateways.
The latter two have seen much focus and progress over the last decade: HS2, our ports, London Heathrow, Northern Powerhouse Rail, RIS, CP6 etc – and that has been hugely important in addressing historical under-investment. We want to see it continue.
Similarly, huge progress has been made in London. It is scandalous that the co-ordinated investment strategy which has been so successful in London is not being replicated in the Midlands and elsewhere. All the more so as the role of cities in our economy grows ever more important, and the drive to rebalance the economy away from London and the south east continues.
Instead of the genuine devolution and long-term funding that London has benefited from, the UK’s other cities face a fragmented and piecemeal system of funding programmes and grants – each requiring entry into a new bidding process, and adherence to a new set of priorities and requirements.
The inevitable result is short-termism and bid fatigue. When faced with so many other pressures, what rational authority would put serious time, effort and resources into developing a long-term strategy in that context.
The Transforming Cities Fund has been a step forward – but is still small-scale and still suffers from the same short time horizons. With the money needing to be spent over what is effectively a three-year period, authorities are inevitably driven to short-term fixes like new carriages or schemes that happen to be already sitting on the shelf, rather than really starting to invest in the future.
What is needed isn’t another three-year funding programme, however well-intentioned, but a genuine shift in ambition and change of mindset from government. We believe that is what the urban transport recommendations in the National Infrastructure Assessment would provide.
They have three elements.
First, proper devolution – through five-year funding settlements for all of England’s cities, in line with the approach taken in London since 2000. Specific budgets for each city announced on the day of the spending review, with local leaders free to decide how to spend them. This would be the biggest step forward in devolution since the advent of the metro-mayors.
Second, a genuinely transformational funding increase – some £43 billion in addition to current plans for city transport over the period to 2040. The largest part of the cities’ infrastructure funding would be provided through devolved settlements, but with a significant tranche held back to fund more transformational strategies in the most congested and fastest growing cities.
And third, new powers and duties to make the most of the funding, including in particular a requirement on city leaders to produce joined-up transport, housing and employment strategies.
Important to stress that these recommendations come as a package – it’s not a question of picking and choosing. In particular, more funding alone (for all that increased cash is always welcome) won’t solve the problem. In the Commission’s view, another extension of the Transforming Cities Fund would not, in itself, constitute an adequate response.
The package as a whole, in contrast, delivers against a very broad range of objectives:
It addresses the over-complication and fragmentation that bedevils the current funding system for urban transport – providing a clear long-term funding stream for all city leaders, combined with the opportunity to seek additional funding for more transformational schemes where needed.
It brings transport and housing together – and addresses the weaknesses of a system in which strategies for each are developed in isolation. The need for greater integration between transport and housing policy was a key theme of our Cambridge-Oxford study and this builds on those findings.
It is not just about a handful of major cities such as Manchester, Birmingham or Bristol, but provides new opportunities for all our urban areas.
The challenges faced by smaller cities – from Wakefield to Worthing – are often just as complex as those in the largest conurbations, and yet their leaders have even fewer levers and powers to deal with them.
And nor is it at odds with the need to support the UK’s ‘left-behind’ towns. Effective urban and suburban transport systems enable growing city economies to act as anchors for a broad range of communities around them.
And many of the cities that our proposals would cover are also on the Centre for Towns list of large towns – Basildon, Bournemouth and Bradford to name just three (and without even getting past the second letter of the alphabet).
Our recommendations could also play a huge part in driving the rebalancing of the UK economy away from London and the South East. Around a third of the people living in the cities covered by our recommendations are in the north of England, and around half are in the north and midlands combined.
The best way to help these regions to become more economically productive will be to support growth and dynamism in their cities.
On that point, it is absolutely crucial to note that there is no either/or here – no choice between providing funding to improve urban transport across England or to deliver much-needed improvements to our inter-urban networks.
The Commission has worked within the ‘fiscal remit’ of 1.2% of GDP for public investment in infrastructure provided to it by the Government, and our report shows that within that envelope it is possible both to fund a major upgrade of our interurban networks, through projects such as HS2 and Northern Powerhouse Rail, as well as high levels of ongoing funding for Network Rail and highways England, and to provide the transformational increase in funding for cities that we have proposed.
Indeed, once again, the two work together as a package:
Improved interurban networks need to connect into effective urban transport systems.
Productive city economies need reliable, efficient links between them.
Cities need to play a stronger role in the specification and delivery of the strategic transport networks that they rely upon – particularly as sub-national transport bodies become more influential, as the devolution agenda gathers pace in Network Rail, and as the Williams review considers the wider governance of our railways.
Having made our recommendations, we’re not just sitting on our hands. We’re pushing government to accept our recommendations, and we’re working with a wide range of England’s cities to build networks and broaden perspectives through a programme of knowledge-sharing events, as well as supporting five case study cities – Liverpool, West Yorkshire, Exeter, Basildon and Derby – as they develop their urban transport strategies.
But the National Infrastructure Strategy – and the forthcoming Spending Review – will be critical.
It is a big step forward that the government has committed to respond in this way – many independent Commissions see their reports brushed under the carpet, but the government has taken that option off the table. But nonetheless, it is crucial that it lives up to the commitments it has made:
That means that it needs to make the fiscal remit a reality, and provide the stable, long-term funding that the country’s cities need.
And it means that it needs to provide a concrete, ambitious response which genuinely engages with the detail of our recommendation – and not just a restatement or tweaking of existing policies.
And if the government does disagree with us, then it means that it needs to properly explain itself – and set out just why it believes that a shorter-term approach with less funding and more central control will deliver a better outcome.
Finally – assuming you think that our recommendations make sense – I would ask you to support us in making this case. The biggest risk for the National Infrastructure Assessment is that it simply drops off the radar, leaving the government feeling like it can gloss over it with impunity.
So, you need to use your voices and your influence – with MPs, with the media, through your industry groups – and make clear that you support the NIA’s recommendations, that you will be watching carefully how the government responds, and that you see its response as a critical test of credibility on infrastructure.
Infrastructure can inspire confidence and growth – but it needs a long term vision, lasting plans and stable funding from government.
And as political developments change by the day, or even by the hour, it’s that very long term vision we need more than ever.
There is a huge opportunity here to change the UK and its cities for the better – now we need to make that happen.
Thank you and enjoy the rest of your afternoon.
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