BRITAIN is failing to build the infrastructure it requires because the government does not give enough clarity on what returns investors can expect, a new report will claim today.
Private sector backers want to invest in new UK infrastructure but the government does not currently offer enough long-term assurances on the risks associated with individual projects according to the Management Consultancies Association think tank, which put the report together with help from large companies such as Accenture, Deloitte and KPMG.
The think tank also criticises the government’s approach to the High Speed 2 railway and said departments are too often forced into crisis mode when it comes to justifying great schemes to the voters.
“Public bodies sometimes spend money late in the day on experts who help refocus or rescue badly designed projects,” it warns, recommending that Britain should have an independent infrastructure commission to decide on the best targets for investment.
The findings were echoed by Anthony Browne, the chief executive of the British Bankers' Association, who said new liquidity requirements were making it harder for banks to commit funds to projects over the long term.
Browne, a former economics adviser to mayor of London Boris Johnson, told an audience at the Liberal Democrat conference in Glasgow there is “no basic capital shortage” when it comes to investing in UK infrastructure investment – but he had repeatedly found himself meeting sovereign wealth funds who would not commit the money in the absence sufficient government guarantees.