[Re: Road to nowhere, yesterday]
What is largely forgotten in the debate about infrastructure investment is that the role of the state in each part of the sector is different for historic rather than good policy reasons. The micromanagement of energy has been a disaster that needs to be swept to one side with a more market-led approach. Railways continue to be centrally-planned, with vast amounts of taxpayers’ money poured into them. Meanwhile roads generate huge amounts of money, yet are starved of long-term capital. In fact, most infrastructure ought to all be self-financing if only the government got out of the way, and sped up the planning process so that the companies involved could get on with the job.
An equally important point is to question whether the government’s vision (or lack thereof) for infrastructure investment extends beyond Big Ticket projects to supporting local schemes. Bringing forward a number of local projects now would not only secure early benefits to the communities involved, but would also improve confidence among pension fund managers and other big City investors. It would demonstrate that projects, compatible with their investment strategies, are both viable and sustainable. But as Margaret Hodge has indicated, a key challenge is ensuring that there is sufficient certainty in government policy to attract private sector investors.
Robert Burton, director, Roscarrek Consulting
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