Brexit and infrastructure interconnectivity

Following a meeting of the All Party Parliamentary Group on Infrastructure, Members of the House of Lords, House of Commons, experts and industry, ICE has published a policy paper on the UK’s future interconnectivity with the EU and the challenges for infrastructure.

1 Introduction
2 The challenge ahead
3 A UK investment bank
4 Open for business and forging ahead
5 Related articles on Designing Buildings Wiki

[edit] Introduction

With around 300 days until the 29 March 2019 deadline, the UK exit from the EU has become the most pressing political project facing the country.

If Brexit is to be a success government and industry will need to take into account the infrastructure requirements of any final deal – or even a no deal. Our interconnectivity with Europe cannot be an afterthought – the roads, rails, tunnels, ports and airports which link the UK with the countries of the EU and the rest of the world underpin the financial strength of the nation.

[edit] The challenge ahead

The demands Brexit will place on the UK’s infrastructure will be vast and have social and economic implications – not least at land borders with the Republic of Ireland or Spain. Adjusting and building new infrastructure will also need time to be implemented.

Government and industry must work together to ensure the electronic and digital infrastructure needed to keep UK’s financial lead in banking is there by the time we leave the EU.

Similarly, a new customs system with sufficient capacity and facilities for customs checks to support the UK’s freight industry post-Brexit is paramount. Delays currently cost £750,000 per day through cross channel journeys alone.

It is crucial that arrangements are made to continue access to, and expand, gas pipes and energy grids with our closest European neighbours. Similarly, contingencies for energy storage are lacking. If the UK does not adopt these measures the nation will continue to be vulnerable during periods of unexpected demand for electricity or heat when future cold snaps, like the one in March 2018, occur.

Gas storage, the adoption of battery storage, greater diversification of low carbon and renewable energy and multiple options for energy transfer from other European countries will increase resilience should one aspect of our energy mix fail.

[edit] A UK investment bank

Upgrading or building new infrastructure will also need to be financed. The European Investment Bank (EIB) has been a major financial backer in the past decade, providing finance for projects like Crossrail, water and wastewater improvements in Northumbria and social housing in Northern Ireland.

Between 2012 and 2016 it lent £27.46bn (€31.3bn) yet financing in the past year has fallen off a cliff – a 72% drop between 2016 and 2017.

Should the UK lose access to the EIB all together, or if finance from the EIB is not sufficient to meet the infrastructure pipeline of works, ICE would encourage the UK to look at options to implement a UK investment bank. To keep any bank off balance sheet the government should consider using the UK Guarantees Scheme to underpin a privately owned and financed bank, supported in a similar way to the German investment bank KfW and with a similar mission to the EIB.

[edit] Open for business and forging ahead

The UK must remain an attractive location to invest, it must be open to skilled workers and remain at the cutting edge for digital transformation and innovation.

Freedom of movement for engineers, construction workers and other allied professions is vital in the short to medium term to keep the UK building. With an estimated skills gap of 400,000 workers the UK cannot afford to shut out external talent.

Longer term both government and industry must invest in skills, technology and innovations such as offsite construction and manufacture. The built environment sector needs to upskill its workforce and work smarter, not just harder, to meet future need.

Finally, the common standards industry adopt across Europe allows for seamless trade and simplification of best practice. ICE supports the British Standards Institution’s efforts to remain a member of the European Standards Organizations.

Brexit is a challenge for government, business and industry. Through a focus on identifying need, ensuring contingencies, financing, being open to workers in Europe and around the world, upskilling domestic workers and maintaining our role in harmonising standards that challenge can and will be met.

Read the full ICE policy paper: Brexit and Infrastructure Interconnectivity here.