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Last edited 18 Aug 2022

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Association for Project Management Institute / association Website

Negative impacts of political instability on projects

Most project professionals in the UK say political instability is negatively impacting projects they’re working on, according to new data from Association for Project Management (APM).

A survey of 1,000 project professionals, undertaken for APM by research company Censuswide, highlights the potential knock-on effects of the turbulent political environment, as 64% of respondents nationwide expect it to negatively impact projects they or their organisation is currently undertaking.

The survey was carried out against a backdrop of rapid change and growing political pressures, with the UK’s next Prime Minister still unknown, high inflation, rising energy prices and water restriction in parts of the country.

Respondents from the construction and technology sectors were particularly concerned with 76% of respondents from each industry saying they’re concerned that the UK’s political instability will have a negative impact on projects that they or their organisation are currently working on.

With many projects reflecting significant long-term investments, the importance of political stability cannot be overstated. This supports the finding from research undertaken by PwC on behalf of APM previously, in which more than half of the 438 organisations that took part expressed concern over the perceived impact of political uncertainty in the UK.

Respondents to the latest survey were also asked to identify their main concerns regarding project delivery. The ongoing cost of living crisis and escalating energy prices were both identified as key challenges, cited by 28% and 26% of respondents respectively.

The survey reveals a significant increase in projects that are experiencing problems during delivery compared with two years ago. In the latest survey, 31% of respondents say their current main project is not on track to meet its original quality criteria, compared with just 8% in July 2020; and 28% say their main project is currently over budget, compared with 18% in July 2020.

APM has called on the government to ensure a more stable operating environment for projects. Andrew Baldwin, Head of Public Affairs at APM, said: “Political instability affects every type of project in the UK, from major initiatives tackling global issues like climate change, to more targeted projects bringing benefits to local communities and businesses.

“A forecast of recession, spiralling energy costs and uncertainty around the cost of materials and other resources will be of grave concern to those financing or sponsoring projects, as a state of limbo builds anticipation of what the future holds.

“In the worst case, this could see budget cuts to projects, reduced scope in terms of what they’re trying to achieve, or a complete cancellation to avoid uncertainty and risk.

“It is vital the current Government focuses in on that instability, now, and the candidates for Prime Minister outline their approach to project success, providing those who are responsible for the successful delivery of projects the stability they need to ensure success.”

This article appears on the AM news and blog site on August 18, entitled 'Political instability expected to negatively impact projects across the UK'