Philip Hammond
The Chancellor Philip Hammond has announced a consultation into new ways to fund Britain’s infrastructure as part of his Spring Statement today (13 March).
Hammond’s announcement follows his decision in last October’s Budget to rule out the use of PFI and PF2 for future government contracts, amid concerns that the schemes did not genuinely transfer risk to the private sector.
The consultation will seek views on how Britain’s “approach to supporting private infrastructure investment once we leave the European Investment Bank”.
Jason Millett, Mace’s COO for its consultancy arm, said: "Given the demise of PFI, finding a new way to fund Britain’s infrastructure is of the utmost importance. It’s right that the private sector should contribute, but we need to be certain that whatever the new model is, it encourages sustainable, long term growth and doesn’t undermine an industry that already faces serious challenges around margins and risk management.
"In light of our imminent exit from the European Union, it is also vital to ensure that Britain is able to continue to draw on foreign direct investment from across the globe to drive our infrastructure delivery."
David Barwell, chief executive, UK & Ireland, Aecom, said: “It was clear that today’s speech by the Chancellor was as much about persuading the House to take no deal off the table as it was for setting out Britain’s economic future. That said, we welcome Mr Hammond’s commitment to a three year spending review prior to the summer recess.
“A commitment to the Northern Powerhouse Rail project and a review of the National Infrastructure Assessment were positive steps and we look forward to being involved in shaping the future of private infrastructure investment in the UK through the Chancellor’s consultation.
"I hope that in time this will help provide clarity to industry and plug the gap left from the abolition of PF2, an important move forward if we are to support our infrastructure pipeline.
He added: “Having worked to create the masterplan for the Old Oak Common development in West London, we are delighted by the Chancellor’s pledge for £717m of funding for new homes. The £250m that is earmarked for Old Oak Common is a significant pledge that will help unlock the potential of this important site.”
