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Political uncertainty prevents infrastructure progress

The UK is far from delivering the transformational upgrades it needs despite promising improvements to infrastructure policy, according to the latest CBI/URS Infrastructure Survey.

It found that in key areas of competitiveness such as energy and transport, 67% and 57% of businesses respectively expect infrastructure to worsen over the next five years.

Respondents saw the UK’s infrastructure as internationally weak - lagging behind Australasia, North America and the EU - and with little improvement since the first survey in 2011.

This comes despite more than two-thirds of infrastructure providers saying that they viewed government policies such as the UK Guarantee Scheme and pro-growth planning reforms as positive developments.

Such policies are seen as having increased the attractiveness of the UK as a place to invest in infrastructure over the course of this parliament.

When asked what stood in the way of progress, 96% of respondents said political uncertainty was discouraging investment and 93% identified political rhetoric as a problem, as it damaged confidence in the markets.

To tackle this the survey found overwhelming support for the creation of an independent infrastructure commission (89%), as recommended by Sir John Armitt, to help determine what the UK needs and when it needs it.

CBI deputy director-general Katja Hall said: “Where hard decisions have been taken on issues like energy, populist political rhetoric threatens to send us backwards. Just recently the National Grid warned that spare capacity margins are at the lowest level in seven years, so building up investor confidence couldn’t be more important.”

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