Posted: Friday 4th July 2014

Flood Management, Energy and Local Transport in need of improvement according to State of the Nation scorecard.

More frequent extreme weather events will make it increasingly difficult to operate our infrastructure networks in all conditions at the level of service we expect, and our expectations of availability will need to change, according to the Institution of Civil Engineers (ICE).

In its State of the Nation: Infrastructure 2014 report published today – a “scorecard” report which grades the UK’s Transport, Energy, Flood, Waste and Water networks from A to E - the leading engineering body welcomed the progress since 2010 in improving infrastructure and positioning it as a core enabler of economic growth, but it said more needed to be done if we are to have world class infrastructure – in particular on the issue of resiliency given its impact on the economy and the major challenges ahead. This was highlighted by the “at risk” or “requires attention” grades for Flood Management, Energy and Local Transport networks - due to the narrowing gap between supply and demand for energy, inadequate resilience to flooding and the decline in maintenance of both flood defences and local roads following investment cuts.

The ICE report said resilience – including the “domino effect” where the failure of one system can affect the operation of another - should be embedded into the criteria used as a basis for making decisions on priority infrastructure projects, to better reflect future challenges.

It also warned however, that while we need to build the UK’s resilience, our infrastructure cannot be resilient to every eventuality, and that it will become more difficult to operate all infrastructure networks, at all times, in all conditions. It said a shift in the public’s expectations on infrastructure availability would be needed.

State of the Nation report Chair and ICE Vice President, Keith Clarke CBE, said: “As the 2013/14 winter floods showed, unplanned interruptions in our networks are costly to society and the economy. They happen because we are trying to run all services at all times, and are deemed unacceptable as the public expect a certain level of service. Government ultimately bears the risk for the resulting impact.

“It is becoming clear that extreme weather events will become more frequent, and it is time that factors such as availability, resilience and the “domino effect” across the networks when one network fails –as we saw recently when our flood defences were overwhelmed and this in turn disrupted transport, energy, water and waste networks - are rooted into the criteria used to make decisions on which projects go ahead so new infrastructure is more “future proofed”.

“But, importantly, we must all recognise that our infrastructure cannot be resilient to everything and it will become more difficult to run all services in all conditions – it will also not be cost effective. Funding will always be constrained as there are only two sources – tax and user charging - both ultimately falling on the consumer. The balance between the two is a choice for the Government of the day, but irrespective of where it comes from, both are constrained resources and must be used efficiently.

“Clearly there are some difficult decisions ahead regarding just how resilient the UK should be, and also what networks can and should operate 24/7 in what conditions. We can then plan more effectively - avoiding costly unplanned disruptions – and adapt. Management of the public’s expectations on availability during adverse conditions will need to form a key part of this process.

“The onus is on Government to make these choices for public sector infrastructure, and it must also build on its efforts to provide the right regulatory incentives to improve resilience within private sector infrastructure.” he added.

Key ICE recommendations

On strategic decision making and leadership, Government should:

1. Expand the criteria used as a basis for making decisions on priority infrastructure projects to reflect major future challenges– criteria should include resilience, availability, the pathway to a low carbon economy and better acknowledge “interdependencies” across networks – or how one sector impacts on another.

2. Be prepared to make tough choices regarding the levels of resilience in the UK’s infrastructure networks and the appropriate levels of service/availability - and work with industry to manage public expectation.

3. Ensure the right regulatory environment exists to incentivise private infrastructure operators to build resilience into infrastructure.

4. Be appropriately resourced to make and implement decisions on key issues affecting the UK’s resilience or competitiveness, such as aviation capacity.

5. Provide more clarity, certainty and transparency for potential investors through the regularly published National Infrastructure Plan project pipeline - by including more detail on investable projects, their status, planning approval, ownership structure and revenue streams.

On Energy, Local Transport and Flood Management sectors:

6. The Environment Agency and Lead Local Flood Authorities should fully implement a holistic approach to flood management, which includes a wider range of measures in addition to conventional flood defences – including building the physical resilience of communities by making property and infrastructure more resistant.

7. Government should provide the longer term certainty needed to improve flood resilience by committing to a long term capital and maintenance programme for Flood Management which protects funding beyond the current 5 year cycle.

8. Government should enact the secondary legislation to implement EMR by the end of this Parliament, establishing long-term investor confidence and entrenching cross-party support for electricity decarbonisation.

9. Government should extend devolved transport powers and funding through the creation of more powerful, fully integrated transport authorities in city regions.

10. Government and local authorities must establish a more ambitious joint programme to clear the road maintenance backlog, and commit to a more cost effective planned, preventative maintenance regime.

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