EEF says today’s infrastructure spending plans provide much needed clarity, but now is the time for cross-party agreement to provide the confidence needed for manufacturers to invest. The manufacturers’ body explains why the next step is needed now to make the most of £100bn
Like other business groups EEF has applauded the Government’s pledge to spend £100bn on a variety of infrastructure projects from 2015.
“Today’s announcement is another step forward in getting investment in key areas of infrastructure going. The Government has set out much greater clarity on its priorities,” said Terry Scuoler, chief executive of EEF, the manufacturers’ organisation. “And its extension of Infrastructure Guarantees and greater use of commercial expertise should give industry more confidence that these plans will get delivered.”
“And, with progress on Infrastructure Guarantees still slow, breaking the log jam on private funding needs urgent attention.”
On transport, EEF’s Terry Scuoler said:
“Roads are the backbone of the economy. The commitment to tackling the key black spots and the backlog of maintenance are the right priorities. However, the funding allocated today is overdue and only a start, with £2 billion a year when the current backlog is £20 billion.
“With the cost of HS2 mushrooming, the Government must ensure that this delivers real benefits to industry by freeing up freight capacity and that British industry has the best possible chance to win the orders this investment will generate. It also must ensure that its rising costs don’t crowd out vital road investment.”
“The Government needs to address the political uncertainty that has long dogged infrastructure decisions and find ways to generate cross-party agreement on our infrastructure priorities.”
On energy, Scuoler said:
“Investors in low carbon energy are finally seeing the clarity and certainty they need. But energy consumers need the same certainty that costs will be kept under control. And we still need to see the long-term commitment to shield energy-intensive industry from these costs. The additional funding for the Green Investment Bank and the new freedoms to borrow from the government are also welcome moves to unlock investment from industry.
On the Regional Growth Fund, Terry Scuoler said:
“This is the right move to continue with a proven scheme that benefits business at the local level and to ensure that localism delivers value for money.”
EEF published a survey of manufacturers’ views on Transport strategy in April.
Key findings included:
• Four-fifths of manufacturers identify the road network as critical to their business.
• Half of manufacturers say that the state of the UK’s roads significantly increases their operating costs.
• Three-quarters of export-intensive manufacturers identify aviation infrastructure as important to identifying new business opportunities.
• Half of foreign-owned manufacturing businesses say aviation is a key factor in deciding where to invest.
• Two-thirds of export-intensive manufacturers identify investment in road access to international gateways, such as ports, as critical to their growth.
• A third of the most export-intensive firms say the state of the UK’s port infrastructure has significantly increased their operating costs.
• Less than a quarter of manufacturers say investment in high-speed rail is important to their company’s growth.