Carter Jonas’ Head of Transport, Christian Green, comments on the recently released 10 Year Infrastructure Strategy.

The government has published its 10 Year Infrastructure Strategy, announcing funding of £725 billion over the next decade. This covers a very broad definition of infrastructure, from transport and energy, through to schools, hospitals, prisons, and defence. It includes maintenance programmes as well as new projects.

Three themes stand out: greater certainty around funding and the future projects pipeline; the importance of attracting private finance; and providing a more joined-up strategic approach.

Mass transit schemes

The strategy notes the critical role of regional transport connectivity in delivering economic growth. It points out that productivity in nearly all large English city regions sits below the national average, and that English cities are less accessible than comparable European ones, limiting their effective size and productivity. It also notes that rail passenger demand has rebounded since the pandemic and is expected to accelerate over this decade.

In response, it puts a focus on urban public transport systems within city regions, supporting economic clusters. It cites several mass transit priorities, including better connectivity between the major northern English towns and cities (Northern Powerhouse Rail) and delivering East West Rail to enable growth in the Oxford to Cambridge Corridor. A further, more detailed announcement on specific schemes is expected in July 2025, including proposals to take forward Northern Powerhouse Rail.

The Strategy also confirms investment of £15.6 billion by 2031-32 for the elected mayors to support projects announced at the Spending Review, which included:

• the Metro Extension from Birmingham City Centre to the Sports Quarter
• the Tyne and Wear Metro extension (Washington Metro Loop)
• mass transit development between Bristol, Bath, South Gloucestershire and North Somerset
• funding to design a new mass transit system between Derby and Nottingham
• the proposed West Yorkshire Mass Transit system.

Attracting private finance

Against a background of highly constrained public finances, a key theme is encouraging private investment.

The Strategy dovetails with broader government proposals to require the UK’s large pension funds to invest in private markets; and the recent voluntary agreement by 17 of the UK’s largest defined contribution workplace pension providers to invest at least 10% of their assets in private markets such as infrastructure (known as the ‘Mansion House Accord’).

Public Private Partnerships will also be considered where there is a suitable revenue stream (this model will be used to finance the development of Euston HS2 station).

Public sector finance

The Strategy builds on the previously announced proposed reforms to the Green Book (HM Treasury guidance used to evaluate and appraise public investment projects). An updated document, due to be published at the start of next year, should see a new focus on ‘place-based business cases’, bringing together the different projects that are needed to achieve local objectives such as housing development. The revisions should also lead to a more balanced approach to investment across the UK, ending the previous ‘bias’ towards London and the South East.

Increased public funding certainty is also promised. The recent Spending Review set capital budgets for the next five years, which will be extended every two years at regular spending reviews (and some projects will have funding certainty of up to 10 years).

Changes to how infrastructure investment is treated within the UK’s fiscal framework have helped, as some capital projects are no longer counted in the headline borrowing figures used to assess compliance with fiscal rules.

National Infrastructure and Service Transformation Authority (Nista)

Nista, launched in April this year, is a new UK government body to lead infrastructure delivery, absorbing the Infrastructure and Projects Authority and the National Infrastructure Commission. It will play a key role in developing, overseeing and implementing the 10 Year Strategy. This should enable better cross-government collaboration, strategic direction, streamlined decision-making, and also help to attract private investment.

A key aspect will be increased certainty and transparency of the projects pipeline. Nista will manage the Infrastructure Pipeline interactive portal, to be launched in July 2025, with the aim of providing an accurate and comprehensive forward view of the opportunities over the next decade.

NISTA will lead the development of the new National Infrastructure Spatial Tool, a single digital platform bringing together the needs and constraints for housing development, industrial growth and land use scenarios. The aim is to provide more granular detail to strengthen the local evidence base for place-based infrastructure investment decisions.

The body will also undertake a study to explore the ways in which private sector investment within transport sector can be encouraged.

Conclusions

A national strategy that provides a joined-up approach to the UK’s mass transit infrastructure has been severely lacking. The 10 Year Infrastructure Strategy provides much needed direction, and the forthcoming detailed announcement on specific schemes will add further certainty.

Coupled with other recent policy announcements, the Strategy has the potential to unlock significant private sector investment by providing greater certainty and clarity around the pipeline of future projects and the availability of public sector funding. This is vital for institutional investors and construction firms alike.

We also welcome the emphasis on spatial planning that will link infrastructure schemes with development at a more local level.