£200bn National Infrastructure Plan Announced by Prime Minister
The Confederation of British Industry annual conference took place in London on Monday 26th of October. While politicians and business experts were discussing ways to deliver economic growth to the UK, Prime Minister David Cameron used the meeting to announce its £200bn private investment infrastructure plan.
Cameron couldn’t have picked a better time to announce such an ambitious plan that will “completely update and modernise” the UK’s infrastructure, including roads, railways and utilities, over the next five years.
The announcement caused mixed reactions from business organisations that ranged from an excited response from RenewableUK to a more moderate welcome from the British Chambers of Commerce who urged the Government to turn its “vision to concrete action”.
In short, the Prime Minister’ infrastructure scheme is more a challenge as the Government is looking for the private to provide £160bn of the total investment over the next five years. The idea is to incite companies to invest in a wide range of energy, transport, water and waste, broadband and digital projects. Meanwhile the Government will be investing £40bn in the key areas as announced in last week’s Spending Review.
A large sum of these investments is to be destined to subsidise renewable energy projects while another £70bn is estimated to be spent by electricity generators in building new nuclear power plants for “free” because there is no subsidy.
Support for the £1bn carbon capture and storage technology to develop clean coal is a key part of the programme but this has suffered a setback with the withdrawal of one of two companies building pilot plants.
On the other hand the Green Investment Bank will be using its £1bn initial fund to back up private sector investments the market regards as too risky.
Most of the spending in the five-year plan would come from the private sector “where necessary, helped by suitable regulatory change”, along with levies and State-imposed pricing rules in areas such as renewable energies.
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