The success of London’s Olympic Games has earned the man in charge of organising them a place in government, with a special mandate to attract private sector funding for the UK government’s infrastructure plans.
Following a cabinet reshuffle by Prime Minister David Cameron yesterday, Paul Deighton, chief executive of the London Organising Committee of the Olympic and Paralymic Games, was appointed Minister for Infrastructure and Economic Delivery. Deighton was credited with raising £2 billion (€2.5 billion; $3.2 billion) of private sector capital to help fund the Olympics.
He will replace Lord Sassoon, who inaugurated the role in 2010, albeit without ‘infrastructure’ in the title, and will start in January 2013, reporting to Chancellor George Osborne. Deighton will become a member of the unelected House of Lords in order to take up his new post.
“I am delighted that one of the most talented leaders Britain has is joining the government. His appointment proves this government means business in terms of delivering infrastructure projects and economic revival,” the Prime Minister commented.
As part of his brief, Deighton will be responsible for carrying out the government’s £250 billion, decade-long national infrastructure plan, as well as overseeing the successor to the Private Finance Initiative framework and other initiatives, such as the recently announced £40 billion guarantee scheme for private infrastructure projects.
“The public-private sector collaboration in delivering these [Olympic] Games has been vital to their success. I am delighted to accept the Prime Minister’s and Chancellor’s offer to apply this experience and what we have learnt to the broader UK economy,” Deighton said in a statement.
The Olympics chief, who was formerly European chief operating officer for Goldman Sachs, will, however, face a wall of investor scepticism about funding the government’s new infrastructure plans.
According to an exclusive survey of 200 industry professionals carried out by Infrastructure Investor, about 60 percent of respondents said that “lack of clarity from the government” was the main factor deterring them from investing in UK infrastructure. Close to 62 percent of investors also found the government’s infrastructure plans to be “moderately credible”, with 27.1 percent finding them “not particularly credible”.
*To find out more about investor sentiment toward the UK’s infrastructure plans, be sure to read our special UK Infrastructure Report 2012, to be published alongside the September 2012 issue of Infrastructure Investor magazine.