UK deputy prime minister Nick Clegg placed infrastructure spending at the centre of the government’s push to create new jobs, echoing US president Barack Obama’s jobs creation speech last week, in a speech to the London School of Economics that should give hope to infrastructure investors.
Noting that that the UK ranks “28th in the world for infrastructure [with] railways [that] are a throwback to the 1970s [and] some of the most congested roads in Europe”, Clegg wants to modernise UK infrastructure via a “ruthless” plan “focusing on the investments that transform growth potential: transport, energy, digital communications”. And “stimulating private investment [in infrastructure is] the absolute crux of this [plan],” he added.
To do this, the government will reach out to institutional investors at home and abroad to sell the UK’s new infrastructure plans.
“We know that the UK misses out because investors simply don’t know the opportunities on offer. We know they hesitate if they don’t see a long-term strategy. So I’ve asked Lord Green to use his Trade and Investment Committee to get our plan out there. Next week, Lord Sassoon will travel to Canada to pitch to pension fund investors. Later this month, Lord Green will do the same to the leaders of the Gulf Sovereign Wealth Funds,” Clegg said.
He added: “We’re targeting the Middle East, Latin America and China, where there are investors with five year investment plans of over £150 billion (€172 billion; $237 billion) each. We’re also going to be much more proactive with institutional investors here at home too.”
To ensure the modernisation plans don’t lose momentum, Clegg says the government will “hand-pick up to 40 of the biggest infrastructure projects, the ones most important to growth, which will be given new special priority status”. While the deputy prime minister did not unveil a full list of these priority projects, he did point out examples, like “high speed broadband rollout, work to transform the efficiency of the national grid [and] major improvements to the rail network”.
Clegg also reiterated the government’s support for its Green Investment Bank, which “will leverage funds for low carbon infrastructure in the region of an extra £18 billion by 2014-15”. He added that business secretary Vince Cable “is ensuring government identifies the first projects to get support faster than originally planned [and] Chris Huhne [the secretary of state for energy and climate change] will shortly be setting out our support for renewable energy – a year ahead of schedule”.