The UK's infrastructure performance

1.12 Most current discussion of how the UK is performing on infrastructure refers to two sources: the World Economic Forum (WEF) Global Competitiveness Index, and the World Bank's Logistics Performance Index. These are somewhat inconsistent with each other: the WEF 2011 league tables ranked the UK 28th in the world on overall quality of infrastructure (up from 33rd position last year), while the World Bank's 2010 rankings of infrastructure quality ranked the UK 16th in the world (down from 10th position in 2007).

1.13 A recurring problem with such assessments is that they are subjective, relying heavily on opinion surveys of executives around the world. Nevertheless, they do reflect perceptions of UK infrastructure quality, which in turn can influence business decisions on whether or not to locate in the UK. It is important that views on UK infrastructure performance are based, so far as possible, on objective data, rather than anecdote.

1.14 For the first time, therefore, the Government is publishing measures of the performance and cost of the UK's infrastructure networks using hard data rather than opinion surveys. Performance indices have been constructed for each infrastructure sector, based on a large number of published indicators of performance (including access and coverage, capacity and utilisation, service quality, reliability, and environmental impacts). Similarly, cost indices have been developed for each network by computing, as far as possible, the net cost of infrastructure per unit of output, regardless of how it is paid for (whether by taxpayers or users). Annex D describes in detail the method used to construct these indices.

1.15 Table 1.A shows that the performance of the UK's infrastructure has generally improved over time. However, in the majority of cases, costs to users and taxpayers have risen at a faster rate than performance.

Table 1.A: Summary of performance and cost trend analysis

1.16 Table 1.B provides a more granular assessment of the trend in performance since 2005.

1.17 Despite improvements in overall performance, each sector faces a set of specific performance challenges, some current and others anticipated over the next 10 years (as highlighted in Table 1.C).

Table 1.C: Sectoral performance – strengths and challenges

1.18 This plan also contains a large number of international benchmarks to show how UK infrastructure has performed in a comparative context.³ These show that the UK performs well compared to other OECD countries in terms of telecommunications, electricity and gas network coverage, reliability, security of supply and cost to consumers. For example, the UK currently has one of the most reliable electricity transmission networks in the world (over 99.999 per cent network reliability), a comfortable capacity margin (over 20 per cent) and among the lowest prices in Europe.⁴ The UK's broadband coverage, speed and cost also compare well to Western European countries, but less so in comparison with Scandinavian and East Asian countries. ⁵

1.19 However, there are areas that need to be addressed. Despite recent improvement, road congestion is still a concern and it is likely that congestion will increase again as the economy recovers and the population continues to grow. At some of the busiest UK airports, over a fifth of flights are delayed by over 15 minutes.⁶ Similarly, while rail network coverage is good, train punctuality, though it has improved in the UK, is still worse than Europe,⁷ and the aggregate cost of running the rail network to British taxpayers and consumers is very high compared to peers in Europe.⁸ In waste, although the UK produces less municipal waste per capita than some European neighbours, it recycles less and sends a greater proportion to landfill than countries like France and Germany.

1.20 Without attention and action, the performance of the UK's infrastructure will deteriorate, and it will fall behind other countries. In the pages that follow, the Government sets out its vision for how it will prioritise investment in infrastructure to maintain or improve the competitiveness of each the UK's infrastructure networks. The plan assesses where the UK is now, where it needs to be by 2020, and what the Government is doing (in partnership with regulators and industry) to get there. The plan also anticipates longer term challenges, and sets out the Government's strategy to tackle them.

1.21 This plan is UK wide. However, in devolved areas of policy, it will be for the Devolved Administrations to determine their own policies. In delivering this plan, the Government will work closely with the Devolved Administrations in Northern Ireland, Scotland and Wales, recognising their particular and varying responsibilities. As well as having lead responsibility for infrastructure investment in devolved policy areas, they will be key partners in developing appropriate arrangements in respect of reserved or partially reserved policy areas within their countries in ways that meet their own circumstances and needs. Overviews of the infrastructure investment programmes in Scotland, Wales and Northern Ireland are set out in Chapter 3.

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3 In October 2011, the OECD accepted a UK Government proposal to strengthen comparative analyses of infrastructure performance. Over the next 18 months, the OECD will coordinate a major international benchmarking exercise that will better determine the relative performance of the UK's infrastructure, highlighting both strengths and weaknesses. This will significantly improve the evidence base on which the UK can plan improvements to its infrastructure performance in line with this National Infrastructure Plan.

4 After taxes, UK domestic electricity prices inclusive of taxes are c.16 per cent cheaper than in Spain, 27 per cent cheaper than in Italy and 41 per cent cheaper than in Germany, although they are 11 per cent higher than in France. Source: Eurostat.

5 Source: OECD Communications Outlook (2011).

6 Source: CAA.

7 88 per cent of GB passenger trains were on time in 2009 compared with 91 per cent in France, 93 per cent in the Netherlands or 97 per cent in Switzerland, even though the latter two systems transported almost twice as many passengers per track-km as the 19 GB rail franchises put together. Source: Civity (2010) study for the Rail Value for Money report.

8 The Rail value for money study suggests that the GB rail system is 30-40 per cent less efficient than leading European rail systems.