19th September 2019
A £600m boost for English infrastructure

In August, UK Chancellor Sajid Javid announced that the government would be investing £600 million in five major infrastructure projects across London, Essex and Bedfordshire. The funding, he said, would be used to put the necessary infrastructure in place to support the construction of over 50,000 new homes in these areas, where housing is in high demand. David Hawkes, Policy Manager of the Institute of Civil Engineers (ICE), recently commented that one of the biggest barriers to delivering the targeted number of homes is a lack of infrastructure, and the funding needed to facilitate it. As such, the investment will be used to deliver the new road networks, train stations and schools required to unlock previously unviable land for housing developments.

The Housing Infrastructure Fund

The newly announced projects will be financed by the Housing Infrastructure Fund (HIF), a £5.5 billion pot of money used to pay for infrastructure projects that directly contribute to making land available for housing. Since its launch in 2017, it has already allocated £1.3 billion to deliver up to 76,500 homes. The HIF is split into two distinct parts:

  • Marginal Viability Funding: this fund is available to local authorities to put the ‘missing piece of the puzzle’ in place, providing the final piece of infrastructure funding needed to unblock housing sites quickly.


  • Forward Funding: this is intended for local authorities in areas where housing is in high demand. Its purpose is to pay for a small number of more significant, high-impact infrastructure projects. The five new projects will all be funded with money from this section of the HIF.

Closing the ‘infrastructure gap’

While this new government investment can only be viewed as positive, there still remain significant funding issues preventing the full and successful delivery of desperately needed infrastructure and housing. In 2016, the government published its National Infrastructure Delivery Plan 2016-2021, outlining its ambitious vision for infrastructure development over the next five years. The report predicted that the delivery of this programme would require an investment of £483 billion over this time period; however, the government only committed to providing £100 billion of this sum. New approaches and sources of funding are therefore urgently required to close this gap, and deliver the infrastructure England needs to resolve the housing crisis.

Experts argue that the gap will mostly have to be bridged through private investment. Indeed, the UK CEO of engineering firm AECOM, David Barwell, wrote in a recent article that there are “trillions of dollars of private capital, both foreign and domestic, searching for a home.” However, he argued that the government and infrastructure sector will need to do more to make UK infrastructure projects appear attractive and lucrative to private investors. Indeed, the National Infrastructure Committee (NIC) agreed that “Financing itself is not in short supply. However, state financing institutions can help to encourage private investment and catalyse activity.”

The National Infrastructure Assessment

In July 2018, the NIC published its first ever National Infrastructure Assessment, analysing the UK’s infrastructure needs over the next 30 years and outlining a strategic vision for the future. It made recommendations spanning low carbon energy, digital technology, road transport and flood limitation, among others. In addition, the report included suggestions for funding and financing these recommendations, including the establishment of a UK infrastructure investment institution in case the UK loses its access to the European Investment Bank in the wake of Brexit. The government, who published an interim response to the Assessment in its 2018 Autumn Budget, is due to release its official National Infrastructure Strategy this autumn; only then will we find out which of the NIC’s recommendations have been adopted. With the future of UK infrastructure now at a critical point, it remains to be seen whether the Strategy adequately responds to the country’s current and future infrastructure needs.