A new High Speed Rail Group (HSRG) report highlights the crucial need for a long-term infrastructure strategy to engage private investors.
- The report outlines essential steps for the UK to attract investment for major rail projects, emphasising private finance.
- Key contributors to the report include notable entities like Amey, KPMG, and Mott MacDonald, advocating for a comprehensive strategy.
- The success of the Regulated Asset Base (RAB) model in previous projects is cited as evidence of the benefits of private finance.
- Industry leaders stress the significance of a stable investment environment, urging the government to implement long-term strategies.
A fresh report by the High Speed Rail Group underlines the necessity of a comprehensive infrastructure strategy to harness private financing for the UK’s rail sector. The report, titled ‘Driving Investment in Rail Infrastructure,’ proposes steps to effectively engage the investment community by presenting a variety of funding options, with a strong focus on private investment.
The HSRG underscores the importance of collaboration with the private sector, not just to secure the crucial funding needed for infrastructure development, but also to create a conducive environment where projects can be delivered within stipulated timelines and budgets. It advocates for an investment-friendly ecosystem, designed to offer stability and reassurance to potential investors.
Contributors to the report, including major players like Amey, Centrus, and High Speed 1 Ltd, propose a three-pronged approach: maintaining a long-term strategy for travel routes such as Birmingham to the north west, engaging with investors to explore diverse funding avenues, and adopting a holistic approach to planning, funding, and delivering rail infrastructure from a national perspective.
The report highlights the success of the Regulated Asset Base (RAB) model used during the construction of the Thames Tideway Tunnel as a proven method for attracting private investment. This model has transformed what was initially perceived as a high-risk project into a more secure investment, thereby attracting necessary financial commitments.
Further validation of the RAB model’s effectiveness is its potential application in other major projects, such as the Lower Thames Crossing and Sizewell C. HM Treasury has also mandated its use for funding significant water infrastructure from 2025 onwards.
Commenting on the report’s implications, Costain CEO Alex Vaughan remarked that a decade-long infrastructure plan is vital for the industry’s growth. Similarly, High Speed Rail Group chair Dyan Perry emphasised the need for a solid rail strategy extending beyond Birmingham and into northern regions.
Industry voices like Systra’s Sebastien Vecchiato and Mott MacDonald’s Neil Henderson have echoed the belief that robust investment models are essential. Vecchiato pointed out the advantages of public-private partnerships in securing project delivery, while Henderson highlighted the economic and societal benefits that new rail infrastructure can bring.
Richard Catterson of Hitachi Rail drew comparisons with the renewable sector’s success in attracting private investment due to stable, long-term frameworks, suggesting a similar approach for the rail industry. He advocated for learning from both past and other sector initiatives to formulate a strategy appealing to investors.
The report ultimately urges the government to seriously consider its recommendations to facilitate future rail projects, recognising the potential of rail investment in fostering economic growth and regional connectivity.
Investing in a stable strategy to attract private finance is key to developing the UK’s rail infrastructure.
