I have blogged previously about the UK National Infrastructure Plan which plans to invest about £250 billion in the next five yrs and £ 400 billion in the 10 yrs on infrastructure including high speed rail, energy (especially nuclear and wind), aviation, water and wastewater, roads and highways, and high speed broadband. This is a considerably higher spend than in the past and focuses on economic infrastructure. The most revolutionary aspect of this plan is that 70% of the funding is intended to come from the private sector.
The government has found it diffcult to attract the level of private investment that is required, at least partially due to the adverse credit situation in Europe. To make infrastructure investment more attractive to private investors, such as pension funds, the UK goverment has announced a £50bn loan guarantee program for private investment in infrastructure and exports.
It is estimated that up to £40 billion worth of projects could quality. The criteria the government intends to use to assess projects are
- Nationally significant
- Ready to start construction within 12 months (similar to the U.S. ARRA's shovel-ready criterion)
- Financially credible
- Would not proceed without a loan guarantee
- Good value to the taxpayer
The loan gurantees program also includes a temporary lending programme to enable 30 public private partnership (PPP) infrastructure projects worth an estimated £6 billion to go ahead.