UK Infrastructure Bank Bill [HL]

Lord Ravensdale Excerpts

2nd reading
Tuesday 24th May 2022 Lords Chamber

[Lord Ravensdale (CB)]

My Lords, I welcome this Bill. I start by declaring my interests as a project director with Atkins and a director of Peers for the Planet.

To meet the Government’s strategic objectives of net zero and levelling up the UK, large amounts of infrastructure investment will be required. As a simple example, it is estimated that, to decarbonise our electricity system, we will need to install between nine and 12 gigawatts of new capacity every year—more than double what we have managed in recent years. I will concentrate my remarks today on the objectives of the bank, starting with levelling up.

Today marks the opening of the new Elizabeth line. Crossrail is a fantastic engineering achievement, and it will be an enduring tribute to our longest serving monarch. However, it serves to illustrate the gulf in infrastructure investment between the regions. In my home region of the Midlands—I note here that I am co-chair of the Midlands Engine APPG—spending on transport is £289 per head for the east Midlands and £492 in the west Midlands, compared to £882 in London. The Midlands is a region of 11 million people. In order for the Government to level up and meet the aspirations in their White Paper, these disparities will need to be addressed and vast investment funnelled into the regions. We need a Crossrail for the Midlands and north too. That is me with my begging bowl—in response to the noble Baroness, Lady Noakes.

It was very welcome to see the letter from the Chancellor on his strategic steer to the bank, as indeed were the Minister’s opening remarks. This referred specifically to

“the need to end the geographical inequality which is such a striking feature of the UK and it is important that UKIB supports this ambition.”

However, the wording in the Bill that relates to levelling up is somewhat ambiguous, referring only to supporting

“regional and local economic growth.”

My reading of this—perhaps the Minister will correct me—is that it leaves much open to interpretation. Almost any infrastructure investment anywhere in the country could be argued to support economic growth in the region or local area in which it sits. A new transport scheme in London, for example, would meet this criterion by supporting local and regional economic growth in the city.

As the Minister highlighted, the effects of agglomeration work against infrastructure spend outside of the metropolis. The economic return is simply much better in areas that already perform well, so those projects have a much better chance of proceeding. Inequality becomes entrenched and self-fulfilling. That is why the recent reforms to the Green Book were so welcome.

Given that the bank will also be working to address these areas of market failure, it is key that its mission is clear in the Bill. Wording such as “regional developments”, or references to “disadvantaged areas” or “geographical inequality” in this objective, would address this issue. I look forward to hearing from the Minister about it in her summing up and will potentially come back to it in Committee.

Secondly, the bank has an objective of helping to tackle climate change, referring to the Climate Change Act 2008. There are some great synergies between these two objectives, as other noble Lords have already pointed out. I highlight the Midlands Engine’s industry-led Ten Point Plan for Green Growth, which seeks to map out a strategy to level up the region by focusing on our strengths in low-carbon technologies and the natural capital we have in the region.

To strengthen the environmental objective of the bank, there is a great opportunity here for the Government to recognise biodiversity and nature as a specific objective in addition to net zero. To echo what the noble Lord, Lord Teverson, said, placing biodiversity on an equal stature with climate change is absolutely vital. I will not expand on this as it has already been eloquently explained by many other noble Lords. I hope the Minister recognises that this area is important enough to include in the Bill as its own separate objective.