DD2054 Developing a Strategic Infrastructure Investment Programme

Type of decision: 
Director's decision
Code: 
DD2054
Date signed: 
18 October 2016
Decision by: 
Fiona Fletcher-Smith, Executive Director of Development, Enterprise and Environment

Executive summary

This Director Decision has been prepared to seek approval to develop a Strategic Infrastructure Investment Programme for London, in order to better prioritise infrastructure investment throughout the Capital, increase certainty and provide an evidence base to support investment and planning decisions.  

The project will build upon work undertaken developing the London Infrastructure Plan 2050, and will provide a single programme view of London’s infrastructure requirements that is responsive to future challenges and opportunities. Currently there is no mechanism that allows for infrastructure investments to be prioritised or assessed in relation to each other, which compromises London’s ability to secure the investment in infrastructure it requires and plan for growth effectively. This programme will seek to address this gap, and will respond to stakeholder requests that such a programme is developed.  

The project will be supported by strong engagement with London’s infrastructure community, and will involve development of two working groups to ensure the project meets stakeholder requirements. In order to support development of the programme, a budget of £100,000 is required, which will be directed towards technical support and advisory services. This budget is available under the Infrastructure Investment Plan budget allocated for 2016/17.
 

Decision

The Executive Director approves the:  
1.    Development of a Strategic Infrastructure Investment Programme for London; and
2.    Expenditure of £100,000 from the Infrastructure Investment Plan 2016/17 budget to secure technical input and advisory services to develop the programme.
 

Part 1: Non-confidential facts and advice

Introduction and background


1.1.    London is growing and has substantial capital investment requirements to meet the demand presented by growth over the medium and long term.

1.2.     In 2014, the GLA released the London Infrastructure Plan 2050 (MD 1294); the first time such a plan had been developed for the Capital. The plan acts as a strategy document highlighting the scale of London’s infrastructure challenges and options for resolving these challenges; however it does not prioritise investment or develop a programme for delivery, presenting challenges for coordination, funding and planning.  As such there is a need to develop a mechanism or process that will allow for projects to be appraised relative to each other to ensure that projects are committed to which meet strategic goals and benefit London. 

1.3.     It is therefore proposed to develop a Strategic Infrastructure Investment Programme for London (SIIP), which considers projects across the key infrastructure sectors. Such a programme will be responsive to the challenges London faces – population growth, competition from other global cities and environmental threats which could undermine the economy and/or quality of life. The programme will also contribute to an evidence base that will support opportunities presented by potential fiscal devolution and increased Government spending on infrastructure in the wake of the EU referendum result.  Development of such a programme is also supported by stakeholders, who view it as a natural progression from the London Infrastructure Plan. 

1.4.    To support development of the SIIP it is proposed to allocate £100,000 from the Infrastructure Investment Plan Budget within the Economic Business Policy Unit (Development, Enterprise and Environment Directorate) to secure technical input and advisory services. Budget is available to commit to this project. Such services are necessary in order to deliver the project in a timely manner and develop a robust methodology to undertake the assessment that meets the Mayor’s requirements and those of stakeholders involved in delivering London’s infrastructure. The proposed budget has been identified based on a review of previous services provided in developing the London Infrastructure Plan and associated pieces of work.

1.5.    The SIIP will also be supported by the establishment of two working groups. A technical advisory group, made up of leading infrastructure experts from across the field, and a utility working group, made up of London’s infrastructure providers across the key sectors.

1.6.    It should be noted that the intention is for the programme to focus on the same sectors which the London Infrastructure Plan covered: water, energy, digital, transport, waste and green infrastructure; due to the importance of these sectors in supporting land use. Separate processes are underway within the GLA targeting social infrastructure such as schools, health and cultural infrastructure. 
 

Objectives and expected outcomes

2.1.     Development of the SIIP will serve a number of purposes – it will help to align investment decisions and increase certainty, and will provide an evidence base that better positions the Mayor to secure the investment in infrastructure that London requires to remain a successful and competitive global city. 

2.2.     The SIIP will provide a mechanism through which infrastructure investment proposals can be assessed against baseline criteria. This criteria will be developed with input from London’s infrastructure providers and an expert advisory group, and provide a robust process that allows for investment to be appraised on a level playing field (rather than a first come, first served basis).

2.3.     The SIIP will allow for projects to also be considered on a strategic or interconnected basis. The SIIP will allow for packages of infrastructure investment to be identified to support growth, and reduce the likelihood of stranded assets or housing being delayed by infrastructure deficits. Identification of such packages of investment will support land use planning in the capital, including the review of the London Plan, and support prioritisation of the opportunity areas and other growth locations. 

2.4.     A final programme will be used as a piece of evidence to support certainty regarding growth and arguments for increased investment in infrastructure from Government and/or through the regulatory process. It will also act as an evidence base to support the Mayor’s push for fiscal devolution.

2.5.     Data collected on future infrastructure projects will be included in the London Infrastructure Mapping Application. 

Equality comments

3.1.    The SIIP will deliver improvements in how infrastructure investment is planned and prioritised in the capital, which will have benefits for all Londoners, including those with a protected characteristic.

3.2.     The SIIP will be responsive to Mayoral priorities, including social inclusion and fairness (these could be included as part of the assessment criteria being developed), and a social inclusion expert will be included on the advisory group supporting this project.
 

Other considerations

4.1 Key risks and issues analysis

Risk/issue

Impact

Mitigation

Lack of support from utilities, particularly in terms of providing data input and technical advice.

High (timeline, accuracy, endorsement, political)

  • Pre-engagement meetings
  • Identify benefits
  • Develop an alternative approach
  • Recognise the differences between utilities
  • Establish utility working group

Irreconcilable views about the approach/methodology by Advisory Group

Medium (timeline, endorsement)

  • Clarify requirements and challenge from the start

 

Too complex assessment framework

Medium (timeline, cost)

  • Agile approach
  • Clarify requirements from the start

Mayor will be criticised for failing to deliver the infrastructure on the programme

Medium (political)

  • Engagement strategy to ensure that stakeholders are aware this programme extends beyond the Mayor’s funding and delivery remit.

Consultants fail to deliver project to satisfaction of GLA and stakeholders

Medium (timeline, endorsement, cost)

  • GLA will have close working relationship with consultant and contractual provisions will provide protection of interests   
  • SIIP will be an agenda item at future Growth Board meeting
  • Consultant will be invited to participate on working groups.

 4.2. Outputs from the SIIP will inform Mayoral strategy development, and development of this programme is early enough in the strategy development cycle to ensure that recommendations can be integrated into strategies.

Financial comments

Approval is being thought for the allocation of £100,000 from the Infrastructure Investment Plan 2016/17 to secure technical input and advisory services to develop the Strategic Infrastructure Investment for London programme, as underlined in the body of this report.

The funds will be available from the Infrastructure Investment budget held under WBS GE.0382.002 within the Economic Business Policy Unit (DE&E Directorate) and all associated costs will be charged to this code. 

It should be noted that any changes to this proposal, including budgetary implications will be subject to the Authority’s decision-making process.
 

Planned delivery approach and next steps

Activity

Timeline

Procurement activity and project planning

October 2016

Announcement

October 2016

Formal Start Date – consultant hired

October 2016

First utility working group meeting

November 10 2016

Final evaluation start and finish

February 2017

Delivery End Date

February 2017

Project Closure

March 2017


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