Continuing our series of roundtable discussions across the country to discuss the regional challenges of high inflation and construction costs, Arcadis was delighted to bring together leaders from the construction and development industry, policymakers, and experts for a thought-provoking roundtable event in Leeds earlier in November.
During the session, chaired by Arcadis’ Chief Growth Officer Edel Christie, we discussed some of the impacts and challenges raised in this year’s annual International Construction Costs (ICC) report. The focus of the discussion for this session was on whether infrastructure investment be the key to economic development in the North?
Renewing the focus on infrastructure
Our first guest speaker, Alex Sobel, Labour MP for Leeds North West, gave an overview of the party’s planned approach to infrastructure spending. Sobel noted that Labour would not borrow for day-to-day spending but would seek to grow tax revenues through the party’s Green Transition Plan .
On planning, Sobel noted that Labour will also seek to reform the planning process for national infrastructure projects and restore national housebuilding targets, including social housing targets to reverse the decline in council housing numbers.
Sobel was also keen to note that the state exists to bridge the gap in the green transition and therefore Labour would be committed to investing in the strategic road network, including increased funding for accessible transport.
Tough decisions on HS2
In light of the Government’s recent decision to scrap Phase 2 of HS2, there was a discussion around the future of the project and how the North can learn the lessons of HS2 for future major infrastructure projects in the region.
This covered the wider challenges presented by the delivery of infrastructure projects on the scale of HS2, with Henri Murison, CEO of the Northern Powerhouse Partnership raising the issue that smaller contractors have struggled to compete with HS2 for supply and labour. There was a consideration that, going forward, we need to be careful to coordinate resource requirements in the supply chain given limitations across the North, with the private sector and companies such as Arcadis central to this.
Using time and political capital wisely
Following on from this, there was a running theme throughout the discussion on the need to preserve Northern leaders’ time and energy to fight political battles that are winnable and focus on the big picture issues affecting the region. As Murison put it, Leeds has spent a lot of time and effort over the past few years on projects such as HS2 that will not now happen due to central government decisions. Furthermore, too much time is taken up by leaders fighting for small wins on relatively minor projects that should be sorted at officer level. This is a symptom of centralised control, and was backed up in a recent report from the National Audit Office which considered the risks posed to getting projects off the ground with considerable time and effort going into projects with no guaranteed funding. However, Murison noted, there is hope that there will be a change in approach from the next government.
Delivering locally
Leeds City Council leader Cllr James Lewis gave an overview of how the council was working to deliver projects on the ground in the city despite the national uncertainty. Echoing Murison’s point about the difficult nature of discussions with central government over relatively minor projects, Cllr Lewis gave the example of the long running battles to get funding for a new green roof for Halifax Station. He contrasted this with the example of the new South Entrance for Leeds Station, which was entirely funded by money raised by Leeds City Council and has been a great success. He added that “the things we can do ourselves, tend to work best”.
Cllr Lewis also gave an overview on how Leeds City Council has managed to become a leader in the delivery of new social housing, through a focus on? attracting development in Leeds as vehicle for funding social housing. This includes looking at where transport infrastructure is available to support it and then the council delivering itself where there is a business case, such as at Kirkstall Forge station.
The retrofit challenge
Liz Hunter, Leeds City Council’s Director of Policing, Environment and Place, echoed the importance of public-private partnerships in this approach, in particular when it comes to the difficulties of getting housing retrofit projects off the ground. She noted that the ‘stop-start’ nature of funding had made it hard to develop strong public-private partnerships and a move to five-year budgets and stronger deals would provide much needed certainty.
Cllr Helen Hayden, Leeds’s Executive Member for Sustainable Development and Infrastructure, gave some real-life case studies which highlighted the transformative benefits of retrofitting existing housing stock and the urgent need for stronger legislation to drive projects forward, referencing a project in Leeds to upgrade Victorian back-to-back terraces, which saw the internal winter temperature of homes increase from 12°C to 18°C, in other words the difference between internal temperatures that are detrimental to health, to temperatures that are safe and comfortable in winter – a huge improvement to quality of life.
Don’t rip it up and start again
David Shepherd, Strategic Director of Growth and Regeneration at Kirklees Council was keen to stress that the structures in place across the North are working and provide a much better framework for local cooperation that what has gone previously. One of the biggest risks of any new government would be an approach of ‘ripping up and starting again’ with devolution deals, potentially undoing a decade of hard work and setting the region back significantly.
However, he stressed that there is much an incoming government can do to improve the structures in place, such as renegotiating Local Authority funding arrangements to head-off emerging budgetary challenges impacting a number of councils across the country.
Jenny Wilson, Director of Campus Innovation at the University of Leeds added her perspective on the time, effort and patience it takes for public-private relationships to be built over years and the importance in ensuring they are maintained to best promote long-term thinking and trust.
Celebrating the wins
Despite the uncertainty around the future, it was also agreed that the region has a lot to be proud of and more should be done to celebrate the wins, such as the region’s fantastic record of retrofitting and social housing delivery and new transport infrastructure such as Kirkstall Forge Station. All these projects have had material benefits to the quality of life of the people of the region and the lessons learned need to be taken forward to ensure they can be repeated and expanded.
It was great to bring together these Northern leaders for a what was a very engaging and optimistic discussion of how the North can navigate the twin challenges of high inflation and political uncertainty. We were delighted to host the discussion and look forward to continuing our work with partners across West Yorkshire and the North to continue improving quality of life.
