The rise of the mega-scheme, by Angus Walker

This week's announcement that the government will support a third runway at Heathrow airport signals that, although there has been a slowdown in infrastructure projects, those that are coming forward are getting bigger.

When I calculated the number of applications for nationally significant infrastructure projects that have been live at any one time since the regime began in 2010, I found a gradual rise from zero to a peak of 27 in August 2014, followed by an incremental decline to just nine today. Only four new applications have been made in 2016 so far.

It seems that, despite the declared ‘urgent’ need for all forms of energy infrastructure, there is not much of it coming forward. And surely the need for new electricity generation is not going to abate if we are to move toward powering more and more transport and heating with electricity. The National Infrastructure Commission has reported on ways to use existing electricity infrastructure more efficiently, through measures such as storage and interconnectors, but this won’t meet the longer-term demand that they predict in their own figures.

Having said that, the size of the projects now being considered has, on average, increased. We now have Heathrow, phase 1 of the High Speed Two (HS2) project, and the Hinkley Point C nuclear power station in the pipeline and can look forward to phases 2a and 2b of HS2, Crossrail 2, the Lower Thames Crossing, and up to four new nuclear power stations.

This may cause concern about congestion in Parliament among those contemplating hybrid bills. But it’s worth noting that the system of 100 years ago coped with over 300 private members bills in a single year in 1900. And it shouldn’t pose a problem for the Planning Inspectorate, which has already dealt with 27 projects at once.

Dealing with fewer, larger projects posits a different set of challenges to handling lots of smaller ones. Each project will have a larger team, making it more difficult to avoid silos and keep everyone working collab-oratively. There will also be a greater number of larger project documents that will need to be kept consistent, and of course it is more challenging to manage the costs of a bigger project than a small one. So although the overall number of projects has grown, the amount of work involved may remain the same, or increase.

Are the larger projects swallowing up experts’ time and squeezing out smaller ones? I don’t think so. It is possible that short-term uncertainty following the 2015 general election, as well as the potentially longer-term dip in confidence resulting from this year’s vote to leave the European Union, have prevented smaller schemes from coming forward and shifted the focus onto projects spanning further into the future. These are generally larger, as bigger projects take longer to plan. But despite the reduction in the number of infrastructure projects, I hope there is still enough work to go round.

Angus Walker is a partner at Bircham Dyson Bell.


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