Changing direction on Northern Ireland’s growing infrastructure deficit

Northern Ireland’s infrastructure deficit and what kind of long-term strategy is needed to address it.

In brief

• A step change in how infrastructure investment is planned and delivered is required in order to respond to the climate emergency and address Northern Ireland’s existing infrastructure deficit.
• Delivering transformation change will require a new approach, one that better leverages private sector resources and maximises public sector delivery capabilities. 
• The first stage in this journey for Northern Ireland is to develop a realistic plan grounded in detailed analysis. 

Infrastructure is a fundamental building block of society. It brings us together, protects the environment, and supports economic growth. The benefits of enhanced infrastructure are more important today than ever before given the need to boost the economy, as well as meet legislative obligations in relation to climate change. 

Our closest neighbours are making significant headway in relation to infrastructure. Earlier this month, the National Infrastructure Commission (NIC) published its second National Infrastructure Assessment (NIA) and the Irish government unveiled plans for an Infrastructure, Climate and Nature Fund. 

In contrast, Northern Ireland’s Department of Finance (DoF) recently commenced a consultation on potential revenue raising measures necessitated by extreme pressures on public finances. Past and present fiscal challenges have resulted in an infrastructure deficit that now amounts to billions. Our lack of wastewater infrastructure is constraining development, demand for social housing is outstripping supply, public transport usage lags behind the rest of the UK, and our road network is deteriorating rapidly. These issues won’t resolve themselves. If we don’t act, our infrastructure will continue to deteriorate, and our children will inherit an even larger infrastructure deficit.  

In addition to revenue raising measures, DoF’s document also recognises that a combination of additional measures will be required to put Northern Ireland on a much more sustainable footing. These include transforming our services, finding efficiencies, leveraging additional funding, and cutting back on non-essential services. 

What we need to do to address the infrastructure deficit:  

Develop a long-term strategy that is grounded in analysis and realism.

Critical to the success of any endeavour is a plan. Whilst there are several infrastructure-related strategies, Northern Ireland does not have a single cross-sectoral one, akin to the UK’s National Infrastructure Strategy or the National Development Plan in Ireland. 

On average, infrastructure projects take 12 years to deliver. This means we must commence the delivery of the infrastructure needs of the mid-2030s today, further underscoring the utility of a long-term plan.

Like the approach adopted by the National Infrastructure Commission (NIC), the development of a plan must begin with a clear understanding of our current baseline and relevant sectoral priorities. This evidence-based approach will allow us to push beyond time horizons associated with political cycles and focus on the legacy we are leaving for the next generation.

Develop a systemic and robust prioritisation framework to identify high-priority infrastructure projects and focus limited resources on turning them into reality.

Given our infrastructure deficit, it is inevitable that the development of an infrastructure plan will identify a longlist of challenges and an unaffordable list of potential interventions. Challenges must be systemically triaged to arrive at a realistic shortlist. The process should consider the maintenance, renewal and resilience of our aging assets, as well as constructing new ones.

The process of triaging will require a single set of carefully developed criteria that identify relative priorities across the programme. It will also be necessary to apply the criteria in a strict and consistent manner. Without this uniform approach, it will be impossible to robustly take difficult decisions to invest in one thing over another. 

The analysis will, of course, also identify lower priorities. Existing projects aimed at addressing these should be carefully considered. Continuing to develop lower priority projects will result in fewer remaining resources to focus on addressing those of higher importance.

Identify commercial models that effectively leverage private sector investment in infrastructure.

In addition to prioritisation, there is a need to critically examine how we expand our financial envelope for infrastructure. The recently published NIA identifies that private sector investment will account for around 50% of total infrastructure investment over the next two decades; however, Northern Ireland remains heavily reliant on public sector funding.

Opportunities exist to chart a new course and better leverage private sector investment, whether it be to develop our electric vehicle charging network or increase housing stock. The potential introduction of revenue raising measures as outlined by DoF, such as domestic water charges, would pave the way for reduced reliance on the public purse, and unlock potential lending opportunities to support ‘invest to save’ initiatives. The UK Infrastructure Bank, established in 2021, presents an opportunity for the Executive and councils to temporarily expand their financial envelope. The Executive can also access Reinvestment and Reform Initiative borrowing at even more competitive rates. 

Explore alternative major project delivery structures that better leverage public sector capacity and capability.

Northern Ireland has immensely talented infrastructure professionals; however, individuals are limited, and expertise is dispersed across the public sector. These factors make it difficult to deploy the right skills to the right place at the right time, decreasing the likelihood of project success. 

A report by the Northern Ireland Audit Office, published in 2019, concluded that current infrastructure delivery structures are not fit for purpose and recommended alternative infrastructure delivery models be explored as a matter of priority. Since then, there has been little structural change. The transfer of relevant parts of the Health Estates Group from the Department of Health to Construction & Procurement Delivery in 2014, and then back again earlier this year, highlights the difficulties with separating the responsible department from project delivery teams. 

The UK Government Commercial Function and the Infrastructure and Projects Authority are examples of models where skills and resources are held centrally but deployed to departments to support delivery. The implementation of a similar approach in Northern Ireland would allow us to pool limited skilled resources, develop deep infrastructure delivery expertise and deploy resources to where they are needed most, whilst at the same time ensuring funding departments retain overall accountability and control.