2017 must be the year we get to grips with our infrastructure investment
by Sinead McLaughlin , chief executive , Londonderry Chamber of Commerce
C
hancellor Philip Hammond was spoton in his choice of words in his Autumn Statement . “ We choose to invest in our economic infrastructure because it can transform the growth potential of our economy , as well as improving the quality of people ’ s lives ,” he said .
His focus , he explained , was to improve the economy ’ s productivity . “ So we choose in this Autumn Statement to prioritise additional high value investment , specifically in infrastructure and innovation , that will directly contribute to raising Britain ’ s productivity .”
Hammond ’ s reasoning was compelling . “ The productivity gap is well known , but shocking nonetheless . We lag the US and Germany by some 30 percentage points . But we also lag France by over 20 and Italy by eight . Which means in the real world , it takes a German worker four days to produce what we make in five ; which means , in turn , that too many British workers work longer hours for lower pay than their counterparts .”
There is also a productivity gap within the UK . “ London is one of the highestproductivity cities in the world and we should celebrate that fact ,” explained the Chancellor . “ But no other major developed economy has such a gap between the productivity of its capital city and its second and third cities . So we must drive up the performance of our regional cities .”
That productivity gap also exists within Northern Ireland – and must also be addressed . Northern Ireland ’ s productivity level , according to the latest official statistics , was a mere 82.5 per cent of the UK ’ s .
That means that Northern Ireland lags German productivity levels by a horrible 42.25 per cent . This makes Northern Ireland the least productive nation within the UK and gives us an awful competitiveness challenge .
Parts of Northern Ireland – specifically the North West – dramatically underperform the productivity levels achieved in Belfast . Just as London as a capital city outperforms other parts of England , so our capital city dominates the Northern Ireland economy . This does not mean that Belfast should be held back , merely that as we strive to improve productivity for Northern Ireland , we must strengthen all parts of Northern Ireland – especially those that are currently lagging because of their poor infrastructure .
It is worth examining the steps that Chancellor Hammond outlined for attention in England as part of the productivity drive .
The areas highlighted are research , development and innovation , plus the economically productive infrastructure that directly benefits businesses , but which also supports the lives of our people . These are roads , rail , telecoms and housing . Those are also the priorities for Northern Ireland , which our Executive must focus on .
Indeed , many commentators believe that the funds allocated by the Chancellor are insufficient to properly address the infrastructure deficit within England . The result of the spending boost in England is an extra £ 250m for Northern Ireland through the Barnett Formula . That certainly is insufficient to deal with our infrastructure needs .
The most recent CBI survey of its members captured the situation perfectly . Some 87 per cent of respondents said that the most important priority in Northern Ireland is the construction of a new North / South electricity interconnector , to secure energy resilience , which should also bring down electricity costs . The second demand was more domestic flights . The third priority – cited as critical to 51 per cent of respondents and probably 100 per cent to those in the North West – is the dualling of the Belfast to Derry road . The overall infrastructure priorities were named as roads , followed by digital and then energy .
For the North West , those priorities are slightly different . We certainly share the anxiety about energy security and the need for greater competition in the market , which is why our Chamber is strongly supportive of the proposed additional North / South interconnector . By contrast , Derry already has superb digital infrastructure , though the rural areas are poorly served .
Where our infrastructure is seriously inadequate is in our transport connectivity . The latest delays to one section of the Derry / Belfast A6 road upgrade are frustrating . But it is worth remembering that the immediate plans are to upgrade two sections of the road , to dual the rest of the connection between the end of the M22 and Castledawson .
There are two further sections of road between Castledawson and Derry that are below modern standards . One section begins at Derry and bypasses the bottleneck at Dungiven . This may begin before the end of the decade . It does , though , face serious and expensive challenges with regard to the remediation of some badly polluted land on the route .
Yet even when this road is built , we will be
QUOTABLEQUOTE
That means that Northern Ireland lags German productivity levels by a horrible 42.25 per cent . This makes Northern Ireland the least productive nation within the UK and gives us an awful competitiveness challenge
left with poor quality undualled road across the Glenshane Pass . More than 50 years after a plan was published to build a motorway between Belfast and Derry , there is no indication of when there will be a dual carriageway for the entire route between Northern Ireland ’ s two major cities .
As well as this , the plans for an improved road connection between Derry and Dublin have also hit planning and financial problems . Just one section – between Derry and Strabane – has a clear timetable for construction .
Traffic delays on the road in the area of Omagh may therefore persist for some years . A spate of recent fatal and other serious accidents on the Derry to Belfast and Dublin roads has emphasised the need for improvement of both these routes .
Meanwhile , we also need more flights from our airport and more frequency and higher speeds on our trains from Derry to Belfast .
Productivity is not just about transport , but it is an important element . Transport weaknesses are seriously holding back the North West .
www . businessfirstonline . co . uk
37