Businesses have little faith in Government's infrastructure policy, according to CBI and KPMG

Professional services firm KPMG and the Confederation of British Industry (CBI) surveyed over 500 firms involved in the UK infrastructure sector (52-page / 1.2MB PDF), including investors, providers and users of infrastructure. The majority of those surveyed said that they expected to see a worsening in critical infrastructure over the next five years which could undermine the UK's economic recovery. Outstanding issues included road network funding, energy policy, aviation capacity and a lack of clarity surrounding the costs of the national high speed rail network HS2.

"Government has talked the talk on infrastructure for the last two years with too few signs of action," said CBI head John Cridland.

"The faltering speed of delivery on infrastructure creates a worrying sense that politicians lack the political will to tackle some of the major issues head-on. We can't afford any further delay. The Coalition must show strong leadership and prove that the UK can deliver on a small number of projects over the next 18 months and reach a much-needed consensus on bigger issues such as aviation and roads reform," he said.

The Government should complete feasibility studies for the road and rail projects outlined in this year's Spending Round and commit to detailed plans for delivery, alongside a full audit of the current state of the road network and its operating costs, the CBI said. It has also called for the creation of new capital allowances for the construction of vital infrastructure projects, and the development of a long-term plan for digital infrastructure in conjunction with business.

The CBI would also like to see the Energy Bill finalised quickly, with accompanying secondary legislation, to provide businesses with the certainty they need to invest in new projects. Although the Airports Commission, chaired by Sir Howard Davies, is not due to provide its report on the future of UK air capacity until Summer 2015, the CBI would also like every political party to commit to implementing its findings as part of their election manifestos.

According to the survey, future energy policy has overtaken transport provision as the biggest area of concern for businesses. Manufacturers were particularly concerned, with 86% saying that they were not confident of improvements in energy infrastructure over the next five years against a national average of 77%. 95% of survey respondents were concerned about the cost of energy and 90% about security of supply.

However, the UK's transport infrastructure was still an area of concern for businesses, particularly multinational businesses. Dissatisfaction with existing infrastructure is now at 49%, up from 28% in 2011. A considerable proportion of respondents expect both local roads and motorways to deteriorate over the next five years, citing the lack of action on long-term road reform as well as the few projects currently underway.

Multinational respondents said that the UK had overtaken the EU in terms of attractiveness to invest, although the UK remains behind Australasia, North America and the Middle East, according to the survey. Respondents were also positive about the UK's progress in relation to digital infrastructure, although the majority said that faster and more reliable fixed-line and mobile broadband connections were critical to their success.

"It is disappointing to hear businesses report once again a sense of more rhetoric than action," said KPMG's Richard Threlfall. "Of particular concern is growing dissatisfaction with links between our regions, and the 73% of respondents who believe our local road network continues to deteriorate."

"Overlaid on this is the fear amongst businesses that too many critical investment decisions are being pushed back to beyond the next election. Our businesses are competing each day, every day in the global market, and we need to be investing now in building great infrastructure that is a help not a hindrance to our entrepreneurial efforts. We know what good looks like - we need to get on and build it," he said.