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National Infrastructure Commission: Baseline Report

Volume 816: debated on Thursday 2 December 2021

Question for Short Debate

Asked by

To ask Her Majesty’s Government what plans they have to address the concerns in the report by the National Infrastructure Commission, The Second National Infrastructure Assessment: Baseline Report, published in November.

My Lords, it gives me great pleasure to be able to introduce this short debate on the national infrastructure assessment. As noble Lords will know, my noble friend Lord Liddle has had to scratch for transport reasons; he asked me to pass on his apologies. I declare an interest as an officer of the All-Party Group on Infrastructure and a member of the Institution of Civil Engineers.

This is a really good time to debate the infrastructure assessment. It is a baseline report, as we all know; it is the basis for the future work the NIC will be doing. It is also really good that the Government have expanded its remit to cover the transition to net zero and climate resistance, as we have been speaking about that a great deal in your Lordships’ House.

I will try to cover briefly where we are today on infrastructure, where we should be today—if I think that is different—and where we might be in 30 years’ time. Somewhere in this report, it states that we need

“bold action, stable plans and long term funding”,

which sounds just wonderful but might not always happen. At least we are trying.

The baseline report lists some of the successes. It is worth reminding ourselves that broadband circulation around the country has been good in most places and renewable electricity is getting better—we have spoken about electric vehicles. I question how much better flooding has got; drought resilience is not something we need to look at this week, but so be it. On the other hand, some good things have happened there as well.

One of the most important things the NIC has been asked to do is social research. It says that it has got better between 2017 and 2021, which is good news. I suspect there is still a great deal of work to be done there, particularly on things such as clean water and sewage, and probably on energy supplies as well. It also says that some things are not going quite so well, including emissions from electricity and heat, which are still too high—I think we know all that. Emissions from transport have not been declining; I will come back to that, as that is very serious. Asset maintenance is not so good. Five million properties are currently at risk of flooding—that is serious, and is still going on today, as we have recently heard. There is also the pollution from water and sewage. Then there is urban transport connectivity, which I will come on to.

One of the most interesting things which has come out of a briefing from the Institution of Civil Engineers is that only 10% of British adults think that the right conditions are in place for infrastructure to transition to net zero—10% is not very good. Only 31% of British adults think that the Government have a plan for net zero; they should be worried about that, and perhaps the Minister will have views on it.

However, going forward, I hope that the NIC and the Government will take forward some of these issues. I will cover just one or two of them. I will start with net zero, which noble Lords have been debating quite frequently. Other topics include transport, rail electrification—that is in the new policy document from the Government; whether it is enough we can debate—towns, transport within towns, the 20-minute city, which I shall come on to, and new road building and whether we should be doing it. We should not forget that, if every car becomes electrically driven in a few years’ time, there will still be traffic jams. They will be electric traffic jams rather than petrol or diesel ones, but they will still be traffic jams—and, again, that is why I think public transport is so important.

The NIC says that road and rail freight seems to be going quite well, especially with decarbonisation. I would question that, actually, because I think that the technology of making heavy goods vehicles not use diesel or petrol is still in its infancy. I used to be chairman of the Rail Freight Group, and rail freight has had quite a good time over the pandemic. But there needs to be an awful lot more, and really we should be electrifying the railways and trying to cover freight moving in the last mile or so to its destination, which we manifestly do not do at the moment unless we use petrol or diesel.

Turning to energy, there are problems with the sourcing of it, and with its distribution and use. Again, we have debated that frequently over the past few months. What worries me about that is that if we use electrical power to heat most of our homes, and we use electrical power to drive our transport, on road or rail—I think we have to leave air out of this, because it is a complete failure—the forecast is that we will need 10 times the amount of electrical energy that we have now. I view that as extremely serious. We can debate how it is generated, and whether it is a good thing to generate hydrogen from electricity or use electricity as it comes; that is another debate that has to come. We have another debate here on Monday evening about plug-in chargers and things like that. But the 10-times figure is one of the most serious issues we have to address.

Then there are a whole host of environmental issues. I was rather surprised that the NIC thinks that carbon capture and storage is a good idea, because I do not believe it has been demonstrated to work yet. How long will it last and what happens when it does not last any more? I may be being naive on that, but I am not convinced it is a proven technology.

The Government have an enormous amount of work to do on resilience, including on floods and storms —we had a debate about the storms in the north-east today—as well as on drought, energy, transport and the general quality of life. But what I do not understand is why we are still building on flood plains. It seems to be utterly crazy. We may be short of land—that is a different issue—but building on flood plains so that you get flooded is absolutely crazy. I am not going to speak any more about sewage, because we have talked enough about that.

However, it is interesting that the solution for Southern Water, which is one of the worst offenders and has been highly fined, is to sell the company to Macquarie bank, whose track record is that it owned Thames Water around 10 years ago and increased its debt by £2 billion and got fined £20 million itself. Does the Minister think Macquarie bank is the best possible investor to manage Southern Water and all the problems which we know it has had recently?

The last big issue, on the communities themselves, is that there has been a lot of talk recently about how far people want to travel to work, shop, go to school or whatever. Something called the 20-minute community is being talked about quite a lot. It does not just have to be in London or the suburbs around it; it can be anywhere. Maybe the NIC will start looking at something like this when it looks at the quality of life paper, which I believe will come out next year.

Finally, it is very easy to talk about building things—I am a civil engineer, so I love building things, if they are the right things. However, we also have to look at the cost and upset and everything of building new things compared with adapting existing things, which may cause less trouble and hassle. I will bring my remarks to a close. My last point is cost and deliverability. We all know the problems there, but building things small needs to be looked at. Couple that with the question of whether we will have to change our lifestyle as we go towards net zero or whether we can carry on the way we are—you can even drive to Waitrose for a box of matches.

My Lords, I am grateful to my colleague, the noble Lord, Lord Berkeley, for initiating this debate. The rules of politics and this House mean that I cannot formally call him a friend, but we have often found ourselves singing from similar hymn sheets in debates such as this. In particular, we focus on the central importance of rational economic decision-making in national life—we have certainly had some debates on HS2. We also sit on the same committee, where I am hugely grateful to him for the contribution he makes, as well as on the APPG on Infrastructure.

Adequate—preferably good—infrastructure is vital if an economy is to be able to operate effectively. Infrastructure in this sense includes communication, such as roads, rail, telephones and broadband, and utilities such as gas, electricity and water, which last covers both the necessity of adequate and pure supply and the risk of floods and drought. Some might say that adequate housing is another vital component of national infrastructure—here I should declare an interest as I am chair of your Lordships’ Built Environment Committee and we are currently conducting an inquiry into housing. But we do not need to split hairs. We all recognise that some entities constitute something reasonably described as infrastructure because they are required if economic ventures are to work. The Victorians —for whom I have a lot of admiration on the infra- structure side—understood that very well.

It is welcome that the importance of infrastructure has been recognised by the establishment of the National Infrastructure Commission, whose report we are considering today. It is under the leadership of Sir John Armitt, a very worthy chair—I know that because we served together at John Laing Construction when we were building Sizewell B in the 1990s. We might, in passing, wonder why it took so long to establish such an important body as the National Infrastructure Commission.

One answer to that question lies in a particular characteristic of infrastructure which separates it from other economic matters. In matters of infrastructure, a significant degree of national planning is necessary and desirable. In many cases, planning is not desirable; in most economic decisions the best course is to let those with ideas seek to put them into effect. If they are right then they will benefit substantially and so, by Adam Smith’s invisible hand, will the rest of us, to a lesser extent. The concept of Ministers and civil servants trying to decide what will succeed in the marketplace has rightly come to be regarded with derision. However, when it comes to, say, investment in train tracks or the electricity grid—or flooding and water resilience, in the circumstances of 2021—this is insufficient, as I think the noble Lord has explained very clearly, so a significant degree of planning is required.

For some of those contributing to today’s debate, all this theory might seem unnecessary. I say to them that they are wrong. Capitalism is the most effective method of economic advance ever discovered. Why has China become so rich? Because it has abandoned—in economic matters—the notions of communism and adopted, in a surprisingly pure form, those of capitalism. The shame is that it has limited its adoption of western ways to economic matters.

I come to the report before us. It is worthy, which is exactly what it ought to be. I have some quibbles. Thinking in terms of centuries or even decades, as we are bound to do on infrastructure, I do not think the emphasis on climate change will age entirely well. There are other challenges and of course innovation and changing weather patterns could alter matters by the time we get to the second half of the century, but we must certainly be more efficient and more careful in the use of our nation’s and the world’s resources in myriad different ways. It is wholly appropriate to assess matters in this long-term way and to look at both digital and physical aspects, as the report does so well. I welcome the report and the opportunity to debate longer-term infrastructure challenges, which is unusual but very important.

I thank the noble Lord, Lord Berkeley, for giving us this excellent opportunity to debate these important issues. It is important to bear in mind that the Climate Change Committee has recently made the point that we as a nation are nowhere near restricting our CO2 emissions to the level that we need to achieve a 1.5 degree increase, which is what is needed. My comments today will concentrate entirely on transport-related issues.

Last week, we had the shapeshifting announcement of the integrated rail plan, which was slated across the north of England as a huge disappointment. The National Infrastructure Commission’s reports, statements and conclusions are important because they identify transport as the sector that has the most potential to reduce disparities in wealth across the country. The NIC concludes that urban transport connectivity is poor in many places and that the largest towns and cities have the worst connectivity, with congestion slowing journeys. It points out that improving urban mobility and reducing congestion can boost urban productivity and hence prosperity. That makes last week’s integrated rail plan, with its downgrading of the investment potential in the north of England, all the more worrying.

The NIC report points out that 33% of total UK emissions in 2019 were transport emissions. Of those transport emissions, two-thirds came from surface transport and one-third from aviation and shipping. As the noble Lord, Lord Berkeley, has already mentioned, since 1990 surface transport emissions have stubbornly remained at similar levels despite technological improvements. That has happened simply because there is far more traffic around.

Surface transport emissions come from road transport, of course, as well as rail. However, the number of passenger journeys on rail transport has more than doubled since 1990, but, at the same time, there has been a significant reduction in emissions from railways. We can see that a transition from car ownership to public transport is vital if we are to deal with emissions issues.

Within public transport, rail expansion is of course important, but it takes a while to build a railway; it is much quicker to get people on to buses and to improve a bus fleet from an environmental point of view. We have the technology to move to electric and hydrogen buses.

The Government’s bus strategy has welcome and ambitious aims, but the price tag that they have attached to it is far too modest. The first round of bids is in for funding, which is to be spent largely on zero-carbon buses. There are more than 70 local authorities. Roughly 40 of them have made bids. Four of them alone will mop up the total funding that has been made available. The Government promised us 4,000 zero-emission buses. That sounds really good, but we have to bear in mind that there are 38,000 buses on the road, so what will happen about the other 34,000? The Government still have a roads programme of £27 billion. A quarter of that amount, if spent on zero-emission buses, would deal with the whole problem.

Realistically, we cannot deal with this topic of transport without referring to the need for a stronger government lead in the transition to electric vehicles. Their target is fine, but there is as yet no path to it. Earlier this week in Grand Committee, we considered a modest SI that started to tackle the core problem: the infrastructure for charging EVs. The SI was simply about smart charging, so really it was just about stretching the grid as far as possible—and it was pretty optimistic in what was thought to be possible. Many EV owners have no possible access to charge points at their homes, so they rely on the public realm. It is essential that the right mix of speeds of chargers in the right locations is provided. People rapidly learn where those chargers are and what suits their needs, but the big psychological stumbling block still to be tackled is long-distance routes. People will not buy EVs unless they can rely on chargers being as easily accessible and available as diesel and petrol.

The SMMT has recently produced statistics. One charger is being installed for every 52 new electric vehicles. That is not a sustainable position. The really worrying statistic is that the ratio of vehicle charge points to plug-in vehicles has deteriorated by 31% in the last year. We have one of the worst ratios in major global EV markets, behind South Korea, the Netherlands, China, France, Belgium and Japan. This has to be fixed, and it needs not just money but government leadership in terms of a structure of regulation and leadership of the private sector for investment.

My Lords, it is a great pleasure to follow my noble friend Lady Randerson, and I congratulate the noble Lord, Lord Berkeley, on securing this debate and on his excellent introduction. This is an extremely wide subject of great importance to be covered in just a one-hour debate, but we have had some excellent contributions from all sides. The noble Lord, Lord Berkeley, mentioned road and rail connectivity, and the noble Baroness, Lady Neville-Rolfe, understands the national infrastructure network across the board and spoke eloquently.

Given the breadth of the baseline report, I shall concentrate on the areas within my spokesperson’s role—wastewater management and flooding. I declare my interest as a vice-president of the LGA. Before I do that, I will just mention the issue of access to gigabit-capable broadband. The increase of coverage to 85% connection across the UK is to be welcomed, and the target of 95% connection by 2026 sounds excellent. However, this masks the dark areas of the country where there is no connection and where this is unlikely to be remedied by 2026.

Remote rural areas, especially in the national parks and deep rural hamlets, suffer from poor or no connectivity. The numbers affected are small but should not be overlooked. They will be the children struggling to do the homework that their friends in towns are easily able to complete, and the farmers trying to fill in the innumerable Defra forms. We have seen in recent days how storms can so easily bring down power lines and, again, deep rural areas are the last to be reconnected. As there is no government rural strategy, and various Ministers have repeatedly stressed that one will not be forthcoming, I make a plea for these areas not to be forgotten in the gigabit connection programme.

I turn to flood resilience and wastewater. During the passage of the Environment Act, flood resilience and waste were debated fully. Communities up and down the country have been flooded more than once. The misery that flood-water brings is truly heartbreaking; the slime and smell caused by overflowing sewage systems is difficult to describe if you have not experienced it yourself. It can destroy a lifetime’s possessions, many having emotional ties. The Government are due to invest £5.6 billion over the next six years to reduce the risk of flooding. Is the Minister able to tell us where this money is likely to be invested and the areas of the country that will benefit from this investment? I expect it to be in areas where the most difference can be made for businesses and homes, but this is likely to leave some smaller communities still at risk.

Despite recognition of climate change and the effects of building on flood plains and tarmacking over green fields, local authorities still build houses in areas where doing so will increase the risk of flooding. The noble Lord, Lord Berkeley, mentioned this. Inadequate attention is often given to how surface-water drainage will be tackled through properly engineered SUDS. Urgent attention needs to be given to how surface-water management is dealt with to prevent increasing the risk of flooding. Can the Minister give reassurance on this aspect?

Also during the passage of the Environment Act, and twice this week during Oral Questions, the issue of raw sewage being discharged by water companies has been raised. Due to the excellent work of the noble Duke, the Duke of Wellington, the Government have given commitments that water companies will in future have to be stringent in how they operate. There will be heavy fines for companies that discharge wastewater and sewage into our lakes and waterways. However, the ability to fine water companies has been in place for a while and has not deterred them. Investment in their infrastructure is long overdue, but it seems that shareholder dividends loom larger on their agenda than the Environment Agency fines. Can the Minister say exactly what conversations have taken place with water companies about improving their infrastructure to prevent future sewage spillages?

I turn now to waste, a great passion of mine. I first became aware of how important it was to reduce waste as a county councillor, when the landfill tax was introduced. This tax concentrated the minds of councillors and officers immediately, as it rose year on year. Much has been done on the recycling front during the intervening years, with many councils having doorstep collections of recyclable materials. However, many of these recyclable collections are not processed in the way the householder imagines they would be but sent for incineration. Although this can and should be through a waste-to-energy plant, supplying electricity locally, this is often not the case. Councils that ask their residents to separate their recyclable waste and collect it through a single-pass vehicle with different compartments for glass, aluminium foil, cans, paper, cardboard and plastic have much higher rates of true recycling.

Does my noble friend agree that we urgently need a single system for every council across the country to make this important change in recycling rates?

I do indeed, and I am coming to that.

Each of these items can be dealt with in its own way and recycled into reusable articles, thus helping a circular economy. When I lived in Somerset, this system had been up and running for a long time. In Walthamstow, where I rent a flat, all recyclables are in one bin and much of what goes in is not currently recyclable. I know the Government are keen for this system to be rolled out countrywide. Wales has such a system, which has operated for some time, and has the second-highest recycling rate in Europe and, obviously, the highest in Great Britain. Can the Minister give an indication of when the rollout of doorstep separated recyclable waste collections will take place?

My noble friend Lady Randerson spoke passionately about transport and congestion. Reducing emissions and congestion will improve productivity. I welcome the NIC report. Much has been achieved but, goodness me, there is still an awful lot left to do.

My Lords, I congratulate my noble friend Lord Berkeley on securing this short debate. I express my thanks to the National Infrastructure Commission for its report, which provides us all with plenty of food for thought.

In his foreword, Sir John Armitt says he hopes the commission’s output will prompt discussion. Today’s debate is a good start, although we must all acknowledge that this topic requires far more than dialogue alone. We all know that improving infrastructure in its myriad forms is a complicated, long-term project. I hope we will get a sense from the Minister that the Government recognise this and share our appetite to meet the many challenges this country faces. It is also expensive. There will obviously be an important role for the private sector in innovating and delivering change, but those organisations will take their lead from central government, with many likely to fix their gaze on the Treasury and its spending plans. Value for money is and must remain an important consideration, but it seems to me that the starting point is to answer two philosophical questions: what do we want the UK to look like in 20, 50 or 100 years, and how do we get there?

For all the Government’s talk of levelling up, recent ministerial decisions about rail across the north of England seemingly fly in the face of the commission’s call for urban transport connectivity to be improved. Rather than levelling up, I worry that we will see some areas being levelled down to deliver an unsatisfactory equalisation of infrastructure, service and opportunities across the country. Indeed, Transport for London and its custodian, the Mayor of London, are concerned that transport in the capital will have to be placed into managed decline should the Government not ease the organisation’s Covid-related financial difficulties. The Treasury should surely be focused on how the quality and range of transport options can be improved for all.

Of course, it is not just transport identified by the commission as a priority for investment. The body’s list is wide ranging, and I worry that it is symptomatic of more than a decade of Conservative control in Westminster. The tragedy is that, while our Prime Minister takes an interest in infrastructure, his priorities tend to be the wrong ones: an airport in the Thames estuary, a garden bridge in London, a road bridge to Northern Ireland. Each was accompanied by warm words and promises of a brighter future. In truth, the feasibility studies and glossy brochures were a waste of public funds. By focusing on vanity projects, he was distracted from making the right decisions—initially for the people of London, and now for the country as a whole. The result is that we have fallen behind our international friends and competitors where it truly matters. Under this Government, we are not the global leaders we should be.

Problems relating to climate change, including increased risk of localised flooding and what the commission calls “unacceptably high” incidences of water and sewage-related pollution, must be met with concerted and strategic action. That will not only need hard cash but also a proper plan to ensure that resources are available to deliver the commission’s recommendations. The longest lead-time resource is undoubtedly appropriately skilled people. Cash without people is simply a recipe for inflation and disappointment. I hope the commission will study this issue as a vital contribution to the 2023 national infrastructure assessment.

The commission also draws our attention to asset maintenance issues. Those working in the public sector are cursed with the mantra that capital expenditure is good and current expenditure is bad. This results in the premature loss of capital assets as they deteriorate more rapidly due to poor maintenance. As one who was responsible for long-life assets, I know that value for money comes from the whole-life management of capital assets. I hope the commission will continue to emphasise this point in future reports.

There is much to do. The National Infrastructure Commission will now work up a detailed proposal and we look forward to following that work. While options are drawn up and costed, I hope that Ministers will undertake some of the necessary preparatory work, including gathering data, setting targets, and delivering reforms to education and training. As a nation, we are capable of so much; we have world-leading scientists, academics, engineers and architects. We have talented young people who, with the right guidance, can fill those roles and others into the future, building a Britain with much better, greener, and more resilient infrastructure. What they need—and what the country needs—is clear, strategic leadership. By the time the commission comes forward with its next assessment in 2023, we must be ready with our answers to the big questions. Until then, I hope the Minister can provide a sense that his party is learning from previous mistakes in relation to infrastructure and has a sense of where to go next.

Can I repeat some of the points I have made? First, the National Infrastructure Commission is a brilliant idea, but the problem is it does not have saliency. We as politicians should, on a cross-party basis, be helping to build its saliency so that it happens. Secondly, we mismanage the whole people issue; the people have to be related to their whole-life experience, including the skill and be able to learn new skills. Thirdly, we do not look after our assets properly. The maintenance problem comes partly from capitalism without appropriate rules, partly from the way we account for money, and it fails to take account of the real value of looking at all of an asset and all of its future. If we start to get these things right, which will need a partnership between state and private sector, we can look forward to a better value future.

My Lords, I congratulate the noble Lord, Lord Berkeley, for securing this debate. He is known with great respect throughout the House for his pursuit of certain causes célèbres, including matters relating to transport to the Isles of Scilly. I also know he is a long-standing advocate for the benefits of infrastructure and his speech indicated his clear focus on all the key issues, many of which I will be attempting to touch on this afternoon.

The Government recognise the transformative possibilities of infrastructure benefit here. That is why we have committed £130 billion to economic infrastructure since the publication of the National Infrastructure Strategy last year. However, it is fair to say that in past decades and under past Governments, the UK’s infrastructure has been plagued by stop-start public funding and policy uncertainty that has conspired to undermine private investment. In 2015, to help resolve these issues, the Government established the National Infrastructure Commission—which I will refer to as the NIC—to provide independent, expert advice. My noble friend Lady Neville-Rolfe was right to ask why it took so long. I hope to reassure the noble Lord, Lord Tunnicliffe, that the Government have a robust approach to infrastructure. We are focused not merely on capital spending but on long-term infrastructure planning, improving project delivery and supporting private investment. I will try to touch on those points as I go through my remarks.

I remind your Lordships of the crucial role of the NIC’s first national infrastructure assessment. Published in 2018, it set out a recommended long-term strategy for the country’s infrastructure over the next 30 years. That work directly underpinned our National Infrastructure Strategy, which we published last year. Alongside the strategy, the Government published their formal response to the commission’s 2018 recommendations, partially or fully endorsing the vast majority. Already those recommendations are becoming reality. For example, earlier this year we launched the UK Infrastructure Bank in Leeds, which is expected to unlock more than £40 billion-worth of infrastructure investment. Just over a month ago, the UKIB made its first investment with a £107 million loan to Tees Valley Combined Authority. Only yesterday we announced its first private sector investment, in subsidy-free solar energy.

I turn to the baseline report for the Second National Infrastructure Assessment, which is of course the main subject for today’s debate. The report highlights some areas where the Government have made significant progress, so let us start with that. First, on the delivery of gigabit-capable broadband, I mention briefly that, only yesterday, my flat was upgraded to full-fibre broadband, and the speed is much faster—that is just a bit of self-indulgence. The report draws attention to the fact that coverage is now at over 62% compared to just 10% in November 2019. The noble Baroness, Lady Bakewell of Hardington Mandeville, mentioned that rural broadband connectivity is lagging behind. The Government recognise the importance of gigabit-capable connectivity to people across all areas, but particularly in rural parts. We have committed £5 billion to support gigabit-capable coverage in the hardest-to-reach-areas where possible, so that is an ongoing programme and the noble Baroness raised a good point.

Secondly, on the transition to renewable forms of energy, the report points out that the share of electricity generated from renewable sources has grown from less than 10% in 2010 to almost 40% in 2019.

Thirdly, on our ambition for electric vehicles, the report mentions the Government’s pledge to end the sale of new petrol and diesel cars and vans in 2030, with all new vehicles required to be 100% zero emission from 2035. The noble Baroness, Lady Randerson, stated that there was not enough funding for buses along the same theme. I reassure her that £3 billion of new funding over this Parliament will be dedicated, to double the amount given since the 2015 spending review levels. The £525 million for zero-emission buses in this Parliament is in addition to wider support, including a green uplift in the bus services operator grant, and £1.2 billion of dedicated bus transformation funding.

The noble Baroness, Lady Randerson, also suggested that more needs to be done on long-range charging and charger ratios. The Government are making significant investments in electric vehicle charging, including £1.3 billion at the spending review 2020. That includes funding for a rapid changing fund to reduce people’s anxieties around long-range charging by rolling out thousands of rapid charges across our strategic road network. The UK has more rapid chargers per 100 miles than any country in Europe, according to a report. However, of course the noble Baroness is right to make that point, and there is always more to be done there—we all know that as drivers on our roads.

Fourthly, on drought resilience, which was raised. The report underlines that we have endorsed the commission’s recommendation that we increase drought resilience to reflect a one-in-500-year event.

Another positive aspect of the report is the NIC’s social research, which was raised by the noble Lord, Lord Berkeley. Understandably, people will always call for more and better infrastructure. However, this research shows growing public confidence that infra- structure will meet people’s needs over the next 30 years—this is perhaps excepting the views on net zero raised by the noble Lord. I will need to check back on that.

Of course, we recognise that the report also highlights some concerns, including nine key challenges on which the NIC will focus in its second national infrastructure assessment. I want to focus my remarks around three important elements of these, again raised during this short debate: net zero, flooding and transport.

First, although net zero was mentioned in rather positive terms by the noble Lord, Lord Berkeley, we recognise the report’s concerns about our journey to net zero, including in respect of decarbonising our electricity system and heating. That is why we have recently published our net-zero strategy, setting out how we plan to achieve our 2050 goals, in particular by leveraging up to £90 billion of private investment in green infrastructure by 2050.

The Government have also published the Heat and Buildings Strategy, which lays out our vision for a sustainable and affordable transition to a low-carbon heating sector. We are providing £3.9 billion over the spending review period for heat and buildings decarbonisation, including £1.8 billion for low-income households and £450 million for the new boiler upgrade scheme, which financially incentivises home owners to install heat pumps.

We have also provided significant funding to decarbonise transport. This includes confirming £6.1 billion at the spending review to support the policies and strategy in the transport decarbonisation plan. We have invested £620 million in the transition to EVs, building on the £1.9 billion committed at the previous spending review.

The noble Lord, Lord Berkeley, and my noble friend Lady Neville-Rolfe stated that there was no road map for net zero and that the UK was not reducing emissions fast enough. I note those two points. In response, I would say that the UK reduced emissions faster than any other country in the G20 between 1990 and 2019. The UK reduced its greenhouse emissions by 44% compared to just 5% for the G7 as a whole. In June 2019, the UK became the first major economy to legislate for an end of contribution to climate change by 2050. As I mentioned earlier, the recently-published net zero strategy sets out a clear pathway to reach net zero and level up the UK by supporting up 190,000 jobs in the mid-2020s and up to 440,000 jobs in the 2030s.

On progress on greenhouse gases and zero emissions, where does the into-the-UK part of international aviation come in this? At the moment, I get the impression that it is dumped and seen as not part of our problem. It is part of our problem.

I agree with the noble Lord that it is part of the problem. I suspect that he may be referring to the air passenger duty and other matters. I shall write separately to him on that important matter, because I think it is fair to say that there is a balance to be struck between allowing people to travel and being sure that our aeroplane sector is fit for purpose in terms of achieving our climate change goals. I think that was probably the gist behind his question.

On flooding, we recognise that action is needed to improve surface water management as flood risk increases, so we have commissioned the NIC to conduct a study into the management of surface water flooding in England, including the role of nature-based solutions. In addition, the Government have updated their partnership funding arrangements, enabling more surface water schemes now to be delivered via their £5.2 billion investment programme.

Finally, I turn to urban connectivity, as part of the wider transport issues that I mentioned earlier. We recognise the challenges in respect to this highlighted by the report. That is why in the Budget we committed £5.7 billion over five years for London-style integrated transport settlements that will transform local networks in eight English city regions, and we have announced £1.2 billion over the spending review period for bus transformation deals.

The noble Lord, Lord Berkeley, asked whether the Government should consider the challenges and costs of delivering major infrastructure projects. He is quite right to highlight this. That is why the Chancellor set up Project SPEED to ensure that spending decisions are informed by deliverability concerns.

Moving quickly to next steps—with the Committee’s indulgence, I will go on beyond my time, but not too far—our work to create an infrastructure revolution is a remarkable cross-government effort. The Government have an established process for formally responding to the NIC’s recommendations. Once it has published the second national infrastructure assessment in the second half of 2023, we will respond as soon as practicable, although, as I have shown today, we are already engaging on these issues.

The noble Baroness, Lady Bakewell of Hardington Mandeville, asked about flood defences and where the £5.6 billion is being invested. Funding is distributed consistently across the country to wherever the risk is greatest and the benefits are highest. Defra published its flood and coastal erosion risk management investment plan in July 2021, as she may know. It provides an indicative regional breakdown of spend, including between £620 million and £750 million of investment in the north-west and £680 million to £830 million in Yorkshire and the Humber.

The noble Lord, Lord Tunnicliffe, asked about funding and urban connectivity. The Government have provided £4 billion of additional emergency funding to support TfL through the pandemic to address urban congestion. We have announced £5.7 billion to support transport networks.

I will conclude with a few ad lib-type remarks, as I want to pick up on an interesting point made by the noble Lord, Lord Berkeley, about our reflection on going to Waitrose to pick up a box of matches. We should be sure, as part of this debate on the NIC, of the vision we are looking at. This is probably not government policy, but we should look ahead—probably not too far—at how we might get our box of matches. Surely we would order a drone, which would deliver it to us. Or, if we were going to go to Waitrose, we would talk to our watch and ask a car—not our car but any driverless car—to come to our door. We would then get into the car with a coffee and a newspaper, be driven to Waitrose to buy our box of matches and then be driven back. The car would then disappear into the ether. We would then take our box of matches—perhaps rather cynically, I wonder what it might be for. Perhaps it is to light your fire in the drawing room, which adversely affects CO2, so maybe we should not go there. Anyway, the serious point is that we need to think quite positively about the changes that will definitely come to the way that we live. The noble Lord, Lord Berkeley, spoke about society and our way of life. He makes an extremely good point.

To conclude, this is an extraordinary moment—

Before my noble friend sits down, perhaps he would like to exceed his brief again and say something about the longer term. He has answered very well on some of the individual comments raised by Peers this afternoon, but the point I was trying to make is that the National Infrastructure Commission is important because it looks at the longer-term, comprehensive picture, and the need for planning is very important. As a former Treasury Minister, I know that it is not always top of the Treasury’s list.

Perhaps we might discuss on another occasion the excellent point made by the noble Lord, Lord Tunnicliffe, about capital and current expenditure. I remember talking to Education Ministers who had spent lots of capital on schools. Capital was easy, free and glamorous, but running costs were not. The capital did not provide the cheapest possible way of running things, which commercial operators care a lot about. There is a profound point underlying his question, and it would be good if we could come back to that on a future occasion.

My noble friend makes a very good point, and I hope that I have made it clear that we are thinking big and long. I mentioned 30 years, but perhaps we should look longer than that. One example is HS2. Whether we like it or not, that is an example of long-term planning—now covering four Governments, because I think it goes back to before 2010 as a concept.

That plays in nicely to my concluding remarks. We are perhaps at an extraordinary moment in this country’s history, as we make our way in the world as global Britain and build back better after Covid-19. This Government’s infrastructure revolution will, as the Prime Minister has previously put it, unleash the productive power of every part of this country and allow us to seize these opportunities with both hands. I have no doubt that the advice and guidance of the NIC will be integral to achieving all this and ultimately to helping us reach new levels of success.

Finally, as the noble Lord, Lord Berkeley, and the report put it,

“bold action, stable plans and long term funding”

are the aims. It is just a question of how we get there.

Sitting suspended.