Autumn Budget: it’s crunch time for the Infrastructure Pipeline

The government’s Infrastructure Pipeline is its most prized possession and essential to economic growth. BCIS data services director, Karl Horton, explains why it must not be forgotten in Budget month.

Autumn Budget: it’s crunch time for the Infrastructure Pipeline

One of the greatest Budget gifts the Chancellor could give is to stand by the government’s infrastructure commitments. With a public purse in need of some serious TLC, finding the funds to get projects off the ground won’t be easy, but this, and padding out the fine print on private finance models, are essential for building confidence and growth.

Things on the infrastructure front are looking up, and the Budget should be used to continue this momentum. Insight from the latest BCIS Civil Engineering Tender Price Index Panel revealed a healthy infrastructure pipeline in 3Q2025.

Work in the aviation, rail and water sectors are creating demand, with panellists citing the positive clarity that recent government announcements (i.e. Gatwick Airport’s expansion) have provided on long-term investment.

Labour availability remains a pinch point but with better visibility over the Infrastructure Pipeline and funding, contractors can plan further in advance and with more certainty.

The question is when this visibility will become available.

In a briefing paper on the structural and operational barriers to infrastructure delivery, the Institution for Civil Engineers (ICE) underlined poor investment sentiment toward the UK as one of the main pinch points⁽¹⁾.

It nods to the latest pulse survey from the Global Infrastructure Investor Association (GIIA), which showed the UK struggled to attract positive investor sentiment in the first half of 2025⁽²⁾.

The then-absence of the 10-Year Infrastructure Strategy and associated pipeline were certainly contributing factors, but so too was and is the draw of more appetising investment conditions internationally.

In 2Q2025, the UK’s unattractive regulatory environment and the lack of clarity provided on private finance models were rated as the biggest barriers to investment by GIIA survey respondents.

While barrier scores for the UK were down on all counts on 4Q2024, the ratings for regulatory and funding model performance were the highest recorded across the sample, which included the US and EU.

Global competition for private investment is fierce and the UK’s reputation for stop/start infrastructure projects and budget overruns continue to undermine its ability to contend.

Counterparts like France, Germany, the Netherlands and the Nordic countries have the advantage with healthier tax environments, better regulatory conditions and fully-fledged commitments to big, economic infrastructure programmes – for instance, the German-Dutch-Danish North Sea Wind Power Hub.

With a 10-year Infrastructure Pipeline now in tow, the UK’s investment ship is looking steadier and more likely to attract interest in H2.

The turning point, however, will be the extent to which the government delivers in and around Budget month.

It’s been fairly cloak and dagger on its approach to private finance models and has only pledged a decision on public-private partnerships (PPPs) by the time of the Budget.

This will be based on the ‘co-development’ of a model and business case between the National Infrastructure and Service Transformation Authority (NISTA) and relevant departments.

However, distant promises are not enough to cement the UK’s place on investors’ radars.

What’s needed is the intended approach to private finance models (or new plan of attack for private finance initiatives [PFIs]) in black and white, ideally with models assigned to each relevant project in the Infrastructure Pipeline.

The government is not going into this blind.

In September, the Association of Infrastructure Investors in Public Private Partnerships (AIIP) published a framework to help policymakers understand the shortcomings of past private finance models and to develop solutions for sustainable infrastructure delivery⁽³⁾.

The guide identifies all the usual suspects and more as key challenges – high bid costs, risk transfer, contractual rigidity – and proposes answers, from redesigning the PFI model to break down the unitary charge and improve risk sharing, to introducing ‘pit stops’ to renegotiate project scope, standards and technology, where required.

Together, the measures call for a new generation of PPPs, one led by pipeline clarity and market confidence, contractual flexibility, high operational performance and fair risk allocation. This must be underpinned by the consolidation of assets’ performance data along with robust, reliable cost data to inform better decision-making.

All the puzzle pieces (primarily lessons learned from past PFIs) are already available.

It’s down to the government and NISTA to rearrange them – and quickly.

The next update to the Infrastructure Pipeline, due in early 2026, will hopefully bring more financial clarity, but this seems too late.

The government is already in its second year and a political shake-up in 2029 might spell disruption for Labour’s infrastructure strategy.

If the government plays its tax cards right, gets its skates on with planning reform and confirms private finance models sooner, Budget month could be transformative for kickstarting infrastructure delivery, and supporting the wider economy, in the near-term.

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^{(1) ICE – ICE Next Steps Programme: What are the pinch points to delivering on the UK’s infrastructure ambitions? – here}

^{(2) GIIA – Q2 2025 Pulse Survey reveals latest trends in the attractiveness of core markets to investors– here}

^{(3) AIIP – NHS and public sector missing billions in capital investment – here}