The credibility of George Osborne’s £310bn plan to boost economic growth by building roads, railways, airports and power stations is thrown into doubt today by MPs.
The Commons Public Accounts Committee accused ministers of being unrealistic over how much private capital could be raised – and warned that consumers could end up shouldering much of the cost through higher rail fare and utility bills.
The criticism came in a report into the National Infrastructure Plan, which was launched by the Chancellor in 2010 and last updated in December. It listed projects costing £310bn, of which £200bn would come from the private sector.
The MPs said: “We are not convinced a plan requiring £310bn of investment in infrastructure is credible given the current economic climate, the cutbacks in public finances and the difficulty in raising private finance for projects on acceptable terms.”
They noted the Treasury said it had prioritised 40 projects, but many were broadly defined and there are actually 200 individual projects “whose relative priority is not clear”.
Their report cautioned that investors would be reluctant to come forward with money “until government policy is clear and consistent”.
Margaret Hodge, the committee’s chairman, said: “The Treasury's Infrastructure Plan is simply a long list of projects requiring huge amounts of money, not a real plan with a strategic vision and clear priorities.
“Most of the £310 billion of investment needed will come from the private sector, with households shouldering the cost through higher energy bills and fares. Family budgets are already badly squeezed and inevitably those on the lowest incomes will be hit hardest. The Government needs to urgently assess the impact on consumers and how this can be contained.”