Why Does UK Infrastructure Cost So Much?

This Insights Paper by Professor Graham Winch of The Productivity Institute examines the long-term drivers of UK infrastructure costs and how they compare internationally.

Drawing on over three decades of comparative research, macroeconomic productivity analysis, and evidence from major project datasets, Winch assesses both project delivery and project shaping performance. He finds no systematic UK disadvantage in delivery, but identifies a broader structural challenge shared with other advanced economies: infrastructure costs have been rising faster than general inflation since around 1970.

The paper explores the drivers behind this trend, particularly weak productivity growth in construction (the Baumol effect) and the growing influence of citizen voice through regulation and stakeholder engagement, and sets out implications for policy, owner capability and long-term investment strategy.