Nothing ventured

Universities should seriously consider government offers to guarantee infrastructure projects, writes Edward Sunderland.

Infrastructure spending is high fashion and big politics. In his recently updated national infrastructure plan, George Osborne was eager to highlight some of the projects that the coalition government proposes to support: a new garden city at Bicester, transport upgrades and a new campus development at the Queen Elizabeth Olympic Park in east London. Yet despite the welcome £141 million awarded to support the east London campus, the lion’s share of funding is going to energy and transport. Why? Is higher education less attractive or are universities failing to make the most of the support on offer?

Certainly some are availing themselves of the opportunity. In November the University of Northampton confirmed that it had obtained full government support for its campus development. The proposed waterside campus is more than just an educational project and ticks a number of additional boxes including urban regeneration and job creation. For a chancellor wanting to prove he could spend, not just slash, this is manna from heaven and ready-made for the coalition’s £40 billion UK Guarantees scheme, whereby the government has agreed to underwrite spending on British infrastructure projects in order to kickstart those that could otherwise stall. As a result, a subsidiary company of the university has been able to issue £231 million of publicly listed bonds and borrow £60 million from local authorities, all guaranteed by the government.