The government is overspending by around £8 billion a year on taxpayer-funded transport infrastructure schemes, according to a new report.
The analysis found that new road, rail and tram projects in Britain cost 65 per cent more than comparable developments in France, Germany, Italy, Spain, Canada and South Korea.
Researchers said ministers could have saved £42 billion had UK project costs remained in line with those seen in similar countries.
The report argued that, if costs had been kept down, the savings could have helped Britain meet NATO’s target of spending three per cent of GDP on defence without increasing taxes.
It also claimed that Hinkley Point C, Britain’s first new nuclear power station in 30 years, is heading towards becoming the most expensive nuclear plant ever constructed.
Compiled by the think tanks Britain Remade and the Centre for British Progress, the report examined 345 transport projects in 21 countries, covering 121 road schemes and 224 rail and tram developments.
The findings suggest that, despite common assumptions, Britain typically spends more on infrastructure than many of its European peers while receiving less value in return.
A £100 million bat tunnel was built by developers as part of HS2 to shield the animals from high-speed trains
The southern tunnel entrance of the new Lower Thames Crossing linking Kent with Essex
Research found that ministers spent £11.5 million a mile to electrify the Great Western mainline from London to Wales whereas Germany’s electrification cost £2.1 million a mile.
And more than £100 million was invested per mile of track for a new tram link for Manchester – double the cost per mile of similar projects in Paris and Madrid
The report argues that the waste of money does present ‘good news’ for Britain.
It implies that, without spending an extra penny, Britain could vastly improve its public infrastructure by adopting the same processes as those of France, Germany or Spain.
The report said that Britain’s planning and regulatory scheme is time consuming, complex and expensive, with public money wasted on lawyers, consultants and unique design specifications rather than the infrastructure itself.
It cited the Lower Thames Crossing, a planned road tunnel linking Essex and Kent. The planning application for which ran to 359,070 pages, involved around 150 staff, and cost almost £300 million to write.
Even the environmental statement ran more than 12,000 pages.
The full project, 14 miles of road including a 2.6-mile tunnel, is estimated to cost between £9 and £10.6 billion. By comparison, Norway’s Lærdal Tunnel, the longest road tunnel in the world, cost around £140 million
The think tanks also argued that a lack of devolution in the UK has left regions unable to build infrastructure without consulting the Department of Transport and The Treasury.
Other European countries have handed more local power to regions, allowing them to build infrastructure on their own initiative.
The report also highlighted the stop-start nature of UK infrastructure, pointing out that skills learnt and developed through projects such as the Crossrail link in London were often lost because there was no development following it.
The UK has upgraded its rail intermittently, rather than consistently at a steady pace, like Germany.
The report found that, between 2015 and 2023, Britain invested, on average, £308 per person per year on road and rail infrastructure.
This was £37 more than France and £57 more than Germany. However, Britain paid a 65 per cent cost premium for that infrastructure, meaning that for every £1 million spent on infrastructure in European countries Britain needs to spend £1.65 million to get the same amount of rail or road.
Sam Richards, chief executive of campaign group Britain Remade, said although ministers had made some progress in trying to speed up the planning process, there were still significant bureaucratic issues that made it hard to reduce costs.
Hinkley Point C, the first nuclear plant built in Britain in three decades, is on course to be the most expensive ever built
He said organisations such as Natural England still have too much power over planning regulations, adding that developers ‘have still not solved the HS2 bat tunnel problem’.
The tunnel, which cost £100 million, was built as part of HS2 to protect bats from being hit by high speed trains.
Mr Richards warned that it was still too easy for campaigners to use the legal system to tie up projects in endless delays.
He told The Times: ‘We are pouring billions into infrastructure and getting a fraction of what other countries deliver for the same money. This isn’t a funding problem; it’s a failure of the system. Bloated planning rules, endless legal challenges and a culture of delay mean projects take longer, cost more and deliver less. The result is a hidden £42 billion hole where investment goes in but infrastructure never comes out.’
Richard Holden, the shadow transport secretary, said the government was continuing to follow outdated EU rules which meant it was impossible to do things differently.
He said: ‘The last Conservative government passed legislation in 2023 to scrap the EU environmental assessments driving these costs. Two years on Labour has not lifted a finger to implement it and their pursuit of EU alignment will make reform even harder to deliver.’
The Treasury and Department of Transport have been contacted for comment.
