The UK Regulators Network (UKRN) and the Global Infrastructure Investor Association (GIIA) discussed the role of independent economic regulation in supporting investment and fostering economic growth. Key points include:
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UK's Attractiveness for Infrastructure Investment
- Views on the UK's overall attractiveness for infrastructure investment vary, but there is broad agreement on its long-term strengths, such as its legal and regulatory system and the Regulated Capital Value model.
- Factors affecting current investor sentiment include political instability, experiences in the water sector, and increased politicisation of regulated utilities. However, the UK's inherent strengths are recognised, and competitors have modernised their frameworks, necessitating a shift in perception.
- The UK government's focus on growth and infrastructure investment is seen as positive, with consistency and engagement being key to maintaining competitiveness.
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Opportunities to Improve the UK Regulatory System
- Independent regulation is valued for stability and fair market access, but improvements are needed, such as simplifying regulators' duties, ensuring consistency in appeals processes across sectors, and streamlining administrative processes.
- Strategic steers from the government can help regulators balance their duties more effectively, with focused guidance being more effective than broad support areas.
- These opportunities align with recommendations from Fingleton's GIIA report on regulatory change to drive UK growth.
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Collaboration Between Investors and Regulators
- Despite differing views on individual decisions, there is strong alignment in long-term objectives among the government, regulators, and investors.
- The regulatory process's complexity hinders investor engagement, necessitating more opportunities for dialogue to address common problems and share views.
Overall, the report highlights the importance of a balanced and adaptive regulatory approach to enhance the UK's appeal to international investors and support sustainable economic growth.
