MD2880 Infrastructure Coordination Service Expansion Phase

Infrastructure Coordination Service pilot phase (June 2019 – June 2021)

1.1. London has the potential to plan, programme and deliver its pipeline of infrastructure and development activity in a more coordinated way. With the need to reduce road network congestion, ensure London can respond to the current climate emergency and plan for future growth, senior leaders in the infrastructure sector recognise the GLA as the most appropriate organisation to drive forward this coordination in the capital, given its convening power and its ability to broker agreement between the different parties involved in or affected by infrastructure delivery.

1.2. On the back of a comprehensive business case, the Mayor’s London Infrastructure Group endorsed the creation of a new GLA function – the Infrastructure Coordination Service (ICS) – which launched in June 2019. The establishment of the ICS was approved by the Mayor, under cover of MD2386, to improve planning and delivery of infrastructure and development activity across London, coordinating between infrastructure providers, Transport for London (TfL), boroughs and developers. After securing £2.87m of grant funding from London Lane Rental Scheme Surplus Income, the initial ICS pilot phase ran for two years to June 2021. The pilot phase was composed of three interrelated service lines: Streets, Planning and Development.

1.3. The pilot phase achieved a wide range of results across the three service lines. The Streets Service delivered eight collaborative streetworks projects, saving over 426 days of disruption; achieving £799,000 of cost savings to works promoters; and creating an estimated social value of up to £4.1m. The Planning Service partnered with the London Borough of Tower Hamlets to bring reducing disruption to the heart of local infrastructure planning for the first time, proactively developing infrastructure strategies for the Isle of Dogs to avoid future retrofitting. The Development Service placed infrastructure coordinators in five boroughs to streamline how new developments connect into infrastructure networks, lending support to an initial eight projects.

1.4. Monitoring and evaluation results, along with industry recognition, indicate that the ICS met its objectives during this initial stage, laying the groundwork for increased coordination efforts going forward.

ICS expansion phase (July 2021 – June 2023)

1.5. Based on the pilot phase results, the Mayor’s London Infrastructure Group endorsed a second phase of the ICS to deliver more projects, refine initiatives, and develop a longer-term strategy for the future of the service. The Mayor approved, under cover of MD2735, establishment of the ICS expansion phase with £3.5m grant funding from the London Lane Rental Scheme Surplus Income to cover core expenses. The expansion phase runs from July 2021 to June 2023.

1.6. The expansion phase will roughly double ICS delivery across the three service lines, with additional cross-cutting activities, such as improved data tools and related policy work to support them. The expansion phase will see the team responding to demand by increasing geographic reach to cover additional London boroughs, delivering more projects, refining its services, increasing engagement and embedding collaboration practices within key stakeholder organisations.

1.7. Part of the GLA’s commitment in the expansion phase is to diversify funding sources, securing income streams in addition to core grant funding so that it can meet its ambitious targets. The following three additional sources of funding have been identified to date, totalling up to £880,000:

• subscription fees as a result of the gas sector’s Streetworks Collaboration Incentive (£580,000)
• grant funding from the Regulators’ Pioneer Fund, managed by the Department for Business, Energy and Industrial Strategy (BEIS) (£200,000)
• fees paid to infrastructure coordinators via the Development Service (up to £100,000).

1.8. These additional funding sources will support the activities approved under cover of MD2735, which include: expanding the number and complexity of collaborative streetworks the ICS convenes, including incorporating healthy streets and sustainable drainage improvements; facilitating development of innovative infrastructure strategies in further high-growth areas and at the sub-regional level; creating additional data tools to help utilities and boroughs plan more effectively for growth; and placing more infrastructure coordinators into London’s boroughs.

1.9. It is hoped that the ICS will identify additional funding sources throughout the coming two years to support the Expansion Phase. The delegation of authority to the Executive Director to seek and approve the receipt and expenditure of such third party funding is therefore sought to the extent that such authority is not provided by the General Delegation and Signatory Permission as set out in Mayoral Decision-Making in the GLA.

1.10. This initial effort to diversify funding comes in advance of June 2023, when the expansion phase ends. The ICS is currently developing a plan for a stable and sustainable ICS after June 2023, with the right funding mix, structure and service offer so that it can continue to deliver benefits in the long term.

2.1. As described in MD2735, the ICS expansion phase remains focused on reducing disruption and other adverse effects caused by streetworks, by ensuring the processes of planning and delivering London’s infrastructure and development are efficient and coordinated. Additional objectives include improving air quality; enable housing delivery; and contributing towards achieving net zero carbon emissions in London by 2030. The ICS has already documented significant benefits to a broad range of stakeholders: Londoners, boroughs, TfL, utility companies and developers.

2.2. A key objective of the ICS expansion phase is to embed change within stakeholder organisations so that collaboration during infrastructure planning and delivery becomes business as usual.

2.3. It is already clear, in the early stages of the expansion phase, that industry is undertaking changes as a result of the ICS work programme that are gathering momentum. The additional sources of income relate to these changes in regulation and organisational structures.

Collaborative Streetworks Incentive

2.4. The ICS, in partnership with London’s gas companies Cadent and SGN, worked with energy regulator Ofgem to design an innovative financial incentive that encourages gas companies to undertake collaborative streetworks with water, electricity and digital providers, and other asset owners across London – reducing repeated works and disruption to Londoners.

2.5. The introduction of the incentive in April 2021 has significantly increased gas companies’ appetite to deliver collaborative streetworks; and provided additional funding that the companies can use to pursue these opportunities. Cadent and SGN have recently hired collaboration specialists whose purpose it is to facilitate joint works, engaging regularly with the ICS. These experts are also reviewing ways to change their organisations’ internal processes to facilitate further collaboration, more deeply embedding these ways of working.

2.6. The intention is to establish similar incentives within the electricity and water sectors. Thames Water has already hired its own collaboration specialist even before a water incentive is in place, recognising the benefits that collaboration can bring.

2.7. Industry stakeholders have recognised the ICS as critical to convening collaborations, especially as the numbers scale up. Because the ICS Streets Service identifies, project manages and evaluates collaborative streetworks, which now benefit the gas sector more than other partners that do not receive an incentive (electricity, water and telecoms), the GLA has secured a collaborative streetworks subscription fee from Cadent and SGN as a contribution to the GLA’s costs of activity in this regard. This will ensure fairness across the industry, covering the GLA’s costs to support the gas sector so that core grant funding can be reserved for ICS work that benefits stakeholders equally.

2.8. This additional income will also support enhanced monitoring and evaluation of collaborative streetworks, which the GLA will undertake as a neutral party to confirm to Ofgem the benefits of collaborative schemes, as well as publicising findings more widely to spread best practice.

2.9. The GLA will receive £145,000 a year from Cadent and SGN, generating £580,000 from August 2021 to June 2023.

Regulators’ Pioneer Fund



2.10. In order for Collaborative Streetworks Incentives to be successfully incorporated into the electricity and water sectors, additional research and analysis is required to capture the full range of benefits that joint digging can achieve; ensure the incentives are compatible with one another; and identify the right regulatory levers for this work. The ICS was successful in applying to the Regulators’ Pioneer Fund, managed by BEIS, to explore these topics through a grant of £200,000 for the 2021-22 financial year.

2.11. The project will be undertaken in partnership with Sheffield City Council. Sheffield will help to ensure recommendations proposed by the GLA are applicable to utilities operating more widely than London. This is essential because utilities regulators will only consider changes to regulation that are relevant for the wider industry. Sheffield will help to ensure the work undertaken by the GLA is well placed for regulators to seriously consider implementation in future, allowing this research to achieve the most impact for London.

2.12. The ICS anticipates that any decision by regulators to introduce incentives into additional sectors will continue to increase the number of collaborative streetworks that companies are able to support and wish to undertake, shifting these projects from experimental pilots to long-term workstreams within utilities, and is supporting ongoing discussion and research around these issues.

Development Service income

2.13. The ICS Development Service aims to streamline how developers interface with local infrastructure networks, which can often cause delays to housing delivery. To start, the ICS has embedded infrastructure coordinators into a number of boroughs, where they offer a consultancy-style service to developers to help resolve these issues.

2.14. To date, five infrastructure coordinators have been hired within the boroughs of Croydon, Lambeth, Redbridge, Tower Hamlets and Westminster. These experts have already supported eight projects, which have been welcomed by industry. Boroughs have recognised both the need to unblock infrastructure barriers to housing delivery and the benefits of embedding an infrastructure coordinator. There is now a waiting list of boroughs that would like the ICS to provide them with a coordinator.

2.15. The Development Service was initially established using core grant funding, with the intention that developer fees paid to coordinators would cover their costs in time and allow the ICS to add additional coordinators in new boroughs.

2.16. Now that the existing five coordinators are well embedded and beginning to secure paid developer clients, the ICS will start to receive this income. While the scale is still uncertain, the Development Service is currently seeking approval to receive up to £100,000 in developer fees over the course of the expansion phase. This is a conservative estimate, given £25,000 has already been identified. If the service is successful and fees increase beyond £100,000, the Executive Director for Good Growth would approve additional receipt of funds under delegated authority.

2.17. If the Development Service shows evidence of increasing income to cover costs, additional coordinators will be embedded in further boroughs. If it does not begin to cover its costs as expected, new coordinators will not be hired and the direction of the service will be re-evaluated in June 2022.

3.1. Under section 149 of the Equality Act 2010, the Mayor and GLA are subject to the public sector equality duty and must have due regard to the need to: eliminate unlawful discrimination, harassment and victimisation; advance equality of opportunity between people who share a relevant protected characteristic and those who do not; and foster good relations between people who share a relevant protected characteristic and those who do not.

3.2. The “protected characteristics” are age, disability, gender re-assignment, pregnancy and maternity, race, religion or belief, sex, sexual orientation and marriage/ civil partnership status. The duty involves having appropriate regard to these matters as they apply in the circumstances, including having regard to the need to: remove or minimise any disadvantage suffered by those who share or is connected to a protected characteristic; take steps to meet the different needs of such people; encourage them to participate in public life or in any other activity where their participation is disproportionately low. This can involve treating people with a protected characteristic more favourably than those without one.

3.3. In line with the Mayor’s ambitions, the ICS aims to improve all Londoners’ access to essential services, housing and the city. Reducing disruption on the road network creates benefits like reducing noise and improving air quality, which are particular issues in neighbourhoods with the most vulnerable residents. Streetworks collaborations to date have focused on Tower Hamlets and Hackney, two of the most deprived authorities in England based on the Overall Index of Multiple Deprivation.

3.4. The ICS also plans proactively for high growth areas so that new housing can be delivered without infrastructure challenges becoming a barrier. Building affordable homes for Londoners benefits the most vulnerable, and the focus of this work to date has also been in Tower Hamlets.

3.5. Infrastructure and development works often reduce the accessibility of roads and the public realm, having a negative impact on several groups with protected characteristics. The ICS aims to minimise impacts upon these groups and to actively ensure their needs are considered wherever possible at an early stage of project planning. Reducing the length of time of streetworks by working collaboratively will also help improve accessibility across London. The ICS looks to reinstate roads better than before, with healthy streets interventions that improve the quality of London’s public realm to ensure it caters to the needs of all Londoners, but particularly those with protected characteristics for whom navigating roads is otherwise a challenge.

3.6. The Infrastructure team works with the major stakeholders involved in these activities—London’s utilities—to improve diversity and inclusion in the industry. These companies have committed to four pledges, which include: improved data collection on workforce diversity, inclusion, and wellbeing; and outreach to schools to bring more diverse candidates into the workforce. As a result of this, many utilities companies in London are participating in the WIN Design Lab initiative to bring young black men into work. Efforts like these will continue throughout the expansion phase.

4.1. Risk assessment:

4.2. Links to Mayoral strategies and priorities:

4.3. No one involved in the drafting or clearance of this document has any conflicts of interest to declare.

5.1. Approval is sought for receipt and expenditure of up to £880,000 from the Streetworks Incentive Subscription Fee (£580,000), the Regulators’ Pioneer Fund grant (£200,000), and developer fees (£100,000) via the ICS Development Service.

5.2. Approved project expenditure will occur over the remaining 23-month duration of the phase and span financial years 2021-22 to 2023-24. The profile of spend is detailed below. Note that the table captures only the income outlined in this MD, not the core grant funding for the expansion phase captured in MD2735:

5.3. This work does not require creation of additional posts, because posts to deliver the ICS expansion phase were already created and funded through MD2735.

6.1 The foregoing sections of this report indicate that the decisions requested of the Mayor concern the exercise of the GLA’s general powers, falling within the GLA’s statutory powers to do such things considered to further or that are facilitative of, conducive or incidental to the promotion of social and economic development and wealth creation and improvement of the environment in Greater London; and in formulating the proposals in respect of which a decision is sought, officers have complied with the GLA’s related statutory duties to:

• pay due regard to the principle that there should be equality of opportunity for all people
• consider how the proposals will promote the improvement of health of persons, health inequalities between persons and to contribute towards the achievement of sustainable development in the United Kingdom
• consult with appropriate bodies.

6.2 There are restrictions on the exercise of the GLA’s general powers, to the extent that such exercise involves incurring expenditure on doing anything that may be done by TfL. Those restrictions do not however, prevent the GLA cooperating with, facilitating or coordinating the activities of TfL, which officers have indicated, at section 7.1 of this report, is the case here.

6.3 The Mayor may delegate the exercise of the GLA’s powers to the Executive Director as proposed should he wish.

6.4 The GLA has powers to provide and charge boroughs and other parties with services under the Local Authorities (Goods and Services) Act 1970 and section 93 of the Local Government Act 2003 respectively. Services provided under section 93 of the Local Government Act must be discretionary, i.e., the GLA chooses to but is not obliged by legislation to provide such services, and any charges made for such provision do not exceed the cost of such provision.



6.5 In taking the decisions requested, the Mayor must have due regard to the Public Sector Equality Duty – namely the need to eliminate discrimination, harassment, victimisation and any other conduct prohibited by the Equality Act 2010; and to advance equality of opportunity, and foster good relations, between persons who share a relevant protected characteristic (race, disability, sex, age, sexual orientation, religion or belief, pregnancy and maternity, and gender reassignment) and persons who do not share it (section 149 of the Equality Act 2010). To this end, the Mayor should have particular regard to section 3 of this report.

6.6 Should the Mayor be minded to make the decisions sought, officers must ensure that:

• no reliance is placed upon the receipt of the third-party funding noted until BEIS, SGN and Cadent (and any other third-party funder) are bound legally to the award of such funding and payments of charges to the GLA and the GLA is content that it can comply with the conditions applicable to the same.
• no reliance is placed upon the receipt of ICS sums until it has been confirmed, in accordance with the ICS contracts, that boroughs have generated developer fees to such level as obliges them legally to provide such sums
• to the extent that the GLA is the accountable body for the BEIS Regulators’ Pioneer Fund, that an appropriate agreement is entered into between and executed by the GLA and Sheffield City Council that protects the GLA’s interests (also taking into account the GLA’s duties to BEIS) before any commitment to the award of funding to Sheffield City Council is made
• any other third-party funding is sought in accordance with the GLA’s statutory powers and sponsorship policy where applicable.
  

7.1. The ICS expansion phase planned delivery approach is captured in MD2735, including the creation of new roles to support this work, a key decision point to determine the future of the ICS in December 2022, and collaboration with TfL. Roles have since been filled and expansion phase activities commenced in July 2021 as anticipated.

7.2. The Regulator Pioneers’ Fund is a discrete piece of work that will be managed by the ICS Planning Service, through initial scoping, procurement, delivery, monitoring and evaluation, to be complete before 1 April 2022.

7.3. The Incentive Subscription Fee is additional funding toward existing workstreams already laid out in the previous MD. The ICS Streets Service project manages a regular programme of identification, viability, procurement, delivery and evaluation to deliver collaborative streetworks.

7.4. The receipt of Development Service fees does not alter the existing delivery plan through to June 2022, since fees will cover the salaries of the existing five infrastructure coordinators already in post. In June 2022, the ICS will determine whether the scale of income being generated warrants bringing onboard additional coordinators, or whether the service offer needs to be re-evaluated. Note that there is an intention to extend the ICS Development Lead post to June 2023 to manage these activities through the end of the expansion phase.

7.5. These timelines are captured below: