08. 01. 2020
1 euro today or 5 euros in a year’s time?
By Graham Colclough, Urban DNA
If you’ve got kids or a good memory, you’ll remember the teacher trying to get the message across about the time value of money. And you might remember saying you’ll have the €1 today also – I do! I’m glad that my 7-year-old just got it right though.
The story of resilience decisions can all too often have similar illogical hallmarks. Except that the consequences are perhaps a tad more profound. When city resilience started earning some more serious attention 5-10 years back, the expectations (at least that of the industries that install infrastructures) were that the money might start to flow freely as big infrastructure projects emerged. Alas, that did not prove to be so.
Many cities realised that influencing people could be a cheaper and better substitute than just putting infrastructure in place. Or perhaps some Chief Resilience Officers were finding it dreadfully hard to engage leadership and convince them to spend money today for a potential saving (well at least to mitigate a large future recovery bill) in an uncertain number of years’ time: “in all probability that is, according to this simulation model that we’ve been using”.
Perhaps no surprise then that market actions didn’t work out quite as expected. There’s a good and a bad side to this story. And it’s still far from over yet.
The good news is that we see resilience as a people-business and that we can find solutions that are better for societal wellbeing and that society itself can help get involved with. And of course, it’s handy that with stretched public budgets we are finding a means not to have to spend from the public purse.
The bad news is that we are perhaps rather too unsure that we’re making the wisest investment decisions at the wisest time.
And the story is far from over yet!
What we now almost all unarguably agree with is that the prevalence of and scale of climate change events are increasing at alarming rates. Add to that infrastructure failures from, frankly, often just very tired assets. Or increased levels of public safety concerns from vandalism, unrest, or terrorism. Or a host of other vexing challenges.
So, are city leadership teams in their strive to deliver those rather elusive public value goals, perhaps stimulated with public funds, making informed wise decisions? Or are they relying heavily on intuition and past experiences? And who are those leadership teams? They involve a host of public actors from different tiers of government and different functional areas; and leaders from the core city service providers (often these days commissioned from the private sector); and a variety of other important stakeholders. All with different opinions, motives, capabilities, and budget! That all makes up is complex soup to get things right, or to point fingers when they go wrong.
Such decisions, given the current context, must be taken built around assumptions that are sanguine and appropriately informed by what we are really experiencing in terms of disruption. They must be informed by a far better understanding of the interdependencies that exist across the various operational units of the multiple organisations that sit under the leadership team? And they must exploit the growing capabilities of modern models that better evaluate probabilities, timing, consequences, mitigating factors, and costs.
Building in the good news – capacities and protocols of humans to respond appropriately; together with modern technologies (including ML/AI, IoT etc), combined with a more honest appraisal of the behaviour of city infrastructures and services, we have the opportunity to much better inform our investment decisions.
The thesis we hold to is that there is a whole host more thinking and work to be done to answer the city resilience €1/€5 financial puzzle that we need to get on with well and fast.
At RESCCUE we are wrestling with these complex challenges, and we look forward to sharing what we find and learn with you. Pop 9-10th March in your diary for the URCC (Urban Resilience in a context of Climate Change) conference and come discuss your views.
Or you could just stick with the question of the €1 and the €5!