‘Growth Plan’: Chancellor eyes streamlined planning process for offshore wind, homes and roads

Kwasi Kwarteng is expected to ditch green planning rules and accelerate the development process for new offshore wind farms, roads and homes, as he sets his sights on “a new era for Britain” driven by a laser-like focus on growth in his first major financial intervention as Chancellor tomorrow.

The Chancellor is expected to announce a flurry of fresh fiscal and planning policies in his so-called mini-Budget tomorrow, in response to inflation which has risen to its highest level in almost four decades, prompting growing concern about the risks of the UK economy dipping into recession in the coming months.

The global economy has been rocked by the impacts of the Covid-19 pandemic, which has also been exacerbated by soaring fossil gas energy prices and Russia’s war in Ukraine, as well as rising food costs and devastating climate impacts worldwide.

In order to drive up growth and investment, Kwarteng is expected to announce plans for new legislation to speed up the delivery of around 100 major infrastructure projects across the UK, prioritising schemes across transport, energy and digital infrastructure.

These priority project areas are heavily tipped to include offshore wind farms, nuclear power plants, and new roads.

In addition, plans to “reduce the burden” of environmental regulations in planning rules and establish 38 new low tax ‘Innovation Zones’ in England to encourage business investment are also expected to be unveiled.

They are set to form part of a major package of over 30 measures being announced by Kwarteng tomorrow – dubbed ‘the Growth Plan’ – which is aimed at tackling soaring energy bills, bringing down inflation and cutting taxes, the Treasury said.

It follows plans announced yesterday by the government to lift the ban on fracking in England, hand out further oil and gas licenses in the North Sea, and to scale back hundreds of regulations and laws originally derived from the EU by the end of next year, all of which prompted ire from green groups. Other policies expected tomorrow include cuts to stamp duty and national insurance payments.

Such moves follow through on repeated promises made by Liz Truss during her successful bid to become Prime Minister over the summer to cut taxes and regulations in order to spur growth, despite concerns from her opponent and former Chancellor Rishi Sunak that reducing taxes too soon could drive up inflation as the UK stares down the barrel of a potential recession.

Kwarteng, however, is expected to argue tomorrow that the UK needs “a new approach for a new era focused on growth”, and that reducing taxes, cutting regulations, accelerating infrastructure projects and establishing 38 new Investment Zones across England would “turn the vicious cycle of stagnation into a virtuous cycle of growth”.

“That is how we will deliver higher wages, greater opportunities and sufficient revenue to fund our public services, now and into the future,” he is expected to say. “We will be bold and unashamed in pursuing growth – even where that means taking difficult decisions. The work of delivery begins today.”

As part of the Growth Plan, the Treasury said it was currently in discussions with 38 local and mayoral combined authority areas in England – including West Midlands, Tees Valley, Somerset and Hull – to set up new Investment Zones, or hubs for growth, in specific sites within their area.

These zones are each to be offered targeted and time-limited tax cuts for businesses, in a move the government believes could boost productivity and create jobs by encouraging investment in new infrastructure and services.

Crucially, too, these areas are expected to be further given liberalised planning rules – including reforms to environmental regulations – in order to release more land for housing and commercial buildings in addition to speeding up development, according to the Treasury.

Green groups earlier hit out at potential reforms to environmental and planning regulations, which they warned to lead to critical environmental and habitats regulations being ditched, while disincentivising housebuilders from building greener homes.

But the government insisted that Investment Zones would only be established with support from local councils, and that it would work together closely with areas to “develop tailored proposals that support their ambitions and deliver benefits for local residents”.

Kwarteng is expected to argue tomorrow that building homes and infrastructure in the UK is “getting slower, not quicker”, and that targeted action is needed to drive growth be releasing land and accelerating development.

The Treasury pointed out that last year it took 65 per cent longer to get consent for major infrastructure projects compared to 2012, and that no new nuclear power stations have been built in the UK since 1995.

It also specifically highlighted the length of time taken to secure planning consent for new roads, and that the 1.8GW Norfolk Vanguard offshore wind farm took almost four years to go through only the planning stages, before then also facing legal challenges that set back the project by a further year.

But the Treasury is expected to argue that in order to accelerate crucial offshore wind, nuclear power, roads, railways, housebuilding and other significant homes and infrastructure, there is a need to “reduce the burden” of environmental assessments in the consultation process and reform habitats and species regulations.

“We will liberalise planning rules in specified agreed sites, releasing land and accelerating development,” Kwarteng is expected to say. “And we will cut taxes, with businesses in designated sites enjoying the benefit of generous tax reliefs.”

However, plans to cut back on environmental regulations are unlikely to find favour among green groups, while green business organisations have long been calling for stronger government intervention through investment and robust policies to support more renewables capacity and energy efficiency measures, neither of which are expected to emerge tomorrow.

Friends of the Earth’s head of policy, Mike Childs, described the Chancellor’s trailed announcements from tomorrow’s mini-Budget speech tomorrow as signalling “yet another lost opportunity” to insulate homes and scale up renewables in order to reduce demand for expensive risky gas.

Plans to weaken environmental standards are also “deeply worrying”, he said. 

“The Chancellor is treating economic growth and environmental protection as mutually exclusive, but they’re not,” he said. “It’s this tired thinking that is driving the energy, climate and ecological crises we’re facing. We really needed this budget to ease the cost-of-living emergency, restore nature and cut the emissions that cause climate change, but it totally fails on all counts.”

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