What Kwateng Said on Investment Zones – and What he Implied- His Speech -Environmental Regulations Will be Stremlined not Scrapped -The Growth Plan – EU Regs will be ‘dissapplied’ New Bill Coming on This

Treasury Blue Book Growth plan

Accelerated development – there will be designated development sites to deliver growth and
housing. Where planning applications are already in flight, they will be streamlined and we will work
with sites to understand what specific measures are needed to unlock growth, including disapplying
legacy EU red tape where appropriate.
Development sites may be co-located with, or separate to, tax
sites, depending on what makes most sense for the local economy.

Err not in his speech

Which said

New Investment Zones will bring business investment and release land for new homes in communities across the country. And we’re accelerating new road, rail and energy projects by removing restrictions that have slowed down progress for too long.

It was also confirmed that the government is in discussion with 38 local and mayoral combined authority areas in England including Tees Valley, South Yorkshire and West of England to set up Investment Zones in specific sites within their area. Each Investment Zone will offer generous, targeted and time limited tax cuts for businesses and liberalised planning rules to release more land for housing and commercial development. These will be hubs for growth, encouraging investment in new shopping centres, restaurants, apartments and offices, and creating thriving new communities.

In a further move to grow the economy, the Chancellor announced plans to accelerate new roads, rail and energy infrastructure. In 2021 it took 65 per cent longer to get consent for major infrastructure projects than in 2012. New legislation will cut barriers and restrictions, making it quicker to plan and build new roads, speeding up the deployment of energy infrastructure like offshore wind farms and streamlining environmental assessments and regulations.

Note a dramatic shift in tone since mid week – perhaps they read my blog that it was impratical – nah just made sure did not make headlines by burying it hopeing stupid jounos didnt spot it and made headlines So not quite streamlinuing the regs (the Grove Plan) not scapping them (the silly Truss plan, already her first u turn for the Iron Weathervane, no facing all ways at once- Trus turns and spins but she doesnt u-turn as she is always and forver right (and left and up at down all at once) but then the real policy not annouced in parliament talks about ‘dissaplying them’ which will require a new bill as is unlawful

However the Guardian reported the speech said

Addressing planning, Kwarteng says the system is too slow.

The government will bring forward a bill “to unpick the complex patchwork of planning restrictions and EU derived laws that constrain our growth”.

Not unpick not scrap or dissplay – note the langayuge three contradictory statements on the Habitate Regs. The Iron Weathervane turns to face all directions at once.

The Guardian Report

Planning changes under consideration are thought to include removing restrictions on height limits and potentially ditching requirements for affordable housing alongside developments, as well as other regulations such as environmental rules.

In a sign of the breakneck pace at which sweeping new measures are being introduced, the Treasury said it was unable to provide details of how much they would cost because “full details on implementation are yet to be determined”.

Earlier they Said

The provision of affordable housing as part of wider construction projects could be ditched under plans being considered by ministers to deregulate the planning system in about a dozen “investment zones”.

Sources said the controversial move was being contemplated ahead of a mini-budget by the chancellor, Kwasi Kwarteng, on Friday outlining the government’s growth strategy and promised tax cuts.

Swathes of environmental and planning regulations are expected to be ditched to “drive growth and speed up development” in the first batch of roughly 12 investment zones.

The zones are modelled on freeports, and are meant to encourage more business investment by granting firms tax relief and cutting red tape.

The prime minister, Liz Truss, mooted the idea during her leadership campaign, saying it would help with her plans to “unleash investment and boost economic growth right across the country”.

Councils began expressing interest in applying to become investment zones this week and Kwarteng hopes to be able to point to the uptake as proof of the policy’s popularity in his speech to the House of Commons later this week, insiders said.

A letter from the levelling up department sent to local authorities and seen by the Guardian said that one of the main benefits of becoming an investment zone would be “designated planning sites to build for growth and housing”.

It added: “Where planning applications remain necessary, they will be radically streamlined. Planning sites may be co-located with, or separate to, tax sites, depending on what makes most sense for the local economy.”

While each deal will be bespoke, local authorities granted investment zone status may be able to let developers circumvent requirements for affordable housing to be built alongside any proposed new property, according to government sources.

And planning obligations like section 106 agreements, which require developers to mitigate pressure on the local area by building or paying for additional infrastructure projects in exchange for planning permission, could also be scaled back in the first batch of investment zones.

Growth Plan Factsheet on Investment Zones

Notably on Treasury Website not DLUC

A key issue here is two tier authorities where Counties will lead but apart from minerals and waste are not the LPA, so how will it work?

The perverse incentive against designation in terms of business rates seems fixed, but how will this work in two tier.

Investment Zones will drive growth and unlock housing across the UK by lowering taxes and liberalising planning frameworks to encourage rapid development and business investment. I emboldened a few key points for planning.

They also seem to have partially dientangled the mess of mixing up Freeports with Special Economic Zones (to use the international term), the former being outside a customs zone to allow customs free entrepot (import manufacture customs free reexport), the latter being tax induced new large employment areas targeted at global firms and inward investors.

Final Thought – perverse incentive for Data Centres pushing out housing. They need to be exempt from capital and business rate allowances.

Where will they be?

We are in discussions with 38 local authorities to establish investment zones in England and intend to work closely with the devolved administrations and local partners to deliver this opportunity to drive local growth in Scotland, Wales and Northern Ireland.

How will they work?

Areas hosting Investment Zones will benefit from:

  • Lower taxes – businesses in designated sites will benefit from time-limited tax benefits.
  • Accelerated development – there will be designated development sites to both release more land for housing and commercial development, and to support accelerated development. The need for planning applications will be minimised and where planning applications remain necessary, they will be radically streamlined. Development sites may be co-located with, or separate to, tax sites, depending on what makes most sense for the local economy.
  • Wider support for local growth – subject to demonstrating readiness, Mayoral Combined Authorities hosting Investment Zones will receive a single local growth settlement in the next Spending Review period.

When will they be set up?

In England, the Government will deliver Investment Zones in partnership with Upper Tier Local Authorities and Mayoral Combined Authorities.

In Scotland, Wales and Northern Ireland, Investment Zones will be delivered in partnership with Devolved Administrations and local partners.

The Secretary of State for the Department for Levelling Up, Housing and Communities will shortly set out the selection criteria to become an Investment Zone, and the process for designating sites within it.

Who decides where they are?

We have written to local leaders in every part of England to invite them to begin discussions with government to agree Investment Zone(s) in that area. The areas announced today are the areas keen to be involved now, with more to come.

We intend to work with the devolved administrations and other local partners to deliver Investment Zones across all parts of the UK as quickly as possible.

How will they grow the economy?

The Investment Zones tax offer will be carefully designed to encourage investment and new economic activity, supporting growth and jobs.

In addition to the tax offer, planning flexibilities will remove a significant barrier to economic growth, and together tax and planning flexibilities will enable businesses to benefit from the positive effects of co-locating (also known as “agglomeration effects”).

The Freeports programme has already shown how targeted tax reliefs and support can bring together the public and private sector to begin to transform areas in need of levelling up.

What are the tax benefits?

Businesses in designated areas in investment zones will benefit from 100% business rates relief on newly occupied and expanded premises. Local authorities hosting Investment Zones will receive 100% of the business rates growth above an agreed baseline in designated sites for 25 years.

In addition businesses will receive full stamp duty land tax relief on land bought for commercial or residential development and a zero rate for Employer National Insurance contributions on new employee earnings up to £50,270 per year.

To incentivise investment there will be a 100% first year enhanced capital allowance relief for plant and machinery used within designated sites and accelerated Enhanced Structures and Buildings Allowance relief of 20% per year.

When will you provide more detail on the planning changes?

We will set out further detail on the liberalised planning offer for Investment Zones in due course.

Where are the 38 local authorities?

  • Blackpool Council
  • Bedford Borough Council
  • Central Bedfordshire Council
  • Cheshire West and Chester Council
  • Cornwall Council
  • Cumbria County Council
  • Derbyshire County Council
  • Dorset Council
  • East Riding of Yorkshire Council
  • Essex County Council
  • Greater London Authority
  • Gloucestershire County Council
  • Greater Manchester Combined Authority
  • Hull City Council
  • Kent County Council
  • Lancashire County Council
  • Leicestershire County Council
  • Liverpool City Region
  • North East Lincolnshire Council
  • North Lincolnshire Council
  • Norfolk County Council
  • North of Tyne Combined Authority
  • North Yorkshire County Council
  • Nottinghamshire County Council
  • Plymouth City Council
  • Somerset County Council
  • Southampton City Council
  • Southend-on-Sea City Council
  • Staffordshire County Council
  • Stoke-on-Trent City Council
  • Suffolk County Council
  • Sunderland City Council
  • South Yorkshire Combined Authority
  • Tees Valley Combined Authority
  • Warwickshire County Council
  • West of England Combined Authority
  • West Midlands Combined Authority
  • West Yorkshire Combined Authority