Government scraps Planning Gain Supplement

RESPONDING to the Government’s latest Comprehensive Spending Review, the Quarry Products Association (QPA) has welcomed the news that the Treasury will not be going ahead with the proposed Planning Gain Supplement (PGS), thus avoiding what could have resulted in huge costs for the quarrying industry when securing new permissions.

In close liaison with the CBI Minerals Group and the Construction Products Association, the QPA had argued vociferously against the PGS tax proposals, which it said did not take into account the stark differences between minerals development and other forms of development, particularly housing.

However, the battle may not yet be over, as scrapping of the PGS has opened the door for a proposed new system of planning charges, which would apply to residential and commercial development. This would be delivered through the planning system, as opposed to national taxation, and would also be linked to the Local Development Framework process.

The QPA says at this stage it is not clear whether aggregates and mineral operations qualify as commercial development and that the lack of detailed guidance means that the industry remains cautious about the new system.

The Association plans to meet with DCLG representatives and says it will continue press the Department to ensure that minerals will be exempt from the scope of the new system.

The QPA’s director general, Simon van der Byl, commented: ‘Kate Barker’s original recommendation to levy for a proportion of land value uplift through the planning process clearly had residential development very much in mind. In the light of the new proposals, the QPA will continue to seek clarification on the scope of the system and work to ensure that mineral operations are exempt. Above all, we will seek to guarantee that the new system will not unnecessarily constrain the need for an adequate and steady supply of aggregates for the UK construction industry.’

The Construction Products Association also gave a cautious welcome to the Comprehensive Spending Review. Allan Wilen, economics director at the CPA, said: ‘We are pleased that the Chancellor appears to have listened to the construction products industry and taken action on key programme areas where previous investment has been slow to come into effect.

‘We are particularly encouraged by the long-term commitment to improve the transport infrastructure, raising investment by 2.25% in real terms every year until 2018/19. Given this commitment, the Department for Transport should now publish a clear investment strategy for the road and rail systems that will tackle congestion and safeguard the UK’s competitiveness.’