Dozens of ‘investment zones’ to benefit from tax cuts and speedier planning rules

·3-min read
Kwasi Kwarteng is expected to announce the plans when he sets out his mini budget on Friday - Rob Pinney
Kwasi Kwarteng is expected to announce the plans when he sets out his mini budget on Friday - Rob Pinney

The Chancellor will announce plans on Friday to establish up to 38 “investment zones” across England which will benefit from tax cuts and speedier planning rules.

Kwasi Kwarteng will tell MPs he is in talks with authorities in places as diverse as the West Midlands, Tees Valley, Somerset and Hull to set up the new zones.

Each zone will offer generous, targeted and time-limited tax cuts for businesses, backing them to increase productivity and create new jobs.

This could encourage investment in new shopping centres, restaurants, apartments and offices – creating thriving new communities.

These areas will also benefit from further liberalised planning rules to release more land for housing and commercial development, and reforms to increase the speed of delivering development.

Mr Kwarteng will tell MPs: “The time it takes to get consent for nationally significant projects is getting slower, not quicker, while our international competitors forge ahead. We have to end this.

“To support growth right across the country, we need to go further, with targeted action in local areas.

“We will liberalise planning rules in specified agreed sites, releasing land and accelerating development.

“And we will cut taxes, with businesses in designated sites enjoying the benefit of generous tax reliefs.”

The Chancellor will promise reforms to environmental regulation and streamlined local and national planning policies, such as removing height restrictions on development, so that investment zones can bring forward more development – including housing and commercial sites – at the pace needed to boost growth.

The Treasury wants time-consuming negotiations between councils and developers for each project over affordable housing contributions to be scrapped. This will be replaced with a set percentage of affordable homes, whilst ensuring communities get the infrastructure they want and need.

Investment zones will only be established with support from local leaders. The Government will work closely with areas to develop tailored proposals that support their ambitions and deliver benefits for local residents.

Mr Kwarteng will also set out an ambitious package of measures, including new legislation, to accelerate the delivery of around 100 major infrastructure projects across the country.

Mini-budget to set out priority infrastructure projects

His mini-budget will also sets out the infrastructure projects that the Government will prioritise for acceleration, across transport, energy, and digital infrastructure.

In 2021 it took 65 per cent longer to get consent for major infrastructure projects than in 2012, with not a single new nuclear-power station finished since 1995.

The development, consultation and consent for a large road scheme takes an average of five to seven years, while some offshore wind farms can take up to 13 years from development to deployment and other projects require 34,000 pages of documentation.

The Norfolk Vanguard wind farm, a 1.8GW-wind farm project located off the coast of Norfolk that will power almost two million homes, took almost four years to go through just the planning stages and faced a legal challenge over the visual impact of the scheme delaying the development consent by a further year.

The Junction 10A of the M20, an international route which is used by large volumes of heavy goods and holiday traffic, took seven and a half years from the review of the preferred scheme to be granted planning permission due to delays in the planning system.