Budget 2011 and Environmental Taxes

Written evidence submitted by the Campaign to Protect Rural England

Executive Summary

1. The Campaign to Protect Rural England (CPRE) is concerned that the proposals set out in The Plan for Growth, which was published alongside the 2011 Budget, are incompatible with commitments set out in the Coalition Agreement that the Government will be the ‘greenest ever’ and will ‘radically reform the planning system to give neighbourhoods far more ability to determine the shape of the places in which their inhabitants live.’

2. In its inquiry into the environmental impact of the Budget we suggest that the committee considers how the Government will deliver on these promises, particularly in relation to the following points:

· Recognition of the critical role of planning in delivering long term, sustainable economic growth while also promoting environmental and social goods must not be lost in a rhetoric of the planning system as a ‘barrier to growth’;

· Any presumption in favour of sustainable development must be based on a sound definition of ‘sustainable development’, and this presumption must not override the plan-led system of development;

· The commitment to continued protection of the Green Belt and Areas of Outstanding Natural Beauty (AONBs) is welcome. The abolition of the target for housing development on previously-developed land, however, combined with incentives for development that do not favour quality and need, could seriously undermine protection of non-designated, yet still valued, green space;

· The Budget implies that the role of the planning system is to deliver jobs and economic growth. It is unclear how this can be reconciled with its role of economic, environmental and social objectives.


3. CPRE welcomes the opportunity to submit evidence to the Environmental Audit Committee’s inquiry into the Budget 2011 and Green Taxes. As a leading environmental charity, we have worked to promote and protect the beauty, tranquillity and diversity of rural England by encouraging the sustainable use of land and other natural resources since our formation in 1926.

4. CPRE champions the role of planning in protecting the environment while securing appropriate development and effective local involvement. We welcomed the Coalition’s original aspirations for planning reform, which recognised the importance of involving people in local decision-making, but are deeply concerned by the package of planning reforms announced in the Budget, which suggest that some in Government have a confused view of the role and value of the planning system.

How policy proposals in The Plan for Growth will affect sustainable development and environmental protection

5. CPRE believes that, to be sustainable, future economic growth must remain within environmental limits, acknowledging that natural resources including land and landscape are finite. We welcome therefore the commitment included in The Plan for Growth to the continued protection of Green Belt land and AONBs.

6. This commitment was accompanied, however, by a series of statements that threaten seriously to undermine the ability of planning decision-makers to take into account environmental and social considerations as well as economic ones. CPRE believes that these statements arise from the misconception, articulated repeatedly throughout the Budget speech itself and the accompanying literature, that the planning system acts as a barrier to economic growth.

7. For example, a Written Ministerial Statement by the Minister for Decentralisation, Greg Clark MP, published on 23 March, stated ‘there is a pressing need to ensure that the planning system does everything it can to help secure a swift return to economic growth’. This statement represents a fundamental shift from the planning system as a mediator between economic, environmental and social priorities to one focused on delivering economic growth alone. And such a shift is contrary to existing planning legislation which states that the objective of the planning system is to contribute to achieving sustainable development [1] . Much about the ongoing reform of the planning system is still to be clarified by the Government, and we recommend that the Committee considers how the environmental objectives of planning are not lost in a push for short term, unsustainable economic growth.

8. CPRE believes that, on the contrary, for over sixty years the planning system has operated as a democratic process that advances public, not sectional, interests by mediating between different aims; local and national, economic, environmental and social, short-term and long-term. In doing so the planning system has successfully delivered sustainable development. It has played a crucial role in protecting the countryside from inappropriate development and in securing the holistic regeneration of urban areas.

9. The Budget proposes that to resolve the, we believe misconceived, ‘problem’ of an overly obstructive planning system, the Government will ‘introduce a new presumption in favour of sustainable development, so that the default answer to development is ‘yes’’. CPRE welcomes the qualification that this development must be sustainable. We suggest therefore that to provide greater certainty for all, and to identify the common goal towards which all participants in the planning process should be working, the Committee should reiterate the recommendation made in its recent short report, Sustainable Development in the Localism Bill , and recommend to Government that it enshrines in the Bill a short definition of sustainable development using the principles set out in the UK Sustainable Development Strategy. These principles are:

i. living within environmental limits;

ii. ensuring a strong, healthy and just society;

iii. achieving a sustainable economy;

iv. promoting good governance; and

v. using sound science responsibly.

10. Even a sound definition of sustainable development must not override the presumption in favour of the development plan that is currently defined by planning legislation [2] . This presumption allows for a ‘plan, monitor, manage’ approach to development, meaning that development is delivered in response to evidence of need. Such a strategic approach protects the countryside from ad hoc, unnecessary and unsustainable development. We recommend that the Committee explores how a sound presumption in favour of sustainable development could be reconciled with the established plan-led system of development.

11. The Budget also included the abolition of a national target for the proportion of new housing to be delivered on previously-developed land. The justification for the abolition of this target, as included in The Plan for Growth, is that it has ‘helped to drive up land prices in certain areas and would increasingly limit the supply of new housing, which would harm first time buyers in particular’.

12. CPRE believes that one of the biggest environmental successes of recent years has been the regeneration of many of our urban areas due to development being targeted towards ‘brownfield’ sites, and that this has also protected vast swathes of countryside from unnecessary development. As a result of the previously-developed land target introduced to Planning Policy Statement 3: Housing (PPS3) by the previous Labour Government 80% of new homes built in 2009 were on previously-developed land. This is as opposed to 56% on previously-developed land in 1997.

13. CPRE believes that the loss of a target for development on previously-developed land, combined with the use of incentives to encourage development regardless of quality or need, could seriously undermine the ability of the planning system to direct the right kind of development to the right places, with potentially seriously damaging consequences for the countryside.

14. While the commitment in the Budget to the continued protection of the Green Belt and AONBs by the planning system is to be welcomed, CPRE is extremely concerned about the level of protection that will be afforded to non-designated green space in the wake of the abolition of the previously-developed land target and the implementation of development incentives. This ‘ordinary’ countryside makes a profound difference to well-being and must not be disregarded. While supporting the inclusion of empty home refurbishments within the scope of the New Homes Bonus incentives scheme, we strongly question whether the Government’s policies are strong enough to promote urban regeneration and a brownfield first approach to development.

The impact of the taxation system in general on sustainable development

15. In particular, we would have welcomed some consideration of equalisation of VAT on house refurbishments and new build. Such a change, we believe, would provide a significant fiscal incentive for both individuals and business to invest in bringing empty homes back into use, and thereby complement the New Homes Bonus, which is not weighted towards rewarding environmentally sensitive house building. In place of fiscal incentives, we look to the forthcoming National Planning Policy Framework to give clear guidance to local authorities that they should prioritise refurbishment of existing empty dwellings and development on brownfield sites.


16. CPRE recommends that, in considering all of the issues described above, the Environmental Audit Committee addresses in particular how contradictions in commitments to environmental health, economic growth, local involvement in planning and the perpetuation of a plan-led system of development might be reconciled.

20 April 2011

[1] S.39 Planning and Compulsory Purchase Act 2004

[2] S.38 Planning and Compulsory Purchase Act 2004