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Lord Gisborough: My Lords, about a fortnight ago I was in Wharfedale. I am sure that there can be few finer places to walk. There I saw some old scars on the hillside which had obviously been made many years before and had been left as eyesores. It is interesting to compare those scars with the results of more modern quarrying. Very often the replaced quarry looks better than the original site.

What is required to achieve good environmental standards without threatening the quarry industry, which is so important, with what amounts to retrospective compensation? I am sure that there is a way but I do not think it is the way set out in the proposed new clause. My noble friend Lord Ullswater referred today and in Committee to the steps taken by the industry to improve its performance. That should be recognised. Some of us have had material from the British Aggregate Construction Materials Industries and it is clear that their environmental code, strongly supported by the member companies, is already having a beneficial effect. That should be encouraged. There is no reason why in essence that could not be incorporated into legislation. It would be wrong to attack the underlying assets and economic operation of companies' sites while formalising the continuous uprating of the environmental performance of the industry.

The line proposed in the new clause is quite unique in planning law. How many other industries would be threatened in this way? The key issues that go right to the heart of the economic operation of aggregates sites are those of the area, depth, rate and hours of working and the total quantity to be extracted. Surely those rights should not be forcibly removed or diminished without full compensation. However, we know that this policy area has been the subject of consultation and subsequent discussion for nearly a year. The industry has come forward with positive proposals that, subject to the safeguards I have just covered, would allow regular updating of all sites to the benefit of the environment but without unreasonably prejudicing the economics of the operation. I support that approach.

This is not an abstract issue. We are debating the future of an important industry. It is one vital to the construction industry and to the economy, particularly rural areas and the rural economy, where often it is one of the rare sources of jobs. We want the quarry industry to be good neighbours. That is what the industry says it wants too. A better and fairer framework than the new clause proposed by the noble Viscount, Lord Addison, could help to get the right result.

I should like to add a special comment on what are called dormant sites—those with full planning permission but which have not been worked for some time. I have some sympathy for those near such a site that suddenly opens up after perhaps decades. I understand that dormant sites can still be important

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assets and part of companies' and local authorities' land banks, but some carefully considered special regime might not be unreasonable. Those which have been dormant since before 1982 should not reopen without completely updated conditions being attached.

Lord Desai: My Lords, I rise to support the amendment moved by the noble Viscount and supported by my noble friends. An asset which exists now is only worth what its future net income will be. What we face right now is a planning permission which was given long ago when environmental benefits were underpriced or not priced at all. Therefore, by not paying the proper cost for the environmental costs imposed, extra profits were made. We are not asking the industry to give back those extra profits. I should like to see that, but neither I nor the noble Viscount is proposing that. We are saying that from here on an appropriate price should be paid for making good the environmental damage done. That is not recontracting. It is basically reflecting an uncertainty that any investor faces when prices change. If prices change we have to pay the changed prices. Therefore, under those conditions, no extra compensation should be paid but we should say that the people who operate the planning permissions should pay the appropriate price for making good the damage done.

Perhaps I may say something about compensation. That arose regarding the amendment moved by the noble Lord, Lord Campbell of Croy. In that case, I believe that there is perfect justification for saying that no compensation should be paid. The mineral extraction for which planning permission was given is no longer applicable because the mineral is no longer being extracted. That planning permission has no future income. It may have alternative incomes because everything has such alternative incomes. The permission was for extracting ironstone and if that is not being extracted, the position changes. Therefore, in such cases no compensation is necessary because future income as regards extracting ironstone as a result of granting the permission is zero. One can add together any number of zeros, and the result is zero. Therefore, there is no compensation to be paid, and that particular asset has no value whatsoever in economic terms.

Lord Renton: My Lords, as with all excavation, quarrying and mineral extraction, the crux of the matter is that the licence or planning permission should ensure that conditions are attached for restoration of the site. It is that restoration to which we have to apply our minds in particular. I am not sure of the technicalities of this matter. We have heard various views expressed. I shall be very interested to hear what my noble friend Lord Ullswater has to say.

I am quite sure that the Government should bear in mind—as was done with the opencast coalmining sites—that most of them had very stringent conditions attached. In most cases, there has been exceedingly good restoration work which has fitted in well with the countryside. That is what we need to go for. I hope that my noble friend will be able to say whether the

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amendment of my noble friend Lord Addison achieves that objective or whether something slightly technically different is needed.

Lord Moran: My Lords, I am quite sure that the noble Lord, Lord Renton, is right to stress the importance of restoration. But the problem is that many of the old planning permissions had no conditions attached to ensure restoration. That is one of the biggest problems being faced. They also did not have proper environmental conditions attached such as restriction on noise limits, hours of working, depth limits and so forth.

I support the proposed amendments. I was encouraged by what the Minister said at Committee stage. I look forward very much to hearing what he has to say about the government review which they have been carrying out. They have had consultations, but it has been a very slow process. It is important that the matter should be speeded up.

One of the problems about old planning permissions is that as they were granted on much less stringent conditions than would be given today, and very often for areas where one would never obtain planning permission today, such as in national parks, SSSIs and areas of outstanding natural beauty, there is a distortion in the market between people operating on the old and lax permissions and those who are operating with today's rightly much more stringent conditions.

I am also very worried about dormant permissions. I believe that there may be as many as 1,600 of them. In some areas they are a kind of time bomb ticking away with no restrictions at all at the moment on when those permissions will expire. That is a source of great worry. Therefore, I hope that the Government will be able to go some way to meet the arguments put forward by the noble Viscount, Lord Addison.

3.45 p.m.

Lord Glenarthur: My Lords, I have considerable difficulty with the amendment of my noble friend Lord Addison. I must declare an interest in that for five or so years I have worked for Hanson PLC which owns ARC, a company heavily involved in the aggregates business throughout the United Kingdom. During the five years I have been involved with it I have become familiar with many different aspects of the industry and the issues which it faces.

While I recognise the sentiments which lie behind my noble friend's amendment, I have to ask him whether he has really considered the damaging effects of what he proposes. The effect of economic loss was very much glossed over by the noble Lord, Lord Desai. The loss of asset value cannot be ignored to those companies which are engaged in winning minerals and it is, as my noble friend Lord Gisborough said, considerably greater than anything which exists if other types of planning permission are taken away. To that extent, what my noble friend proposes will result in a measure which is not only retrospective, but to a very large extent confiscatory. I very much echo the remarks of my noble friend Lord Boardman.

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When my noble friend Lord Ullswater replies, I hope that he will bear in mind two important matters. Although I am aware that there may be bad examples up and down the country, I hope he is aware that in general the quarrying industry has proved itself to be much more adaptable, responsive and responsible than perhaps my noble friend Lord Addison gave credit for.

I believe that the industry has demonstrated a readiness to accept proper constraints which contemporary environmental awareness necessitates. I believe that my noble friend Lord Renton and the noble Lord, Lord Moran, will find plenty of examples of really first-class restoration of works which returned what was perhaps a large hole in the ground to its original state, but also enhanced in a way which people never imagined before, environmental amenity and other aspects which the work gave scope for.

There are numerous examples throughout the country of the industry accepting restrictions on the sensory aspects of quarrying such as noise, control of vehicles, blasting and visual amenity. I have no doubt that more can be done where the cost of so doing would not be excessive. But there is a major difference between those sorts of conditions and those limiting, for example, depth, area, quantity and rate at which minerals can be extracted. To that extent, the noble Lord, Lord Moran, seemed to connect the sensory factors with those later examples which I have given.

It is very much that second point which I ask my noble friend on the Front Bench to bear in mind. Those later conditions limiting depth, area, and so on, represent the asset value of the operation which the noble Lord, Lord Desai, seems to believe does not really exist. Imposing revised and restrictive conditions without compensation is wholly unacceptable. During the passage of the Planning and Compensation Act 1991, the then Minister, the right honourable Sir George Young, made a statement, in relation to interim development orders, advising that a distinction should be drawn between conditions which deal with the environmental and amenity aspects of working a site which would not affect asset value, and conditions that would fundamentally affect the economic structure of the operation. Conditions that would significantly affect the asset value would be more appropriate for reviews under the provisions introduced by the Town and Country Planning (Minerals) Act 1981. The difficulty was that that matter was merely addressed as a statement of intent and was not enshrined in legislation.

Since 1948 much enhanced legislation, notably the Town and Country Planning (Minerals) Act, has been introduced. Consents granted for mineral extraction since then have been given with a much greater degree of control. I believe that everyone is prepared to acknowledge that, but I urge my noble friend to make plain on the face of the Bill under what conditions compensation will be payable. If the principle of Sir George Young's statement is worth the paper on which it is written, putting that in the Bill cannot make much difference to the Government, but it would certainly make a difference to its acceptability to the industry,

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particularly since it has been demonstrated that mineral planning guidance has subsequently weakened the intention of that statement.

If my noble friend can go that far, he will find that the industry is responsive to him. However, if what he is going to say does not recognise the fact that mineral planning permissions are integral to the stability of the industry and thus form a key part of the asset base (and hence the balance sheets of companies) with all that that entails for employees, shareholders and the industry's contribution to the economy, and that, if removed, the rights that were granted under the planning system will not be compensated in law, I am afraid that the scope for a meeting of minds on that issue is very much diminished. I very much hope that my noble friend will see the force of those arguments and produce a statement from which all concerned can derive confidence.

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