Wednesday, 26 March 2014

Death of Greenest Government Ever pronounced in Budget 2014

This assessment is published this week in the weekly e-bulletin for Sustainable Building
Chancellor George Osborne’s Budget 2104, presented to Parliament on Wednesday, marks the death of the “Greenest Government ever”, as he put saving energy costs for energy intensive, manufacturing industries, proposed a new garden city in Kent’s flood plain and announced paltry support of half a million pounds to assist more house construction.

Housing and planning

The Budget “Red Book”* claims that as a result of government reforms to date, planning approvals and housing starts “are at 5 year highs, and housing activity recently expanded at its fastest rate for 10 years.”

Housing supply will be assisted by £500 million Builders Finance Fund, to support SME access to finance, which ministers hope will provide loans to developers to unlock 15,000 housing units stalled due to difficulty in accessing finance.

 For people who want to build their own home, the government says it will consult on creating a new ‘Right to Build’, giving custom builders a right to a plot from councils, and a £150 million repayable fund to help provide up to 10,000 serviced plots for custom build. The government will also look to make the Help to Buy: equity loan scheme available for custom build.

Communities housing minister Kris Hopkins told Labour MP Chi Onwurah in a written answer on 19 March (Official Report, Column 601W) “ told There is growing interest in self build housing which has many advantages. It can be an affordable route to home ownership, providing home owners with the opportunity to own a bespoke and sustainably designed high quality home. It also creates significant opportunities for smaller and medium sized home builders.”

He added that “The Government supports individuals and communities who want to build their own homes. This includes identifying 12 sites for self build as part of our surplus public sector land disposal programme; making £30 million available through our Custom Build Homes fund to provide; short-term project finance for group (multi-unit) self build projects and introducing an exemption for self builders from the Community Infrastructure Levy. We will also shortly be consulting on removing small scale housing projects from having to pay costly section 106 obligations.)

The National Planning Policy Framework asks local authorities to assess the demand for people who wish to build their own homes and make provision for this in their development plans.

The government will also  establish a £150 million fund “to kick start the regeneration of large housing estates through repayable loans, helping to boost housing supply.”

The Red Book says “Bids will shortly be invited from private sector developers, working with local authorities on estates that might be able to benefit,” ands reveals that following the Autumn Statement, expressions of interest have already been made through the Greater London Authority relating to the Aylesbury Estate, Blackwall Reach and Grahame Park regeneration projects in London.

Emphasis on SE England development

 The Government will work with the Mayor of London and the Greater London Authority
(GLA) to develop proposals for extending the Gospel Oak to Barking Line to Barking Riverside, and to ensure that any public investment unlocks the construction of up to 11,000 new homes, the Red Book reveals.It will also work with the GLA and the London Borough of Barnet to look at proposals for the Brent Cross regeneration scheme, “subject to value for money and affordability.”

 A New garden city?

The Budget confirmed a pre-released plan to support a new Garden City at Ebbsfleet in Nortrh Kent. Ebbsfleet has capacity for up to 15,000 new homes, based on existing brownfield land, the Red Book argues, pointing out to date, under 150 homes have been built on the largest site. The Budget announced that the Government will form a dedicated Urban Development Corporation for the area, in consultation with local MPs, councils and residents, to drive forward the creation of Ebbsfleet Garden City, and will make up to £200 million of infrastructure funding available to kick start development.

No mention is made of the sustainability of building or of green architecture SUDs and other sustainability measure, although, as I tis to be a garden city, these will by a key aspect of the development. It will represent the first new garden city since Welwyn Garden City in 1920.

The Government will also publish a prospectus, by Easter 2014, setting out how local authorities could develop their own, locally-led proposals for bringing forward new garden cities.

Reform of the planning system

The Budget announces it will review the General Permitted Development Order - based on a three-tier system to decide the appropriate level of permission -  using permitted development rights for small-scale changes, prior approval rights for development requiring consideration of specific issues, and planning permission for the largest scale development.

Building change of use

The  Budget announces ministers also plan to consult on specific change of use measures, including greater flexibilities for change to residential use, for example from warehouses and light industry structures, to allowing businesses greater flexibilities to expand facilities such as car parks and loading bays within existing boundaries, where there is little impact on local communities. It is unknown whether SUDS and permeable paving will be a requirement in such developments.

Blue energy
Extensive lobbying by the manufacturing sector have won a series of number of concessions in the Budget with package worth in total a £7bn to cut energy bills in energy intensive industries, that will put a cap on  green taxes  and  ring-fence companies from renewable energy subsidy costs, which have risen.

The carbon levy tax, the Carbon Price floor, introduced only last year by the Chancellor more than £2bn by 2018. The price floor rate was due to rise from £9.55 in April to just over £18 from 2015.

Friends of the Earth said the Budget represented a “caving in to big business lobbying on pollution tax”.

Infrastructure initiatives
The Budget announced £140m of funding to rebuild recently damaged flood defences, and in a move that will assist transport infrastructure,  also unveiled a £200m pot to repair millions potholes across Britain’s roads, experts were underwhelmed by the paucity of fresh proposals to rebuild the UK’s transport, energy and social infrastructure.

The flood protection fund complements, the Red Book argues, “the Government’s long term strategy, which in Spending Round 2013 allocated capital funding of £2.3 billion from 2015, allowing an increase in annual investment of 15% in real terms on that over the current spending period, even with the extra short-term funding allocated in this Budget.”

The government is developing a long-term plan that will direct this investment to protect the country from future flooding and will publish this in the autumn, the Red Book adds.

Business support


The Red Book says that “To further support innovative start-ups and early stage companies to invest in research and development, the government will raise the rate of the R&D tax credit payable to loss making small and medium sized companies from 11% to 14.5% from April 2014.” It adds that over the next 5 years this increase will support £1.3 billion of investment in innovation.

The Red Book also states “This Budget announces a package of reforms to

radically reduce the costs of energy policy for business – particularly in manufacturing – while improving security of supply and maintaining the government’s ambition to increase renewable generation. This package will benefit every household, business and region in the country saving a total of up to £7 billion by 2018-19. This will particularly benefit the most energy intensive manufacturers, around 80% of which are based in the North of England, Scotland and Wales.”


Tom Crotty, director of chemicals giant Ineos, said: “We have been crying out for this for some time, so it’s good to see the Government responding. The carbon floor freeze gives us some investment certainty, though not for as long as we’d like, and we’re pleased to see they’ve listened on combined heat and power plants. It’s important for the chemicals industry because we’ve all got them.”

But these measures did not finfd favour with the Renewable Energy Association, whose chief executive Nina Skorupska complained “By freezing the carbon price floor, the Chancellor is rowing back on his own policy and once again moving the goalposts for investors in green energy.”

Science investment
£19m support was announced to support research, demonstration and deployment of  the so-called wonder  material graphene, whose early research has centered on Manchester University. It has attracted academic and commercial  interest for its high-performance electrical, thermal and mechanical properties.

Mr Osborne said: “So we will establish new centres for Graphene – a great British discovery that we should break the habit of a lifetime with and commercially develop in Britain.”

The funding for research graphene will go through the Catapult network, the UK’s elite technology and innovation centres.

Political reaction

Labour leader, Ed Miliband responding to the Chancellor’s speech, said bluntly: “We needed a Budget today that would have made the long-term changes that our economy needs, in housing, banking and energy.”

Labour MP  Derek Twigg, commented: The Chancellor mentioned support for the energy-intensive manufacturing industry. To date, this has been a major failure. I have been lobbied rigorously by companies in my constituency about the Government’s failure, and I have also lobbied the Government regularly.”

Ian Swales, Liberal democrat MP for heavy-industrial heartland, Redcar, observed: “ I am pleased about the measures on energy-intensive industries. My constituency has not only a steel industry, but a large chemical complex. The employers will welcome those moves. I also welcome the moves on combined heat and power plants, which are relevant to my constituency. All those measures will help Britain to be more competitive and they are certainly needed.)

He was challenged by Green MP Caroline Lucas who said: “The Lib Dems used to pride themselves on their green policies, so I wonder whether the hon. Gentleman is equally happy that the Government are hell-bent on getting every last drop of oil out of the ground, as the Chancellor said?” Mr Swales menacing responded:”I am disappointed that, having given way to {her],  she took quite a lot of my time. I will see her outside the Chamber with the answers to those questions.”

Former Conservative trade and industry secretary, John Redwood said “I am pleased that the Chancellor made some moves on energy. …The first thing we need to do to have such a recovery is to ignore the advice of the Green MP, and to go for cheap energy.”

Another Conservative MP, David Mowat, representing the industrial area of south Warrington, said “Some 900,000 people work in energy-intensive industries in our country, and I sometimes think they are forgotten in our dialogue about energy prices. It is worth understanding that what the Chancellor has done is remove the straitjacket on costs, which would have put a great deal of those jobs at risk. ..I am surprised that a number of Opposition Members are not more exercised about this issue in general, given that they represent parts of the north-east, where there is heavy chemical manufacturing, and there are a lot of energy-intensive industries and a lot of jobs, because we cannot rebalance our economy back towards manufacturing if we have differentially high energy prices in this country.”

Natalie Bennett, leader of the Green Party, writing in the Independent on Thursday suggested Mr Osborne's has simply returned us “to a worse model of 2006,” described the chancellor’s new policy on carbon taxes as “retrograde”, and called instead for carbon taxes to pay for the provision of energy efficiency measures to lift nine out of 10 households out of fuel poverty, create up to 200,000 jobs, and cut carbon emissions.

Carbon price floor: reform
This Tax Information and Impact Note explains the capping of the Carbon Price Support rate to £18 per tonne of carbon dioxide (t/CO2) from 2016-17 to 2019-20.


PDF, 39.7KB, 4 pages


The Carbon Price Support (CPS) rates of Climate Change Levy (CCL) apply to fossil fuels used in electricity generation that are taxed under the CCL regime (gas, solid fuels and liquefied petroleum gas). The CPS rates of fuel duty apply to oils and biofuels used in electricity generation.

The UK-only element of the carbon price floor will be capped at £18 per tonne of carbon dioxide (t/CO2) from 2016-17 to 2019-20. This will have the effect of freezing the CPS rates for each of the individual taxable commodities across this period at around 2015-16 levels.

Business Premises Renovation Allowance

This Tax Information and Impact Note explains the type of expenditure that qualifies for relief under Business Premises Renovation Allowance.


PDF, 36KB, 3 pages


Legislation will be introduced in Finance Bill 2014 to amend Part 3A of CAA 2001 to clarify the scope of the expenditure that qualifies for Business Premises Renovation Allowance.

National Infrastructure Plan: finance update

An infrastructure finance update was published alongside Budget 2014.


Ref: ISBN 978-1-909790-88-9, PU1656 PDF, 277KB, 24 pages


This update provides further information on how the economic infrastructure investment planned over the coming years is expected to be financed – defining the nature and extent of the potential investment opportunity to 2020.

Progress report on the Spending Review 2010 commitment to reduce the burden of regulation on housebuilders.


Ref: ISBN 9781409841821 PDF, 272KB, 10 pages

If you use assistive technology and need a version of this document in a more accessible format please email quoting your address, telephone number along with the title of the publication ("Spending Review 2010: housebuilder deregulation commitment: table").


In the Spending Review of 2010, the government made a commitment to reduce the burden of regulation on housebuilders. This report is an update on progress in delivering that commitment.


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