Major infrastructure planning reform in the UK trailed by Kwarteng

Out-Law News | 23 Sep 2022 | 12:25 pm | 3 min. read

Legislation to address the UK’s “slow” and “fragmented” planning system will be tabled by the UK government in the months ahead to support the accelerated delivery of “priority major infrastructure projects”, UK chancellor Kwasi Kwarteng has said.

High-level details of what will be in the legislation, and which specific projects the reforms will benefit, have been trailed by the Treasury – a non-exhaustive list of 138 projects across transport, energy, local growth and digital has been outlined. The Treasury said (42-page / 1.38MB PDF) these projects “have particularly high potential to move to construction at an accelerated pace”, though it said a project’s inclusion on the list is not a guarantee that it will benefit from funding, planning consent or approval for other regulatory or permitting processes.

Planning law expert Robbie Owen of Pinsent Masons said the proposals look like they would go further than what has previously been outlined and have the potential to deliver “real change” to the planning system. However, construction law expert Neal Morris, also of Pinsent Masons, has warned that fewer construction companies may be around to deliver the raft of new infrastructure planned unless more government action is given to the industry to overcome the economic challenges it faces.

Owen Robbie_November 2019

Robbie Owen

Partner, Parliamentary Agent

A standalone Bill on the matter will provide the greater focus needed to secure real change, particularly to reduce the myriad of assessments and appraisals now required

According to the Treasury, delays to the delivery of major infrastructure projects “undermine investor confidence and restrict the growth potential of the government’s landmark public investment in high quality infrastructure”. It has attributed the delays, in part, to “a complex patchwork of environmental and regulatory rules”, which it said it wants to “reform and streamline”. 

Some of the rules have their origins in EU law and were retained on the UK statue book post-Brexit. On Thursday, the government introduced a new Bill aimed at repealing retained EU law en masse, and the Treasury has now given an indication of what that might look like in the context of planning law specifically.

It said the new legislation will reduce “the burden of environmental assessments” and “bureaucracy in the consultation process” and reform “habitats and species regulations”. It said the legislation will also provide greater flexibility to make changes to a development consent order (DCO) once it has been submitted.

The DCO planning regime applies to nationally significant infrastructure projects (NSIPs). The Treasury confirmed plans for a new cross-government action plan for reform of the planning system that applies to NSIPs and said that new national policy statements for energy, water resources and national networks would be prioritised.

The Treasury also outlined its intention to update onshore wind planning policy so that it aligns with planning policy for other infrastructure. This, it said, would make it easier for onshore wind development to take place in England.

Further reforms aim to promote consenting for new roads and make it more difficult for legal challenges to “cause unnecessary delays to delivery”.

The Treasury also confirmed that it would add amendments to the Product Security and Telecommunications Infrastructure Bill that is already before parliament “to give telecoms operators easier access to telegraph poles on private land, supporting the delivery of gigabit capable broadband”. Further government plans for supporting new digital infrastructure are to be outlined later this year, it said.

Owen said: “The announcement of major infrastructure projects planning reform is welcome and goes much further than the limited provisions in the current Levelling-Up and Regeneration Bill. A standalone Bill on the matter will provide the greater focus needed to secure real change, particularly to reduce the myriad of assessments and appraisals now required.”

“The list of a wide variety and large number of transport, energy and telecoms infrastructure projects to be prioritised for acceleration should give a real boost to the good work already done and still underway as part of the Project Speed initiative, although it is so long that this may make prioritisation simply not possible in every case, particularly for those projects still at an early pre-planning stage,” he said.

In what the Treasury has termed a “growth plan”, Kwarteng referenced the issue of rising energy costs which businesses and households are grappling with. He announced a package of measures designed to help businesses address these rising costs.

Morris Neal

Neal Morris

Partner, Head of Construction Advisory & Disputes

If the government is serious about committing to delivering infrastructure projects, including its re-commitment to the Northern Powerhouse Rail, it must work with developers and contractors to control spiralling energy, materials and labour costs

The package includes a series of tax cuts, including reversing the previous chancellor’s decision to increase corporation tax to 25% from next April – the rate will remain at 19%. It also includes an energy bill relief scheme, which will provide businesses with a discount on energy prices for six months from October. Kwarteng has also committed to negotiating agreements with gas producers and electricity generators with a view to bringing wholesale prices down.

Neal Morris said, though, that more targeted action is required to support construction companies.

“Unfortunately, the reality is that these support measures might not be enough to save businesses and jobs,” Morris said. “Construction companies, in particular, have already seen a considerable increase in the costs of essential materials such as reinforced steel and concrete. Whilst some costs are being passed to end users, traditional contracts often don’t factor in such an increase in price or cost recovery in light of an energy crisis, leaving businesses bearing the brunt of sky high prices.”

“If the government is serious about committing to delivering infrastructure projects, including its re-commitment to the Northern Powerhouse Rail, it must work with developers and contractors to control spiralling energy, materials and labour costs to enable these projects to be delivered and to provide the ‘boost to growth’ that the government is banking upon to increase tax revenues,” he said.