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More Radical Initiatives Needed Says GVA

Thursday, 22 March 2012

Alistair Andrew, associate in the Planning, Development and Research team at leading independent commercial property advisor GVA in Leeds, comments:

 "The Government's drive to support infrastructure initiatives is positive. Economic growth and improving infrastructure are intrinsically linked so it was reassuring to hear. The package to unlock £1.2 billion of investment intoManchesterwas encouraging, and we welcome the additional £270 million within the Growing Places Fund. However we don't feel the Chancellor has fully considered the importance of providing stimulus to trigger wider development which is vital to the growth of the economy. We would urge Government to open serious positive discussion with other cities regarding similar deals to drive infrastructure provision and thereby encourage economic growth.

"Nor has the Chancellor considered the importance of smaller projects to drive growth. We can not rest on our laurels by solely supporting flagship schemes. Cities must positively promote, as part of a comprehensive strategy, local development and infrastructure using new powers under the Localism Act and funding mechanisms in the Local Government Finance Bill to build upon these larger, catalytic schemes.

"The Chancellor touched on its planning reforms and gave final confirmation that it would be presented on Tuesday. While simplification of the planning system is needed, it is the lack of finance and appropriate levels of funding that continue to be the biggest obstacle. No matter how simple the planning system becomes that will not itself spark development and regeneration. Developers are crying out for access to finance on appropriate, commercially viable terms.

"The proposal to sell major new trunk roads and motorways to private sector investors to finance infrastructure improvements is an interesting proposal given the state of our public finances, and I look forward to reviewing the details. However our concern over where the Government intends to source the money from to finance this initiative still stands. It mentioned twelve pension funds as a potential source. We need clarity on how this initiative should be delivered, if improvements in the growth of the national economy are not to be held back."




Alistair Andrew adds:

"As GVA predicted and called for, the Chancellor acknowledges the overly complicated nature of the CRC and suggested it needs to be amended. Sadly, there was not enough detail to assuage the fears of the property industry that this already confusing scheme will continue to confound businesses for some time to come. It's clear however that some form of carbon tax will remain meaning that property owners and occupiers need to up their game on energy efficiency. 

"It seems the Chancellor has missed an open goal to use existing regulatory instruments, such as SDLT & Business Rates, to deliver real green progress in a fiscally neutral manner. 

"It's also a shame that despite wanting Britain to lead and "earn its way in the world" he has failed sufficiently to commit investment in the further development of the UK's low carbon buildings industry, which is on the verge of attaining world leading status. 

"As we stated prior to the Budget, the Government's green policy still appears schizophrenic. This won't have reassured investors of green energy. Tax cuts for the fossil fuel industry, subsidy slashes for renewables as well as "support" for renewables? We would urge the Government to present more clarity in this area."