Kwarteng ‘dash for growth’ in mini-budget sparks fears for environment


Chancellor Kwasi Kwarteng has unveiled plans to destroy environmental protection across much of the UK as part of Liz Truss’ ‘Dash for Growth’ strategy.

The plans – to be a central part of Mr Kwarteng’s emergency budget on Friday – sparked horror from green groups, who warned they were endangering the country’s natural beauty through a series of seedy developments.

The budget will include a “growth plan” that includes measures to combat high energy prices and inflation and to speed up major infrastructure projects, as well as a network of investment zones where planning rules will be hacked back to encourage development.

Mr Kwarteng is expected to say the highly controversial initiatives – coupled with a raft of tax cuts for businesses and the wealthy – will help break a “cycle of stagnation” that has led to a halt in growth and soaring taxes.

He will say that the “key mission” of Liz Truss’ government is to boost growth through tax cuts and regulation, and promises to usher in a “new era” of higher wages, more opportunities and tax revenues to fund public services.

Indicating the stiff opposition he expects to his plans, he will tell MPs: “We will boldly and unabashedly pursue growth – even if it means making difficult decisions.”

But the political director of rural charity CPRE, Tom Fyans, warned: “This government’s obsession with driving growth at all costs is alarming and will not end well for the country or our rural communities.”

Describing investment zones as “deregulation on steroids”, Mr Fyans said: “Successive governments have already severely weakened planning controls and the result has been a decade of disastrous design. CPRE’s own research in 2020 found that 75 percent of all new homes were of mediocre or poor quality.

Also Read :  People who sleep 5 hours or less a night face higher risk of multiple health problems as they age, study finds

“This government is making a wrong choice between being green and boosting economic growth.”

Friends of the Earth policy leader Mike Childs said plans to weaken environmental protections were “deeply concerning”.

“The Chancellor treats economic growth and environmental protection as opposites, but they are not,” he said. “It is this tired thinking that is driving the energy, climate and environmental crises we face.”

Lamenting the Chancellor’s failure to use the mini-budget to set out a plan to insulate homes, Mr Childs said: “We really needed this budget to bring down the cost of living, restore nature and cut emissions that are causing climate change cause, but it fails on all counts.”

With the Bank of England raising interest rates as Britain officially slipped into recession, economists warned Ms Truss’ plans – which include a massive increase in government borrowing – would put the nation’s finances on an “unsustainable” path.

The 0.50 percent hike in interest rates was less than the 0.75 most forecasters in the city had predicted but left borrowing costs at 2.25 percent, a 14-year high as the bank struggled to contain inflation .

The independent Institute for Fiscal Studies calculated that even after Mr Kwarteng’s package, the average worker will be £500 worse off in real terms than last year – a pay cut of around 3 per cent.

And the Joseph Rowntree Foundation said millions of Britain’s poorest people were “left out in the cold” by the Chancellor.

Mr Kwarteng announced on Thursday that predecessor Rishi Sunak’s 1.25 per cent increase in Social Security would be scrapped from November 6, fulfilling a flagship promise from Ms Truss’s Tory leadership campaign.

Also Read :  Artist discusses human impacts on the natural environment at Snow convocation

And he is expected to use his mini-budget to squash Sunak’s proposed increase in corporation tax from 19p to 25p and reduce the stamp duty paid on the purchase of homes worth more than £125,000.

Together the moves amount to an unfunded tax cut of more than £30billion and the Chancellor has controversially turned down offers from the Office for Budgetary Responsibility to pass judgment on their impact on public finances.

Figures from the Treasury showed that the NI cut will be worth an average of £3,890 for high earners over £150,000 a year, £175 for those earning less than £50,000 and nothing at all for those earning less than £12,750 .

The low-paid think tank Resolution Foundation said the chancellor “gives most to those who need the least help.”

Some 38 local authorities and combined mayoral offices across England – from the West Midlands to Tees Valley, Somerset and Hull – are in talks with the Government about tenders for investment zones in their area.

Each zone will offer businesses “generous” and time-limited tax cuts, as well as liberalized planning rules to speed up development and free up land for building homes, factories, offices and shops, the Treasury Department said.

This could include an end to height restrictions on developments and fixed percentages for affordable housing to replace heights currently being negotiated according to local needs.

Meanwhile, the growth plan will accelerate the construction of up to 100 road and rail projects, nuclear power plants and wind farms by scaling back environmental requirements and relaxing regulations to protect habitats and species.

Citing examples of seven-year delays in road projects and 13 years in getting an offshore wind farm approved, Mr Kwarteng will say: “The time it takes to get approval for nationally significant projects is slowing down, not speeding up, while ours advance international competitors. We have to end this.

Also Read :  Auburn University celebrates opening of health care clinic in Boykin Community Center

“We will liberalize planning rules at certain agreed sites, freeing up land and accelerating development.

“And we will lower taxes, with companies in designated locations benefiting from generous tax breaks.”

Shevaun Haviland, director-general of the UK Chambers of Commerce, said businesses would “enthusiastically welcome” the Chancellor’s pledge to focus on growth and “crack down on our creaky planning system”.

Ms Haviland said investment zones had the potential to meet the government’s alignment promises but warned of the risk that they would simply “shift growth and investment from one area to another without creating new economic activity”.

Labor Treasury spokesman Pat McFadden said Ms Truss’ decision to pile up the national debt at a time of sky-high inflation and rising interest rates did not amount to a “new blueprint for economic growth”.

“They just went from leveling to lowering, and that hasn’t worked in the past,” he said

“The whole pattern of changing the Tory leadership every two years and pretending it’s a fresh start has created instability and chaos. What Britain needs now is a government that will make businesses safe, make our economy safe and grow. The Tories cannot offer that.”

Liberal Democrat Treasury spokeswoman Sarah Olney said: “Kwasi Kwarteng was Minister for Growth for three years and now says he has managed a vicious cycle of stagnation. It is a shocking acknowledgment of the damage done to our economy by years of incompetence and chaos under this Conservative government.”



Source link