Departments to consult industry over cost of national scheme for transport and utilities

The government is to conduct a series of industry consultations this summer to flesh out a national infrastructure strategy that will complement the sustainable communities plan.

This is because the Treasury and the ODPM wish to obtain a more accurate and comprehensive picture of what will be required in terms of energy, transport and sewerage requirements, amid industry concerns about these issues.

The government is due to consult the industry on a proposed development tax and report back by the end of this year.

The ODPM will consult on two research projects that will provide the basis for affordability targets over proposed housing and infrastructure. It is envisaged that these targets will be set at the end of this year as a follow-up to the report into the supply of housing by Treasury economist Kate Barker.

The first project, which is being led by a private consortium including Mott MacDonald, will consider the economic, social and environmental impact of the sustainable communities plan.

The other project, which runs until April, will provide economic models for affordable housing. This is being completed by a consortium led by Geoffrey Meen, head of economics at the University of Reading business school.

A senior Whitehall source told Building that the results of the two projects, particularly on national infrastructure targets, would form the basis of discussions with senior industry figures, which are set for the start of the summer.

We are looking at a summer of industry consultation

Senior Whitehall source

He said: “The Treasury has a good idea of the extent of infrastructure needed in the growth areas, but now the idea is to get a national picture.”

Meanwhile, the government is working on proposals for a development tax. The Whitehall source said that a Treasury property tax team and ODPM officials were considering the abolition of section 106 agreements and replacing them with a “planning gain supplement”.

There will also be extensive consultation on the issue of the revised Planning Policy Guidance 3 (PPG3), which dictates the size and type of housing schemes.

The source said: “We are looking at a summer of industry consultation with results being produced by the government by the end of the year.”

However, in the wake of strong criticism by the environmental audit select committee, the source added that the current message to housebuilders was that they needed to be prepared to win the sustainability argument for the developments to get the go-ahead.

He said: “There is going to be a huge amount of opposition from green groups on the proposed developments, so the message from government is that they need to be prepared to demonstrate that they are building in line with the very best methods of sustainable construction.”