MPA calls for reinstatement of Aggregates Levy Community Fund

The Mineral Products Association is calling on UK Chancellor Rishi Sunak to reinstate the Aggregates Levy Community Fund to support communities and environmental projects near quarries.
Quarry Products / October 22, 2021
By Liam McLoughlin
The MPA wants the Chancellor to delay removing the red diesel rebate until viable alternatives become available
The MPA wants the Chancellor to delay removing the red diesel rebate until viable alternatives become available

The reinstatement of the fund was one of four key policy areas that the MPA highlighted for the Chancellor to "do the right thing" in its budget submission ahead of the 2021 Budget and Spending Review on October 27.

The MPA also said the Chancellor should delay removing the red diesel rebate until alternatives are available, deliver on funding and policy to help mineral producers achieve net zero, and improve the certainty and clarity of future infrastructure projects.

The association says that together these measures would help to ensure the mineral products industry could play its part in delivering the Government’s ambitions in infrastructure, housing and a green industrial revolution. The four areas are:

For the Aggregates Levy Community Fund (ALCF), the MPA is proposing a fund of £10m a year – which it says is a small fraction of the £400m raised annually from the levy on newly-quarried primary aggregates. It adds that, given the Government’s intention to increase the Aggregates Levy year-on-year, restoring the ALCF is particularly pertinent and timely.

Secondly, the MPA says its industry is repeating calls to retain the red diesel rebate until viable alternatives become available to power heavy machinery. The rebate is due to be withdrawn from mineral products companies in April 2022. Although the industry is working with plant manufacturers to develop non-diesel powered equipment, the MPA says no suitable machinery is close to being introduced to the market. It adds that the removal of the red diesel rebate is therefore unjustified, premature and should be delayed.

Thirdly, the mineral products industry has reiterated its calls for the right policy and support to achieve net zero carbon emissions. The MPA says the concrete and cement sector in particular has set out a clear, achievable Roadmap to Beyond Net Zero but some of the levers rely on the Government delivering on its own decarbonisation commitments in this and future Budgets.

Finally, the MPA has called on the Government to take steps to vastly improve the certainty that businesses require to make investment decisions - in turn strengthening the whole construction supply chain. It says that publishing the National Infrastructure & Construction Pipeline annually with sufficient detail will give businesses the confidence to invest in new materials sources, production and supply facilities, equipment and people.

The MPA adds that even better will be requiring major construction projects funded by the public purse to clearly set out their mineral product requirements, which would cost nothing but deliver significant efficiency gains across the supply chain. The association has also repeated its call for five-year budget plans for local roads which would support local authorities’ planning and allow asphalt producers to invest and supply materials in the most efficient way possible.

MPA chief executive Nigel Jackson commented: “MPA members produce more than 90% of the essential materials needed for the Government to realise its ambitions for infrastructure, housing and a green industrial revolution. The industry could play its part far better if preparations for major projects and the mineral planning system worked as they should.

“The industry already contributes the thick end of £1bn to the public purse each year and with the Aggregates Levy being increased and the red diesel rebate being removed mineral producers are set to pay even more. It’s not unreasonable for us to ask Government to improve its own performance and to use a fraction of our tax take to support local communities surrounding minerals production sites.”

Jackson said that the 2021 Comprehensive Spending Review is an opportunity to improve infrastructure and housing delivery, set the groundwork for a net zero built environment and make several key decisions to help hard-to-decarbonise sectors get to zero.

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