In a move likely to have consequences for planning, Theresa May has proposed direct community compensation in areas where fracking takes place.
The proposals form part of the Government’s consultation on a ‘Shale Wealth Fund’, which seeks to ensure that the financial benefits of shale gas extraction – known as fracking – are shared with the communities in which the fracking takes place.
Mrs May made her remarks at the launch of the public consultation on the Shale Wealth Fund, making it clear that her team had amended the original proposals to ensure that communities felt a direct benefit from fracking operations. The Downing Street press release issued by Mrs May stated that:
‘The consultation has been changed by the new Prime Minister to include the option of money being paid directly to local residents in host areas.
Plans for the fund were first announced at last year’s Autumn Statement, but the new Government has changed the consultation to ensure a greater focus on control for local communities – including insisting on proposals to transfer funds directly to households rather than local authorities.’
It was accompanied by a direct quote from Mrs May, who said:
‘‘The Government I lead will be always be driven by the interests of the many – ordinary families for whom life is harder than many people in politics realise. This announcement is an example of putting those principles into action. It’s about making sure people personally benefit from economic decisions that are taken – not just councils – and putting them back in control over their lives.
We’ll be looking at applying this approach to other Government programmes in the future too, as we press on with the work of building a country that works for everyone.’’
The hint in the final paragraph about this approach being applied to other areas of Government was confirmed later on in the press release, which stated:
‘The government will also be looking at whether this approach to the Shale Wealth Fund can be a model for other community benefit schemes with the aim of putting more control and more resources in the hands of local households. Examples of where the principle could be extended include the Community Infrastructure Levy, which is currently being reviewed.’
If carried through into policy, these changes could have a real impact on the politics of individual planning applications. In SP Broadway’s experience a lot of the opposition to development projects hinges on a perception that the community concerned is having ‘something done to them’. Direct, positive participation in a scheme, through sharing in the financial benefits of it, could help shift such perceptions. That said, there are many questions about how such a scheme would work in reality – how would the boundary be drawn between households that benefit and households that don’t? How would the rate of compensation be calculated? How would the money itself be paid?
The fate of the Shale Wealth Fund proposals should tell us a lot about how the Government is likely to proceed. If the principle of direct community compensation works well for fracking, we can expect Ministers to further explore how it could be applied to planning – and to consider the tricky questions about how it would work in practice.