Minister considers U-turn on plans for low-tax investment zones in Wales

Plans for the creation of low-tax investment zones in Wales could be scrapped, according to the UK Government’s new Levelling Up Secretary Michael Gove.

Earlier this month, Mr Gove’s predecessor Greg Clark confirmed he had opened talks about establishing at least one of the zones in Wales and claimed it would be a “disaster” if the Welsh Government did not agree to the scheme.

Welsh Conservative MPs James Davies and David Jones led calls for the UK Government to ensure the zones were implemented in Wales.

The plans, a key pledge in Liz Truss’s campaign for the Tory leadership, would benefit from a low-tax burden, reduced planning restrictions and regulations tailored on a case-by-case basis.

However, opposition politicians questioned how the proposed investment zones would actually boost economic growth.

Under review

Speaking on Sky News’s Sophy Ridge on Sunday programme this morning, Mr Gove indicated that anything that might undermine the environment “is out” under the new regime and confirmed he was reviewing plans for the zones.

“We need to make sure that any change that we make is one which of course helps to support economic growth and good jobs for people, but also one of the concerns raised about investment zones was the impact on the environment,” he said.

“I’ve been very clear and the Prime Minister has been very clear that under no circumstances will we weaken environmental protections.

“So I will be looking with the Chancellor of the Exchequer, with the Environment Secretary and with the Prime Minister at the proposals that were drawn up when Liz was prime minister… and anything that might in any way undermine environmental protections is out.”

Advantages

Welcoming the plans in the House of Commons two weeks ago, Clwyd West MP David Jones said:

“Friend will know that north Wales is part of the same economic region as the north-west of England, and it is therefore essential that it should have the same economic advantages.”

Greg Clark responded: “We need to avoid there being a hard border between England and Wales, and indeed between Scotland and England, on these questions”.

“It is vital that we make sure that we listen to the voice of business and local government as well as to MPs—my hon. Friends the Members for Clwyd South (Simon Baynes), for Ynys Môn (Virginia Crosbie), for Vale of Clwyd (Dr Davies) and for Aberconwy (Robin Millar) have already met me about this issue—to make sure that we avoid the disaster for north Wales of England proceeding with these zones and Wales not choosing to do so.”