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Mon December 06 2021

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Quarry firms press for red diesel u-turn

21 Oct Postponing the prohibition of red diesel is among the measures that quarrying companies are pressing on the chancellor of the exchequer ahead of his spending review next week.

The Mineral Products Association (MPA) is calling on chancellor Rishi Sunak to retain the red diesel rebate until viable alternatives become more readily available to power heavy machinery.

It also wants the aggregates levy community fund to be brought back and it wants the national infrastructure & construction pipeline to updated and published every year.

The chancellor is scheduled to present his 2021 autumn budget and spending review on Wednesday 27th October.

The rebate is due to be withdrawn from construction and mining companies in April 2022. Although the industry is working with plant manufacturers to develop non-diesel powered equipment, no suitable machinery is close to being introduced to the market, the MPA says. The removal of the red diesel rebate is therefore unjustified, premature and should be delayed, it tells the chancellor.

The MPA is also calling for the return of the aggregates levy community fund (ALCF) to support communities and environmental projects near quarries. MPA proposes a fund of £10m a year – a small fraction of the £400m raised annually from the levy on newly-quarried primary aggregates. “Given the government’s intention to increase the aggregates levy year-on-year, restoring the ALCF is particularly pertinent and timely,” the MPA says.

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In addition, MPA says that publishing the national infrastructure & construction pipeline every year, with proper detail, would give businesses the confidence to invest in new materials sources, production and supply facilities, equipment and people.

It also wants the Cabinet Office to go even further, not just publishing the list of planned projects but also set out their mineral product requirements – it would cost nothing but deliver significant efficiency gains across the supply chain, the association claims. MPA 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.

On the suggested return of the community fund,  MPA chief executive Nigel Jackson said: “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.”

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