QPA: Defra Commitment to Levy Fund welcome, but further reductions evident

QPA, the principal trade body for the quarry products sector, has expressed relief that Defra has at last confirmed that the Aggregates Levy Sustainability Fund (ALSF) will be maintained for the next three years. The future of the fund had been uncertain since the previous scheme finished in March 2008, in spite of the 22% increase in the aggregates levy rate implemented in April 2008.

The major change in the allocation of ALSF funds is the introduction of a specific carbon reduction focus, as proposed by the QPA, but our welcome for this development and the future of the ALSF in general is tempered by wider concerns about the value and use of the fund.

Specifically, the original ALSF allocation in England was £29.3 million pa, but largely due to Defra diverting funds for other purposes and the difficulty in carrying over funds from one year to the next, the fund was significantly underspent in its first six years. The Defra consultation on the future of the levy released at the end of January proposed a disappointing £24 mil pa allocation for the three years 2008/9 to 2010/11, but included within this was a £3 million contingency, so that only £21 million was identified for specific expenditure areas.

The Defra announcement this week includes specific allocations for just £19 million in 2008/9, rising to £20.8 million in 2010/11. Part of the reason for the low 2008/9 allocation is that the process of consultation and Defra review was so delayed that spending decisions are only now being announced - with four months of the year already gone.

Taking account of the significant increase in the value of aggregates levy revenue likely this year (c. £70 million) following the 22% levy increase in April 2008, the fact that Defra has not increased the level of funding going back into local communities through the ALSF is particularly disappointing.

QPA Director General Simon van der Byl said: "While we have concerns about the level of funding and some distribution issues, we want to be positive and work with the distributing bodies to help ensure that the fund is used in the most productive way over the next three years, particularly within communities around our operations."


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Notes to Editors

For more information please contact Jerry McLaughlin by tel: 0207 9638000. www.qpa.org

QPA is the principal trade association representing the UK aggregates industry. Our members produce over 90% of aggregates extracted - sand and gravel and crushed rock - as well as silica sand, recycled aggregates, agricultural and industrial lime, asphalt, mortar, and ready-mixed concrete.