asked the Minister for the Environment when he proposes to introduce legislation to deal with the problem of exorbitant urban land costs; and if he will make a statement on the matter.
Written Answers. - Urban Land Costs.
162.
The control of urban land costs presents formidable legal and administrative difficulties. The basic issue raised by proposals based on the Kenny Report is one of constitutionality — any attempt to acquire land at less than full market value runs the risk of infringing the property rights guaranteed by the Constitution. I am asking the Attorney General to examine the general legal and constitutional issues which arise from the Kenny Report so that an up-to-date opinion, taking account of recent important judgments by the High Court and the Supreme Court on relevant aspects of the Constitution, will be available to me in assessing the options on this matter. In the meantime the Government have acted to deal with exorbitant profits from dealings in building land and have ensured that a considerable amount of the windfall gains resulting from the provision of services by local authorities are returned to the community. A capital gains tax rate of 50 per cent on gains from disposals of development land was announced in the recent budget. This is 5 per cent higher than the rate proposed in the Coalition's budget. In addition, gains within one year of acquisition will be liable at a new 60 per cent rate for such short-term gains and there will be restrictions on certain reliefs hitherto available.
I am convinced that an increase in the supply of serviced land is a vital corrective element in regard to urban land prices. To achieve this it is necessary to provide sufficient resources for the servicing of land. This year I am allocating £87.4 million for public water and sewerage schemes — an increase of over 30 per cent on last year's provision of £66.98 million for public schemes and an increase of £7.4 million on what was proposed in the Coalition's budget.