Ministers are to take charge of major infrastructure planning applications following the abolition of a quango set up to fast-track decision-making, the Government has announced.
The Infrastructure Planning Commission (IPC) - created only last year by the former Labour government - is to be scrapped in keeping with the Tory-Liberal Democrat coalition agreement.
Major planning projects like offshore wind farms and nuclear power stations will in future be handled by a new Major Infrastructure Planning Unit within the Planning Inspectorate.
The Department for Communities and Local Government said, as a result, elected ministers rather than unelected commissioners would be taking the decisions.
In an indication of further planning reform being considered by the Government, George Osborne said local communities should be offered greater financial incentives in return for nearby planning projects.
The Chancellor said the current system of section 106 agreements - whereby developers offer services or amenities if their applications are approved - was inadequate. "At the moment there is absolutely no incentive for a local community to accede to a planning request," Mr Osborne said.
"They see none of the economic gain that comes from planning decisions. We want to change the incentives in planning so there are direct economic benefits for local communities," he said, suggesting that that could be done through council tax or business rates.
His comments came at a conference of chief executives in London ahead of an announcement of the Major Infrastructure Planning Unit by Decentralisation Minister Greg Clark.
The Cabinet was expecting to discuss efforts to boost the economy in the regions when it meets outside London.
The IPC was set up by Labour to streamline complicated planning applications of national importance which might otherwise get held up for years on end.
