You may be returning from that escapist world that is MIPIM and grimacing at the prospect of a week’s worth of emails, or you may be finishing a week of grimacing at all the LinkedIn pics of your colleagues in Ray-Bans. In any event, we now have three developments in relation to the Levelling-up and Regeneration Bill, currently at Committee stage in the House of Lords, sent to test the old saying that a change is a good as a rest…
I’m very grateful for three of my partners, not part of the MIPIM contingent, who have particularly had their eyes on the following:
Government amendment relating to removal of “hope” value in relation to particular categories of CPO
The Government tabled amendments on 13 March 2023 to the Levelling-up and Regeneration Bill that would have significant impacts on landowners. Raj Gupta has written a Compulsory Reading blog post LURB in the Lords – no hope (16 March 2023) on the potentially far-reaching implications. We have arranged a Clubhouse Planning Law Unplanned session at 5 pm on Thursday 23 March to discuss the proposal, led by Raj, Jon Stott, Greg Dickson and other leading specialists. Please RSVP here if you would like to tune in and/or take part in the discussion.
Government consultation on environmental outcomes reports – a new approach to environmental assessment
The Government published its consultation today, 17 March 2023, on the design on its proposed new system of environmental assessment. See the press statement, and consultation document. Duncan Field has set out some initial comments in a LinkedIn post. Again, we are going to arrange a Clubhouse Planning Law Unplanned event, probably for Thursday 30 March but further details will appear shortly.
Government consultation on the proposed infrastructure levy
The Government published its consultation today, 17 March 2023, on the design of the proposed infrastructure levy. See the press statement, technical consultation and a February 2023 research paper published alongside it. Clare Fielding will shortly be publishing a Levy-Headed blog post as to the likely implications.
Now to unpack. And let my picture be a warning for you to keep your parents away from the Be Real app.
I think I can point to something good that came out of Liz Truss’s premiership.
On 26 September 2022 she appointed former energy minister Chris Skidmore MP to carry out an “Independent review of net zero delivery by 2050 aims to ensure delivery of legally-binding climate goals are pro-growth and pro-business” and to “scrutinise green transition to make sure investment continues to boost economic growth and create jobs as well as increase energy security”.
Some of us may have feared the worst as to what lay behind this. Was the intention to back-end progress on the net zero by 2050 target?
The final report, Mission Zero: Independent Review of Net Zero, was published on 13 January 2023. I’m no expert but it seems to me – and to many better-informed commentators (although some of course express disappointment that the recommendations could be more radical) – to be a remarkably thorough and practical piece of work – running to 340 pages of waffle-free analysis and recommendations, with (such is the modern way of these things):
10 priority missions
A “25 by 2025” set of recommendations
It only needed a golden thread and … bingo!
There is this good House of Lords library summary published on 20 January 2023 ahead of a short debate on the document that is due to take place on 26 January 2023.
Actually, if one looks more closely, there is a golden thread to the report: the need for urgent reform of the planning system so as to make the path to decarbonisation smoother and faster.
From the paragraph 12 of the executive summary:
“We have made great progress decarbonising already with success stories in offshore wind and electric vehicles and it is essential we continue these. However, too often, we heard of problems hampering business and local areas from going as far and as fast as they want to. Whether it is lack of policy clarity, capital waiting for investible propositions, infrastructure bottlenecks, or delays in the planning system, it is clear that we need action to catalyse the deployment of clean solutions, particularly if we want British companies to capture the economic benefits.”
See priority mission 7: ““unblocking the planning system and reforming the relationship between central and local government to give local authorities and communities the power they need to act on net zero”.
From pillar 4, “Net Zero and the Community”:
“There is plenty of regional, local and community will to act on net zero, but too often government gets in the way. The UK government must provide central leadership on net zero, but it must also empower people and places to deliver. Place-based action on net zero will not only lead to more local support but can deliver better economic outcomes as well.
1. Government should simplify the net zero funding landscape by the next Spending Review
2. Government should fully back at least one Trailblazer Net Zero City, Local Authority and Community, with the aim for these places to reach net zero by 2030
3. Government should reform local planning and the National Planning Policy Framework now”
See recommended action 21 in the “25 by 2025” list:
“Local and regional Reform the local planning system and the National Planning Policy Framework now. Have a clearer vision on net zero with the intention to introduce a net zero test, give clarity on when local areas can exceed national standards, give guidance on LAEP, encourage greater use of spatial planning and the creation of Net Zero Neighbourhood plans, and set out a framework for community benefits.”
See also commentary like this:
“Planning system presents major barrier to net zero action. View of system on net zero is unclear and does not give sufficient weight to net zero as a national priority. Often slow and difficult to navigate, especially for individuals and communities.
Central government should reform the local planning system and the NPPF now. Have a clearer vision on net zero with the intention to introduce a net zero test, give clarity on when local areas can exceed national standards, give guidance on LAEP, encourage greater use of spatial planning and the creation of Net Zero Neighbourhood plans, and set out a framework for community benefits. Government should undertake a rapid review of the bottlenecks for net zero and energy efficiency projects in the planning system, and ensure that local planning authorities are properly resourced to deliver faster turnaround times”
“817. While the National Planning Policy Framework (NPPF) references climate change, it does not reference net zero specifically and the Review heard that the vision of the planning system on net zero is not clear. Too often there are conflicting or unclear messages, with important points relegated to footnotes.
818. The planning system should be an essential tool in delivering the changes needed for net zero. A system that appears ambivalent to net zero will not be capable of delivering the scale of change required.
819. The planning system should move towards implementing a test for all developments to be net zero compliant, ensuring enough lead-in time to prevent adverse economic consequences or stalling of current development plans. Across the economy the cost of building to net zero standards and using net zero technologies is coming down. Providing clarity and certainty on net zero requirements in the planning system could help drive further action and build supply chains, making net zero development the norm.
“Planning can be a driving force for not only net zero but for growth as well, helping to unlock opportunities across the country […] The reputation of planning in the UK would only be furthered if it were given the ability and position to be a key driving force for net zero. Our own research suggests that planning brings in millions to the UK and has the potential to have a much larger impact if the passion and expertise of our consultancies both large and small were showcased as one of our key exports” – the Royal Town Planning Institute.
820. There is also confusion over whether, where and how local authorities can exceed national standards on planning. The litigious nature of the planning system means local authorities are often unwilling to take risks, and so the system effectively puts a ceiling on local ambition.
821. For example, the Review heard from several stakeholders about the difficulty faced by West Oxfordshire District Council in their plans for the Salt Cross Garden Village.568 The Council had proposed that development at Salt Cross would be required to demonstrate net zero carbon, with submission of a validated and monitored energy strategy. However, in May 2022 the Planning Inspectorate provisionally found that such a policy was not ‘consistent with national policy or justified’ and the plan was modified as a result. This is a clear example of the planning system being unclear in its support for net zero.
“Local authorities are wary of the threat of legal challenge, this means to make confident use of their powers, they have to undertake rigorous legal checks, which slows delivery, adds expense and makes some of them risk averse” – Climate Change Committee (CCC).
822. Similarly, some local authorities felt that planning requirements on viability presented a hindrance to net zero development. These local authorities felt that some developers use viability requirements to reject proposed net zero improvements. These local authorities suggested that such viability considerations should be reformed or scrapped, and that net zero should be a fundamental consideration when determining the viability of a project. Current guidance states that viability assessments “should not compromise sustainable development.” This language should be strengthened to ensure that viability assessments actively encourage sustainable and net zero developments, and that assessments take a longer-term approach to determining what is viable.
823. Reforms to the planning system should therefore make it clear when local authorities can exceed standards and provide guidance on how local areas could go further should they wish to.”
(and there is more, through to paragraph 836 in the document, but you get the picture).
So how joined-up is this with current proposals to reform the planning system?
In summing up on behalf of the Government at the end of the House of Lords second reading debate on the Levelling-up and Regeneration Bill on 17 January 2023 Baroness Scott said this on climate change:
“The Government recognise the challenge of climate change. It is critical that the planning system must address this effectively. Through the Climate Change Act 2008 the Government have committed to reduce emissions by at least 100% of 1990 levels by 2050 and to produce national adaptation programmes every five years that respond to economy-wide climate change risk assessments. The Bill sets out that local plans “must be designed to secure that the development and use of land in”— the local planning authority area — “contribute to the mitigation of, and adaptation to, climate change.”
Our new outcomes-based approach to environmental assessment will ensure that the ambitions of the Environment Act and the 25-year environment plan are reflected in the planning process, placing the Government’s environmental commitments at the centre of decision-making.
The National Planning Policy Framework is already clear that plans should take a proactive approach to mitigating and adapting to climate change, taking into account the long-term implications for flood risk, coastal change, water supply, biodiversity and landscapes, and the risk of overheating from rising temperatures, in line with the objectives and provisions of the Climate Change Act 2008. The National Planning Policy Framework must be taken into account in preparing the development plan and is a material consideration in planning decisions. This includes the framework’s current policies related to climate change mitigation and adaptation. Furthermore, as committed to in the net-zero strategy, we will carry out a full review of the National Planning Policy Framework to ensure it contributes to climate change mitigation and adaptation as fully as possible. This will be consulted on as part of wider changes to the National Planning Policy Framework to support the ambitions in the Levelling-up and Regeneration Bill.”
Does this go far enough? Chris Skidmore’s report is a useful reminder of the importance of a properly functioning, resourced and managed planning system and I hope he has a hand in shaping the current reforms.
“The planning system is vital for a strong economy, for an attractive and sustainable environment, and for a successful economy. At present, the planning system in England achieves none of these goals. It is broken”.
“…we approach the second decade of the 21st century [the incredible potential of this country] is being artificially constrained by a relic from the middle of the 20th – our outdated and ineffective planning system.”
Well fix it, dear Henry, dear Henry, as the old song went. But, of course, it wasn’t broken in 2009 and it – just about – wasn’t outdated or ineffective in 2020. In 2023? I’m not so sure.
Given that the Government is currently refusing to accept there is an NHS crisis, I wonder if it would still accept that there is a housing crisis? Is it concerned by the number of local authorities deciding to pause or abandon preparation of their local plans? I’m genuinely unsure.
But let’s ignore for the moment the political direction in which this old vehicle should be headed and look instead at how the engine is working – can it actually deliver us to wherever it is we want to go?
Instead, let’s just focus on development management for a moment. In what should be a straightforward matter of processing, in accordance with statutory timescales, planning applications so as hold firm against the unacceptable and to approve the rest without delay , in form that that can lead to development taking place, and the public benefits which flow from that, there are currently at least two really horrible feedback loops, or vicious circles, that are holding back even the best projects:
Under-resourced planning departments, precautionary in nature, burdened with being the custodians of so many different policy objectives (climate change, health, building safety, beauty, air quality – you name it), take increasingly longer to process applications and their members’ decision-making is increasingly unpredictable (heads turned by lobby groups and hints from Government as to changing approaches). This leads to more applicants deciding to appeal so as to achieve a certain timescale and objective consideration of the issues. This places more work on officers, slowing down consideration of other applications. Which then also end up at appeal. And the slower the application and appeal process, the more likely that new issues arise, sending the applicant back to an earlier stage in the process again.
The demands on an applicant to tie down elements of a project at too early a stage, together with short implementation timescales and uncertain processes for processing scheme changes, lead to much unnecessary activity both in (a) keeping planning permissions alive with relatively minor works so that a permission that has taken years and a huge amount of money to achieve is not prematurely lost before the development is in a position to proceed and in (b) using clunky work-arounds – various combinations of section 96A, section 73 and/or drop-in applications – in order to refine proposals so that the permission is for a development which can actually be built. The longer the process for securing planning permission in the first place, the more likely that the resultant planning permission will need to be varied. The more certainty that the authority seeks to achieve with tightly drawn development parameters and a long list of planning conditions, the more likely that changes will be required.
I suspect that the Government is unaware of the true extent of the issue. I was looking at the latest statistics from December 2022. 86% of major applications last year were apparently determined “within 13 weeks or agreed time limit”. “or agreed time limit” is the clue, with time extensions routinely agreed so as to safeguard against premature refusal. Can anyone find where in the tables one might find how long an application for planning permission takes on average, from submission (usually after a lengthy and expensive pre-app process) to completion of section 106 agreement?
Another awkward reality to introduce at this point: projects need to be viable in order to proceed. Private sector development will not take place unless, broadly speaking, (1) the land owner will be paid by the developer an amount sufficiently above existing use value to make it make it worth his or her while to sell, and above what the land may be worth for any other development which could be carried out on the land (2) the developer can achieve a profit which makes undertaking the development commercially worthwhile, having regard to the financial risks inherent in the project, and can be sufficiently confident that there will be a market for the end product and (3) the capital deployed can achieve a better return than if it were to be deployed elsewhere. At present, with construction cost inflation, increased political risks, uncertainties as to the economy, is it any wonder when development is stalled; when development projects which may previously have been viable no longer make any financial sense on the terms negotiated, or when scheme changes are needed to reflect changing commercial (or indeed Building Regulations) requirements? I focus on private sector development given how reliant as a country we are on the private sector to deliver housing in particular, but of course most of the same economic realities apply, or should apply, to development carried out by the public sector.
None of this appears to be recognised in current Government announcements. Far from it. Instead, the rhetoric is to double down on developers who do not build out quickly, in genuflection to the myth of land-banking – with the Levelling-up and Regeneration Bill’s provisions about development commencement notices, changes to the completion notices regime and even a power for local planning authorities to decline to determine applications in cases of earlier implementation. As if these measures were ever going to force a developer to build out a permission for a scheme where the funding wasn’t yet in place, where there was not yet a ready market or where the project was no longer viable! Instead, these measures will simply discourage many from entering the process in the first place, rather than risk abortive expenditure, even if the odds are that the scheme will go ahead. Why take the additional risk?
To people like me, the 2007 – 2008 global financial crisis seems like yesterday. Development almost came to a halt. Whilst it seemed too slow at the time, the then Government responded with measures that were summarised in its guidance document, Greater Flexibility For Planning Permissions, published first in 23 November 2009 and revised 1 October 2010). Look at the 2009 impact assessment:
“In current economic circumstances, there is a reduced take-up of existing permissions. Where permissions lapse, there are costs and delays associated with providing and processing an application for a fresh planning permission.
There is also a broader need for added flexibility to allow developers and local planning authorities to make non-material amendments to existing planning permissions and to clarify and streamline the process for making minor material amendments. There is currently a lack of clarity about what can be done, which is resulting in unnecessary expense and time for both parties.”
set out the temporary arrangements that had been brought in to extend the life of planning permissions. “This measure has been introduced in order to make it easier for developers and local planning authorities to keep planning permissions alive for longer during the economic downturn so that they can more quickly be implemented when economic conditions improve.”
explained about the then new section 96A process for non-material amendments to planning permissions, introduced on 1 October 2009 pursuant to the Planning Act 2008.
The guidance was withdrawn on 7 March 2014 and replaced with the Flexible options for planning permissions section of what was then the new Planning Practice Guidance. In the transition, somehow the policy thrust of the earlier guidance was lost – the notion that flexibility can be a good or even necessary thing.
If you recall, the coalition Government subsequently introduced by way of the Growth and Infrastructure Act 2013 new sections 106BA, BB and BC into the Town and Country Planning Act 1990, providing a new application and appeal procedure, to review affordable housing obligations on the grounds of viability. Whilst helpful in some situations, it was certainly abused in others, and it was then repealed in 2016.
More recently of course, during the pandemic there were temporary measures to allow for the extension of time limits on planning permissions.
The Levelling-up and Regeneration Bill has its second reading in the House of Lords on 17 January 2023 and, when it comes to greater flexibility for planning permissions, clause 102 (introducing new Section 73B into the Town and Country Planning Act) remains as a small step in the right direction. Section 73 will continue to exist but section 73B provides for an alternative procedure for amending schemes, given that as a result of the Court of Appeal’s ruling in Finney, section 73 cannot be used for amending the description of development on a planning permission. Section 73B will allow for an application to be made for planning permission to be granted for an amended form of a previous planning permission. Planning permission will only be able to be granted “if the local planning authority is satisfied that its effect will not be substantially different from that of the existing permission”. It will not be able to be applied for in relation to a section 73 permission. The local planning authority “must limit its consideration to those respects in which the permission would, if granted…differ in effect from…the existing permission”.
My worry with section 73B is that unless there is really encouraging guidance from DLUHC, local planning authorities will be cautious as to the “not substantially different” test. After all, where does it rest on the spectrum between “non-material amendment” and “fundamental alteration”?
It seems to be that we will now have the following procedural options:
Section 96A for non-material amendments
Section 73 for amendments which may be material but which are not a fundamental alteration to the approved scheme and which do not necessitate a change to the description of development on the face of the original planning permission.
Section 73B for amendments which do not approve development whose effect will be substantially different from that of the existing planning permission
A fresh application for planning permission (encompassing also the Supreme Court’s suggested solution given in paragraph 74 of its Hillside judgment: “Despite the limited power to amend an existing planning permission, there is no reason why an approved development scheme cannot be modified by an appropriately framed additional planning permission which covers the whole site and includes the necessary modifications”)
In a case where the existing planning permission is, in the words of the Supreme Court in Hillside, “severable”, our old friend the “drop-in permission”. Unmentioned in Hillside, not to be found in legislation or guidance but still in my view clearly possible in the right situation.
Wouldn’t it be useful for DLUHC to publish a document now with the can-do tone of Greater Flexibility for Planning Permissions, recognising the obstacles in the way of achieving timely development, and encouraging local planning authorities to use these procedural tools available to them where necessary, so as not to delay or frustrate development, with suggestions as to how the appropriate tests should be approached? At present the whole thing is a lottery, dependent on the particular views of individual planning departments and even individual officers.
And wouldn’t it be useful if, instead of the hyperbole, there could be an honest look at the real stresses and strains the current system is under and if there could be a tightening of processes in the same way as Rosewell achieved for the planning appeals system? And above all, if planning departments could have available to them sufficient staff: well-trained, well-managed and well-motivated?
And now the prospect of strikes at the Planning Inspectorate. An interesting year ahead, folks.
The Government appears to be in negotiation with Tory MPs (46 of them at least) who may be prepared to wreck the Levelling-up and Regeneration Bill unless it includes a provision abolishing housebuilding targets for local authorities and abolishing the policy in the NPPF as to the maintenance of a five years’ supply of housing land. No doubt this will end up with some fudged solution adding further (1) uncertainty, (2) complexity and (3) hurdles in the way of housing provision.
But in another part of the forest, assuming they will overcome that local difficulty (aka huge chasm), the Government has brought forward a further set of amendments to the Bill to seek to address the nutrient neutrality problem which has amounted to a de facto veto on housebuilding in many areas of the country (see eg my 23 July 2022 blog post Neutrality: Government Clambers Off The Fence).
A new legal duty on water companies in England to upgrade wastewater treatment works by 2030 in ‘nutrient neutrality’ areas to the highest achievable technological levels.
A new Nutrient Mitigation Scheme established by Natural England, helping wildlife and boosting access to nature by investing in projects like new and expanded wetlands and woodlands. This will allow local planning authorities to grant planning permission for new developments in areas with nutrient pollution issues, providing for the development of sustainable new homes and ensuring building can go ahead. Defra and DLUHC will provide funding to pump prime the scheme.”
“The new legal duty on water and sewerage companies in England to upgrade certain wastewater plants will be introduced via a Government amendment to the Levelling Up and Regeneration Bill. We want these improvements to be factored in for the purposes of a Habitats Regulation Assessment.”
The nutrient mitigation scheme “will be open to all developers, with priority given to smaller builders who are most affected. Developers can also continue to put their own mitigation schemes in place should they choose. Natural England will work with, not crowd out, new and existing private providers and markets for nutrient offsets wherever they exist.
The scheme is due to open in the Autumn. All affected areas can continue to access practical support from the government and Natural England in meeting nutrient neutrality requirements. Natural England will deliver the scheme by establishing an ‘Accelerator Unit’, with the support of Defra, DLUHC, the Environment Agency and Homes England.
This announcement will support the delivery of the tens of thousands of homes currently in the planning system, by significantly reducing the cost of mitigation requirements. The mitigation scheme will make delivering those requirements much easier for developers.”
The possible bad news? Not so much bad news but an inspector’s appeal decision letter which confirms that the Habitats Regulations’ assessment requirements do not just apply when an application for planning permission is determined but, if an assessment was not carried out at that stage, at reserved matters/ conditions discharge stage. This is of course one of the huge current frustrations.
The decision letter, dated 24 November 2022, is here and is summarised by Landmark Chambers here.
Charlie Banner KC was for the appellant and his submissions were in line with an opinion previously provided for the HBF and widely circulated. The issues are not straight-forward and we wait to see whether the question will now come before the courts.
Short blog post this week – too busy, and to0 much football to watch.
Commentary about the Government’s adjusted direction for planning reform has been running on mist and speculation since Michael Gove’s return as Levelling Up Secretary of State on 25 October 2022, pending the Chancellor’s Autumn Statement on 17 November 2022.
But now it’s all systems go. As well as the Autumn Statement we now have:
The Secretary of State is due to appear before the LUHC Select Committee on 21 November and the Bill will have its report and third reading stages on 23 and 28 November before heading to the Lords.
The Autumn Statement itself contained little in relation to planning reform, other than to “refocus” investment zones:
“3.16 The government will seek to accelerate delivery of projects across its infrastructure portfolio, rather than focus on the list of projects that were flagged for acceleration in the Growth Plan. The government will continue to ensure that all infrastructure is delivered quickly through reforms to the planning system, including through updating National Policy Statements for transport, energy and water resources during 2023, and through sector-specific interventions.”
“3.25 The government will refocus the Investment Zones programme. The government will use this programme to catalyse a limited number of the highest potential knowledge-intensive growth clusters, including through leveraging local research strengths. The Department for Levelling Up, Housing and Communities will work closely with mayors, devolved administrations, local authorities, businesses and other local partners to consider how best to identify and support these clusters, driving growth while maintaining high environmental standards, with the first clusters to be announced in the coming months. The existing expressions of interest will therefore not be taken forward. The government is grateful to local authorities for their work to develop proposals.”
I recommend two good commentaries on the Autumn Statement:
The amendments tabled to the Levelling-up and Regeneration Bill are potentially significant. To quote from the 18 November 2022 press statement:
“Amendments being tabled will:
Tackle slow build out by developers to make sure much needed new homes are delivered. Developers will have to report annually to councils on their progress and councils will have new powers to block planning proposals from builders who have failed to deliver on the same land.
Improve our environment and enshrine in law an obligation on water companies to clean up our rivers by upgrading wastewater treatment works. Considering all catchments covered by the amendment, our initial estimates indicate that there will be around a 75% reduction in phosphorus loads and around a 55% reduction in nitrogen loads in total from wastewater treatment works, although this will vary between individual catchments. These upgrades will enable housebuilding to be unlocked by reducing the amount of mitigation developers must provide to offset nutrient pollution. This will be accompanied by a Nutrient Mitigation Scheme that will make it easier for developers to discharge their mitigation obligations.
Give residents a new tool to propose additional development on their street, like extensions to existing homes, through ‘street votes’. Planning permission will only be granted when an independent examiner is satisfied that certain requirements, such as on design, have been met and the proposal is endorsed at a referendum by the immediate community. Pilot Community Land Auctions – testing a new way of capturing value from land when it is allocated for development in the local plan to provide vital infrastructure, including schools, roads, GP surgeries, and the affordable housing that communities need.
Enhancing powers for mayors to support them to managing their key route networks and increase transport connectivity across their area.
Help Nationally Significant Infrastructure Projects such as wind farms and new major transport links be delivered more quickly, by enabling a small number of public bodies to charge for their statutory services to help them provide a better, reliable, quality of advice to developers and support faster planning decisions.”
There are some potentially controversial proposals here, for instance local planning authorities would be able to decline to determine an application for planning permission of any prescribed description if the application has been made by someone who “has a connection with” earlier development which “has begun but has not been substantially completed” and where the “local planning authority is of the opinion that the carrying out of the earlier development has been unreasonably slow”.
Begun but not substantially completed, unreasonably slow – sounds to me like the Government’s performance in relation to planning reform….
The press statement doesn’t mention an additional tabled amendment, which would empower the Secretary of State to make such amendments and modifications to existing planning, development and compulsory purchase legislation as in the Secretary of State’s opinion facilitate or are otherwise desirable in connection with their consolidation. That’s one hell of a Henry VIII clause! A Town Legal colleague commented to me that the Delegated Powers and Regulatory Reform Committee will certainly be interested in this one if it reaches the Lords.
More from me on a number of the proposals in due course. In particular, I had really hoped I would never have to tackle community land auctions (again) or street votes.
We still await any announcements about planning policy reform, including as to changes to the NPPF and the future of the standard method for calculating local housing needs. We were left to read between the lines of what was said by Levelling Up Under Secretary of State Dehenna Davison in a Westminster Hall 30 minute debate earlier in the week on housing targets (15 November 2022):
“I know I am preaching to the converted when it comes to the need to modernise our planning system, and I think all MPs understand and get that we need a planning regime that is fit for 2022. […] I also understand that Members are frustrated—they are right to be frustrated—that this has been under discussion not just for months, but for years. We need more houses, and that obviously brings with it an obligation on us in Government to be frank and straight with people that building more houses has implications, both positive and sometimes negative. In some places, it will cause tension, and in some places, it will be a source of relief, but it is our job to be willing to have that dialogue, regardless of how difficult it may be. I am not sure that Governments of all colours have always approached these kinds of conversations in the most productive way. The inconvenient truth is that, for the best part of two decades, demand has outstripped the supply of homes.“
“…If we can get our planning regime right, we can unlock a huge amount of economic growth locally. We want to help local authorities to adopt and implement the best planning approaches for their areas. To achieve that, local authorities will need to be able to better attract and retain planners […] and we want to work further with the sector on that. He was right to highlight that as one of the major challenges facing authorities at the moment.
To incentivise plan production and to ensure that newly produced plans are not undermined, the Government intend to make it clear that authorities do not have to maintain a five-year supply of land for housing where they have an up-to-date plan. As Members would expect, we plan to consult on that. The new measures should have a minimal impact on housing supply, given that newly produced plans will contain up-to-date allocations of land for development, but that will also send a signal that the Government are backing a plan-led approach, provided that those plans are up to date.
There is no getting around the fact that we are in a difficult economic time. We face headwinds from all angles—energy, inflation and interest rate rises—and those have knock-on implications for everything that the Government do, but to my mind, they only serve to underline the need to build more homes and to give generation rent the chance to become generation buy. That is why we have to stand by our commitment to dramatically ramp up housing supply and our manifesto pledge to build a million new homes within the first term of this Parliament”
For additional political colour (blue) see also Michael Gove’s keynote speech at the Centre for Policy Studies’ Margaret Thatcher Conference on growth (16 November 2022)
Resignation of Rishi Sunak as chancellor – 5 July 2022
Resignation of Boris Johnson as prime minister – 7 July 2022
Replacement of Boris Johnson by Liz Truss as prime minister – 6 September 2022
Death of Her Majesty – 8 September 2022
Mini-budget and publication of growth plan – 23 September 2022
Resignation of Liz Truss as prime minister – 20 October 2022
Replacement of Liz Truss by Rishi Sunak, Boris Johnson or AN Other as prime minister – October 2022
A lot has happened. Or perhaps, in our planning world, nothing has happened.
We briefly had a prime minister who talked of abolishing “top-down, Whitehall-inspired Stalinist housing targets” and indeed the Levelling Up Secretary of State Simon Clarke (who incidentally came out publicly today as a backer of Boris Johnson) spoke about those targets as if they had already been abolished. But of course, as we wait for the mythical NPPF changes prospectus (delayed to November even before the Truss resignation which could lead to further delay), formal policy remains as is. The only effect of the loose talk was to give cover to local authorities anxious for an excuse to pause their local plan making. Thanks Liz – it wasn’t just the markets that you spooked.
No doubt the change is on its way regardless but, honestly, how idiotic it would be to give up on having a methodology that identifies each local planning authority’s local housing needs, for which they should usually plan. The likely consequences of removing the targets are clear:
longer plan-making processes, particularly the examination stage
fewer homes delivered
more planning by appeal
plan-making increasingly largely driven by promises of funding to be provided and threats of funding to be removed. We can try to forget about that “pork markets” Truss quote but I suggest you retain at hand a much older phrase: “pork barrel politics”.
And what is wrong with top down targets anyway? Our health and education systems for instance are full of the things.
Away from housing, the announcements in the growth plan in relation to, for instance, fracking (pro – despite the planning minister Lee Rowley being strongly against) and solar energy (anti) have not get found their way into any formal policy changes.
I have scrolled through the amended Bill and aside from the detailed changes to schedule 11 (which relates to the infrastructure levy) mentioned by Nicola, and other minor tweaks, I would only draw attention to the following new provisions:
clause 111 – power to shorten the deadline for examination of DCO applications
clause 112 – additional powers in relation to non-material changes to DCOs
clause 152 – prospects of planning permission for alternative development [in the context of CPO compensation]
Next up will be Report stage and a debate on the Third Reading of the Bill and we shall see if any further amendments are tabled by the Secretary of State, whoever he or she may be at that stage.
“The government will look to introduce primary legislation in order to enable the offer on tax and simplified regulations. The final offer will be subject to the passage of that legislation through parliament.”
There really isn’t much clarity as to the nature and extent of any primary legislation that will in fact be required to deliver the regimes envisaged for each investment zone (potentially bespoke for that investment zone). When you add this to the wider confusion as to the relationship of the proposed Planning and Infrastructure Bill with the current Levelling-up and Regeneration Bill (with much of what was trailed for the former either already within the latter – eg environmental law reform – or shortly to be added by way of amendments.- eg amendments to NSIP processes – or able to be secured by way of secondary legislation), some clarity from Government is urgently needed.
Turning to the question of what amended planning regimes may be appropriate for some investment zones, people have rightly pointed to the potential use of local development orders, which for example the Government has previously encouraged in relation to enterprise zones and freeports.
However I’m wondering whether, instead of further primary legislation to set out some unspecified new procedure (which sounds slow and impractical), the Government has considered whether two provisions which are already on the statute book are in fact sufficient: simplified planning zones and planning freedoms schemes. Are ministers even aware of them? I would be interested in people’s experiences with either.
“Section 154: Planning freedoms: right for local areas to request alterations to planning system
441 This section enables the Secretary of State, by regulations, to make planning freedom schemes in England. Planning freedom schemes may only be made following a request from the local planning authority for the relevant area and only if the Secretary of State considers the scheme will lead to additional homes being built.
442 Before bringing forward proposals for a scheme the local planning authority must consult in their local area.
443 Such schemes will operate for a specified period (although subsection (7) includes the power to bring schemes to an end early, for example, where the local planning authority asks the Secretary of State to do so).
444 Planning freedom schemes will apply in relation to a specified planning area which will be the area of a local planning authority or an area comprising two or more adjoining areas of local planning authorities. The Secretary of State may restrict the number of planning freedom schemes in force at any one time.”
Is anyone aware of this, extremely open-ended, power ever having been used?
Planning legislation is full of these false starts and dead ends. I’m sure there’s plenty more that you can point to. Regardless of any substantive changes, a spring clean of the whole legislative framework is well overdue. Although who knows what we’ll find.
I hope people enjoyed listening to the clubhouse chat with Hashi Mohamed last week. If you missed it you can listen back here.
It’s good that this huge issue is attracting media attention – and I’ll come on to the Government announcement in a moment – but it is disappointing to see the usual “red tape” sneer.
The problem isn’t the rules or bureaucracy: we have specific areas designated of particular ecological importance and sensitivity, the integrity of some of which is under threat because of the existing levels of nutrients draining into them, from farming (eg fertilisers, animal waste) and from homes (human waste), and the integrity of others which is under threat due to the consequences of over-abstraction of water. These situations haven’t been adequately dealt with by the water companies or government agencies, meaning that even one more home being built in these catchment areas is considered by Natural England to be unacceptable without adequate mitigation in place (which can be difficult, particularly for smaller schemes). The problem isn’t the housebuilding, it’s the pre-existing precarious state of these areas.
It is a big problem, and it has been with us for a long time now (see my previous blog posts).
These are the main measures announced by the Secretary of State:
“In order to drive down pollution from all development in the relevant catchments, we will be tabling an amendment to the Levelling Up and Regeneration Bill. This will place a new statutory duty on water and sewerage companies in England to upgrade wastewater treatment works to the highest technically achievable limits by 2030 in nutrient neutrality areas. Water companies will be required to undertake these upgrades in a way that tackles the dominant nutrient(s) causing pollution at a protected site. We are also using feedback from the recent ‘call for evidence’ to water companies to identify where these upgrades could be accelerated and delivered sooner.”
Natural England is directed to establish a nutrient mitigation scheme. “Defra and DLUHC will provide funding to pump prime the scheme: this is intended to frontload investment in mitigation projects, including wetland and woodland creation. This will then be recouped through a simple payment mechanism where developers can purchase ‘nutrient credits’ which will discharge the requirements to provide mitigation. Natural England will accredit mitigation delivered through the Nutrient Mitigation Scheme, enabling LPAs to grant planning permission for developments which have secured the necessary nutrient credits…We will announce further details in the autumn when the scheme will launch, and in the meantime, Natural England will be in touch with local authorities and developers.”
“Longer term, we continue to progress proposals to reform the Habitats Regulations so that impacts on protected sites are tackled up front, focusing on what is best for bringing sites back into favourable status.”
“We will make clear in planning guidance that judgements on deliverability of sites should take account of strategic mitigation schemes and the accelerated timescale for the Natural England’s mitigation schemes and immediate benefits on mitigation burdens once legislation requiring water treatment upgrades comes into force. DLUHC will revise planning guidance over the summer to reflect that sites affected by nutrient pollution forming part of housing land supply calculations are capable of being considered deliverable for the purposes of housing land supply calculations, subject to relevant evidence to demonstrate deliverability. It will be for decision takers to make judgements about impacts on delivery timescales for individual schemes in line with the National Planning Policy Framework.”
Joanna Averley’s letter goes into more detail as to how the proposed new statutory duty on water companies will help:
“The majority of nutrient pollution from residential properties enters waterbodies via treated discharges from wastewater treatment works (WWTW). The performance of WWTW varies based on the limits in environmental permits issued by the Environment Agency, which in turn reflect the environmental requirements of the waterbodies to which the effluent is discharged. The performance of WWTW is therefore the central factor in the level of nutrient pollution associated with existing homes and new development. It is therefore logical that effort on reducing nutrient pollution associated with housing focusses on upgrading WWTW. The statutory obligation for upgrading WWTW, which will be introduced into the LURB, will ensure that WWTW in nutrient neutrality catchments are operating at the highest level of performance, rectifying nutrient pollution at source. This will reduce the pollution from not only new development coming forward, but also from the majority of existing dwellings in affected catchments, representing a significant decrease in overall pollution from housing.
The specific performance levels of the connected WWTW is a major variable when determining the amount of mitigation new development has to secure to achieve nutrient neutrality. Suitable mitigation measures might include constructed wetlands or land use change, which can be land intensive. Under Natural England’s Nutrient Neutrality methodology, the permit limit is used, or where there is no permit limit on nutrient discharges from WWTW, a standard precautionary figure is used (8mg/l for phosphates (P) and 27mg/l for nitrates (N)). The statutory obligation from 2030 will require WWTW to operate at the technically achievable limit (TAL); for phosphates this is 0.25mg/l and nitrates 10mg/l. This action will ameliorate nutrient pollution and significantly reduce the mitigation burden for developments.
The habitat regulations require that mitigation be secured for the lifetime of the development which Natural England consider to be 80-120 years. The obligated upgrades to WWTW required from 2030; will provide clarity from the point of the LURB measures coming into force. For developments this means that the current high level of mitigation will only be required up to the end of 2030. After 2030, the pollution levels via WWTW will be much reduced and so a lower level of mitigation will be required. This reduces the overall mitigation burden on housing developments coming forward in nutrient neutrality catchments.”
This should be welcomed (even if it is so belated and does raise questions as to whether water companies will actually be able to deliver – and at whose cost) but of course there is still the period to 2030 before these new permit limits apply and so it is important that the promised nutrient mitigation scheme is up and running as soon as possible. Housing Today have raised significant concerns on that score in their piece, Government’s nutrient mitigation scheme ‘years away’ (22 July 2022)
Finally, the ministerial statement sets out unambiguously the Government’s position as to whether the Regulations bite on reserved matters applications and applications to discharge pre-commencement conditions: “The Habitats Regulations Assessment provisions apply to any consent, permission, or other authorisation, this may include post-permission approvals; reserved matters or discharges of conditions.” Joanna Averley’s letter promises further planning practice guidance on this issue.
In the meantime, there is no Planning Law Unplanned clubhouse event this week but I am speaking at a clubhouse event arranged by Iain Thomson of Bellona Advisors for 6pm on Monday 25 July 2022 on the subject of Strategic Rail Freight Interchanges, alongside writer Gareth Dennis and Intermodality’s Nick Gallop – join here. And for a taster of what we may cover, here’s Iain’s recent SRFIs blog post.
I was left feeling that the nuances of how our wretchedly complicated, but still, at some level, functional system are lost in the political chatter. Of course, these sessions aren’t “debates” as such but in large measure a long succession of disjointed interventions and special pleading. Has anyone yet coined the term NIMC? There was certainly a lot of “not in my constituency” and very little discernible appreciation of the utter reliance of this country on private sector risk-taking and funding for most new homes (regardless of tenure) and employment-generating development. How can the development of 300,000 homes a year (confirmed by Michael Gove in Select Committee on 13 June 2022 still to be the target) be remotely possible in this political and fiscal climate? So many MPs assert the case for a lower target for their particular constituency: we know what underlies the clamour against centralisation of power (a theme we’ll come back to shortly). Development is held again and again to be the culprit for failing public services, lack of infrastructure, waiting lists at GPs’ surgeries and so on – ahem, it’s new development that ends up paying for much of this – existing residents should look rather at the ways in which the Government chooses to manage and fund the provision of health care and other services. And if the complaint is not that new residents are overwhelming local services (not true) it’s that developers are securing permissions and then choosing not to building them out (not true, although there are certainly unnecessary delays largely caused by the clunkiness of the planning system itself: you want to amend your development proposals to reflect the inevitable market changes or regulatory requirements since you first applied for planning permission years ago? Well that’s not going to be a simple process at all my friend). (Beauty as a way to securing greater acceptance of development? Despite the Government having alighted upon that particular agenda, driving the proposals around local design codes for instance, that issue seemed to receive little airtime).
The Bill entered Committee stage on 21 June 2022. The Public Bill Committee first heard evidence from various witnesses and then started line by line consideration of the Bill on 28 June 2022. They have not yet reached the planning provisions but the transcript of the discussion so far is here.
The Levelling-up, Housing and Communities Select Committee, chaired by Clive Betts MP, is holding a mini inquiry into the Bill. Michael Gove MP, Stuart Andrew MP and Simon Gallagher all gave evidence on 13 June 2022, which was slightly more illuminating. For instance, an exchange in relation to design codes from the session:
“Chair: Are we going to have the same level of consultation on the supplementary plans and design codes [as on the local plan]?
Simon Gallagher: Yes. One of the objectives of design codes is that they are locally popular, which is going to require a degree of engagement. Supplementary plans are created as one of the vehicles by which there would be opportunity for proper engagement, or legal force design codes. One of the problems with design codes at the moment is that they are often produced as supplementary planning guidance, which has no legal force.
One thing we have done in the Bill, subject to Parliament’s views, is to create something that is a legal device, a supplementary plan, which must be consulted on. Design codes must be provably popular and we are using the Office for Place to champion the best means of that community engagement.”
One of the themes that has dominated discussion of the Bill has been a concern that it could lead to a centralising of power, for instance by way of the requirement that decisions should be made in accordance with national development management policies (as well as local plans), unless material considerations “strongly” indicate otherwise – thereby putting this potentially amorphous concept of national development management policies (the extent of which is for the Government to determine and which can be added to or amended by the Government with as little prior consultation as it chooses) on the same level as statutory local plans.
“a) The Bill represents a significant change to the existing planning system. It undermines an important planning principle, the primacy of the development plan, by elevating national development management policies to the top of the planning hierarchy.
b) Unlike development plans, which are produced locally via a statutory process that involves considerable public participation, the Bill contains no obligation to allow the public to participate in the development of national development management policies.
c) The Bill also introduces two new development plan documents, spatial development strategies and supplementary plans. The Bill provides for very limited opportunities for public participation in the production of these documents.
d) The Bill introduces a new mechanism to allow the Secretary of State to grant planning permission for controversial developments, bypassing the planning system entirely. There is no right for the public to be consulted as part of this process.
e) Overall, in our view the Bill radically centralises planning decision-making and substantially erodes public participation in the planning system.”
Clive Betts pursued this theme with the witnesses on 13 June 2022:
“Chair: I am told that this is new in the way it is written into legislation. We have had very interesting legal advice from Paul Brown QC and Alex Shattock from Landmark Chambers, and it might be helpful if the Committee wrote to you with some of the questions that they have raised, which are pretty serious accusations of a centralisation that these measures are bringing about.
Michael Gove: Of course, I would be more than happy to explain the position and, indeed, any distance that these proposals place between themselves and the existing practice. I do not believe that they do significantly, but I am very happy to engage with the advice that the Committee has sought, and with others as well.
Simon Gallagher: Just to add to that, the Secretary of State referred a few minutes ago to the national planning policy framework prospectus that we were going to publish in July. We intend to set out in that how we can use these powers most effectively. That will give us the basis for proper engagement. I accept that, on the face of the Bill, it is a bit hard to read our intentions, so we need a little bit more detail and explanation out there, which will help.”
There was a further session on 20 June 2022, with evidence given by Victoria Hills RTPI), Hugh Ellis ((TCPA)and Chris Young QC.
Clive Betts’ has subsequently written to Michael Gove asking for his response by 4 July 2022 to a number of points in the “opinion” by Paul Brown QC and Alex Shattock (NB for what it’s worth, it’s not an opinion – barristers are careful in their use of language, it’s just a briefing note).
This month we can also expect to see the Government’s prospectus as to its intended approach to revising the NPPF as well as how it intends to draw up its national development management policies.
We are going to be running our own discussion on Clubhouse on the “who will have the power?” question, at 6 pm on 19 July. More details soon but do join here. Indeed, if you would like to speak do let me know – we would like a diverse range of voices and views.
I will also be speaking at the National Planning Forum event “The good, the bad and the beautiful – the Levelling Up and Regeneration Bill – a planning panacea?” on 5 July and hope to explore the issues a little further alongside an excellent panel of fellow speakers.
There has been much consternation in some circles about DLUHC’s 6 June 2022 consultation paper Compulsory purchase – compensation reforms: consultation which, amongst other things, proposes introducing an amendment to the Levelling-up and Regeneration Bill so as to “to allow acquiring authorities to request a direction from the Secretary of State that, for a specific scheme, payments in respect of hope value may be capped at existing use value or an amount above existing use value where it can be shown that the public interest in doing so would be justified.”
Key passages from the consultation paper:
“29. An option for the framework of seeking a direction might be as follows:
a. Before a public sector acquiring authority:
a. makes a CPO; or
b. applies for other types of Order seeking compulsory purchase powers,
it may apply for a direction from the Secretary of State in relation to a specific scheme.
b. The direction sought may, in relation to the proposed scheme, have the effect of:
a. taking no account of AAD [appropriate alternative development] in a valuation; or
b. limiting the payment of any effect of AAD to no more than a specific percentage over the existing use value.
c. In seeking a direction from the Secretary of State, the authority would need to:
a. identify the scheme;
b. provide details of the estimated land value that would be captured as a result of issuing a direction for the scheme; and
c. evidence how that land value would be applied to the scheme for the public benefit and/or how certainty over the level of compensation payments in respect of prospective planning permission will benefit the scheme.
d. In considering an application for a direction then Secretary of State may appoint a person with requisite expertise to make a recommendation as to whether to issue a direction.
e. Any disputed compensation that relates to AAD would be settled by the Upper Tribunal (Lands Chamber) on the basis of the terms of the direction.”
“…we would welcome views as to whether the proposals set out should go further and look to cap or remove hope value generally or in relation to specific types of schemes. “
“Should the government decide, following consideration of the consultation responses, to take forward this proposal, our intention is for the power to make such directions to be introduced as an amendment to the Levelling-up and Regeneration Bill.”
Land owners, wherever their land is in England and Wales, may find that it can be compulsorily acquired at less than market value. And, on the subject of market value, what effect will that risk have on the value attributed to land in the first place (above existing use value)?
“The Government agrees that there is scope for central and local Government to claim a greater proportion of land value increases. The Government’s priority is delivery, in line with the Housing Minister’s commitments to provide more higher quality housing more quickly.
Changes to land value capture systems can have profound impacts on the land market in the short term, even where they are sensible for the longer term. Accordingly, the Government’s priority is to evolve the existing system of developer contributions to make them more transparent, efficient and accountable. It will of course continue to explore options for further reforms to better capture land value uplift, providing it can be assured that the short-run impact on land markets does not distract from delivering a better housing market.”
“To further incentivise councils to build, the Conservatives also intend to reform compulsory purchase rules to allow councils to buy brownfield land and pocket sites more cheaply. At the moment, councils must purchase land at “market value”, which includes the price with planning permission, irrespective of whether it has it or not. As a result, there has been a more than 100% increase in the price of land relative to GDP over the last 20 years and the price of land for housing has diverged considerably from agricultural land in the last fifty years. Between 1959 and 2017, agricultural land has doubled in value in real terms from £4,300 per acre to £8,900 per acre, while land for planning permission has increased by 1,200%, from £107,000 to just over £1,450,000. Local authorities therefore very rarely use their CPO powers for social housing, leaving derelict buildings in town centres, unused pocket sites and industrial sites remain undeveloped.”
The proposals have grown over time – this is no longer simply about brownfield land and “pocket sites”.
What do we think? Will this be a workable tool that might enable authorities to secure development with reduced land costs such that affordable housing and other essential social and physical infrastructure can be provided? Or a proposal that will give rise to more heat (litigation) than light and that interferes unacceptably with the rights of land owners as against the rights of society more generally?
There are so many angles to this: political, economic, commercial and legal. Which make this an ideal topic for our next clubhouse session: 5pm on Wednesday 15 June 2022. We will have an array of well-known commentators, including Rebecca Clutten QC, Caroline Daly, Raj Gupta, Colin Cottage, Henry Church and Richard Asher. Link here.
And if you missed our webinar last week “Will the Bill deliver more or less housing? Yes or no?” featuring Simon Gallagher (Department of Levelling Up, Housing and Communities), Zack Simons (Landmark Chambers), Kathryn Ventham (Barton Willmore now Stantec) Meeta Kaur and myself, there’s a youtube link here.