In the latest of our series of blogs examining the Government’s technical consultation on implementation of the planning changes, we consider the proposed changes to planning application fees.

Currently, planning application fees are set nationally, and were last revised in 2012. The Government is now considering increasing fees, but only for local authorities who are providing an ‘effective service’. Changes to the fee regulations are anticipated to come in in Autumn 2016, after the enactment of the Housing and Planning Bill, which includes provisions to make it easier for different fee scales to be applied in different areas.

The technical consultation proposes that fee increases would be:

  • increased by a ‘proportionate’ amount, linked to both inflation and performance;
  • reviewed regularly, with adjustments on an annual basis, if required, to keep pace with inflation;
  • limited to the best performing authorities. Authorities designated as under-performing would be excluded (or eligibility for increases would be limited to authorities in the top 75% of performance for both speed and quality of decisions).

The consultation asks for opinions on whether:

  • changes should be implemented quickly (meaning under-performing authorities would be excluded from the Autumn 2016 increase) or whether there should be a grace period to encourage improvement; and
  • fast track services should be provided in return for a proportionate fee, and whether the requirements for any fast track services should be set out in legislation or more informally through local performance agreements.

The Government has decided, for now, not to allow fees to be set locally. Its concern is that while authorities remain solely responsible for the planning service in their area, there is too high a risk of unintended consequences – such as fees being increased to a level which dissuades applications from coming forward. Nonetheless, the door is open to these changes – the Consultation notes the desire for ‘radical service improvement’ and potential introduction of competition in the processing of applications.  Where outsourcing goes beyond the initial pilots, providers (including local authorities) would need significantly more flexibility to set their own fees and service standards.

Whilst all local authorities would no doubt be happy to accept higher fees, many will feel unfairly penalised if the increases are linked to performance at a time when budgets continue to be cut. Allowing authorities to determine fee levels in return for the introduction of competition into the application processing market may also not prove as welcome as the Government hopes. Local authorities may consider the proposals to be a double-edged sword, with the benefits of setting their own fees being outweighed by the risks of being undercut by the private sector, as well as the loss of overall control of the planning process.