The Localism Act 2011 (“the Act”) was granted Royal assent on 15 November 2011. Some of the provisions in the Act came into force during the 12 month period November 2011 and November 2012. It is anticipated that the remaining provisions (incorporating some of the aspects summarised below) will come into force by January 2013.
This briefing note summarises some of the main points and implications of the Act for property practitioners and professionals including;
- The changes to national and regional Planning strategies and processes
- Introduction of a Community right to bid for assets and to challenge the Local Authority
- The impact on the Tenancy Deposit Scheme
- The Abolition of Home Information Packs
- Change of Local Authority power in setting Business rates and Council Tax
- Implications for Social Housing
1.1 Abolition of regional strategy
The Act returns decisions on planning and housing supply from the regional to the Local Planning Authorities (‘LPAs’)
1.2 Duty on Local Authorities and public bodies to co-operate on planning issues.
Where once the responsibility fell with the regional bodies it is Local Authorities that now have a duty to co-operate regarding planning and sustainable development. The obligation imposed on LPAs and other bodies is to ‘engage constructively, actively and on an ongoing basis’ with local communities in the preparation of development plans,local development documents and other activities supporting development planning. The Act imposes certain obligations and limitations on planning inspectors in particular LPAs will be generating policy documents on how to take these changes forward.
1.3 Neighbourhood Development Orders
The Act introduces the Neighbourhood Development Order (‘NDO’). An NDO is an order that grants planning permission in a particular neighbourhood for development specified in that order. The Act allows any qualifying body(for example a parish council a body designated as a neighbourhood forum) to request an NDO and if granted implement certain developments without the need for planning permission from the LPA.
1.4 Community infrastructure levy (“CIL’’)
The Act changes CIL to make it more flexible allowing some of the money raised to be spent on ongoing costs of existing infrastructure as well as on new infrastructure. It also grants Local Authorities greater freedom in setting the levy that a developer should contribute and ensuring that some of the money raised benefits the neighbourhood where the development takes place.
1.5 Consultation with local communities.
The Act places a new duty on developers to consult local communities before submitting planning applications above a specified size. It is currently proposed that this obligation comes into effect for major developments i.e. of 200 residential units or more and developments of 10,000 square metres or more of new floorspace.
The requirements for this consultation process and include for example, publishing the application details in a manner that would reasonably bring details of proposals to the attention of the majority of people living or occupying the premises in the surrounding area of the application site. Developers would be required to have regard to any responses received.
1.6 Unauthorised development
The Act introduces new rules giving councils the ability to take enforcement action for extended periods against individuals or bodies that deliberately conceal unauthorised development.
The Councils will also have the power to decline retrospective applications where an enforcement notice exists.
1.7 Abolition of Infrastructure Planning Commission (‘‘IPC’’)
The IPC was established in October 2009 and is an independent, non-departmental public body responsible for considering and making decisions in England and Wales for nationally significant infrastructure projects (‘‘NSIPs’’) that exceed statutory thresholds.
The Act abolishes the IPC and transfers the functions of the IPC to the Secretary of State (‘SoS’) instead including for example introducing a three month time limit for the SoS to make a decision after an application has been examined.
2 Community Empowerment
2.1 Community right to bid for assets
The Act introduces an obligation on Local Authorities to maintain a comprehensive list of land assets of community value. Once an asset has been recorded on this list, the owner will not be permitted to dispose of it unless notification of the intended disposal has been given to the relevant Local Authority and community interest groups, such as charities and social enterprises, have had the opportunity to bid for the asset.
2.1 Community right to challenge
The Community right to challenge permits certain groups to challenge a local authority by expressing an interest in running a service. Those groups are voluntary and community groups, social enterprises, Parish Councils and Local authority employees currently delivering a service.
3.1 Tenancy Deposit Scheme
Since 6 April 2007 it has been compulsory for a landlord granting a residential Assured Shorthold Tenancy in England and Wales, where a deposit is paid by the tenant, to join a Tenancy Deposit Scheme (‘’TDS’’). The landlord must provide the tenant with details of the particular TDS being used and the mechanics for the release of the deposit (the “Prescribed Information”) and hold the deposit in accordance with the provisions of the TDS. The Act requires landlords to provide tenants with the Prescribed Information within 30 days of receipt of the deposit rather than within a period of 14 days (as was previously the case). If a landlord fails to comply with this 30 day time frame, the tenant can apply to Court to enforce compliance, even if the tenancy has ended. If the Court finds that a landlord has failed to comply, the landlord may be ordered to pay a penalty of between one and three times the amount of the deposit.
3.1 Abolition of Home Information Packs
The Act formally abolishes the requirement for a seller of residential property to provide a Home Information Pack (‘’HIP’’) save for the obligation to provide an Energy Performance Certificate (“EPC”) which remains.
3.2 Business rates and Council Tax
The Act gives Local Authorities more control over business rates, cancels unfair backdated business rates and prevents Councils from imposing a business rate supplement on firms if a simple majority of those affected do not give consent. In addition the process for claiming small business rate relief has been simplified. Local Authorities currently have absolute discretion in setting the amount of Council Tax levied. The Act provides that, if a Local Authority proposes to raise Council Tax above the level set by the Secretary of State, it must hold a referendum to obtain the consent of local voters.
3.3 Social housing
There are various changes to the social housing regime and to homelessness legislation including a national homeswap scheme, reforming the current system of council housing finance, and giving local housing authorities greater freedom about who should qualify and who should go on the waiting list.