Summary and implications

The Government’s commitment to shake up the planning system by abolishing regional strategies and the newly created Infrastructure Planning Commission (IPC), is generating shared feelings of uncertainty and concern amongst developers and local authorities alike.

This briefing note outlines:

  • The consequences and implications of the abolition of these two critical planning functions;
  • The timetable for reform; and
  • Action that applicants should take.

Abolition of Regional Strategies

The Secretary of State for Communities and Local Government, Eric Pickles, formally revoked all Regional Strategies on 6 July 2010, although they will not be legally abolished until the Localism and Decentralisation Bill is enacted which is likely to be in November 2011.

What are Regional Strategies and why were they important?

Regional Strategies were introduced in their most recent form by the 2004 planning reforms. They were intended to create a regional tier of policy between local authorities and national government in order to ensure cross boundary co-ordination of strategic planning and, in particular, the delivery of centrally imposed housing targets. Regional Strategies informed the preparation of local development frameworks and planning authorities were required to take them into account when determining planning applications.

Why is the abolition of Regional Strategies causing so much concern?

The Government’s July announcement was accompanied by a short guidance note to local authorities in the form of a Q&A document on the impact of the revocation. This guidance is intended to constitute a material consideration in the determination planning applications. However, it fails to provide local authorities with a sufficiently clear steer or a firm transition agenda on how they should determine applications in the period between revocation of Regional Strategies and the legislation to abolish them altogether.

Pressing issue – uncertainty

Aside from the debate as to whether or not these changes will positively rebalance planning control and ensure the right planning decisions are made at a local level, or whether, without a higher level structure, local authorities will act as rivals allowing nimbyism to run riot, the pressing issue for planners, developers and inspectors alike is the practical difficulty in trying to operate within what is now an uncertain policy environment.

Uncertainty exists at a number of levels. First is whether the Government’s decision to revoke Regional Strategies before primary legislation is in place was lawful. A legal challenge has already been launched by Cala Homes. Questions have also arisen as to whether the Government’s actions are potentially contrary to EU legal principles that require a degree of public participation before changes to plans can be made. There is also uncertainty to whether the remaining parts of local development frameworks are adequate and fit for purpose and whether the Planning Policy Statements that have been based on Regional Strategies, and are taken into account in the decision making process, could now be rendered unsound.

Consequences

None of these uncertainties are likely to be resolved in the immediate future which could make any strategic planning decision an easy target for challenge. Unsurprisingly, Councils are reluctant to make decisions until they are more certain about what is going to happen and how the new system will work. Applicants (particularly house builders) don’t know whether to submit applications now or to put them on hold, or on what grounds to base an appeal where applications have been rejected. As a result, the number of development schemes being abandoned or put on hold is growing. The National Housing Federation has found that 85,000 planned homes have already been scrapped since the Government’s announcement and this figure is likely to rise.

With a twin threat of legal challenges from Europe and by local objectors, it is inevitable that the courts will have a role to play in establishing the ground rules of the new system, even if clearer guidance is issued. This means the new system could take years to establish and the level of uncertainty is set to stay. Frustratingly, and at a time when residential and commercial developers could do with a boost, there is little that developers and local authorities can do other than to keep up to date with changes, consider the consequences and participate in any consultations on the emerging legislation as and when the opportunities arise.

Abolition of the IPC

Whilst not causing quite the same stir as the decision to abolish Regional Strategies, the other major planning reform is the Government’s decision to abolish the IPC.

The future of the Infrastructure Planning Commission (IPC)

The IPC is the independent decision making body that was created under the Planning Act 2008 to decide applications for nationally significant infrastructure projects. It only opened its doors to receive applications from 1 March this year, but will be abolished when the Decentralisation and Localism Bill is enacted, which is likely to be in November 2011.

How will decisions on large infrastructure projects be taken?

The previous Government introduced the IPC to speed up and simplify planning for large infrastructure projects. The intention was that decisions would be made in less than a year following submission of an application and a single development consent granted authorising all aspects of the project. However, the new Government’s main concern with the IPC is that its decisions will be undemocratic as they are taken by unelected Commissioners. The IPC will therefore be replaced with a “Major Infrastructure Unit”, which the Government has confirmed will retain the expertise, process and special character of the IPC, and will constitute an “efficient and democratically accountable” system that will provide a fast-track process for major infrastructure projects.

Major Infrastructure Unit

This unit will be part of a restructured Department of Communities and Local Government that will also include the Planning Inspectorate. Recommendations on nationally significant infrastructure projects will ultimately be made to the relevant Secretaries of State for final decisions. In practice, although no formal announcement has been made as to how the new regime will work, it is likely that the main difference between the IPC regime and the new regime will be that the Planning Inspectorate will set the procedure for the examination of the application and make a recommendation to the Secretary of State as to how the application should be decided. This is similar to the existing procedures for the largest and most complex planning inquiries, so will not amount to radical reform.

Critical issue for promoters

The critical issue for promoters of infrastructure projects is that the transition between the two processes is smooth that projects started under the existing IPC regime will not have to be restarted and that there will be no advantage in the existing process over the new process and vice versa. The Government has repeatedly stated that there will be no question of this being the case, and that the statutory timetable for decision making will be no longer under the new regime. Whilst the details of the new consenting procedure are being developed, the existing IPC process continues. Applicants do not appear to be delaying submissions of applications as a result of this announcement; by the middle of July 43 projects were already included in the IPC’s programme. However, the devil will of course be in the detail of the emerging legislation as to whether or not the Government’s intentions of a smooth transition translate into reality for promoters.

Timetable for reform – an end to uncertainty?

The Decentralisation and Localism Bill that will deliver these two major reforms, as well as reforms to other areas of planning, local government and housing law, is intended to become law in 2011. The ramifications of these changes mean that the Bill is likely to be carefully scrutinised by those with interests in these sectors and will probably attract significant opinion and debate. This timetable could well be delayed, so an end to the uncertainty created by these reforms will, unfortunately, not be on the immediate horizon.