We devoted the December edition of our planning newsletter, Future Perfect?, to the Bill where we summarised a number of key planning issues, but what are the implications for the property industry?
Here are three points which seem to me to have relevance to property owners and professionals.
Assets of community value
With the “community” very much centre stage in the new world of localism, we see here one of the ways in which the Government plans to give more control to local people over the communities in which they live. Under the proposals, local authorities must keep a list of assets in the area with “community value”. Although we will need to wait for more detail in the regulations which are to follow, certain things are clear.
If property is included in this list (a listing which has five years as its default lifespan), then it cannot be disposed of (freehold or leasehold for more than 25 years) without notifying the local authority. This allows for a period of negotiation and potential bids from community groups before the property can be sold on the market. Inclusion on the list may flow from what the Bill calls a “community nomination”. This can be made by a parish or community council, or any other person specified in regulations.
So if you see the chair of the parish council walking by your front garden and taking notes … .
Enforcement time limits
For many years now, we have worked with the four or ten year periods at the end of which breaches of planning control are immune from enforcement action. However, 2010 saw two cases (Fidler and Welwyn Hatfield) which showed that, with careful concealment of the breach, the time period may pass unnoticed. This has sufficiently outraged the Government that it is seeking to use the Localism Bill to stop this happening.
Under the new proposals, even if the local authority first discovers the breach after the four or ten year period has passed, it can ask the Magistrates Court for an order allowing it still to take enforcement action. The court would only be able to make such an order where it is satisfied someone has concealed the breach – but the section allows for inaction to count as a sufficient act of concealment so the hurdle may not be very high.
Currently, a purchaser will often rely on the passage of the relevant time limit. However, if the proposals go through as drafted, this benefit will be largely nullified. In fact, it would even be questionable whether an application for a lawful development certificate (based on the passage of time) would be advisable since this in itself may encourage the making of an application to the Magistrates Court. So will we see price reductions to reflect this added risk?
In many cases, the message will be – if you believe you have the benefit of the time limit, but hadn’t got around to making an application for a lawful development certificate, now may be the time.
We were expecting to see in the Bill a presumption in favour of sustainable development (however that was to be defined). That has not appeared and we now know that the presumption will be a creature of the soon-to-be-forthcoming overhaul of national planning policy (see our blog on this subject).
The reason why this presumption was of real interest was to test the Government’s commitment to development. Will its programme bring forward the development it is talking about in terms of delivering economic growth (in particular housing and infrastructure) – or will the NIMBYs win out?
The Bill proposes some changes to the CIL regime and also allows local authorities to recover their relevant costs from development arising out of neighbourhood planning (neighbourhood plans/neighbourhood development orders/community right to buy). There cannot be many local planning authorities now not intending to bring forward CIL. Leaving aside the effect of the CIL regulations, CIL now has a real financial case behind it. To realise that benefit, of course, local authorities must grant planning permissions – so CIL should be seen as part of the package of incentives the Government is laying out to encourage development. But it cannot be denied that CIL and neighbourhood planning charges will impact on development viability.
The other incentives to encourage development include the New Homes Bonus, which closed as a consultation on Christmas Eve. Even a few months ago, many of us were sceptical about this as a means of encouraging development – but given the extent of the cuts to local authority budgets, it seems to be one of the few sources of income that local authorities cannot afford to pass by.