In his Budget statement, the Chancellor announced his intention to tackle the planning system, which he described as “a chronic obstacle to economic growth”. Amongst a range of measures is a presumption in favour of sustainable development, provided it complies with planning policies, and an expressed expectation that planning authorities will prioritise growth and jobs. Much of the detail of the proposals remains to be settled. Initial reactions have been mixed and there is a feeling of deja vu!

Enterprise Zones

A major plank of the Chancellor’s policy is the reintroduction of Enterprise Zones in which financial incentives and the relaxation of planning restrictions are intended to kick start economic growth. Zones will be located in urban areas of highest need and growth potential. The first four have been announced as Boots campus in Nottingham, Liverpool Waters, Manchester Airport and London Borough of Newham’s Royal Docks with others in Birmingham and Solihull, Leeds, Tees Valley, Tyneside, Bristol, the Black Country, Derbyshire and Sheffield. 10 more will be announced in the summer. The exact locations will be designated by Local Enterprise Partnerships.

Businesses moving into a Zone during the current Parliament will have a 100 per cent business rate discount, worth up to £275,000 over five years. The growth in business rates for at least 25 years will be retained by local authorities for local investment.

Within the Zones, the planning regime will be “radically simplified”. The detail is awaited but this may involve using Local Development Orders to allow certain development without planning permission. There will also be Government help to introduce superfast broadband and possibly also enhanced capital allowances and tax increment financing.

The response of the RICS, typical of much of the initial reaction to the announcement, is that it is not clear how effective the new zones will be in stimulating long term sustainable development beyond an initial boost. The incentives may attract short term investment but at the expense of other nearby areas.

Streamlining the Planning System

A package of measures was announced to remove bureaucracy and speed up the planning system including:

  • a guarantee to deal with planning applications, including appeals, within 12 months;  
  • extending permitted development rights for minor commercial development;  
  • consulting on permitting change of use without planning permission from business, general industrial or storage use (use classes B1, B2 and B8) to residential; and  
  • removing national targets for development on brownfield sites.  

Land Auctions

The Chancellor also announced that the controversial idea of land auctions is to be piloted on public sector land. As the Plan For Growth explains “The model would generally involve local authorities auctioning planning permission on parcels of land, owned either by the public sector or private landowners who want to participate.” The idea has been widely criticised and its flaws are fairly obvious: it depends on landowners not choosing to obtain planning permission themselves, and it requires the authority to incur considerable administrative cost without the certainty of a good price at auction. It is hard to see how the scheme could be workable unless planning permissions which would not otherwise be available are granted for commercial reasons which may well be inconsistent with sound planning objections. It is far from certain that these measures will succeed in delivering sustained economic growth.