Proposed changes to planning law – good news for developers?

19 August, 2014
by: Cripps Pemberton Greenish

The Government has again shown its commitment ‘to get Britain building’ in its latest consultation on planning law.


The reforms proposed in the consultation are generally good news for developers. The Government has stated that its aim is to make practical improvements to help achieve development and housing which ‘our future growth depends on’.


Below, I summarise some of the most significant proposals.


  1. Allowing light industrial buildings, storage and distribution buildings, launderettes, amusement arcades, casinos and nightclubs that were in that use at the time of the 2014 Budget (19 March 2014) to be converted to residential use.


This change is being proposed as a small step towards increasing vitally required housing and although there is little comment in the consultation on why or how these particular property uses have been selected, it is possible that the Government had reducing local objections to housing in mind with residential use arguably being more desirable.


In line with the existing permitted change from office use to residential, the change itself would be approved using permitted development rights and the local planning authority (“LPA”) will only be able to consult on specific prior approval matters.


  1. Making the current permitted development rights for offices to be converted to housing permanent.


Despite the controversy surrounding these rights and concern over loss of active office space rather than redevelopment of empty office buildings, the Government has not made any suggestions for changes that would mean only vacant offices could benefit from the existing rights. The Government has instead proposed that the existing rights (due to expire on 30 May 2016) become permanent.


Developers should note that the Government has also confirmed that, in any event, the existing rights will be extended until 30 May 2019.


That said, under the new proposals, in addition to flooding, highways and transport and contamination the LPA would also be able to consider if the development would cause ‘the significant loss of the most strategically important office accommodation’ and refuse the change of use if necessary. However, the Government’s intention is to support the housing market. Therefore, the consultation confirms that this new prior approval matter would be tightly defined and LPA areas currently exempt from the existing permitted development rights would not be exempt from the permanent rights proposed.


  1. Deemed consent in relation to certain pre-commencement conditions and the return of fees if no decision has been made within 8 weeks


If these proposals are successful the LPA would have 6 weeks to make a decision on a prior approval based pre-commencement condition, after which point the applicant could serve notice on the LPA confirming that unless a decision is reached within 2 weeks its consent will be deemed and the application to discharge the condition will be successful.


This could be a key step in helping development to move forward and preventing delays which are no fault of developers. It will also assist when negotiating default positions in terms of s.106 agreements which also often include clauses requiring approval of certain matters or confirmation of compliance of certain clauses before development can begin.


  1. Increasing the thresholds for when Environmental Impact Assessments will be required.


The Government must be careful with any changes it makes to when an EIA will be required as the need for an EIA does not just come from UK law but stems from a European Directive which the Government must not breach.


However, the Government wishes to make changes to reduce the number of unnecessary applications and suggests that some LPAs and developers have been carrying out screening unnecessarily due to the fear of legal challenge. Statistics show that of the 160 urban development projects screened by the Secretary of State between 2011 and 2014 only 20% of those actually required an EIA.


To tackle this issue the Government is proposing to increase the thresholds on urban development projects (including housing, cinemas, hospitals and schools) and industrial estate development (including manufacturing, trading and distribution/transport) which cover the most common project types subject to EIA. This would mean that far fewer projects would require screening.


The current proposal for residential urban development projects is to increase the threshold on the size of the development before it will be seen as likely to have a significant impact and therefore have to be screened. The current size threshold is 0.5 hectares and this would be increased to ‘five hectares including where there is up to one hectare of non-residential urban development’.


This would generally mean that developments of 150 houses or less that are not in a ‘sensitive area’ (as defined in the Town and Country Planning (EIA) Regulations 2011) including for example National Parks, Scheduled Monuments and special area of conservation would not be deemed likely to give rise to significant environmental effects and therefore will not require automatic screening.


However, the consultation paper makes it clear that the Government would like to do more to unlock growth but is also wary of breaching European law. Therefore, at this stage the proposal is only to increase the threshold from 0.5 hectares to 5 hectares. However, the Government’s guidance suggests that in reality it is unlikely that a residential urban development project would have significant environmental effect unless it was of around 30 hectares or more (roughly 1,000 houses).


Whether this threshold can be increased any further without breaching European law is currently in debate and the Government has sought comments on this issue as part of the consultation. A jump of 29.5 hectares seems unlikely to be interpreted as complying with the European Directive which aims to stringently monitor and protect against adverse impacts on the environment due to development. However, perhaps a middle ground of around 10 hectares or 300 houses is a step the Government may consider if it is willing to push the boundaries of European law limits to help tackle the current housing crisis.


In relation to industrial estate development the threshold would also be raised from 0.5 hectares to 5 hectares. This change would have a noticeable impact as, at present, practically all industrial estate developments require screening as they are unlikely to be 0.5 hectares or smaller in size. The proposal would therefore mean that at least the smallest developments (outside of sensitive areas) would not require a screening opinion.


In addition to (and arguably in contrast with) the above, the Government is also seeking views on changes that will make the process of putting in place neighbourhood plans quicker and easier. It has also been made clear in the consultation that once a neighbourhood plan has been adopted, local authorities should be aware that the adverse impact of allowing a development that conflicts with key policies in the neighbourhood plan are likely to be substantial. The consultation document also confirms that this is a consideration for the decision makers even where the local planning authority cannot demonstrate a five year housing supply.


The consultation is open until the 26 September so watch this space for further updates!