Latest CLG consultation: you need to get involved
||16 January 2013
After two years of upheaval in the planning system there are faint signs that the emphasis on growth is starting to produce positive results, but the house building sector must participate in the process of change if a workable system is to be achieved.
Inspectors are placing welcome emphasis on the need for local planning authorities to both robustly justify their housing targets and make sure they have an identified land supply which will enable the targets to be delivered. However, house building figures are still hampered by deep-rooted viability issues and, in particular, the need to achieve sufficient return to incentivise landowners to sell land. In that respect the NPPF establishes the broad parameter that in order to be viable development must “provide competitive returns to a willing landowner”, but fails to provide a detailed definition of what constitutes a ‘competitive’ return.
This gap in planning guidance was recently highlighted by Lord Taylor (in the December 2012 “External Review of Government Planning Practice Guidance”) who concluded that the preparation of guidance on Viability needed immediate attention “to ensure planning authorities and developers have a good mutual understanding of what this test requires” and it is exploration of this area of ‘mutual understanding’ which is likely to expose the fundamental conflict in all viability negotiations; i.e. if planning obligations are to be funded from the uplift in land value what proportion will incentivise a landowner to sell the site?
The Lord Taylor report is open for consultation until 15th February 2013 (http://planningguidance.readandcomment.com/respond/) and it is essential that the industry makes its voice heard as this debate underpins both the release of land and the establishment of CIL payments. Very recent examples of the range in opinion as to acceptable land values can be illustrated with reference to, on the one hand, a national consultancy advocating EUV + 20% in support of a draft CIL charge to, alternatively, an Inspector agreeing at a S.78 inquiry that a landowner should receive EUV + 50% of the uplift in unfettered land value. On a brownfield site the first example results in 70% of unfettered land value being available to fund planning obligations whereas the latter approach makes 38% available. These figures would be 92% and 53% respectively on a greenfield site.
Furthermore, the Lord Taylor report also proposes that future guidance should “exclude best practice exemplar type information which is better provided by practitioner bodies”. When opinions differ to the extent illustrated above which practitioner body will hold sway?
This consultation is about more than just sweeping away thousands of pages of out-of-date guidance and it is essential the industry responds to the consultation process to deliver a planning system which works.