UK: Planning Update: Recent Changes

Last Updated: 21 May 2014
Article by Rob Bruce

Changes in the planning system are continuing at pace. We report and comment on some of the recent key changes that seek to:

  • improve planning authority performance and we consider this in the context of the actual statistics;
  • boost the supply of affordable housing and assist the economic recovery; and
  • iron out flaws in the Community Infrastructure Levy (CIL) system.

Government consultation on planning performance

The Consultation seeks views on proposals which aim to improve the speed of decisions on planning applications for major development.

The Government is proposing that its threshold for designating planning authorities as under-performing, based on the speed of deciding applications for major development, should increase from 30 per cent to 40 per cent or less of decisions made within the statutory period of 13 weeks (or 16 weeks for applications subject to Environmental Impact Assessment (EIA)), unless a longer period has been agreed with the applicant. This threshold could be raised further at a later stage.

If following the consultation the Government decides to take the changes forward, a revised document will be laid before Parliament for a statutory 40-day period before any changes can come into effect.

Our view

Failure by a planning authority to meet the target can result in the Secretary of State designating the authority as underperforming so that the Planning Inspectorate takes responsibility for determining the authority's major planning applications. The increase in the target is likely to increase standards at the lower end. Other targets for the time taken to determine planning applications that result in a reduction of central government funding for planning authorities are more effective in respect of mid to better performing authorities.

Planning statistics

In the year ending December 2013, district level planning authorities:

  • received 464,400 planning applications, an increase of one per cent compared to the previous year but below the peak of 689,000 in 2004-2005; and
  • approved 88 per cent of planning applications, an increase of one per cent compared to the previous year and the highest level of planning approvals since 2007.

In the year ending December 2013, 67 per cent of major applications were processed within 13 weeks. This is an 11 per cent increase from the previous year.

Our view

The slight improvement in the number of planning applications submitted and approved appears consistent with an incremental improvement in the economy. However, in terms of the number of applications submitted, we are surprised that the increase is not greater in light of the improving economic outlook.

Increased borrowing powers for council affordable homes

In order to boost affordable housing and assist the economic recovery the Government announced in April 2014 that Councils will be able to bid for a share of £300m of extra borrowing. This funding will be made available through an increase in their housing revenue account borrowing cap, and invested in new affordable housing over two years from 2015.

It was also confirmed that the rules about council land sales would change, so more surplus and redundant land and property can be released to build homes for local communities.

In order to obtain extra borrowing powers councils will have to show maximum value for money.

The Government say this reform will enable councils to keep their rents and receipts from house or land sales, in return for taking more responsibility for housing in their area.

CIL (Amendment) Regulations 2014

The 2014 CIL Amendment Regulations were brought into force in February 2014.

The key changes of interest are:

  • A new "vacancy test" (for off-setting existing floorspace in the CIL calculation to avoid additional CIL charges):
    • for in-use buildings, the qualifying period is now six months of continuous lawful use within the relevant three-year period; and
    • for other buildings, retained parts will not be charged CIL if its planning use will not change and can be carried on lawfully and permanently.
  • Extension of the deadline for charging authorities to adopt CIL in their areas until April 2015 before restrictions on the use of section 106 and section 278 agreements come into effect.
  • A change to allow charging authorities to set differential rates by the size of development as well as type.
  • A requirement on the charging authority to strike an appropriate balance between the desirability of funding infrastructure from the levy and the potential effects of the levy on the economic viability of development across the area. Previously the authority only had to "aim to strike the appropriate balance".
  • The option for charging authorities to accept payments in kind through the provision of infrastructure either on-site or off-site in lieu of paying the levy. The infrastructure must not be required to make the development acceptable in planning terms. This restricts the benefit of this amendment. Existing provisions for payments in kind by land transfers also remain.
  • Provisions for phasing of levy payments to all types of planning permission.
  • Social Housing Relief on qualifying communal development. This deals with the current uncertainty over whether or not communal areas should be excluded for the purposes of calculating CIL. 
  • Discretionary relief for discounted market housing (housing made available at no more than 80 per cent of open market value).
  • The prevention of the use of section 278 highway agreements to fund the same infrastructure as the levy, so that developers are not charged twice. A gap, however, still exists for section 38 highways agreements (presumably because dedication and adoption of private land as public highway requires an agreement with the land owners) and other statutory agreements (other than section 106 planning obligations and section 278 agreements).

Our view

The CIL changes are generally welcomed, particularly those to extend the deadline for the introduction of CIL to April 2015 to support the economic recovery and the vacancy test. The new vacancy test is a significant improvement on the previous requirement for six months of continuous lawful use in the relevant 12-month period that we observed was causing significant problems in practice and leading sometimes to absurd outcomes.

EIA amendments

The European Union in April 2014 adopted a directive amending the EIA Directive. The amendments seek to resolve perceived gaps and ambiguities in the EIA Directive. The general EIA process remains substantially the same and we wait to see what changes may be made by the Government to EIA Regulations as a result.


Overall, it has been another busy period for the Government. The continuing reform and state of flux leads to some uncertainty in the planning system, but generally we view the changes made as positive in terms of supporting development and the economic recovery.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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