The Localism Act- implications for developers

The Localism Act 2011 received Royal Assent in November 2011, heralding a number of changes to the planning system with implications for property developers.

The changes are the result of a landmark overhaul of the English planning system, with the aim of reducing the cost, uncertainty and red tape associated with the existing system, whilst seeking to encourage sustainable development rather than development based on Government targets.

Abolition of the regional tier of planning - taking power away from central government and moving away from a target driven planning decision system.

Local authorities will, amongst other things, be responsible for identifying their own future housing requirements without having to consider regional housing targets and so will have the power to drive sub-regional growth and development.

There will also be a duty on local authorities to co-operate in the planning of sustainable development, being one of the ways in which strategic planning can be maintained.

It remains to be seen how local authorities will interpret these powers and whether they will succeed in promoting and achieving regional growth.

Creation of a new tier of neighbourhood planning - giving communities the ability to have more control over development in their local area by creating a forum and by drawing up a neighbourhood development plan and neighbourhood development order.

Such plans or orders would still need to be in line with the local planning policy but once adopted would become the principle plan or order for that area. This may give more clarity to developers regarding the type of development that is needed and what will be permitted.

The criteria to become a member of a forum are relatively strict. For example, there must be a minimum number of individuals who live or work in the area, the forum must be established with a view to improving the social, economic and environmental wellbeing of that area and documented in a written constitution.
The Localism Act allows greater business involvement in neighbourhood planning, especially in neighbourhoods that are largely commercial in character. This could benefit developers who may be able to take advantage of the business community influence on the neighbourhood planning process.
As the production of neighbourhood plans is likely to require time and resource there could also be a role for those promoting development to sponsor the plans.

These new provisions will give developers an opportunity to get involved at an early stage in the neighbourhood plan process, so that the development they are promoting becomes part of the principal plan for the neighbourhood in question.

Pre-application consultation - this places a requirement on developers to consult local communities before submitting planning applications for certain types of developments. Whilst it is not yet clear who or what applications this will apply to, it is suggested that it will only apply to large scale major applications.

The new provisions will inevitably impose a raft of new statutory responsibilities on developers, who will have to be more thorough at this stage of the process. However, having the opportunity to iron out any local issues before an application is submitted may help to side step objections and reduce delays, which could have a bigger and more costly impact on the final form of application.

Retention of the community infrastructure levy - this gives local authorities greater control to set charges, which developers must pay for, for infrastructure that must be strategic rather than in relation to a particular development.

The Localism Act includes an obligation for a ‘meaningful proportion’ of the community infrastructure levy to be passed to local communities, as an incentive for those communities to accept ‘sustainable’ development, although what constitutes a ‘meaningful proportion’ is yet to be defined.

Whilst a number of sections of the Localism Act are already in force, others will come into force later this year during 2012.

For further information please contact Yildiz Betez.