A Brave New World for Developers?

1. A Brave New World for Developers? John Pugh-Smith Barrister & CEDR Accredited Mediator

2. What are the practical implications of: • The new NPPF • Localism • CIL A view on what this all means for the industry and how the future is looking. “A pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty” Winston Churchill

3. The ‘golden thread’ • ‘Sustainable development’ definition • expanded if not clarified: • - Defined by reference to the five guiding • principles from the 2005 UK Sustainability • Strategy Securing the Future • - Given ‘three dimensions’ giving rise to three • roles for the planning system: economic, social, and environmental • Described as ‘mutually dependent’ and • to ‘be sought jointly and simultaneously’ The NPPF: Achieving Sustainable Development

4. The 12 Core Planning Principles – planning should: • be genuinely plan-led, empowering local people to shape their surroundings; • not simply be about scrutiny, but instead be a creative exercise; • proactively drive and support sustainable economic development; • always seek to secure high quality design and a good standard of amenity; • take account of the different roles and character of different areas, including the intrinsic character and beauty of the countryside; • support the transition to a low carbon future in a changing climate; • contribute to conserving and enhancing the natural environment • encourage the effective use of brownfield land; • promote mixed use developments; • conserve heritage assets in a manner appropriate to their significance; • make the fullest possible use of public transport; • support local strategies to improve health, social and cultural wellbeing.

5. NPPF: The presumption in favour of sustainable development • Para 14 makes clear that for decision taking “where the development plan is absent, silent or relevant policies are out of date permission should be granted unless – Adverse effects of granting permission would significantly and demonstrably outweigh their benefits when assessed against the policies of this Framework as a whole” or – Protection against development is specifically provided for in the NPPF e.g. Green Belts. BUT • It cannot and does not alter the plan-led system (Para 12); but it seeks to: - embed the presumption in favour of development in the Development Plan System; and - apply that presumption now where the Development Plan is silent or out of date.

6. So when can the Development Plan be set aside in favour of the presumption? • When it is absent • When it is silent - a matter of fact and degree (and debate) When it is out of date. Whether a Plan is out of date will be a matter of fact, degree and judgment for the decision maker but some guidance is set out in Annex 1: – Policies not out of date simply because pre-date the NPPF. – Until 27.03.13 decision takers may give full weight to post 2004 policies even if limited degree of conflict. – Thereafter weight will depend on consistency with NPPF

7. Structure of Policies: the 13 sections 1. Building a strong, competitive economy 2. Ensuring the vitality of town centres 3. Supporting a prosperous rural economy 4. Promoting sustainable transport 5. Supporting high quality communications infrastructure 6. Delivering a wide choice of high quality homes 7. Requiring good design 8. Promoting healthy communities 9. Protecting Green Belt land 10. Meeting the challenge of climate change, flooding and coastal change 11. Conserving and enhancing the natural environment 12. Conserving and enhancing the historic environment 13. Facilitating the sustainable use of minerals N.B. Waste to be addressed separately

8. Specific matters: Retail, leisure, offices and other town centre uses • Town Centre first remains the priority. • Failure to shoulder the rigours of the sequential approach means a refusal • But policy recognises the importance of fully meeting the need for town centre uses such as retail, housing and leisure and ensuring that they are not compromised by limited site availability. • To this end the ability of out of centre sites to continue to meet needs that cannot be met on sequentially preferable sites is emphasised again. (Para 24). • On balance, a more realistic approach for developers.

9. Employment Land • Draft removed protection • Final version includes modified protection, dependent on the extent to which there is a ‘reasonable prospect’ of the land being used for employment • Change of use to residential from B use classes provided there are no strong economic reasons why this would be “inappropriate”

10. Rural Economy • Planning policies should ‘support economic growth in rural areas in order to create jobs and prosperity by taking a positive approach to sustainable new development’ through: • supporting the sustainable growth and expansion of all types of business and enterprise in rural areas, both through conversion of existing buildings and well designed new buildings; • promoting the development and diversification of agricultural and other land-based rural businesses; • supporting sustainable rural tourism and leisure developments that benefit businesses in rural areas, communities and visitors, and which respect the character of the countryside. • promoting the retention and development of local services and community facilities in villages, such as local shops, meeting places, sports venues, cultural buildings, public houses and places of worship.

11. Transport • Make the fullest possible use of public transport, walking and cycling, and focus significant development in locations which are or can be made sustainable (including larger scale residential developments with a mix of uses) • All developments that generate ‘significant amounts of movement’ should be supported by a Transport Statement or Transport Assessment plus a Travel Plan • Move to local parking standards • Encouragement to local authorities to improve quality of town centre parking and charges that do not undermine the vitality of the town centre • Infrastructure safeguarding – HS2+?

12. Housing: general approach • Again emphasis is on meeting the need not finding reasons for avoiding meeting the need. • Identify and update a supply of deliverable sites sufficient to provide 5 year supply of deliverable sites plus5% unless persistent record of under-provision in which case plus 20% (incl. windfall if track record) • Housing should be considered in the context of the presumption • Failure to have a 5 year land supply renders housing supply policies (including locational policies on supply) automatically out of date. • Then the presumption kicks in… permission unless the “harms” significantly and demonstrably outweigh the benefits, or, specific policy prohibition in the Framework • Emphasis on viability and deliverability

13. Housing: specific matters • LPAs to set densities to reflect local circumstances and policies to resist “inappropriate development of residential gardens” • Affordable housing targets removed (definition now includes social rented, affordable rented and intermediate housing but not low cost market housing); off-site contributions to be “robustly justified” • Change of use from B use classes provided there are no strong economic reasons why inappropriate • Rural Areas: - plan for local needs, particularly affordable housing including some market housing if it “would facilitate the provision of significant additional affordable housing to meet local needs” • locate housing where it will enhance or maintain the vitality of rural communities • avoid new isolated homes unless essential worker, optimum viable use of a heritage asset, re-use redundant or disused dwellings, or, exceptional quality or innovative nature of the design of the dwelling

14. Design • Given strong emphasis key aspect of sustainable development • ‘Great weight’ should be given to ‘outstanding or innovative designs which help raise the standard of design more generally in the area’. • ‘Permission should be refused for development of poor design that fails to take the opportunities available for improving the character and quality of an area and the way it functions’ • Design codes, where could lead to high quality outcomes but policies should avoid unnecessary prescription or detail • Proper to seek to promote or reinforce local distinctiveness but not to impose architectural styles or particular tastes • Importance of integration of new development • Is the scope further than that in PPS1?

15. Duty to Cooperate • Applies to planning issues that cross administrative boundaries, particularly those which relate to the strategic priorities. • The Government expects joint working on areas of common interest to be diligently undertaken for the mutual benefit of neighbouring authorities. • Local planning authorities will be expected to demonstrate evidence of having effectively cooperated to plan for issues with cross-boundary impacts when their Local Plans are submitted for examination.

16. Ensuring viability and deliverability? “Pursuing sustainable development requires careful attention to viability and costs in plan-making and decision-taking. Plans should be deliverable. Therefore, the sites and the scale of development identified in the plan should not be subject to such a scale of obligations and policy burdens that their ability to be developed viably is threatened. To ensure viability, the costs of any requirements likely to be applied to development, such as requirements for affordable housing, standards, infrastructure contributions or other requirements should, when taking account of the normal cost of development and mitigation, provide competitive returns to a willing land owner and willing developer to enable the development to be deliverable.” (Para. 173) “Where obligations are being sought or revised, local planning authorities should take account of changes in market conditions over time and, wherever appropriate, be sufficiently flexible to prevent planned development being stalled.” (Para. 205)

17. Some consequences of the Presumption • Timescales: - Most developers will understand that the determination and appeal period involved with a project are likely to exceed 12 months - Most LPAs will be struggling to achieve even a partial review of their development plans within that timeframe (though they are urged to and some are trying). - Much development will be determined at first instance in reliance upon extant development plans (which will be significantly less weighty by the date of the appeal) • Expectations: localism, elected members and constituents

18. Some impacts • There will be significantly more weight given to the positive economic impacts of developments with some “on balance” cases l being granted where before they would be refused simply for this reason • The presumption in favour of development will be hard to resist for LPAs unless significant and demonstrable harm can be shown, particularly where reliance is placed on out of date development plans • The longer term “freeing” of the system for developers will depend upon the efficient feeding of the new presumption in favour of development through the Development Plan system So, is it likely in the medium term and beyond that more permissions will be granted?

19. Concluding thoughts • Problems and uncertainties remain? • Inherent tension between devolution to the community level and objective of sustainable development across the country? • What will be the practical effects of the duty to cooperate? • To what extent will the NPPF be used as a litigation tool particularly in relation to out-of-date or allegedly contradictory local plans? • How will viability and deliverability be ensured in practice? • What will ‘sustainable development’ look like in delivered form? • When will we have more homes and jobs?

20. What IS “localism”? Localismdescribes a range of political philosophies which prioritize the local. Generally, localism supports local production and consumption of goods, local control of government, and promotion of local history, local culture and local identity. Localism can be contrasted with regionalism and centralized government, with its opposite being found in the unitary state . (Wikipedia) Fox Strategic Land & Property Ltd v SSCLG [2012] EWHC 444 (Admin) • Localism - “a principle which at this stage has nothing about it against which one can measure a proposal” But, currently, it is simply being translated into a prematurity refusal reason (see e.g. Wainhomes (South West) Holdings Ltd v SSCLG [2012] EWHC 914 (Admin) - housing development (1,300 dwellings) at St Austell that was on such a scale that releasing the site for development would be premature in advance of the local authority establishing the appropriate level of future housing.

21. The plain English Guide • New freedoms and flexibilities for local government • General power of competence: • Abolition of the Standards Board and clarifying the rules on predetermination • Directly elected mayors and other freedoms • New rights and powers for communities and individuals • Community rights to challenge and to bid (assets of community value) • Reform to make the planning system more democratic and more effective • Abolition of RSS and duty to cooperate • Community right to build and neighbourhood planning • Requirement for planning application community consultation • Reforming CIL and the way Local Plan are made • Reform to ensure that social housing decisions are taken locally

22. However, even before s.122 of the 2011 Act (which will require specific consultation on certain planning applications) the consultation process had already been legislatively embedded… • Town and Country Planning Act (1971/1990) publicity of planning applications and formal consultation requirements under the T&CP (General Development Procedure Order) 1995, now the T&CP (Development Management Procedure) Order 2010 (from 01.10.10) • Human Rights Act 1998implementing the European Convention on Human Rights, including: Article 6: the right to a fair hearing ; Article 8: the right to respect for private and family life; Article 1, First Protocol: the right to property • Planning and Compulsory Purchase Act 2004 which introduced the Statement of Community Involvement (SCI) as a matter of policy for each LPA with s.18(2) applying the SCI requirement to the emergence of the Local Development Framework development plan documents (ss. 19,26 & 28), and, to development control decisions under Part III of the Town and Country Planning Act 1990

23. Legal Considerations: “The Sedley Principles” Consultation must be at a time when proposals are still at a formative stage The proposer must give sufficient reasons for any proposal to permit of intelligent consideration and response Adequate time must be given for consideration and response The product of the consultation must be conscientiously taken into account in finalising any proposals

24. The need for real consultation and response • LPAs will need to ensure that : - They have a “clear understanding” of local needs , and ,a proportionate evidence base - The terms of the SCI are being met for development management decisions • Successful developers will need to deploy a community-focused local approach to secure planning, and, to reflect that process in their submission documentation • Will this lead to more or less High Court challenges?

25. And local finance considerations:New section 70(2)(b) of the TCPA 1990 • Local finance considerations, so far as material to the development, relevant material consideration since 15.01.12 • CIL and NHB both “local finance considerations” • DCLG consultation paper on NHB: “ … in some cases [NHB] could lawfully be taken into account as a material consideration where there is a direct connection between the intended use of the Bonus and the proposed development". The House of Lords debate on the legal change also noted that, to be material, a consideration "must relate to the planning merits of the development in question.“ • Are CIL and NHB also only material if spending plans openly published? • Should a Developer identify NHB and CIL revenue generated by its scheme in its Planning Statement and Environmental Statement? • Weighting: enabling role of development?

26. The Community Infrastructure Levy

27. Relevant infrastructure - Regn 123(4): “relevant infrastructure” means— • (a) where a charging authority has published on its website a list of infrastructure projects or types of infrastructure that it intends will be, or may be, wholly or partly funded by CIL, those infrastructure projects or types of infrastructure, or • (b) where no such list has been published, any infrastructure. • CIL intended to provide infrastructure to support development of an area rather than impact mitigation of a particular development: current April 2014 cut-off for LPAs • Important of website list: avoidance of double charging?

28. CIL applies to ...? “Development”: anything done for creating a new building, or, in respect of an existing building but not to non or intermittently occupied buildings and structures Net additional increase in floorspace (“chargeable development” ) Each phase of outline planning permission Original chargeable development where s.73 extension of time Permitted development under GPDO but not, currently ss.191 & 192 CLEUDS and CLOPUDs

29. Who pays? Freeholder or lessee (7 years plus) of land on which liable development is situated Burden runs with benefit of p.p. Apportionment

30. Exemptions? Pre- & Post-Schedule: Development category Developer justification Exemptions Charities (block) social housing Other exceptions? State aid? Nil rates

31. When is CIL due? Development commencement “material operations” demolition? when? different project planning? Commencement notice requirement default? LPA determination Payment windows? Funding timelines?

32. Continuing role for s.278 Highways Act agreements and s.106 TCPA obligations - Provision that is not capable of being funded by CIL: • Affordable housing (CIL Amendment?) • Specific impact mitigation not identified on LPA CIL website • Infrastructure projects where pooled contributions from five or less separate planning obligations - Continuing importance of tests previously in Circular 05/2005 now NPPF, para. 204 and Regn. 122 of CILR 2010: • Necessary to make the development acceptable in planning terms; • Directly related to the development; • Fairly and reasonably related in scale and kind to the development

33. And the CIL tale from Newark & Sherwood DC (so far) ... 13.04.11: Charging Schedule submitted to PINS for examination under s.212 of the Planning Act 2008 20 & 21.7.11: Examination hearings before Nigel Payne BSc [Hons], Dip TP, MRTPI, 19.08.11: Report received 20.09.11: NSDC approves the Newark and Sherwood Community Infrastructure Levy (CIL) Charging Schedule, CIL Instalment Policy and Regulation 123 List of Schemes to be funded by CIL 01.12.11: Charging Schedule and Instalment Policy come into effect as part of the planning application process.

36. And a few little issues: • Inflexibility of CIL and need to rely upon s.106s to provide flexibility over development viability: what goes? • If the KISS principle is not adopted then there is a danger with differential charging rates (including within the same Use Class e.g. small and large retail) on policy grounds rather than on viability raise State Aid considerations • Inability of examiner, meaningfully, to assess viability and appropriateness of proposed rates • Increased financial burden a discouragement to development commencing?

37. And a further opportunity … Mediation Guide prepared, endorsed by Bob Neill MPMinister for Planning Launched at the RTPI Planning Convention June 2011 and available on the NPF web-site www.natplanforum.org.uk

38. John Pugh-Smith Barrister & CEDR Accredited Mediator Thirty-Nine Essex Street Chambers, 39 Essex Street, London, WC2R 3AT www.39essex.com john.pugh-smith@39essex.com Environment and Planning Set of the Year Environment and Planning Silk and Junior of the Year Thirty Nine Essex Street LLP is a governance and holding entity and a limited liability partnership registered in England and Wales (registered number 0C360005) with its registered office at 39 Essex Street, London WC2R 3AT Thirty Nine Essex Street's members provide legal and advocacy services as independent, self-employed barristers and no entity connected with Thirty Nine Essex Street provides any legal services. Thirty Nine Essex Street (Services) Limited manages the administrative, operational and support functions of Chambers and is a company incorporated in England and Wales (company number 7385894) with its registered office at 39 Essex Street, London WC2R 3AT