Planning considerations as Environment Bill returns to parliament

Out-Law Analysis | 02 Nov 2020 | 3:26 pm | 6 min. read

The Environment Bill proposes a number of changes relevant to developers in England, particularly around biodiversity net gain and including net gain in local plans and National Policy Statements.

The Environment Bill returns to the UK parliament this week, ahead of the Public Bill Committee reporting deadline on 1 December. There remain a number of parliamentary hurdles for it to clear, and therefore significant scope for further amendments to be introduced.

However, amidst moves more generally to put the issue of biodiversity loss and nature conservation front and centre, and ahead of the UN Biodiversity Conference in 2021, it seems likely that a number of the existing provisions affecting developers will survive.

The language of environmental or biodiversity net gain has been cropping up in policy documents, local plans and case law in recent years. Ahead of the Bill becoming law, a patchwork of different requirements is already emerging based on local plan requirements, which are themselves based on the provisions of the National Planning Policy Framework (NPPF).

The detail of a number of the regimes set out in the Bill will be the subject of future regulations, and a number of consultations are likely to follow. Developers should be ready to respond and help to shape the regimes.

Biodiversity net gain

If passed in its current form, the Bill would amend the 1990 Town and Country Planning Act (TCPA) to require that, subject to some exceptions outlined below, all planning permissions granted in England will be subject to a deemed condition that development cannot begin unless:

  • a biodiversity gain plan has been submitted; and
  • the planning authority has approved the plan.

The Bill sets out what the developer's biodiversity gain plan must contain, including information about the steps that will be taken to minimise the adverse effect of the development on the biodiversity of the onsite habitat and the site's pre- and post-development biodiversity value. The planning authority can only approve the plan if it is satisfied that key matters are as specified in the plan, and that the biodiversity gain objective is met.

The new mandatory 'biodiversity gain objective' is for the biodiversity attributable to the development to exceed by at least 10% the pre-development biodiversity value of the 'onsite habitat', which is defined as the habitat on the land to which the planning permission relates. The 'relevant date' for assessment purposes is generally the date on which planning permission is granted, although the developer and planning authority can agree another date if more appropriate.

The Bill also provides that where a developer carries out activities which do not have planning permission and which lower the biodiversity value of onsite habitat, the pre-development biodiversity value must be the value prior to those activities taking place. This is intended to prevent developers from degrading habitat before planning permission is obtained in order to reduce their net gain obligations.

The biodiversity value of the development would be the total of:

  • the post-development biodiversity value of the onsite habitat; and
  • the biodiversity value of any registered offsite biodiversity gain allocated to the development; and
  • the biodiversity value of any biodiversity credits purchased for the development.

An offsite biodiversity gain site is separate site, away from the development site, at which habitat enhancement works must be carried out under a conservation covenant or planning obligation imposed on the development site. The enhancement must be maintained for at least 30 years after the completion of work on the development site.

The Bill would permit the secretary of state to make regulations to set up a biodiversity gains site register, including eligibility criteria for land to be registered and who may apply to register land.

The Bill would enable the secretary of state to make arrangements for a system of 'biodiversity credits', which could be purchased by developers instead of a requirement to make onsite or offsite biodiversity enhancements. The funds generated from the purchase of biodiversity credits would be used to fund habitat enhancements in England, purchasing interests in land with a view to carrying out these enhancements and operating and administering these arrangements. Any works funded in this way would have to be additional to works that the government is already required to carry out.

The price of biodiversity credits would be set by the secretary of state, at a level which does not discourage offsite enhancement and registration of biodiversity gain sites in the register.

The secretary of state would be required to produce and publish a biodiversity metric, to be used for calculating the biodiversity value of any habitat or habitat enhancement. A draft metric is expected to be published for consultation, but it is expected to be based on the existing Defra biodiversity metric.

Before the Environment Bill was published, a government consultation response indicated that there would be a number of exemptions from the new requirements. However, based on the current draft, only Permitted Developments and Nationally Significant Infrastructure Projects (NSIPs) would be excluded. The current position is that all development, including minor development, in England requiring consent under TCPA would be subject to the new requirements. There is a power for the secretary of state to introduce exemptions by regulations.

There is also a power in the Bill for the secretary of state to modify, or exclude, the requirements in relation to biodiversity net gain where the onsite habitat is 'irreplaceable' habitat. Irreplaceable is as yet undefined, but could potentially be defined in line with the NPPF to include ancient woodland and ancient or veteran trees. Any such regulations would also have to require arrangements to be made for the purpose of minimising adverse effects of development on the biodiversity of the onsite habitat.

The secretary of state would also have the power to modify the biodiversity net gain requirements in relation to the grant of outline planning permission where reserved matters require phased development, or in relation to the grant of planning permission for development which can be carried out in phases.

Conservation covenants

It is expected that the proposed biodiversity net gain requirements would lead to the need for more long-term covenants to be secured over land. Currently, there are a number of potential issues with this, including the fact that conservation agreements are personal agreements which do not bind successors in title.

The Bill makes provision for new 'conservation covenants'. These are legally binding agreements between a landowner or lessee and a 'responsible body' – such as the secretary of state, local authority or other body designated as a responsible body by the secretary of state – in relation to a 'qualifying estate' with provisions of a 'qualifying kind'. They must have a 'conservation purpose', and be intended for the public good.

In this context a qualifying estate is a freehold or leasehold granted for a term of more than seven years. A qualifying kind of provision is a provision which either requires the landowner to do, or not do, something on land in relation to which the landowner holds a ‘qualifying estate’, or requires or allows the responsible body to do something on such land.

Key features of the proposed conservation covenants are:

  • they will bind successors in title and those deriving an interest from the covenanting party, and will be registered as local land charges;
  • they will apply for an indefinite period of time or the remainder of the leasehold interest as the default position, unless a shorter period is agreed;
  • any ancillary provisions contained in the conservation covenant agreement, such as provisions relating to how the work is to be undertaken, will also be given statutory effect;
  • they can be used to conserve – meaning to protect, restore or enhance - land as a place of archaeological, architectural, artistic, cultural or historic interest, or the setting of such land, and so apply more widely than just the natural environment;
  • remedies for breach of provisions of a 'qualifying kind' and ancillary provisions are set out in the Bill and include specific performance, injunctions and damages;
  • there is scope to vary and discharge covenants, and also to appoint a replacement responsible body.

Conservation covenants will be relevant to developers undertaking all scales of development, whether they are used to secure biodiversity net gain required under the Environment Bill or for protection, restoration or enhancement driven by other requirements – such as policy, mitigation or compensation required under the Environmental Impact Assessment (EIA) or Habitats Regulations. They may also be helpful in the context of NSIPs.

There had previously been some suggestion that a template covenant would be made available. However, there is currently no sign of this, as well as a question mark over whether such a one size fits all approach would adequately cater for the range of different scenarios that such agreements might need to cover. It is therefore likely that these will be drafted and negotiated on a case by case basis, albeit that a number of responsible bodies may prepare their own standard agreements that they will expect to be used.