Housing bill provides for 'permission in principle' and government intervention in planning process

Out-Law News | 20 Oct 2015 | 4:15 pm | 3 min. read

The Housing and Planning Bill laid before UK parliament last week proposes to introduce 'permission in principle' on land allocated for development and to give the government significant new powers to intervene in the planning and plan-making processes.

The Bill also lays the foundations for the introduction or extension of several government housing policies.

In its published form, the Bill (119-page / 479 KB PDF) provides for 'permission in principle' (PiP) to be granted for land allocated for development in certain adopted or emerging documents.

Development orders from the communities secretary would be used to grant unconditional PiP directly or to provide for local authorities to grant it, for development proposals meeting a prescribed description. Full planning permission would then be granted by councils through a 'technical details consent', which would be able to be made subject to conditions.

An explanatory note (62-page / 844 KB PDF) accompanying the Bill said the government initially intends the use of PiP to be restricted to land allocated in development plan documents, neighbourhood plans and a new statutory register of brownfield land suitable for housing development. PiPs would come into effect when the relevant document was adopted or revised to allocate the land.

Several clauses propose new powers for government intervention in the local planning process. Where a council is considered to be failing to put a development plan document in place, the Bill would allow the communities secretary to prepare or revise the document or to direct the council as to how to proceed. The Bill would give the communities secretary a general power to direct the examiner of any development plan document to suspend examination, to consider specified matters or to hear evidence from specific persons.

The Bill would also enable the communities secretary to take steps to speed up the neighbourhood planning process. These include setting time limits for local authorities to decide whether to designate a neighbourhood planning area and whether a referendum should be held on a neighbourhood plan and prescribing dates by which an approved plan or neighbourhood development order must be approved.

On the request of the relevant neighbourhood planning group, the communities secretary would also be able to intervene in the council's decision on whether to hold a referendum in certain circumstances, including when the council has been too slow to decide.

The Bill provides the statutory framework for the introduction of the government's 'starter homes' initiative, through which homes are to be offered for sale to first-time buyers under the age of 40 at a discount of at least 20% of their market value. An initial price cap of £450,000 for starter homes in Greater London and £250,000 elsewhere in England is set in the provisions, which do not apply any restriction on the income of first-time buyers using the scheme.

A general duty will be imposed on councils in England to promote the supply of starter homes when carrying out their planning functions. It includes a power for the communities secretary to "provide that an English planning authority may only grant planning permission for a residential development of a specified description if the starter homes requirement is met".

Following an agreement between the communities secretary and England's housing associations earlier this month, the Bill will enable registered housing providers to offer their tenants the right to buy their home at a discount, using funding provided by grants from the Greater London Authority and central government. It will also introduce a duty for local authorities to consider selling their interest in high value housing that has become vacant, and allow the communities secretary to incentivise disposal by requiring a payment each year in respect of such interests.

The Bill will impose a duty on councils to provide a supply of planning permissions and permissions in principle to meet the demand for serviced plots of land in their area for use by those engaging in self-build or custom house building. Councils meeting certain criteria, to be determined in further regulations, will be able to apply to the communities secretary for exemption from this duty.

The provisions of the draft legislation also: allow for the introduction of new performance criteria for the removal of planning powers from local authorities; clarify and harmonise powers of compulsory purchase; and provide for the inclusion of an element of housing under nationally significant development projects.

Planning expert Lucy Close of Pinsent Masons, the law firm behind Out-Law.com said: "It can be expected that the Bill will be widely welcomed by developers as the emphasis is on building houses efficiently and helping more people to get onto the property ladder. Up to date local plans are key to development as they provide a common focus for developers, local planning authorities and local communities, bringing stability and therefore encouraging investment. A register of brownfield sites will also help the property sector to understand what land is available to work with and how to make the most of it."

"However, a crucial point to remember is that the planning system is only one element of a wider solution that is needed to deliver more housing nationally," said Close. "Although figures show that the number of permissions granted for housing has increased in recent years, it is important that these permissions are then converted into completed houses in a timely and efficient manner. Therefore, whilst this bill may be viewed as a positive step forward to solving the housing crisis, the government needs to ensure that other elements of the housing market, such as finance, infrastructure and skilled labour, are aligned so that houses are actually delivered."