The presumption in favour of sustainable development. Community Infrastructure Levy Update
The presumption in favour of sustainable development – will it make a difference?
Well of course it will. The questions are how, how much, and how do we know what it means? The presumption was first announced by George Osborne in his 2011 Budget and his clear intention was to use it to help make Britain the destination of choice for those wanting to start a new business. He sees it playing a significant role in economic recovery and national competitiveness. Whilst we have to recognise that other Government ministers appear to be less enthusiastic, including the Secretary of State for Communities and Local Government, the presumption is now truly embedded in Government policy.
The National Planning Policy Framework is the starting point. In the foreword, Greg Clark, Minister for Planning, writes:
- The purpose of planning is to achieve sustainable development.
- Sustainable development is about positive growth – making economic, environmental and social progress for this and future generations.
- Development that is sustainable should go ahead, without delay.
- Planning must be a creative exercise in finding ways to enhance and improve the places in which we live our lives.
But we need to see that he also writes that this should be a collective enterprise. He believes that people and communities have been excluded, partly as a result of targets being imposed, and decisions taken, by remote bodies. Therefore the regional apparatus has been dismantled and neighbourhood planning introduced. In addition, the one-thousand-plus pages of planning policy has been a turn-off to ordinary people (and many planning professionals, myself included, feel that national policy had become verbose, repetitive and even tedious) and is replaced by ”around fifty, written simply and clearly…allowing people and communities back into planning”.
The NPPF gives the meaning of sustainable development initially on page two – incorporating the Brundtland Commission definition – meeting the needs of today without compromising the ability of future generations to meet their own needs – and also the five guiding principles adopted in 2005 – living within the planet’s environmental limits; ensuring a strong, healthy and just society; achieving a sustainable economy; promoting good governance; and using sound science responsibly. The meat of the presumption for decision-taking (development control as we used to call it) is that:
- proposals which accord with the development plan should be approved without delay; and
- where the plan is absent, silent, or relevant policies are out-of-date, permission should be granted unless:
- its adverse impact would significantly and demonstrably outweigh its benefit as assessed against the policies in the NPPF as a whole; or
- specific policies in the framework say development should be restricted.
This must of course be read subject to the requirement to take decisions in accordance with the development plan unless material considerations indicate otherwise. But the NPPF and the presumption are material considerations.
Some people say that words like “significantly” and “demonstrably” are vague and hard to interpret. Experience suggests otherwise. They are drawn straight from the policies of the 1980s when there was a presumption in favour of “development which does not cause demonstrable harm to interests of acknowledged importance”. It was applied without too much difficulty then and surely does not present serious difficulties now.
The actual working out of the presumption is going to be strongly influenced by the rest of the NPPF which explains the Government’s view of sustainable development in practice. So we shall have to look at that carefully. It talks of boosting the supply of housing, protecting green belt land and ensuring the vitality of town centres, though it has to be said that the language is less inspirational than, for example, Greg Clark’s foreword.
Finally, what about existing development plans? Are they overridden? This is a key issue and the position is muddied by the transitional arrangements, which are arguably unnecessary. But we have them, so we had better pay attention. For twelve months planning authorities may continue to give full weight to policies adopted under the 2004 Act system even if there is a limited degree of conflict with the NPPF. So presumably plans which are in serious conflict cannot be relied on. And the use of the word “may” allows authorities to adopt the NPPF approach if they wish even where there is no conflict. But in other cases, which apparently means saved policies under the system before the 2004 Act, due weight should be given according to their degree of consistency with the NPPF – so for those the NPPF apparently cannot be used. It is difficult to see why the requirement is stronger for older policies and it is also disappointing to see that the Planning Inspectorate has already misinterpreted the position. It states that 2004 Act policies should be followed.
So to summarise, we have a positive planning policy emphasising positive growth. It will make a difference and both the presumption and the NPPF are required reading.
Community Infrastructure Levy Update
The Community Infrastructure Levy (“CIL”) was introduced under the Planning Act 2008 and came into effect in April 2010 pursuant to CIL Regulations 2010 (“the Regulations”) as amended by the Community Infrastructure Levy (Amendment) Regulations 2011. Although adoption is not compulsory, and whilst only a handful of authorities have adopted charging schedules so far, many more are now looking to take up CIL as there is a cut-off on 06 April 2014 for pooling more than five S106 contributions. The Mayor of London has already adopted a London-wide CIL which will apply to most developments granted consent on or after 1 April 2012. Approximately thirty more charging authorities have published draft schedules so the number likely to start charging by the end of 2012 is set to rise rapidly.
Application of CIL
CIL applies from the date of grant of planning permission but only becomes payable upon commencement of development. Most new buildings over 100 square metres will be caught by the levy although there are a few exemptions including relief for charities.
Rates for CIL are set out in a charging schedule and given as pounds per square metre, which will be levied on the net increase in gross internal floor space. They must be set at an appropriate level that will not adversely affect the economic viability of development. However, variable rates can be used for different areas or uses. In London, for example, the rate set for Zone 1 is £50 psm; Zone 2 £35 psm and Zone 3 £20 psm taking the gross internal floorspace.
If CIL is adopted by a local planning authority it does not mean that planning obligations cannot be imposed. S106 agreements will remain important for site specific mitigation requirements. Circular 05/05 dealing with S106 obligations has been revoked but the new National Planning Policy Framework (“NPPF”) as published in March this year sets out the same statutory tests for acceptability.
Changes made by the Localism Act 2011
The existing CIL regime is reformed by the provisions contained in Chapter 2 of the new Localism Act 2011 (“the Act”), amending the Planning Act 2008. This broadly relates to the way in which charging schedules are to be approved, and the way that the levy can be spent (ss114-115 of the Act).
In terms of the adoption process, a charging authority is now required to use appropriate available evidence to inform preparation of its draft charging schedule. The Act paves the way for further regulations to be introduced which will determine the type of evidence which is appropriate, what evidence is available, and how it is to be relied upon. Examiners will also be required to consider whether certain “drafting requirements” have been met, and to consider whether any non-compliance can be remedied, however if that is not possible the examiner must recommend rejection of the draft schedule. In a case where the examiner has recommended rejection the charging authority is then duty-bound to follow that advice. In a case where the examiner has recommended amendments to overcome non-compliance he must publish a report in a format to be prescribed, but a charging authority is not duty bound to follow the recommendations.
Amongst the other changes, the original statutory purpose of CIL has been expanded, which now relates to the broader costs supporting the development of an area. This is all designed to respond to the fears expressed in response to the original CIL Regulations that there needs to be a much closer nexus between CIL and local infrastructure delivery in the neighbourhoods where development takes place.
The levy can now be used for replacement, improvement, operation or maintenance of infrastructure, not just pure infrastructure provision. It will be possible for new regulations to specify that other persons are to be provided with levy receipts, who may then use that money for infrastructure, or additionally for anything else which helps address the demands placed on an area by development. Furthermore, any new regulations will be able to deal with the timing of this ‘return’ funding. Those persons may then be required to account for CIL and to monitor and report on its expenditure and there are related responsibilities on charging authorities in that regard.
There are a number of questions that commonly arise that we could assist on such as:
- How may charges apply to different types of development in different zones?
- What guarantees do I have that infrastructure will be delivered on time, and what sort of costs will this include?
- Will the appeal and review mechanisms be effective in relation to economic viability?
- What can we do to ensure that viability will be assessed fairly where reserved matters are approved much later in time when rates may have changed?
- Who is liable for paying CIL if the original developer goes bust or does not pay and what drafting will protect against this risk?
We are holding two workshops in autumn this year looking at CIL in more detail, and these frequently asked questions in particular, and the sort of issues that developers and local authorities should bear in mind. Invitations will be sent out later this year but if you would like to reserve a place please contact email@example.com.
CIL Legal Service
The adoption process for CIL is not straightforward and a number of legal issues often arise for both local authorities and developers. We offer a tailored legal service to provide full support for both ‘ad hoc’ questions and on-going advice.
This article is for general information purposes only and does not constitute legal or professional advice. It should not be used as a substitute for legal advice relating to your particular circumstances. Please note that the law may have changed since the date of this article.