Lord Shipley
Main Page: Lord Shipley (Liberal Democrat - Life peer)
Lord Shipley
My Lords, I should first declare my interest as a vice-president of the Local Government Association. I am grateful to the Minister for the opportunity to have this debate, albeit at very short notice. The reason is that we shall not be discussing the Growth and Infrastructure Bill for several weeks and, given the importance of growth to the economy, this is a valuable opportunity to debate the background, particularly the proposals around planning, which exist in the context of the Localism Act.
The period after the Summer Recess, and through the party conference season, is often one for announcements. There is a tendency for ideas to be floated and an equal tendency for some of them to start to sink when the detail is examined. So it was with announcements on planning made on 6 and 7 September, many of which were welcome and were described by the Minister, but some of which most certainly require further thought and revision.
I agree entirely that the Government’s overriding objective should be growth and to get Britain building again. That is right. Growth drives jobs and it drives higher tax income to spend on public services. Therefore, we should welcome the £300 million to provide 15,000 affordable homes across the country and the extension to the refurbishment programme to bring an extra 5,000 empty homes back into use, together with the £280 million for FirstBuy, the shared equity scheme, to give a further 16,500 first-time buyers the chance to own their own home. We should welcome the £10 billion of loan guarantees to housing associations, property management companies and developers to enable them to secure lower borrowing costs, which should lead to thousands of extra rental homes being built. All this creates jobs and helps to deal with the shortage of affordable homes.
There are many positive aspects in the Growth and Infrastructure Bill, such as bringing the town and village green legislation into line with the planning system, some positive proposals around the importance of broadband to growth and the short-term postponement of business rates revaluation. However, we need to be clear what the problems are that we are trying to solve in the planning system and to secure broad agreement to these. The main barrier to growth seems to me to be access to finance, not the rate of determinations and approvals. For example, we debated at length in the Local Government Finance Bill the need to extend tax increment financing. We know that the lack of investment finance in construction and mortgages is the major cause of the low number of housing starts. The Local Government Finance Bill contains a clear incentive to local councils to drive growth, in which they themselves will share. It is in everyone’s interests for development to succeed.
We should note that there are existing permissions for 400,000 new homes yet to be built by developers and that planning approvals for residential and commercial applications ran at 87% in 2011-12. Indeed, approvals for major office, general industry and retail distribution were more than 90%. It is no surprise that the British Property Federation has commented that the reforms proposed to the planning system would increase uncertainty rather than reduce it, because it does not ring true that the main problem that we need to solve is a failure of local councils to manage the planning process speedily or well enough.
The Bill seems too centralist in its thinking at the very same time that the Localism Act is coming into effect, encouraging local decision-making and neighbourhood planning. I am very pleased that the Minister has been able to announce this evening that 200 neighbourhood plans are in the process of being developed. However, the Bill would give much greater power to the Planning Inspectorate than seems justified and it is unclear why this is thought to be necessary when it is likely to increase conflict with local authorities. An unintended consequence could well be to increase the time taken to determine applications. I think that the involvement of the Planning Inspectorate would be of positive benefit with very large schemes that cross several council boundaries. Under the Growth and Infrastructure Bill, the Secretary of State would be able to direct that some major infrastructure developments, such as energy, transport and waste projects, would require consent under the major infrastructure planning regime. I understand and support that, but clarity is still needed on what would fall within the national framework and what the role of local planning committees would be. I hope that the Minister may be able to give some greater clarity today, because the power of the Secretary of State should not be used to remove from local decision-making, for example, retail and business applications. Such a proposal would in any event be contrary to the aims and ambitions of the Localism Act.
I would like now to address the issue of the so-called poor performers, who could lose the right to determine applications. It is true that some planning departments are less good than they should be. It is also true that some planning committees can make poor decisions. But the majority are good and deliver to time. The DCLG has stated that large-scale commercial projects would be fast-tracked for determination within 12 months, but we should note that councils currently approve over 90% within 52 weeks. Planning magazine for 19 October 2012 listed the slowest decision-makers for all applications in 2011-12, and even the slowest got nine out of 10 applications determined within 26 weeks. I do not feel that the accusation of slowness is proven here. On major applications, the slowest decision-makers are spread across the country, with the lowest being Torbay at 31% within 26 weeks and the London Borough of Kensington and Chelsea with 33% within 26 weeks, with the 25th slowest being New Forest, determining 58% within 26 weeks.
The Minister will be reassured that I do not think that statistics such as these should be taken at face value. I would prefer to know more about why the figures are as they are, because they might reflect complex Section 106 negotiations; there may be Highways Agency delays, of which there are far too many; and they might relate to any one of a number of government agencies that are not subject to the same standards of response times as local government. I am at present unconvinced that action is required by the Secretary of State as long as advice and mentoring are available to authorities deemed to be slow.
However, there is another test that we should pay more attention to, which is that of planning authorities with the highest proportion of defeats on appeal. There is some evidence that too many councils lose too many appeals, which suggests that an improvement may be justified. Of course, it could be that some planning appeals are incorrectly judged. Whatever the case, the first step should always be to enable a poorly performing council to improve, with special measures being introduced only when there is a very serious failure in the quality and speed of decisions. We have just passed the Local Government Finance Bill. That encourages growth, because local authorities can share in it. Councils have a clear reason to drive growth, so I remain puzzled as to why so much emphasis is placed on giving the impression that councils are doing a poor job when the evidence does not really justify that.
On Section 106 agreements, I understand the problems faced by developers financing affordable housing, but I would not wish to see enforced renegotiation meaning that benefits from Section 106 agreements are lost for ever. We support the Government’s objective to get the construction industry moving, but there is a significant body of evidence to show that councils are responding to local conditions and trying to find local solutions. Enabling the Secretary of State to give the Planning Inspectorate power to override Section 106 agreements in terms of the number of affordable units and to decide the number of affordable homes in schemes seems to me to be over the top. Central government’s role must be to make sure that there is a demand for housing by addressing the financing for social housing and access to mortgage finance for private buyers.
There has been a cross-party LGA response asking the Government to rethink their proposals to force renegotiation of Section 106 agreements with developers that provide an element of affordable housing. Councils can do this anyway and many are. Councils can in any case be purchasers of last resort to rent out the homes that they buy. If these proposals go ahead, there is a possibility that developers could try to delay building to pursue renegotiation. Section 106 in any case can relate to community facilities such as schools, street lights and access roads and there are clear dangers in taking power over such matters from local planning committees. Anyway, who will be the judge of viability of a scheme containing affordable homes? Is there evidence that central government knows better than local government? I do not think that the case is proven. There is now evidence to suggest that, when voluntary renegotiation has happened, on average councils are accepting a level of affordable housing around one-third lower than stated in their local plan. If plans in relation to Section 106 renegotiations are continued, a system of independent verification of claims of unviability should be established, possibly through the Homes and Communities Agency.
I also suggest that the HCA scoring system for the allocation of the additional funds announced—the £300 million cash and £10 billion loan guarantees that I referred to earlier—should reflect the willingness of a local council to renegotiate a Section 106 agreement in its area. I also support consideration being given to HCA funds being used to make viable an otherwise unviable site so that the full measures in a Section 106 agreement can be maintained. I recognise that guidance will be given once the Bill is agreed about how viability of Section 106 agreements should be assessed. I hope that the Minister will agree that there is a danger that a national assessment undertaken outside the area might not reflect local circumstances and, secondly, that while the affordable housing element is the one emphasised so far, new schools, roads and community facilities can be just as important.
I refer now to the amendments proposed to the Communications Act on 7 September, when it was announced that broadband street cabinets could be installed in any location other than a site of special scientific interest without the need for prior approval and without any conditions. These are large junction boxes, so surely there has to be some local and neighbourhood consultation in the spirit of localism. I understand that this change may have to include—and I seek the Minister’s clarification of this—that all telecommunications equipment and infrastructure could be part of this. I hope that the Minister will agree that this should not give rise to the uncontrolled installation of mobile phone masts and related equipment in unsuitable locations, particularly areas of natural beauty.
Finally, there are proposals on extensions and permitted development rights. On these, it is not clear what problem the Government are trying to solve. It would not increase the number of extensions by very much, but it would increase the number of disputes between neighbours. Once built, such extensions would stand for many years. In any case, Article 4 directions could be used in such cases, so I question why this proposal has been made and why there have been suggestions that it could last longer than the three years initially proposed.
I conclude by saying that these issues need full debate, involving all parties. We need clear statements and agreements as to what the problems are that we have to solve. With agreement to those, solutions can be found, so I hope that the Minister will agree that we need further discussion and that we can build on that further discussion to devise the right way to proceed.