Planning and Infrastructure Bill (First sitting)

Paul Holmes Excerpts

Committee stage
Thursday 24th April 2025 Public Bill Committees

[The Chair]

We will now hear oral evidence from Robbie Owen, board secretary and director at the National Infrastructure Planning Association and head of infrastructure planning at Pinsent Masons LLP, and Sir John Armitt CBE, former chair of the National Infrastructure Commission. Before calling the first Member to ask a question, I remind Members that questions should be limited to matters within the scope of the Bill. We must stick to the timings in the programme motion that the Committee has agreed for this panel. We have until 12.05 pm. I call the Opposition spokesperson.

[Paul Holmes (Hamble Valley) (Con)]

Q Sir John and Mr Owen, thank you very much for coming this morning. As you know, this is a huge piece of legislation, and we want to scrutinise it to the best of our ability. Thank you for the work that you do in your occupations.

We remain consistent in our concern about democratic accountability and processes, and about the balance between speeding up planning delivery and retaining the power of local people to make differences and have their say on nationally important critical infrastructure. First, do you think that these proposals strike the right balance between speeding up the delivery of national infrastructure projects and public accountability? Do you think that democratic and public accountability will remain at the heart of the delivery of that national infrastructure under the Bill’s proposals?

Sir John Armitt: Yes. I think this is a reasonable attempt to address the fundamental question of getting the balance right between taking forward the critical national infrastructure that the country needs and local interest. Consultation has always been an essential part of that, and the ability of people to express their views is important. Having said that, it is and will continue to be a very complex area. People on the receiving end of new infrastructure will naturally seek every mechanism in their legal right to challenge where they feel that they will be adversely affected. The Bill seeks to set out a number of remedies for that, and I think one could reasonably expect to see some acceleration, but just how much acceleration there will be in the process only time will tell.

Robbie Owen: I broadly agree with that; I think the Bill largely strikes the right balance. Let us not forget that even in the light of the amendments tabled by the Minister yesterday in relation to consultation, there will still be an extensive amount of consultation required—justifiably so—in relation to these projects, involving, among others, the local community. The examination of applications for consent takes place over a maximum of six months, which is a very long time, within which the local community can express their views. The Government are retaining the ability for local impact reports to be produced, which I think is important. I have no fundamental concern that democratic and public accountability will be lost by these changes. I actually think they do not quite go far enough in some respects, but we may come on to that later.

[The Minister for Housing and Planning (Matthew Pennycook)]

Q Thank you both for your time this morning. I also wanted to ask you about the nationally significant infrastructure projects regime. As you know, the objective of the Bill in this area—chapter 1 of part 1—is to provide for a more certain regime, but also to speed up the process through which applications are taken, because we have seen, as you are both aware, a deterioration in the performance of the system over recent years. We have done a huge amount of consultation on this legislation—statutory consultations, working papers, calls for evidence—but we are still very much in listening mode on whether any further changes are required. I want to get your views, picking up on the comments that you just made. In terms of the critical barriers to bringing forward major economic infrastructure, where do you think the Bill gets things right, and where does it not go far enough?

Sir John Armitt: The Bill seeks, to a large extent, to provide a regime of compensation to offset where people are going to be affected. That, in a sense, is no different from what we have seen in the housing sector in section 106, for example, for a very long time. The real challenge here is the ability of the process to actually slow things down. We know that judicial review is one of the big difficulties in this area. You could argue that the recent recommendations made for judicial review do not go that far. The only way in which it can be held back is where the court decides that the issue being raised is, perhaps not frivolous, but immaterial. But I would imagine that the nature of the legal system is such that people will find ways around that.

Judicial review constantly acts as a brake, and influences those who are developing projects to try to cross that bridge before they get there: you put in more mitigation than ideally you would wish, which raises the cost, and you potentially finish up with a more expensive project than ideally you would have had. That is the nature of people trying to second-guess what is going to be raised and how the judicial review will be handled.

I am not sure that the recommendations will go far enough to have a serious impact on that aspect, which is one of the central aspects of what has been holding up these schemes quite significantly. Each year of judicial review is likely to potentially add a year to the process, and that is why it is difficult to see that these changes will benefit the overall process by more than six to 12 months, at the end of the day. Robbie and I were talking about this before we came in; he is more of an expert in it, so I will turn to him for any other observations.

Robbie Owen: Minister, I absolutely support what is already in the Bill. I think that every provision on national infrastructure planning is appropriate, including what I hope will be added to the Bill through the amendments that you tabled yesterday, in relation to pre-application consultation and some other measures. As you say, those are all good measures that have followed extensive consultation and engagement.

There are two areas where I believe the Bill needs to go further, be bolder and be strengthened. The first relates to the further streamlining of the development consent order process. That should focus on allowing the standard process to be varied, on a case-by-case basis, where there is justification for doing so. That was trailed in your planning working paper in January; I encourage you and your officials to have another look at that, because there is a justification for giving some degree of flexibility to reflect the nature and requirements of individual projects and how the standard process might need to be adapted to them.

Secondly, we need to look again at the ability of the DCO process to be a one-stop shop for all the consents you need for construction of these big projects—that was the original intention back in 2008. All the discussions around that have yet to fully come to a conclusion. I note the review by Dan Corry, published a couple of weeks ago, but I do not think that it provides a full answer to allowing development consent orders to do more than they have been doing in practice, in terms of all these subsidiary consents, which, beyond the development consent order itself, are quite important for some of these big projects.

The other area where the Bill should and could go further relates to the whole area of judicial review. The changes that were announced in January, following the call for evidence off the back of the Banner review, are not particularly significant. They are really quite modest, and relate largely to the permission stage of judicial review. Approximately 70% of judicial review applications get permission and go forward, therefore we need to focus beyond the permission stage.

There are two other areas where the Bill could make some worthwhile changes. The first relates to the interaction between judicial review and national policy statements. As you will know, national policy statements are approved by Parliament, and the Bill contains some proposals to change that process. It has always struck me as strange that national policy statements can nevertheless still be, and are, judicially reviewed.

The final point on judicial review is that Parliament should be able, if it wishes, to use a simple one-clause Bill to confirm decisions to give development consent for projects of a critical national priority. This used to be the case: we used to have lots of provisional order confirmation Bills. I think that is a very good way for Parliament, where it wishes, to express its support for a big, critical project. That could easily be done through some amendments to the Bill.

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[The Chair]

I call shadow Minister Simmonds.

[Paul Holmes]

I am the shadow Minister.

[David Simmonds (Ruislip, Northwood and Pinner) (Con)]

Q I found the evidence you gave about the parliamentary process by which this might be streamlined really helpful, Mr Owen.

My question is for you both. One challenge for the planning system element of this Bill is that the local authority has a quasi-judicial role in administering planning law, and then statutory consultees and other organisations might be required to give consent for something, so the local authority has consented but Natural England, the Environment Agency or someone else needs to sign off. First, does the Bill strike the right balance in streamlining the different parts of that process, so that nationally significant infrastructure can make its way through quickly and efficiently?

Secondly, as well as judicial review, I am always conscious that a local authority may be subject to a maladministration complaint if it fails to take into account the legal obligations that Parliament has placed upon it. While the system may seem bureaucratic, the bottom line is that Parliament requires councils to go through that process when considering planning applications. Do you think there is a need to remove not so much the ability of others to challenge, but some of the requirements we place on local authorities, so that there are fewer loopholes and less complexity in administering that quasi-judicial role?

Sir John Armitt: That is a very complex question. I shall pass to my legal friend.

Robbie Owen: It is a complex question. On the balance and restricting this to national infrastructure, where the role of local authorities is among the role of many public bodies, as I touched on earlier, I do not think that we have yet got to a balance where the development consent order contains the principal consents and leaves subsidiary ones to be dealt with later.

I would like to see the Bill repeal section 150 of the Planning Act 2008 so that decisions can be taken on a case-by-case basis by the deciding Secretary of State on what they consider to be appropriate to put into the development consent order by way of other consents. I do not think it is appropriate for that decision to be subject to the veto of the relevant regulatory bodies, which it is at the moment. That is inappropriate.

If I understood the question on maladministration correctly, I am not sure that is a particularly relevant process for national infrastructure. My own experience is that it is quite ineffective generally. In terms of the role of local authorities in downstream supervision of the implementation of these projects, the answer is to make sure that the development consent order is very clear on the requirements and the conditions to the consent, which the local authority then needs to police and give approvals under. I think that is the way forward.

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[The Chair]

We will now hear oral evidence from Dhara Vyas, the chief executive officer at Energy UK; Charlotte Mitchell, the chief planning officer at the National Grid; Beatrice Filkin, the director for major projects and infrastructure at Ofgem; and Christianna Logan, the director of customers and stakeholders at Scottish and Southern Electricity Networks Transmission. I call the shadow Minister.

[Paul Holmes]

Q Thank you all for coming and giving evidence. I have only a few questions, because I know Back-Bench Members will want to ask questions and scrutinise the legislation. First, the legislation obviously aims to speed up grid connections. Charlotte Mitchell, could you outline to the Committee how much consultation you had, as an organisation, in the formulation of this legislation, and give us an overarching view of whether those connections would be sped up and whether you think the Government could go further to enable the elimination of some of the gridlock? How will the legislation in its current form ease the backlog of connections in the UK?

Charlotte Mitchell: The set of connection reforms underpinned by the Bill are really welcome. They will move us from a “first come, first served” system to a “first ready, first needed, first connected” approach. Under the “first come, first served” system, we have seen a proliferation of projects in the queue. To bring that to life, there are about 450 GW of capacity in the queue at the moment, and that is about three times what we would need to achieve net zero. It is fair to say that not all of those projects will come forward, and they certainly will not come forward at the pace at which we originally envisaged when they found their spot in the queue. That ultimately means that it is taking a really long time to connect the grid to new projects coming forward, and promoters of those projects are quoted decade-long connection timeframes.

We welcome the reforms; we have been part of the discussions and have had a seat at the table, with the National Energy System Operator leading the approach to the reforms. For us, it is really important that the legislation comes forward quickly enough that we can move across to that new system and refocus our resources and priorities on connecting those projects that are ready and have the highest need to be connected to the grid.

[Paul Holmes]

Q Thank you. My second question is for Dhara Vyas and, if necessary, Christianna Logan. I do not mean to leave Ofgem out, but I am focusing on just two issues, because I am aware that other Members will want to come in. You will be aware that the previous Government consulted on community benefits to infrastructure, and there was a proposal to allow direct payments, which the Government have continued.

Do you have any concern, or do you think that that is the result of the industry not doing enough to consult local people when infrastructure was delivered previously? Will an unintended consequence of direct payments to consumers be to undermine your members’ emphasis on making sure that community benefit and community consultation are done adequately?

Dhara Vyas: Thank you for the question. I do not think it is a failure of the industry. I think it is a series of consecutive failures of regulation and policy over the past decade, if not longer, that goes beyond the energy industry.

It is really welcome to have this unified vision in the energy space for infrastructure build-out, and that goes across the Department, the National Energy System Operator and Ofgem. It is critical that we use all the levers we have to engage with people. The reality is that transmission network operations is a very specific piece in the Bill, and that is the large stuff—the bigger stuff—but it has to be part of the broader conversation that we need to have with people about the placement of assets. Infrastructure is part of that, with substations and of course generation assets. It is about the changes we are going to be making to homes and businesses across the country, and it is also about the difference that investing in this will make for future generations.

So, to answer your question about whether it is specifically a failure of industry, I do not think so. It is a failure, and I think we share the blame, but I am really positive about the steps set out, both in this Bill and more broadly, for the energy policy space.

It is worth being really clear about the context, which is that we need twice as much transmission network build-out as we have had in the last 10 years. That is a huge scale of work, and we need speed in doing it. The reality is that different communities will have different priorities. For some communities, investment in community spaces might be the right conversation to have; for others it will be about direct payments, or investing in community ownership of assets. It is really about tailoring.

Last, and you will all know this far better than I do, while having a significant conversation about how you balance national equity and local diversity is not unusual, it is a newer conversation for the energy industry. As we navigate this, we and all my members intend to work very closely with partners, including Natural England and other environmental groups, as well as local and regional government. It is important that we are honest and open about this shift in the way of working and not fall into the trap of assuming that one size fits all.

Christianna Logan: Our research has shown that, in areas where we have previously developed projects, perceptions of the benefits of projects are much stronger and more positive. The big challenge for us now as an industry is the scale—the magnitude—of what we have to deliver, when in many cases, the local communities likely to be impacted have not seen this scale of infrastructure before.

We have developed a package of local benefits that come with these projects, whether that is local jobs, contracts for local supply chains or, in fact, new permanent homes that will initially be used to house workers on the project, but then used by communities for their own needs after the projects are completed. Community benefits are an important part of that package, but so too is the very real engagement that we do with local communities. We have made changes around things such as substation locations and overhead line routes as a direct result of that engagement. That is what is building trust around these projects.

As Dhara said, we all need to work together to increase understanding of the benefits that the projects bring. Our recently produced national campaign, on which we collaborated across the sector, will help with that. Our own media campaign in the north of Scotland has resulted in a double-digit shift from neutral to positive around these projects among those who have seen the campaign. We cannot achieve this on our own, as transmission owners; we need to work cross-party, cross-Government and cross-sector to be able to help people to understand the real imperative and benefit of undertaking these projects.

[Paul Holmes]

Q Thank you for that, and congratulations on the work that you are doing. I want to push slightly further—not push you, because you have answered the question, to be fair. Further down the line, do you have any concern that systematic decisions in companies such as yours will have an unconscious bias toward direct payments making it easier to get these projects through, and that the traditional community investment, which would be accountable to that community, will fall aside because the direct payment route is easier than genuine community benefits?

Christianna Logan: Genuine community benefits are the most important part of these projects. I think it would be risky to see direct payments as a silver bullet to reduce objection to projects. When you are delivering new infrastructure across hundreds of miles in these types of areas, there will be objections. In this endeavour, we all have to show courage to take forward well-designed projects that have been developed with local communities in mind, taking on board their challenges where we can, while recognising that that will require trade-offs and that we will not be able to appease all objections.

[Paul Holmes]

Just for the record, that is not my view. There are some concerns. I was not castigating you.

[The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Michael Shanks)]

Q Good afternoon. Thank you for joining us. As a Government we have set out the ambitious clean power by 2030 plan, which involves significant roll-out of renewables. Key to that will be storage and our ambition to build the first long-duration storage in 40 years in this country. I would like to ask Beatrice and Ofgem, what is your sense of the importance of the mechanisms for doing that, particularly the cap and floor financing scheme; and how important is long-duration storage to the energy mix we are trying to build?

Beatrice Filkin: As you said yourself, Minister, we have not seen any large scale, long-duration energy storage built in this country for decades now. We know that the market is not willing to take on those risks at the moment and it is absolutely right that the Government are instructing us through this Bill to expand the regimes and protections.

We support the proposed introduction of a cap and floor regime for long-duration storage. We have seen NESO’s advice to you as part of the development of the Clean Power 2030 Action Plan—that increasing the amount of flexible storage on the system is critical to getting through your clean power targets. We are very keen to be part of supporting that. We think the cap and floor regime has proved its worth over the last decade or so through interconnectors, and obviously, we are adjusting it now with input from a wide range of stakeholders to make it appropriate for the long-duration storage schemes.

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[The Chair]

We will now hear evidence from Marian Spain, chief executive of Natural England. We have until 1 o’clock for this session. I call the shadow Minister.

[Paul Holmes]

May I call you Marian?

Marian Spain: Of course.

[Paul Holmes]

Q Thank you very much for coming and for the work you do. I am sure you will appreciate that this is one of the more controversial areas of the Bill, with Natural England taking on more responsibility under Government proposals. Many stakeholders have said they are concerned about the responsibility that Natural England will be taking on in terms of environmental delivery plans.

In particular, the Royal Town Planning Institute has said that it is concerned about whether you will be adequately resourced. The Institution of Civil Engineers is worried about a two-tier system and stakeholders and organisations being resourced adequately. The County Councils Network has also said that it remains concerned over the resourcing of Natural England. Do you believe that Natural England is adequately resourced and has the management structures and systems in place to cope with the extra responsibilities that it will take on?

Marian Spain: Yes. We very much welcome this Bill. We think this Bill is absolutely the right thing to give us the growth the nation needs, while not just protecting nature but giving the opportunity to restore nature. My answers will be in that context. This is a Bill we very much welcome, and it is something we have worked very closely with Government on.

In terms of resourcing, in principle, yes, the resourcing should be adequate. We have £40 million in this financial year to begin the preparatory work for the environmental delivery plans and the nature restoration fund. That will enable us to start on the first of those EDPs, and I can say a bit more about what we think those will be, if that is helpful. In future, the levy arrangement should allow us to fully recover our costs. It should allow us to recover the costs of doing the work on the ground and also the overheads that we will need to incur to work with developers to do the monitoring, reporting and so on.

I think the risk is in the early years of the scheme, when the levy is not yet flowing, but we need to get up front and do those delivery plans so that they are ready when the developers are ready to contribute. We are working with our parent Department, the Department for Environment, Food and Rural Affairs, and our colleagues in the Ministry of Housing, Communities and Local Government on a bid for next year’s spending review. The limiting factor will be whether Government are able to put in initial preparatory money. For the district level licensing scheme, we had effectively a rolling fund—Government put money in up front that we then rolled over as the levy came in to fill the gap behind it.

[Paul Holmes]

Can I come back on that, briefly?

[The Chair]

Very briefly. We have to keep this very tight.

[Paul Holmes]

Q That is fine. What impression are you getting from Government that they remain satisfied, and are you satisfied as chief executive, that the whole aim of this legislation in terms of EDPs will not be undermined by a gap in funding in the early stage, before you can recover the total costs? I am not criticising you, because you are waiting on Government funding, but you used the words “should” and “may”, and I want to push you on that. Have you started work at this precise time on the preparatory work for EDPs?

Marian Spain: To reiterate, the unknown that I cannot answer is the outcome of the spending review and how much the Government as a whole choose to invest in the next financial year. The other thing that this Bill and the other associated planning reforms coming forward will do is to allow Natural England to relieve some of its existing resources from lower impact work and move them into this. It is not all just about new resources.

I am confident that we can make that change. I am confident that this will be one of the most important things that Natural England does for the next five years or so. You had another question that I have forgotten.

[Paul Holmes]

Q Preparatory work on EDPs. Where are you on that?

Marian Spain: Work is under way now. As I mentioned earlier, we are doing two main things. We are thinking about the first two environmental delivery plans. This is an opportunity to mention that they are almost certain to be improving the existing nutrient mitigation scheme and turning that into a full-blown EDP and NRF system, and also consolidating the district level licensing scheme—the scheme for great crested newts that we set up five or six years ago. Those can be relatively quick wins, done within this calendar year we believe.

We are then looking at what the next EDPs are likely to be. That conversation is live at the moment with our colleagues. We are looking at three issues. We are looking at where development will most need it. Where are the development pressures? That might be major infrastructure or the new towns. Where are the places that are going to most need it? Where is it going to be most feasible—where do we believe we have sufficient evidence to have robust plans that will work and where is the meeting of those two points? That thinking about the EDPs is under way.

We are also using this year’s Government investment to set up the systems and the digital systems we will need. The systems developers will need to test their impact and decide if they want to participate. That is the systems we will use to handle the money and to do the essential transparency reporting and monitoring. That will be in place this financial year.

[Matthew Pennycook]

Q Marian, thank you for giving your time today and for the work that you and the organisation are doing to ensure that the new system will be operational shortly after the Bill gets Royal Assent.

Can I get you on the record in terms of the objectives of part 3 of the Bill? Is Natural England confident that the nature restoration fund will deliver better outcomes for the environment than the status quo? Specifically on the powers that will be available to Natural England in bringing forth EDPs, do you think the Bill gives you enough flexibility to consider a wide enough range of conservation measures to deliver those plans?

Marian Spain: We are confident that this will be an improvement on the current system. We have already run versions of the nature recovery fund for recreational impact, for great crested newts and for nutrient mitigation, so we have seen enough that these schemes can work. We are confident that they will work.

We are also clear that it is an improvement because at the moment the current arrangements are sub-optimal for developers and for nature. We see that developers are investing disproportionate amounts of time on data gathering that could be better done once and centrally. We see that investment in mitigation and compensation in the sequential scheme slows things down and does not always create the biggest impact. We also see that there is less transparency than the public and indeed developers themselves sometimes want about how the money is being spent. We are confident this will be an improvement.

The other important point to note is that many of the pressures nature is facing now, particularly water quality, air quality and recreation, are diffuse. They are not specific. They are widespread. They are cumulative. It is impossible for an individual developer to adequately consider, mitigate and compensate. We need to do that at much more of a scale. We think the measures in the Bill and the associated measures of having more robust spatial development strategies that look at nature and development together, and of having the plan up front that tells us what the impact will be and how to mitigate it, and then the fund to allow that discharge, is a major step forward.

It is unknown—well, it is not unknown, forgive me. It is a risk, of course, and people will be concerned that it will not be regressive and that it will not be a step back, but we think there are enough measures in the Bill that are clear that this is about improvements to nature—maintaining the current protections, but also allowing development to make its adequate contribution to restoration of nature.