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Solace blog

6th May 2016

Nuts and their Sledgehammers

Control of the level of fees for processing planning applications, as you will know, is one of the last vestiges of centralisation (in form, if not reality) and Whitehall is reluctant to let it go. At some point, we might be granted the power to set fees locally; but there will remain significant constraints and the ‘victory’ of securing hard-won freedoms will be somewhat pyrrhic. We may win the battle, but lose our valued troops in the process.

So, what is going on here? In the majority of other cases, in the true spirit of decentralisation and devolution, councils have been allowed to set their own fees, based on local circumstances, demand and cost. Planning, however, seems to be a special case. Why?

The government continues to show its distrust of public services, specifically local authorities – that we will not use this power with probity, fairness and propriety. Its main stated concern is that, because of our monopoly position, there will be no means of control and that we will milk developers – resulting in developments being stalled, defeating the objective of housing growth.

Whilst it is true that councils are in need of greater resources to enable us to continue our services – and make them even better – there is no evidence that we would misuse our acknowledged monopoly position. Indeed, as it has been made very clear that the council Planning Committee will retain the ultimate decision-making power; that position will not change.

What is more, most councils do want to regenerate their areas in the right way. The big issue is not ‘How much can we screw out of developers’; it is ‘How can we ensure that the development we need is delivered in the way most in harmony with what is there already’.

The other main objection, apparently put forward by local authority respondents to consultations, is that there is no guarantee that the additional income will find its way back into the Planning services we all accept are under increasing pressure. Surely, it is for local people and their representatives to decide on local priorities for expenditure. I really do doubt that, given the spotlight (if not searchlight) on Planning (especially Development Control and Enforcement), any of us would choke off necessary additional funding for that service – whilst recognising the wider context of local demand.

There is a long history of calling for an increase in Planning Fees to cover the recognised increased and increasing costs of the service. Indeed, the case in favour of an increase has been made by successive reports from ARUP, the independent consultancy. These reports provided strong justification for the increases granted by government in 2005, 2008 and 2012 – the last based on a 2010 report.

That recent report showed that only around a third of the cost of processing applications is recovered in fees and suggested that the costs identified were probably an underestimate of the real costs. By 2012, the gap had widened from 2010; it has since widened further! And that is without taking account of the costs of Planning Policy and enforcement- surely at least an equal and important element in the overall process – how many, what quality and where?

The proportion of the fee element in the overall cost of development is very small and developers themselves seem comfortable with any proposal which incentivises local authorities to improve our responsiveness. On that basis, surely a system which rewards performance, perhaps by grading fee levels or constraining increases, if targets are not met, will be more effective than what is currently proposed – competition where the competitor can pick and choose and where the less lucrative applications (those which still have to be processed) are left to the local authority.

Don’t get me wrong, we must accept that to secure the goal of increased resourcing via fees, something has to give and competition per se is not evil. But I do worry when I hear the refrains from Whitehall that Ministers ‘buy into’ comments from the private sector and from some developers and are producing proposals based on ‘gut instinct’.

Greg Clark himself in 2010 (and more recently) has supported the view that ‘letting councils set their own fees is a much fairer system for both the applicant and the local taxpayer…’ If the (now) Secretary of State can see it, why can’t everyone else? We don’t need a sledgehammer to crack this nut!

By Steve Atkinson, Chief Executive, Hinckley and Bosworth Borough Council and Solace Deputy Spokesperson on Evidence-based Policy