An interview by Marie-Gabrielle Williams. Stephen Morgan, barrister at Landmark Chambers, and Martha Grekos, barrister at Martha Grekos Legal Consultancy, discuss Policy Exchange’s report on ‘Rethinking the Planning System for the 21st Century’ (the Report). They consider how likely it is that the proposals put forward will be implemented and to what extent they would be successful in addressing the current issues in the current planning system.

What does the report identify as the main issues with the current planning system?

Stephen: The Report considers that the existing planning system does not deliver enough land for development in the right places reflecting market demand. Land is currently rationed, the Report states, on what planners think is needed and thus on aspirations rather than reality. It blames the existing planning system for resulting in stunted ugly and unsustainable urban growth and being based on projections which have been fallacious.

Underlying the Report is a belief that market forces, if less constrained, would deliver ‘natural growth’ to urban areas and drastically improve social welfare, especially for poorer households, at the same time as improving the beauty and sustainability of the environment and boosting innovation in the economy.

The existing system, with its excessive restrictions including the green belt, allows the voice of the ‘noisy minority’ to dominate and has caused a redistribution of wealth and income from renters to homeowners. It has also diminished the country’s base of small and medium sized developers, the Report says. Planners are tasked with achieving too many objectives, pulling in contradictory directions.

Although there has been regular tinkering, the fundamental principles of the current planning system remain the same as when it was established in 1947 as part of the government’s programme to establish a command and control economy in a time period that was very different from 2020.

Martha: The report identifies ten issues with the current planning system:

• land use is rationed depending on what LPA planners think is ‘needed’ but the rapid changes in the economy, society and technology, as well as the unpredictability of human and commercial activity, mean that the ‘needs’ of households and businesses cannot be accurately projected, certainly not over 15 or 20 years
   
• stunted, ugly and unsustainable urban growth is the result
   
• it creates uncertainty as the right to build is conferred on a case- by-case basis according to sets of complex and often contradictory policies and case law
   
• dynamic places are constrained as the supply of housing and employment space has not been able to adjust to increased demand from people and firms locating in high performing urban economies surrounded by restrictive Green Belts
   
• excessive planning restrictions have caused a redistribution of wealth and income from renters to homeowners and this has amplified regional inequalities
   
• excessive planning restrictions have increased the cost of commercial real estate
   
• the planning system has been captured by the ‘noisy minority’ because unless they have the time and patience to attend local planning committees, ordinary citizens are detached from the planning process
   
• the complexity and risk of the planning system has diminished the country’s base of small and medium sized developers as generally only the volume housebuilders and large land companies have the resources to work with the system
   
• planners are tasked with achieving too many policy objectives
   
• the complexity and discretionary nature of the planning system means that decisions are regularly challenged in the courts. This further increases the cost, risk and delay when navigating the planning process

What does it propose to address these issues?
 

Stephen: The Report recommends fundamental reform. The supply of new homes, offices and other types of land use should no longer be capped by local planning authorities (LPAs) in local plans or by site allocations.

The two key proposals are:

• ending detailed land use allocations and introduce a binary zonal system:
  
  - one zonal class is protected against growth and minor development only would be possible, and
  
  - the other zonal class largely permits growth. This would include existing urban areas and new urban extensions made possible by infrastructure improvements
   
• replacing the existing detailed and lengthy local plans with much shorter versions containing development rules and not allocations

Basis and scope of Zonal Designations

Market conditions, and not issues of need, should determine how urban space is used in the development zone and zones should in general have no reference to what specific land uses are allowed on individual private plots of land.

Permission would not be required for a change of use as long as rules on separating certain harmful uses are not broken.

Redefining what a Local Plan should be

Local plans should, the Report proposes, set a limited and simple set of development control rules (rather than policies), together with a zonal map, detailing what development is not acceptable in development zones.

Environmental and heritage planning protections should be transposed into a new system including National Parks, Areas of Outstanding Natural Beauty, building listings and conservation areas.

Green belt protection should be reviewed to clarify what purpose they are supposed to be serving and whether it is still justified.

Neighbourhood plans

Neighbourhood plans should have the power to set development rules for new development in their area. But they should only deal with the form of, and not the fact of, development and how it retains and adds to an area’s sense of place.

Rule based development control (DC)

Development should be permitted as long as:

• it does not break the DC rules and
   
• meets building regulations and
   
• is not in a protected area

Role of local politicians

The rules in local plans are necessarily political and should be voted on by local councillors. This should be the only stage in the planning system when local politicians have a say.

The Planning Inspectorate should be required to monitor whether local and community rules conform to national planning policy and intervene where necessary.

Legislative and policy changes

A new Planning Act is recommended and the National Planning Policy Framework (NPPF) would also need to be rewritten, determining what a local plan should and should not do, as well as relevant policy guidance.

Martha: To remain a competitive economy and to address the country’s housing shortage, the Report believes that the planning system is in urgent need of wholesale reform. It states that the Government should be ambitious in establishing a new system that can meet the challenges the country faces in 2020. The Report’s recommends the following 6 reforms:

• ending detailed land use allocations and introducing a binary zonal system - land should be zoned either as development land, where there is a presumption in favour of new development, or non-development land, where there is not a presumption and minor development is only possible in more restricted circumstances. Land zoned as development land will include existing urban areas and urban extensions made possible by improved infrastructure. Zones should, in general, have no reference to specific land uses. Market conditions should instead determine how urban space is used in the development zone. Land and buildings in the urban area would thus be able to change use without requiring the permission of the state (as long as rules on separating certain harmful uses are not broken). Zonal designations should be separate from any concept of ‘need’. Instead, they should be dependent on metrics that determine whether land has good access potential, whether new development would cause environmental disturbance and the potential for an existing built development to expand. Zones should be updated on an ongoing basis and would need to be periodically reviewed by the Planning Inspectorate
   
• precise and definitive local plans - local plans should set a limited and simple set of development control rules detailing what development is not acceptable in development zones and a similar set of rules detailing what development is acceptable in non- development zones – a framework for administering planning applications that allows developers to respond to market conditions and innovate in the places where new development is suitable. These should be rules rather than policies. Rules should be clear and non-negotiable, relating to development form and layout. Local plans should be short, including a zonal map and several pages of development control rules
   
• development control - administrators of applications for new development should only check that the proposals conform to the local plan’s rules, rather than conferring any judgment on the proposal itself. The starting point of each application in development zones should be that it will be approved unless certain rules are broken rather than if those rules are met (and vice-versa in non-development zones). Applicants should have a right of appeal to the Planning Inspectorate (or a similar body) but only on the basis that rules have been wrongly interpreted. As a public decision made by an administrative body, application decisions would still be within the purview of the judicial review process
   
• environmental and heritage protections - environmental and heritage planning protections should be transposed into a new binary zonal system. This should include National Parks, Areas of Natural Beauty, building listings and conservation areas. Green Belt and Open Countryside land use designations should be reviewed to clarify what purpose they are supposed to be serving and whether it is still justified. Other land uses which are of a low or even negative commercial value, but high social value should be protected, for instance areas of high natural capital and valuable urban green space (e.g. playing fields)
   
• compensation - there should be a twin track developer contribution system mandatory across the country. This would comprise a low-level Local Infrastructure Tariff based on a national formula and the continued negotiation of a section 106 (or similar) agreement on larger sites. The latter would slow the planning process for larger development; however, it is necessary for mitigating their local impact. Also, rather than securing affordable housing contributions through section 106 agreements, developers should be liable for a flat tax on a prediction of the gross development value they submit when applying for planning consent. The tax would be paid on completion of the scheme and LPAs would then spend this money on buying homes in the development (or another development) for use as affordable housing
   
• the role of local politicians - the rules in local plans for new development should be controlled by LPAs. They should be voted on by local councillors. Similarly, to the current planning system, the Planning Inspectorate on behalf of the Secretary of State should be required to monitor whether local and community rules and protected area designations conform to national planning policy and intervene where necessary. This should be the only stage in the planning system when local politicians have a say. They should have no say over deciding applications for new developments

The Report also states that in order to implement these reforms, a further three proposals need to be taken into account:

• legislative and policy reform - a new Planning Act would be necessary to enable a new system to emerge. The National Planning Policy Framework (NPPF) would also need to be rewritten, determining what a local plan should and should not do, as well as relevant policy guidance
   
• gradualist reform - reforms that decrease the capital value of assets that are important to the economy should be made in a gradualist fashion. Even when the long- term benefit for the economy is huge, any short-term loss should be managed carefully
   
• remaining resolute - taking forward reforms of this kind will provoke opposition from certain lobbyist groups, for instance those who say they speak for the countryside. The Government should, nonetheless, be resolute in a bold programme of planning reform

How likely is it that any of these proposals will be implemented/taken forward by the government?

Stephen: Since the Report, the Budget speech on the 11 March 2020, and more particularly the Ministry’s Planning for the Future paper published the day after, focus again on the delivery of 300,000 homes per year.

Planning for the Future (at paras 1-5) states that the government will bring forward a series of major publications and legislate to deliver lasting changes and that this will start with ‘an ambitious Planning White Paper in the Spring to modernise our planning system’. There is reference (at para 13) to expanding the use of zoning tools to support development. However, such tools already exist (eg the use of local development orders), as Planning for the Future recognises.

Planning for the Future (at para 6) echoes the Policy Exchange’s concerns regarding the planning process being complex, out-of-date and failing to deliver enough homes where they are needed. The reforms referred to, however, appear more akin to a further adjusting and speeding up of the current system rather than the wholescale reform advocated by Rethinking the Planning System. Nonetheless, it may be wise not to discount that possibility altogether, certainly in the medium to long term – especially as one of the Report’s authors, Jack Airey, was appointed in February as the PM’s new housing and planning special advisor.

Martha: The Report comes across as very anti planning and very pro free market. Given that the author of the report, Jack Airey, has been appointed as No 10’s housing and planning special advisor, it will be interesting to see if any of the proposals come forward, especially in the upcoming Planning White Paper (coming in spring). There will also be a new National Infrastructure Strategy, Housing Strategy and Comprehensive Spending Review later this year (probably in July) so it will be interesting to see what, if any, changes are made there.

The Prime Minister is clearly in the mood for bold, high-risk policies, and Policy Exchange is playing to that tune by proposing land is simply divided into development and non-development zones. Market conditions will then determine how development land will be used, with few controls. LPAs will be reduced to mere administrators of the system. Apparently, this ‘free-for all’ will create ‘a more beautiful built environment’. The Report is full of this sort of seductive phrasing. However, whilst some of its reforms may be supported such as the need to streamline the role of local politicians, much of the review is limited and over simplified.

I am not entirely convinced that the government will be so radical to start again from scratch given that many will object to such reforms and many will be highlighting the flaws of the Report. The week beginning 9 March 2020 provided the biggest indication yet of the new government’s thinking on the English planning system. The Budget 2020 was published, and Secretary of State for Housing, Communities and Local Government, Robert Jenrick made a statement about English planning reform and the likely content of the upcoming White Paper. Nothing in there indicated radical departure and a system where planning was going to have to start from scratch. Zoning was mentioned and the government said that it will outline further support for local areas to simplify the process of granting planning permission for residential and commercial development through zoning tools, such as local development orders (LDOs). The government will trial the use of templates for drafting LDOs and other zonal tools to create simpler models and financial incentives to support more effective use. The government has also launched a consultation on a new UK freeport model, including on how zoning could be better used to support accompanying development. There does seem to be a call by government for a more zonal, less regulated local authority approach, which could also be seen in the letter from Robert Jenrick to the Mayor of London on 13 March 2020 ordering him not to publish the London Plan in its current state, directing that a series of modifications need to be made to the draft London Plan pursuant to section 337 of the Greater London Authority Act 1999.

Are these proposals likely in practice to address the issues identified with the current system?

Stephen: The Report says that the programme of planning reform will:

• provide broader access to property wealth
   
• increasing economic competitiveness
   
• a more beautiful environment
   
• climate leadership

Assuming those outcomes would be achieved requires a very significant leap of faith. To be fair the Report does recognise that the planning system is not the only structural barrier to economic and social growth. In these conspicuously uncertain times that must be even more so. Indeed, the Report raises as many questions as it proposes solutions and would still require a vast number of issues that are the day to day reality of the planning system to be addressed.

Moreover, and fundamentally, it is advocating the development of more land, probably significantly more (but how much if you do not take into account need?), for development, especially it seems as urban extensions. There will of course be losers as well as winners. The zonal system would be a fundamental shift in approach with market forces being the dominating touchstone.

The Report is sceptical about green belts and dismissive of concerns over rural land. If the Secretary of State’s direction letter of 13 March to the London Mayor on the Alterations to the London Plan is any indication, the current government (in contrast to the Policy Exchange’s Report) continues the previous protective approach to both.

Whilst the proposals certainly deserve serious consideration, the consequences, intended and otherwise, would therefore require rigorous consideration. They would shift the careful balance that can now be achieved by the applications of section 38(6) of the Planning and Compulsory Purchase Act 2004 to a development entitlement regime which undoubtedly would have the potential for significant negative consequences.

However, whether one agrees with the key recommendations of the Report or not, it deserves credit for informatively and forcefully highlighting some fundamental truths about the existing planning system from which lessons can be learnt, including the need to ‘codify’ the existing patchwork of legislation and policy.

Martha: I think these proposals are too simplistic and I do not believe that a lot of the issues the Report has identified stem from the planning system per se.

This is oversimplified as there are many more significant factors which have caused these consequences such as: the previously lack of bank lending on projects; the upfront costs of planning applications which disproportionately affects smaller sites; the underfunded LPA planning departments which has had consequential impact on the quality of service (eg backlogs of reserved matter determinations and pre-commencement conditions to discharge), slow production of new plans, inability to recruit experienced staff and general morale; issues over the delivery of essential infrastructure that needs to be provided by statutory providers; the removal of the regional planning tier; site assembly issues especially in relation to compulsory purchase etc, to name but a few.

Yes, reform is needed to address matters. However, as an example, by focusing on local plans that should be just rules, where at their point of their formation the public, developers and local political councillors can only engage, surely means it will take longer to formulate these given everyone will be debating over every single nuance. It seems like another front-loading exercise that will simply add delay. In addition, implicit in the Report’s analysis is that the experiment with localism has been unsuccessful. The Report places much of the blame on discretionary nature of planning decision-taking and argues that the role of local political councillors in development management decisions should be reduced in order to eliminate uncertainty. Once the boundaries of the development and non-development zones are defined and the associated development management criteria are adopted, local political councillors would play no part in individual development management decisions under their proposals. That is very different to localism and begs the question of how popular support for and confidence in the planning process would be secured under the new arrangements? It also seems to be contrary to the theme of public participation by the Building Better, Building Beautiful Commission (in a report entitled ‘Living with Beauty’) which urges more extensive consultation early in the development plan process and that local planning authorities should have the capacity to undertake more meaningful, visually based, consultation on development projects using digital resources and that communities should be empowered to promote and undertake community development projects of their own through an expansion of community right to build orders and streamlined procedures for the designation and acquisition of assets of community value.

Original Interview by Marie-Gabrielle Williams for Lexis Nexis