Select Committee on Environment, Transport and Regional Affairs Minutes of Evidence

Supplementary Memorandum from The Department of the Environment, Transport and the Regions (EST 98D)


The Committee asked for details of the final outturn of the London Docklands Development Corporation (Question 255)

  12. During its 17-year lifetime, the London Docklands Development Corporation attracted private sector investment of £7.66 billion. No actual amount was promised from the private sector, but the LDDC set annual targets for private sector investment which, cumulatively, totalled £7.07 billion. LDDC therefore exceeded its cumulative targets by over eight per cent. As LDDC received lifetime grant-in-aid of £1.86 billion, this means that for every £1 of central government money put into LDDC, over £4 was attracted from the private sector.


The Committee asked for output figures for investment in repair of local authority housing, together with a timetable for tackling the backlog (Question 261-262)

  13. Mr Ballard provided the output figures for investment in repair of local authority housing in his answer to Question 285. A note on the timetable for tackling the backlog of repairs will be provided with the follow-up information to the Comprehensive Spending Review, as it will be dealt with in the more detailed announcement on housing due shortly.


The Committee asked for a breakdown of the Private Finance Initiative programme detailing the estimated value of individual schemes (Question 265)

  14. The Department estimates that £453 million of capital investment will be made by the private sector on PFI projects in 1998-99. Included in this figure are investments in the London Underground Power and Prestige contracts, the Docklands Light Railway extension to Lewisham, the London Docklands Exhibition Centre and the Channel Tunnel Rail Link.

  15. This figure varies from an earlier figure published in the Annual Report largely as a result of the re-profiling of private sector investment on the Channel Tunnel Rail Link project. Final negotiations on the private sector investment have still to be completed.

Figures in £ millions

1998-99 Private
sector investment
from signed
PFI contracts
additional Private
sector investment in
support of DETR



  16. The Department estimates that for 1998-99 a total of £6.8 billion of direct and complementary private investment will be levered-in to support its policy objectives. The investment will be made through programmes including the Housing Corporation ADP, Large Scale Voluntary Transfers, the single Regeneration Budget, Energy Efficiency, Railtrack, and local authority transport projects.

  17. The Department's existing estimate shows nearly £20 billion of private sector investment being made in arrangements sponsored by DETR during the current year and the next two years. The announcement of new policy initiatives following publication of the CSR will mean that these estimates will need to be updated.


The Committee asked for details of where revenue from the Capital Receipts initiative would be spent (Q289)

  18. The Department will respond to this as part of its note on issues coming out of the Comprehensive Spending Review and following the more detailed announcement on housing which will follow shortly.


The Department would like to provide this further note to the Committee on why the Planning Inspectorate have not met their targets in response to Dr Whitehead's question 309.

  19. At paragraphs 307 to 309 of the transcript for 30 June 1998, Dr Whitehead asked a series of questions about the performance of the Planning Inspectorate compared with key performance indicators. Commenting on the overall performance since 1994-95, Dr Whitehead observed that the Inspectorate was lagging behind the timeliness targets that have been established and asked why.

  20. The main reasons that the Planning Inspectorate has not met all its targets is a substantial and largely unforeseen increase in its workload. While the volume of planning appeals received has declined slightly in the 5 years from 1992-93, the volume of development plans, as measured by the number of objections made, has expanded 3-fold during the same period from an average of 521 representations per plan in 1992-93 to 1,601 in 1996-97.

  21. As a result, an activity which consumed 17 per cent of inspector resources in 1994-95 had grown to 32 per cent by 1995-96. This bulge in development plan work derived from new Local Plans and Unitary Development Plans made necessary by the introduction of the Plan-led system in 1992. The bulge is now behind us, but it is likely that between 20 and 25 per cent of inspector resources will in future need to be invested in development plan work to keep them up to date.

  22. This step change has inevitably caused other services which the Inspectorate provides to be squeezed. The Inspectorate recruited 31 new inspectors in 1996 and a further 19 in 1997. It takes around nine months to recruit and a further 18 months to train thoroughly each inspector such that the impact on handling time and other targets takes time to work through.

  23. Nevertheless, the out-turns for the Inspectorate's appeals casework were a lot better in 1997-98 than in the previous year and are well on the way to meeting new and demanding targets by 1998-99, the current year. This is shown in the following table:

Planning, Appeals England Handling times for 80 per cent of cases, in weeks

1996-971997-98 1998-99
Out turnOut turn Targets

Written method2521 18
Hearings4740 24
Inquiries5652 36


The Committee asked about the length of time Ministers take to reach planning appeals decisions (Question 319).

  24. Ministers aim to deliver decisions within eight weeks of receiving the Inspector's Report for 80 per cent of all such cases. Some background may be helpful.

  25. Applicants for planning permission have a right to appeal to the Secretary of State where local planning authorities refuse planning permission, attach conditions to the permission or fail to determine the application. Most appeals are decided, on behalf of the Secretary of State, by Planning Inspectors working in the Planning Inspectorate. There are around 14,000 such appeals made every year. The Secretary of State sets the Planning Inspectorate targets within which he expects these appeals to be decided. Details of these targets compared with out turn performance are published every year.

  26. A very small number of appeals—about 200 cases each year—are decided ("recovered") by Ministers on the basis of an Inspector's Report. The Report may follow an inquiry or the submission of written representations. The Inspector invariably visits the site and includes his observations in the report to the Secretary of State.

  27. For each recovered appeal an Inspector's Report is delivered to the Government Office for the region in which the case arose. The Government Office places a short submission to a Planning Minister summarising the report's key features and the implications for the region of allowing or dismissing the appeal.

  28. The Government Office writes to appellants when an Inspector's Report is received and inform them that they can normally expect a decision within eight weeks. Submissions to Ministers highlight this eight week target date. In any case where it is known that the target will not be met the appellant is advised and, if possible, an estimate made of when a decision will emerge.

  29. In recent years, the proportion of Ministers cases decided within eight weeks of receipt of the Inspector's Report has varied between 50 and 60 per cent, against a target of 80 per cent. All cases are monitored closely to ensure that Government Offices and other parts of the Department are doing everything possible to minimise delay.

  30. There is no single reason for the substantial minority of cases which fail to meet the eight weeks target. Recovered appeals tend to concern the important, the more controversial or the more complex development proposals. Among the factors which contribute to delay most frequently are the need to refer new evidence after an inquiry has closed back to the parties, the resolution between the parties of planning agreements under Section 106 of the 1990 Act and the need for legal advice on aspects of the case to try to avoid post-decision litigation.

  31. The Public Inquiry into a proposed 5th Terminal at Heathrow Airport opened in May 1995 following a call in and is expected to conclude taking oral evidence by the end of 1998. The Inquiry, conducted by Mr Roy Vandermeer QC, will by then have sat for over three years having heard 650 witnesses and examined 23,000 written representations.

  32. Once the public sittings have been concluded Mr Vandermeer has the considerable task of summarising evidence, coming to conclusions on contested argument and making recommendations. We are not expecting the report before the year 2000. Mr Vandermeer is assisted by nine inspectors from the Planning Inspectorate and a small secretariat all of whom are striving to produce this report as soon as possible.

  33. Once the report arrived, Ministers will be anxious to announce decisions as soon as possible. This is however unlikely to be before the end of 2000.

  34. In the meantime, the Government has expressed dissatisfaction with the present lengthy procedures for dealing with major planning inquiries and has issued proposals for reform in "Modernising Planning", a policy statement published in January 1998.


The Committee asked for details of the budget for each of the Regional Development Agencies and of the portions of DTI expenditure over which the RDAs will have an influence (Q284)

  35. The Department expects to be in a position to publish the overall level of resources available to the Regional Development Agencies (RDAs) shortly. However, the division of resources among the regions will take longer and is not expected to be available until the autumn. The Department will provide the information sought by the Committee as soon as it is available.


The Committee asked (as a supplementary to Q191), indicative figures for the effects of the minimum wage on local authority contracted-out services such as refuse collection, street and/or office cleaning and housing maintenance and repairs (Q320)

  36. We have discussed this further with the Local Government Association (LGA), whose specialist advisers based in local authorities have prepared an assessment of all cost pressures facing local government. Neither we, nor the LGA, expect the minimum wage to have a significant impact on the costs of staff directly employed by local authorities. The pay of the majority of local government employees is negotiated between the employers and the unions. Agreement was reached in July 1997 on a single status pay and conditions package to take effect from 1 April 1997. The lowest point on the new pay scale is equivalent to £4 per hour.

  37. We do however agree that there is a potential upward pressure with respect to the wage rates of some staff employed in contracted out services. The LGA agree with our view that the most significant increases are likely to be felt in the procurement of independent social services. The oral evidence given in respect of the costs which, broadly speaking, might fall in this area was underpinned by estimates made within Government.

  Other areas likely to be affected are:

    —  Commercial refuse collection; and

    —  Cleaning and catering staff (particularly part-time female workers and those employed on a casual basis).

  38. Such cost pressures are inherently extremely difficult to estimate, to such an extent that the LGA have not included a figure for these services in their overall assessment of the cost pressures likely to face local authorities. Firstly, the actual outcome in terms of increased costs to local authorities, for both the costs of staff employed in contracted out services and the costs of procuring goods and services from the private sector, will depend entirely on contract negotiations. The outcome is not predictable, though local authorities have plenty of purchasing muscle to resist price increases. Secondly, any eventual additional cost pressures as a result of increased pay bills in contracted out services when they are retendered in due course, are likely to be typically a small proportion of the total value of the contracts.

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Prepared 17 August 1998