Memorandum by Nottinghamshire County Council
(PGS 07)
Nottinghamshire County Council welcome the opportunity
to have an input into the Inquiry into the Government's proposals
to introduce a Planning Gain Supplement (PGS).
It should be noted at the outset that Nottinghamshire
County Council object to the proposed PGS and that the responses
made in this letter should be considered in this context. Below
are the main areas of the letter submitted in response to the
Government's consultation which are of relevance to the questions
posed by the Inquiry.
HOW THE
SUPPLEMENT SHOULD
REFLECT SUBSEQUENT
USES SUCH
AS SOCIAL
HOUSING
Q4.2 "It is clear from the consultation
paper that the only development specifically excluded from PGS
liability will be that relating to home improvements. On the basis
that all other development may be subject to PGS, a number of
issues need to be considered:
— how will permissions for extensions
to buildings, for example, for industrial use be treated where
the business wishes to expand but there is no intention of selling
the premises? Is an assessment made of the land (including the
current development, as defined in Box 2.2) before planning permission
and another made after planning permission and PGS payable on
the difference between to two in this case? This may mean that
the jobs created by the expansion of the business and the positive
knock-on effects this has on the local economy are put into jeopardy
because the company is liable for PGS and this, together with
the other development costs make the proposal financially unviable;
— how will planning permissions for
change of use be treated?
— thresholds need to be determined
in accordance with the objectives and priorities for the locality.
For example, if there is a need to regenerate an area, a higher
threshold would encourage and facilitate this; and
— in terms of new build development,
it can be argued that there should be no threshold and that any
factors to be taken into consideration should be presented as
part of the valuation and self-assessment.
There appears to have been a lack of consideration
of how the PGS can be implemented in relation to any development
other than new build which will be sold on by the developer and
therefore generate a cash flow, such as housing development."
Additional comment—"no consideration
is given to development for community benefits, for example schools,
hospitals, health centres, roads. Such types of development should
be exempt from PGS liability."
Additional comment—"no consideration
has been given to the provision of land for infrastructure required
as part of a new development. For example, at present if a residential
proposal generates the need for a new school on site, the developer
can provide this and the land is transferred to the local education
authority to build a new school. Under the proposed system it
may not be possible to demand such land to be included within
the development site because the developer is then liable to pay
PGS on the land and there can be no firm commitment from the local
education authority to deliver the school as the funds, which
would currently be obtained through a planning obligation, would
no longer be directly payable and there is no guarantee of how
much will be recycled through PGS. This has implications not only
for the delivery of the school but also the securing of land in
an appropriate location to serve the development."
HOW THE
REVENUE FROM
THE SUPPLEMENT
SHOULD BE
DISTRIBUTED AND
APPROPRIATE USES
Q6.1 "The revenues obtained through
PGS need to be recycled back to the local level on the basis of
the requirements as a result of new development. It would therefore
only be appropriate to adopt an approach similar to that proposed
in the first option in paragraph 6.6. There is a need to ensure
that the full costs of infrastructure required by new development
are met by PGS revenues at an appropriate time in order that they
can be in place to support the development.
Great care needs to be taken as to how this
would work in practice because if service providers have to bid
for monies, provide justification, value for money and so on,
beyond that which would ordinarily be required through the current
system, there is a danger that the costs associated with this
approach would outweigh any monies obtained through PGS recycling
and the time delay would have serious implications for the deliverability
of development. This could clearly result in money being wasted
and could lead to delays and may jeopardise development if the
infrastructure and facilities required to serve it would be delayed
or not forthcoming at all.
The bodies best placed to make the assessment
of the needs of the development will potentially be effectively
cut out of the loop of assessment in the proposed system."
Q6.2 "The need for revenues to fund
regional level strategic infrastructure should be identified in
the forthcoming RSSs. This will provide opportunities for requirements
to be identified and examined in a manner which takes on board
the priorities for the whole region."
Q6.3 "The most appropriate time at
which to engage stakeholders in this is through the RSS and LDF
process. This will enable full consideration to be given to the
overall requirements of all development in the local area and
region, assessing both individual impacts of development sites
and the cumulative impact of development across the area. Through
this approach the consultation and participation of as wide a
range of stakeholders as possible can be achieved in a way which
is co-ordinated with the formulation of development policies and
proposals, and the assessment of reasonable options.
There is one problem with this approach in that
there is currently no commitment that the infrastructure identified
through such an approach will be funded by PGS. This could lead
to a situation where commitments are made by local planning authorities
in site development briefs for the provision of infrastructure
or facilities but they have no guarantee of being able to deliver,
as the PGS funding is uncertain. This problem is exacerbated further
where the local planning authority is not the service provider,
for example in relation to education or highways, and there is
no guarantee of the service provider being allocated with PGS
funding to deliver the infrastructure or facility."
Additional comment—"as a County Council
and service provider, the issue of allocation of funds is of considerable
importance as County Councils are often not the determining authority
for planning applications which are currently subject to planning
obligations. It is unclear from the consultation document how
County Councils will be able to acquire PGS revenues in order
to maintain the delivery of services, the need for which has been
generated by new development."
WHETHER AND
IF SO,
HOW THE
PLANNING GAIN
SUPPLEMENT SHOULD
BE USED
TO ENCOURAGE
DEVELOPMENT OF
BROWNFIELD SITES
Q4.1 "The answer to this question can
only be drawn on a case-by-case basis. The problem with a universal
approach is the lack of assessment of the situation on site and
the aims and objectives of the development plan and community
strategy. Any reduction will need to take into account the circumstances
of the individual case but this will be expensive and lead to
delays.
It is inevitably more difficult to develop a
brownfield site than a greenfield one and any assessment of PGS
will need to fully take this into account, to ensure that there
is an advantage in developing brownfield sites. The valuation
of brownfield sites needs to include all of the remediation measures
necessary in order to bring the site forward. Some sites will
be found to have a negative value because extensive remediation
works are necessary, however, they may be in highly sustainable
locations and development should be encouraged on them.
Development on brownfield sites may however,
place a burden on local facilities and infrastructure and so in
many cases a contribution towards mitigating this impact would
currently be sought through a planning obligation and this should
still be an option through PGS. This is a potential problem of
brownfield sites having a lower market value (taking into account
the potential problems and remediation works) and therefore a
lower PGS liability.
The main issue here is that there will not be
one discount to the PGS which can be applicable to all brownfield
sites because they are all different."
Additional comment—"unless assessments
are made on a case-by-case basis, taking into account all of the
relevant factors of the development site and planning permission,
the introduction of a PGS is likely to provide an incentive to
develop greenfield sites rather than brownfield sites where the
development costs are likely to be higher. However, if case-by-case
assessments are undertaken, it is difficult to envisage that this
will result in a system that is faster overall than the current
planning obligations system."
THE POTENTIAL
IMPACT OF
THE SUPPLEMENT
ON SECTION
106 ARRANGEMENTS NEGOTIATED
THROUGH THE
PLANNING SYSTEM
Q5.1 "The proposed changes to the planning
obligations system fall a long way short of considering the necessary
environmental impacts that development can have and are unlikely
to be able to address the range of matters considered in determining
planning applications, for instance, those raised in Environmental
Impact Assessments. There can be no consideration of off-site
and/or indirect impacts of development. This approach will result
in one of two things happening. Either development which would
cause harm and would have previously been subject to planning
obligations to mitigate or compensate for that harm will be refused
or harmful development will be permitted, contrary to the principles
of sustainable development.
Two examples illustrate this. The first relates
to a planning application which would have a harmful impact on
a nationally designated nature conservation site 100 metres from
the application site boundary. Under the current system, if the
developer entered into a planning obligation to carry out mitigation
works off-site which would avoid the harm to the interest of the
nature conservation site, planning permission could be granted.
Under the proposed system, such a legal agreement would not be
possible, therefore planning permission would have to be refused
and the development could not take place. This may mean that the
site, which would otherwise be suitable for development, could
never be developed.
The second example relates to the removal of
public transport contributions from the scope of planning obligations.
There is considerable evidence that unless public transport provision,
for example a bus route, is available for the first users of a
new development, it will not be successful. If the PGS approach
is introduced with the intention that money for such provision
will be available to local authorities, there will inevitably
be a time lag between the collection of the PGS, the recycling
back to local authorities and the provision of the necessary infrastructure.
If a bus route is introduced, for instance, 12 months after completion
of a residential development due to the time lag described above,
the evidence would indicate that this service will not be used
and will therefore fail. It is therefore difficult to see how
any such provision can be made to work successfully through the
proposed new approach, which will result in less sustainable development
being granted planning permission.
From a County Council perspective, the lack
of ability to take into account off-site environmental impacts
would have serious implications for the consideration of minerals
and waste planning applications. For example, MPG3 requires consideration
of community benefits to offset the impacts of certain minerals
applications and in paragraph 55 states that planning obligations
can be used in order to secure such benefits.
The removal of public transport implications
from the scope of planning obligations would seriously undermine
the delivery of a strategic public transport network. Nottinghamshire
County Council is currently very successful in negotiating and
delivering public transport contributions throughout the County
and the impact of the proposed changes to the system would undermine
the ability to achieve this."
Additional comment—"the proposal
to introduce a PGS but also to keep a scaled down planning obligation
system will further complicate the planning system, increase uncertainty
and lead to more delay than is currently experienced. This is
particularly true since the provision of affordable housing is
retained as a legitimate use of planning obligations. This is,
however, one of the most contentious elements negotiated through
planning obligations and causes significant delays;"
In conclusion, Nottinghamshire County Council
considers that the proposed changes to the planning obligation
system through the introduction of a PGS and retention of a scaled-down
planning obligation system would not be an improvement to the
current system, and indeed would increase uncertainty for the
developer, increase the risk that necessary infrastructure is
not delivered in an appropriate timeframe, lead to potentially
sustainable development being hampered, may encourage greenfield
rather than brownfield development and is itself likely to cause
delays as a universal charge will not be appropriate and each
planning permission will have to be assessed in light of its own
circumstances. The County Council is also very concerned regarding
the allocation of recycled PGS revenues and the implications this
has for the delivery of services.
The County Council recommend that as an alternative
to the proposed approach that a modified planning obligations
system is put in place which has statutory force and places obligations
on the determining planning authority to take into account County
Council recommendations in relation to their service areas, and
ensure planning obligation monies can be secured by County Councils
for infrastructure such a roads, transport and education, for
which they are the service provider. Nottinghamshire County Council
is keen to work with HM Treasury, HM Revenue and Customs and the
Office of the Deputy Prime Minister to formulate a revision to
the current planning obligations system.
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