Localism Bill

Memorandum submitted by the British Chambers of Commerce (L 11)

Introduction

1. The British Chambers of Commerce (BCC) is the national body for a powerful and influential network of Accredited Chambers of Commerce across the UK; a network that directly serves not only its member businesses but the wider business community. Representing 100,000 businesses that together employ more than 5 million employees, the BCC is the Ultimate Business Network. Every Chamber sits at the heart of its local community working with businesses to grow and develop by sharing opportunities, knowledge and know-how.

Summary

2. We welcome the opportunity to submit evidence to the Public Bill Committee on the Localism Bill.

3. Our submission mainly focuses on the planning part of the Localism Bill; although we also have concerns regarding the local government, non-domestic rates and community empowerment parts of the Bill.

4. The Bill must not become a vehicle for anti-growth campaigners to block development. As it is currently drafted some of the Bill's provisions on neighbourhood planning and referenda could have the unintended result of slowing much needed business investment.

5. It is important that a Third Party Right of Appeal is not added to the Bill. A Third Party Right of Appeal would constitute a serious threat to development and clog up an already-overburdened system. We urge the Committee members to resist any attempts to introduce additional appeal rights.

Local Government

6. The breadth of the restrictions on a local authority to do things for a commercial purpose under clause 4 must be clarified. This is important to allay fears that councils will not use the wider powers to enter into direct competition with local businesses simply in order to fund their operations. It is also important that clear limitations on councils’ commercial trading powers must be set out in regulations.

Non-domestic rates: discretionary relief

7. The BCC has long supported greater take-up and automation of small business rate relief and we therefore welcome the inclusion of clause 37. However, we would like the wording of the clause to be strengthened to require any new rate relief scheme to apply automatically to SMEs. We are concerned that the current, looser drafting could result in many small businesses still having to apply for relief in future – which could mean many businesses lose out.

8. We support the decision to give businesses a vote whenever a supplement is levied on business rates. Without such a vote the BCC was concerned that monies raised could be used for projects without a clear benefit for businesses.

Community Empowerment

9. Local referenda could have serious implications for key local infrastructure projects such as waste disposal plants or renewable energy projects such as wind farms.

10. The Bill should be amended to include business rate-payers as part of the electorate for all referenda that relate specifically to strategic planning and economic development. We also believe that business rate payers should be considered a petition organiser.

11. We consider the threshold for a valid petition calling for a local referendum of five percent as too low, especially in areas which have a small electorate, such as rural parishes. It is our view that the Bill should be amended to remove the word ‘lower’ to ensure the threshold for a referendum cannot be lower than 5%.

12. We are disappointed that the community right to challenge excludes not-for-profit limited by guarantee companies from submitting Expressions of Interest to run local services. The Bill should be amended to include such companies.

13. As the Bill stands, the clauses relating to assets of community value could potentially harm the value of premises in private ownership if these are designated prior to their sale. We would like to see the Bill amended to ensure that landowners are protected and compensated if they are subjected to a moratorium on the disposal of listed assets.

14. We also have concerns about proposed measures to allow individuals to nominate sites to be included on a list of assets of community value. These measures could potentially become used as a tool to stop development. Therefore, it is important that the Bill is amended to exclude from consideration community nominations whose sole purpose is to prevent development on a site.

Planning

15. The BCC is concerned about the effectiveness of the measures the Government intends to put in place once Regional Spatial Strategies are abolished. In particular, we do not believe that the duty to co-operate clause contains the necessary form of enforcement to ensure the duty is effective. Enforcing the duty solely through Judicial Review will be insufficient.

16. We have long argued that for Local Enterprise Partnerships (LEPs) to be successful they must have a clear purpose. In the recently published Local Growth White Paper the Government suggested that there could be a role for LEPs in planning. We believe that clause 90 could be amended to grant Local Enterprise Partnerships a scrutiny role over the duty and the right to appeal to the Secretary of State if local authorities fail to discharge their duty to cooperate.

17. The Bill makes a number of changes to the Community Infrastructure Levy (CIL), however there is much about CIL that the Government needs to clarify. Business needs assurances that Councils will not use the levy to raise funds for projects that have little to do with development. Business would also welcome measures to be put into place to ensure that CIL obligations are not excessive.

18. There are a number of issues surrounding Neighbourhood Plans that need to be clarified. As the Bill stands Neighbourhood Plans are very complex and there is a fear amongst business that they will be used as an anti-development tool. Combined with other new measures in the Bill, such as local referendums, Neighbourhood Plans risk empowering individuals whose sole purpose is to prevent development.

19. We have identified a number of changes that could be made to the Neighbourhood Plans part of the Bill that could make the plans more business friendly and therefore help create a pro-growth planning system.

20. The Government must define what constitutes a ‘Neighbourhood’ for the purposes of neighbourhood planning. We believe that an industrial estate or business park, comprised solely of rate-payers rather than Council Tax payers, must be given the same opportunity to form a neighbourhood as a residential area.

21. We also believe that amendments should be introduced to ensure that businesses can be ‘Qualifying Bodies’ for the purposes of proposing a Neighbourhood Development Order or Plan and that when Neighbourhood Forums are drawing up plans, businesses in the area must have a legal right to be part of the Forum and the plan-making process. The Bill should also be amended to ensure that business rate-payers have a vote in any NDO/NDP referendum, alongside individuals on the electoral roll. Further clarification is also needed to set out how Neighbourhood Plans will sit in the wider planning system.

22. The Bill introduces a new requirement on developers of projects to consult local communities before submitting planning applications. While industry is not against pre-application consultation, this measure could add substantial costs to the development control process. We would like further assurance that this new requirement will not trap small and medium sized businesses in costly new pre-application consultation. We are also looking for assurance that planning permission cannot be challenged based on the pre-application consultation.

23. The clause returning final decision making powers on nationally significant infrastructure projects to the relevant Secretary of State requires amending to ensure that the Secretary of State is held to account by Parliament if he/she decide not to agree to a Major Infrastructure Planning Unit recommendation. Being held to account may involve the relevant minister having to make a statement in the Commons or going before a Select Committee.

24. We would welcome clarification on how projects can be upgraded to the Major Infrastructure Planning Unit. In particular, projects that when combined are of national significance. Clarification is also required as to whether a developer has a right of appeal if a Secretary of State makes a decision on a project of national significance when a national policy statement is not in place.

Conclusion

25. Businesses believe that the current planning system is too complex, timely and costly. The changes to the system proposed in the Bill could potentially create more barriers and stop much needed small and large scale investments. However, if the Government listens to business concerns the Bill could reflect a pro-growth approach. We therefore urge the Committee to consider the proposals we have made in our written evidence.

January 2011