Abolition of Regional Spatial Strategies: a planning vacuum? - Communities and Local Government Committee Contents

Written evidence from Legal & General Property (LGP) (ARSS 115)

I write on behalf of Legal & General Property (LGP) to submit comment to the Communities and Local Government Committee Inquiry in to the abolition of Regional Spatial Strategies.

We welcome the opportunity to provide comment on emerging planning reform and look forward to working with the Government as it progresses the draft Localism Bill.

LGP is part of Legal & General Investment Management which manages £320 billion and as such we are one of the largest institutional property fund managers in the UK, responsible for assets of about £9 billion as at the end March 2010.

LGP is a major stakeholder in the built environment and has played an important role in delivering regeneration across all property sectors. Whilst we have a significant development programme, it is in our role as an investor that we write.

It is clear that the importance of private sector investment from institutions including LGP in delivering future renewal will increase. The decision of the private sector to invest in land and property can be influenced by many factors, but the balance between risk and return is key. The impact of planning change on the prospect of securing investment is on the perception of risk and the certainty required to take major investment decisions.

We believe that a critical role of the public sector will be to create the confidence and certainty to support private sector investment and that the planning system is fundamental to this confidence.

We entirely agree with the Government's overall proposition to create an effective and efficient planning system and would support any proposal to simplify and speed the planning application process.

We support the principle of a consolidated national planning policy framework covering all forms of development; albeit that we consider that streamlining of national policy should not be at the expense of clarity and believe that the Government will need to clearly prioritise its objectives give the limited resources that will be available to deliver. We also welcome the intention to express a presumption in favour of sustainable development, subject to clarity over the definition.

Our principle points of concern however relevant to the Committee's terms of reference are:

1.  Providing a framework for the consideration of major investment decisions.

2.  A perceived lack of certainty in the planning system that has arisen as a consequence of the abolition of regional planning guidance. This strategic tier of planning policy was an important tool in the private sector's ability to predict a planning outcome and provided a framework for the consideration of major development that had a wider impact and importance than merely local. We believe that the removal of strategic planning targets, for all forms of development, without replacement, has removed a key consideration against which major applications were judged and has been the cause of uncertainty and delay.

3.  A consequential increased risk of planning opportunism, which could undermine committed or planned major investment and as a consequence, important regeneration.

We very much hope that measures to replace the certainty that was imparted by the now revoked strategic planning framework will be tabled soon in a co-ordinated way, with full account having been taken of the potential consequences.

In particular, we would welcome clarification from the Government over the anticipated role and function of Local Enterprise Partnerships (LEPs) and further clarity over, what we believe will need to be a powerful incentive package to support growth in order for it to have sufficient weight in the balance of planning decisions. In the recently published timetable for reform the incentive proposal was described as "strong and transparent incentives for local authorities to build new homes" and we are concerned that, unless clarified, this might be a signal that the Government will only create the incentive package for housing and not all forms of development. We strongly believe that reform of the planning system, and the Select Committee, should consider all sectors.

Furthermore, in our view, the LEPs could offer an opportunity to reinstate a degree of accountability, without diluting the Government's fundamental principle of localism. We consider that LEPs could assume a sub-regional planning function, as well as replacing the functions of the Regional Development Agencies. We would welcome an explicit commitment from the Government that the outline proposals for the LEPs and their future performance will be assessed having regard to criteria including the delivery of agreed, target sub-regional housing and commercial planning permissions.

I trust that the above is self explanatory however, if you have any queries please do not hesitate to contact me.

September 2010

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