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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