Should local authorities be allowed to set their own planning fees? Polly Reynolds examines recent developments.
A group of businesses, landowners and planning authorities in London's West End are working to develop a pilot scheme under which planning departments would be able to fully recover the costs of dealing with planning applications.
In a letter to George Osborne in February the West End Partnership, chaired by leader of Westminster City Council, Philippa Roe, argued that allowing full cost recovery would improve the provision of planning services.
Signatories to the letter include both Westminster City Council and Camden Borough Council, along with local and national developer stakeholders. If given the go-ahead, participating councils would expect to be able to charge higher fees in return for fast tracked decision making. The additional revenue would be used to subsidise their wider planning departments and allow them to ease the backlog of applications.
The proposed pilot scheme would apply to office, retail and residential applications in the West End and would be aimed at relieving pressure on the councils' planning departments. Westminster City Council's planners process some of the highest value applications nationwide. The Financial Times reported in February 2014 that "the number of planning applications received by Westminster Council has nearly doubled in the last four years…to nearly 16,000 in 2013". Although an extreme example, such a pilot in Westminster would no doubt be keenly observed by the numerous other councils which have raised concerns about increasing financial pressure on their planning departments.
The West End Partnership has indicated that any wider roll-out should be on a voluntary basis. It would be most suitable for councils which are struggling to process applications in a timely manner and where there is existing industry support. Nevertheless, while the proposed pilot scheme is intended to benefit planning departments as a whole through ring-fencing, concerns remain that it would lead to commercial applicants 'paying' for planning consents.
While we await a fully developed pilot scheme proposal, it is worth considering the benefits of the existing regime. The current system of planning fees fixed by central government is well-established and offers predictability for developers. Furthermore, in 2012, council planning fees were raised by 15% on 2008 levels to adjust for inflation. However, this came little more than a year after a Government consultation concluded that councils should be able to set their own fees.
It seems the evidence is not quite strong enough to convince central government to relinquish control of local planning fees. On this basis a pilot scheme might well be the final piece in the jigsaw, generating evidence on the key issue of whether efficiency savings can be made without undermining the quality and impartiality of local planning services.