Statutory duty on councils to cooperate must be strengthened, says CBI

The proposed statutory duty in the Localism Bill requiring local authorities to cooperate in planning must be strengthened and enforceable, the Confederation of British Industry has argued.

In its submission to the government’s growth review ahead of the Budget later this month, the CBI said the proposed duty was welcome, but warned that it “is not yet clear how it will work in practice and be enforced”.

The business group added that strengthening the duty would ensure joined up thinking on crucial issues such as waste management and housing development.

Other key points in the CBI’s wide-ranging submission were:

• The fast-track process for nationally significant infratstructure projects must be retained with ministerial sign-off. “The transition from Infrastructure Planning Commission to the Major Infrastructure Planning Unit is already undermining investor confidence, and we cannot risk eroding this further.” Changes to the system should therefore be kept to an absolute minimum.
• The National Planning Policy Framework should provide a presumption in favour of sustainable development
• Reform of the appeals process in planning must provide more certainty and avoid unnecessary delays. “The remit of the Planning Inspectorate should be narrowed to aspects of an application for which permission was rejected, rather than revisiting the whole application. This would ensure that consultation is carried out at an early stage of the planning process.”
• Strong consideration should be given to land auctioning by local authorities. “Land auctions would provide a strong incentive to local authorities to promote development. However, care must be taken to ensure that it does not undermine a competitive market for developers”
• The uniformity of the current business rate system must be retained. “Changes to the business rate system under the localism agenda must not be a stepping stone to full relocalisation of business rates and must not allow local authorities to increase the business tax burden”
• Legislation for tax increment financing must be introduced. “TIF would provide significant capital for large scale projects in a way that a simple retention of the business rates cannot emulate”
• Growth zones should be used to test new policies. “[The government] should license at the local level a series of controlled experiments, with local areas proposing freedoms that suit their particular needs and aligned to national strategic needs.”
• Commercial and industrial parks should have more autonomy. “In areas that do not have residential premises….local authorities should cede decisions over issues such as planning, energy generation and skills development”
• Public funding for infrastructure must be transparent and proportionate. The government must clarify the relationship between section 106 agreements and the Community Infrastructure Levy so that businesses are not double charged for infrastructure.

The CBI also called for local authority inspection to be harmonised and improved. It pointed to the fact that many firms – especially those in consumer facing industries and many smaller firms – are not regulated by the Health and Safety Executive but by their local authority.

“This leads to a wide variety of interpretations: CBI members report that local authorities generally have a different view of comparative risk to the HSE; and firms with sites across different authorities report contradictory advice,” the CBI said.

“While larger firms in this situation can benefit from dealing with one authority through the primary authority schemes, this option is not available to smaller firms. The government must harmonise risk attitudes and inspection standards of local authorities with those practiced by the HSE in the areas they regulate.”

The CBI submission cited the comments of one national retailer that uses a franchise model.

“Many of our local franchises find H&S regulations particularly difficult,” the retailer said. “We look to help them from the centre as far as possible, but the lack of consistency amongst local authorities is astounding: what one council considers acceptable, another expressly forbids. This means that managers of these entrepreneurial businesses have to spend far too much time thinking about mitigating infinitesimal risks rather than meeting customer demand.”

The CBI called for the government to focus on three critical areas in the forthcoming Budget: boosting export performance, unleashing domestic investment spending, and removing barriers for high-growth firms.

CBI Director-General John Cridland called for a “relentless focus on growth to help get the UK working again.”

He added: “We want to hear more about how the planning system will genuinely deliver swift decisions on infrastructure, and less about abolishing the Infrastructure Planning Commission.”

Cridland said the CBI also wanted the two year unfair dismissal qualifying period to be restored to give companies more time to assess the potential of a new employee. “In addition, the tribunals system should be strengthened to weed out weak and vexatious claims.”

The business group reiterated its desire to see more competition promoted in public service delivery.