5 December 2006

Barker sets out proposals for planning system fit for 21st century

Kate Barker today published her final report on the Land Use Planning System in England.

The report highlights the vital role planning needs to play to deliver sustainable economic development in the context of the pressures of a growing population, rising incomes, changing demographics, climate change and the competitive challenges of rapid changes in the global economy. Kate Barker makes recommendations to improve the responsiveness, efficiency and transparency of the planning system so that it can fulfil its potential. Speaking today she said:

"The planning system has a profound impact on our quality of life, but the current system will come under increasing pressures in the coming decade. Building on recent reforms, the recommendations in my report provide a comprehensive set of measures to ensure we have a planning system that is timely, transparent, flexible and responsive enough to meet the challenges that lie ahead

"Businesses, residents and others want a system that can continue to secure economic prosperity alongside vital social and environmental goals. I believe this reform package, if enacted, can help create this world-class planning system."

The report recognises the high costs placed on developers, businesses and communities when the planning system is unnecessarily slow, unpredictable, expensive and bureaucratic. The report recommends streamlining of planning policies and processes to improve speed, transparency and efficiency. These include:

substantial rationalisation of national planning guidance to provide a clearer and more transparent national policy framework;
improving local plan-making processes so plans can be drawn up in 18-24 months not the current 36-42. This could save local authorities over £100 million over a three-year period;
a more risk-based and proportionate approach to regulation, with significant reduction in the paperwork required to support applications. This will help reduce private sector planning fees (over £200 million a year) and consultancy fees (over £300 million a year);
greater certainty of timescales with new, individually tailored delivery agreements between planning authorities and developers;
faster processing of appeals: from 2008/09 all appeals should take place within six months, and the use of a new Planning Mediation Service to resolve disputes outside of appeal proceedings;
a significant reduction in the number of cases suffering delays due to Ministerial call-in, with 50% fewer call-ins from 2007; and
in line with the findings of the Eddington Study of Transport, a radical overhaul of the planning system for major infrastructure projects, including transport, waste and energy, to improve speed and certainty. Ministers should, following full consultation, set out statements of strategic objectives. Decisions on individual applications would then be taken by a new expert independent Planning Commission.

The Report makes a number of recommendations to enhance the flexibility and responsiveness of the planning system to support sustainable economic growth for the 300,000 business applications a year. These include:

allowing minor changes to commercial premises - including the use of microgeneration technology such as small wind turbines and solar panels- to proceed without requiring planning permission;
updating planning policy guidance on economic development for the first time in 14 years to clarify that full account of the economic benefits of development applications should be taken in decision-making;
ensuring plans and decision-makers take better account of relevant price and market signals, such as land prices for different uses; and
promoting more positive planning within the plan-led system by ensuring, when plans are indeterminate, that applications are approved unless there is good reason to believe the economic, social or environmental costs of development outweigh the benefits.

The Report also sets out proposals for a more efficient use of land in the context of the population, projected to rise to 55 million by 2026, including:

encouraging a high proportion of new development into towns and urban areas through support for the town-centre first policy and use of fiscal policy to encourage empty property to be put into use, and to incentivise the use of vacant previously developed land;
greater mixed use designations in plans and a more positive approach to applications for change of use to reflect the changing needs of the UK's flexible, service-based economy;
ensuring sufficient supply of land for the proportion of development that cannot take place in towns and cities. With only around 8.3% of land currently classified as urban, this can be achieved while protecting land of high environmental or social value. This development should take place in locations that are best from an environmental perspective- where this is near existing towns and cities green belt boundaries should be reviewed by regional and local planning authorities to limit the increased emissions and pollution caused by commuters "jumping" the green belt; and
protecting valued green space in urban areas and taking a more positive approach to applications that enhance the quality of the 13.5% of land in the UK classified as green belt land through creating new accessible parkland or woodland.

Notes to editors

1. In December 2005, the Chancellor and the Deputy Prime Minister commissioned Kate Barker to conduct an independent review of the land use planning system of England, focusing on the link between planning and economic growth. The interim report, focusing on the link between planning and productivity, was published in July 2006.

2. The terms of reference for the review are:

"to consider how, in the context of globalisation, and building on the reforms already put in place in England, planning policy and procedures can better deliver economic growth and prosperity alongside other sustainable development goals. In particular to assess:

ways of further improving the efficiency and speed of the system;
ways of increasing the flexibility, transparency and predictability that enterprise requires;
the relationship between planning and productivity, and how the outcomes of the planning system can better deliver its sustainable economic objectives; and
the relationship between economic and other sustainable development goals in the delivery of sustainable communities."

3. Further information about the review, including copies of the responses to the call for evidence conducted from January to March 2006.

4. There are about 650,000 planning applications made every year. Of these 50% are householder applications, 26% are minor dwellings, commercial and industrial, 6% are listed building and conservation area consents, 6% are for change of use, and 4% are other.

5. According to UKTI planning is consistently one of the top six concerns of companies looking to invest in the UK, while the OECD believe that ensuring planning takes better account of economic considerations is a top priority for UK structural reform. According to the CBI, 69 per cent of firms are dissatisfied with the progress of local authorities in improving the performance of their planning department.

6. Firms pay high direct transaction costs as a result of planning. Planning fees are in excess of £200 million per year, with planning consultancies earning around £300 million from private sector fees in 2005-06. The interim report of the Barker Review of Land Use Planning suggested total solicitors fees in the region of £350-500 million (it did not estimate the likely cost of barristers fees).

7. In terms of the costs of delays, there is evidence of some progress by local authorities. Of the 19,600 major developments decided in 2005-06 66% were made within 13 weeks, up from 49% in 1999-2000. But over 22,000 minor cases took over 13 weeks to process in 2005-06, while large applications still take many months (or sometimes years) to process. Appeal handling times have deteriorated. In 2001/02 6.1% of appeals determined by a hearing took over 24 weeks. By 2005-06 this had risen to 89.9%, with 49.3% taking over a year.

8. Planning contributes to high land prices (agricultural land in England averages £10,000 per hectare, residential land £2.6 million and general business land £780,000). London West End prices are 40% more than any other city, while prime site costs in Manchester and Leeds are around 40% more than mid-town Manhattan.

9. As part of the review process an IPSOS/MORI poll was commissioned. Full details of the survey can be found on the review's website: www.barkerreviewofplanning.org.uk. Key findings include:

54% of respondents believed that around half or more of England was classified as developed. Only 13% of respondents think that around a quarter or less of the country is developed.
The land that people most want protected from development is that with important or endangered wildlife (71%) followed by land with scenic beauty (53%). Only 16% believe that land near towns and cities is among the most important to protect.
There is widespread misunderstanding about the function of green belts, 60% of people believe one of its key functions is to protect wildlife, 46% believe it is to protect areas of scenic beauty and 24% believe it is to protect high value farmland.

10. In terms of protected area designations, 12.9% of England is classified as green belt, 15.6% Areas of Outstanding Natural Beauty, 6.2% Special Areas of Conservation, 4.7% Special Protection Areas, National Parks 7.6%. Around 8.3%-13.5% of land in England is classified as developed.

11. Kate Barker CBE is an external member of the Monetary Policy Committee of the Bank of England. Previously, she was Chief Economic Adviser at the CBI (1994-2001), and prior to that Chief European Economist at Ford of Europe (1985-1994). She was appointed (by Government) in April 2003 to conduct an independent Review of UK Housing Supply; leading to a final report in March 2004. In October 2005 she was appointed a Board Member of the Housing Corporation.

12. Media enquiries - including media bids for Kate Barker - should be addressed to the Treasury Press Office on 020 7270 5238. Non-media enquiries should be addressed to barker.review@hm-treasury.gov.uk or via the Treasury Correspondence and Enquiry Unit on 020 7270 4558.