At the time of writing (April 2025), the Planning & Infrastructure Bill (‘the Bill’) is at committee stage in the House of Commons and by the time it has achieved Royal Assent it is likely to have changed to some degree.
The Bill is hoped to assist this government in achieving its target of building 1.5 million new homes and whether this will come to fruition will no doubt be closely monitored. The committee is expected to provide its report by 22 May 2025 and thereafter the Bill will move onto the third reading at the House of Commons.
At the time of writing, the Bill proposes key changes in the following areas:
In this article I will attempt to address each of these areas so that local authorities and developers can prepare themselves early on for the proposed changes.
What constitutes a development to be an NSIP is set out in section 14(1) of the Planning Act 2008 and relates to energy, transport, water, waste and waste-water and includes, but is by no means limited to, the construction or alteration of harbour facilities, railways, dams or reservoirs, hazardous waste facilities as well as development relating to airports and highways. Not all development relating to these areas will qualify as an NSIP and it is generally dependent on the size and scale of the project.
A proposal requires approval from the Secretary of State who will issue a development consent order (DCO).
The Prime Minister has pledged to sign off 150 DCOs in the next 5 years to achieve a net zero UK by 2030 which is significant considering that the explanatory notes of the Bill illustrate that the existing regime had “consented over 130 projects” in the 15 years or so since the first DCO was made.
Recent DCOs which have been granted include the Lower Thames Crossing consisting of a new road through a tunnel beneath the River Thames which Melanie Francis of Holmes & Hills Solicitors has recently reported on in an article.
The Bill requires National Policy Statements (NPSs) to be reviewed at least every 5 years. These are produced by the government in setting out policies on different national infrastructure development.
The Bill also provides the Secretary of State with the power to remove the requirement for a DCO for an NSIP so that an alternative regime can be applied, such as that under the Town and Country Planning Act 1990, if it is considered more appropriate in areas concerning energy or within a Renewable Energy Zone.
Furthermore, the Bill removes requirements to consult individuals entitled to make a claim for compensation under section 10 of the Compulsory Purchase Act 1965. However, they do have to be notified after an application is accepted.
The changes are significant to local authorities hosting an NSIP as they are statutory consultees. The Bill will require local authorities to have regard to guidance issued by the Secretary of State when being consulted on an NSIP.
Presently, fees for local authorities dealing with planning applications are set by the Secretary of State. The Bill has provision for allowing local authorities to be authorised by the Secretary of State in setting their own fees for dealing with planning applications.
The explanatory notes attached to the Bill mention that “there remains an estimated annual overall funding shortfall for local planning authority development management services of £362 million per year, which in turn is hampering LPA capacity and causing a poorer planning service.”
It is therefore hoped that the new change to planning fees will bolster local authorities financially to ensure that they are fully resourced in dealing with planning applications.
Fees should be “set with a view to ensuring that they do not exceed cost-recovery” i.e. the cost of carrying out the relevant planning function.
The Bill introduces a new requirement for the strategic planning authority to produce a spatial development strategy (SDS) covering a strategy area. The strategic planning authority will be either a combined authority, combined county authority, upper-tier county authority or a unitary authority.
The government can also establish a strategy board if it believes that the SDS should cover a number of authorities. It must contain a statement of the planning authority’s policies in relation to the development and use of land which are of strategic importance. It must have a “reasoned justification” for these policies and the SDS itself must specify the period for which it is to have effect.
There is a requirement to address climate change and so the SDS must be designed to secure that the use and development of land in the strategy area contributes to the mitigation of, and adaption to, climate change.
For London, it is the Mayor which produces the spatial development strategy, otherwise known as the London Plan, pursuant to the Greater London Authority Act 1999.
The impact of this on local authorities is that they must determine planning applications in accordance with the SDS unless there are material considerations as to why it should deviate. For developers it means they will need to have regard to the local plan as well as the SDS in formatting and submitting their development proposals and applications for planning permission.
Development corporations are statutory bodies which can be set up under the New Towns Act 1981 for the purpose of facilitating development in areas needing large-scale co-ordination of investment and planning. The Secretary of State under the current regime has the power to designate an area as the site of a proposed new town and, in doing so, can also establish a development corporation.
The Bill will widen these powers so that land which is adjacent to an existing town can also be designated. This will facilitate urban extension of existing towns rather than creating new towns.
The Bill will also require a development corporation to aim to contribute to the mitigation of, and adaption to, climate change. This will be advantageous for the development corporation in that through urban extensions it can rely on existing town infrastructure.
Local authorities will likely wish to monitor proposed changes on the basis that some of their planning functions or statutory powers may be curtailed by, or lost to, Development Corporations.
The Bill makes provision for an Environmental Delivery Plan (EDP) to be prepared by Natural England to add address “the impact of specified types of development on relevant environmental features” as mentioned in the explanatory notes to the bill. Environmental features are defined as either a specific protected feature of protected site or a protected species. It will set out the conservation measures which will be taken to address the impact of development on the environmental features.
Of relevance to developers in particular, the EDP will also set out the Nature Restoration Levy payable by developers to Natural England. The levy is intended to fund the conservation measures set out in the EDP and the levy will vary depending on the nature and size of the development. The sums payable will be set out in the charging schedules which will be unique to each EDP.
A developer can also voluntarily offer to pay the EDP prior to commencing development and, in doing so, it can be excused from a number of environmental obligations.
As per the explanatory notes, “in relation to an EDP that relates to a protected feature of a protected site, payment of the levy results in the environmental impact of development on that feature being disregarded for the purposes of obligations under the Habitats Regulations or the Wildlife and Countryside Act 1981.” It is indicated that this sum can be collected via a planning condition attached to a planning permission ensuring that the levy is paid prior to any development being carried out.
It is important to note that the levy itself will run with the land and therefore bind future landowners.
Whilst there are a number of changes being introduced under the Bill to the compulsory purchase procedure, what is most likely to be controversial are changes to compensation payments, loss payments and home loss payments.
Loss payments are an additional amount paid to landowners for any inconvenience and disruption caused by the compulsory purchase.
Similarly, home loss payments are an additional amount paid to a person displaced from their home as a result of a compulsory purchase.
The Bill proposes that a home loss payment may be excluded where a property owner has failed to comply with a notice or order served on them to make improvements to their land or properties. This includes notices served by local authorities under section 215 of the Town and Country Planning Act 1990.
The explanatory notes explain that “the clause ensures that those whose neglect of a property has prompted a compulsory purchase order do not benefit from that neglect through a home loss payment.”
Should it successfully be incorporated, this provision will likely encourage property owners to therefore comply with any notices requiring them to make improvements to their property or land under threat of compulsory purchase in the first instance but additional for risk of being denied statutory compensation.
As above, the Bill is likely to be amended and its provisions changed if made law. On behalf of our clients, contracts and referrers, Holmes & Hills will continue to monitor the Bill and provide a further update in due course.
Disclaimer
The content of this article is provided for general information only. It does not constitute legal or other professional advice. The information given in this article is correct at the date of publication.
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