Five key implications arising from this week's Budget

Five key implications arising from this week's Autumn Budget, including concerns that the measures could increase the workload of local authority planners and fears that proposals could undermine faith in the development plan system.

Treasury: has unveiled details of further planning changes in latest Budget
Treasury: has unveiled details of further planning changes in latest Budget

1. Budget measures ‘will increase the workload of local authority planners’
The government’s commitment to solving the UK’s housing challenge is welcome but is contingent on council planning teams being adequately resourced, commentators have said. "We are pleased that the government accepts that the housing challenge is now at the top of its agenda and has announced several measures that should help speed up the planning process," said Ian Fletcher, director of real estate policy at the British Property Federation. "However, in order for these measures to be successful, planning departments need to be adequately resourced or we will end up in the same situation we currently finding ourselves in." Other commentators agreed, with the RTPI noting that many of the changes announced in the budget would increase the workload of local authority planners "so it’s crucial to make sure this is adequately resourced". Ian Anderson, partner in consultancy Cushman and Wakefield’s planning and development team, said council planning teams are "hopelessly under-resourced". "The government said nothing today about ensuring there are enough planners to deliver permissions more quickly," he said.

2. Tax changes could risk investment in urban areas
Changes announced to Capital Gains Tax in the budget could risk jeopardising investment in urban areas, commentators from the property industry warned. In a consultation paper, the Treasury announced that, from April 2019, tax would be charged on gains made by non-residents on disposals of all types of UK property, extending existing rules that apply only to residential property. The change is designed to more closely align the tax treatment of overseas and domestic owners of property. But the BPF’s Fletcher expressed concerns over the move, and its implications for urban areas. "The UK is particularly good at attracting overseas investment capital, much of which goes towards regenerating our towns and cities. Not only does this result in better places to live and work, it supports thousands of industries as varied as construction and leisure," he said. "We are deeply concerned that [the announcement] will jeopardise this much-needed investment."

3. Increased housing target set to maintain pressure for green belt reviews
Consultants Lichfields have suggested that, if the government is to deliver its new housing target, the pressure for development in the green belt is unlikely to recede. The consultants state that, in order to build the government’s stated target of 300,000 homes per year by 2023, "the number of planning permissions needs to increase first to 410,000 per year before stabilising at 380,000 per year". The figures derive from research the firm published earlier in the year which highlighted the stock of consents which it says are needed in order for a boost in housebuilding to be delivered. "The chancellor’s 300,000 target is based on the government’s standard need methodology without the 40 per cent ‘cap’, and represents a 85,000 uplift on last year’s net additional dwellings," Lichfields’ analysis of the budget says. "It assumes 100,000 in London (more than double the completions last year) and uplifts in many unaffordable green belt locations." The pressure for green belt reviews is therefore "unlikely to go away," the firm says.

4. Infrastructure levy regime to get more complex
Experts warn that Budget proposals to allow local authorities to set Community Infrastructure Levy (CIL) rates which better reflect the uplift in land values between a proposed and existing use risks introducing more complexity into the system. Matthew Spilsbury, director at consultancy Turley, said that the proposal could make the system more complicated. "For example, within a residential zone, which may have a differential rate to a neighbouring zone, this suggests that you may have further differing rates for greenfield sites, brownfield sites, and various typologies within," he said. Spilsbury said that it would "clearly require additional viability evidence to support this", which could "become rather onerous". Sara Parkinson, planning and development programme director at business group London First, said: "What we are seeing is another layer of CIL charging and complexity, when actually we should be simplifying the process." MORE.

5. ‘Use it or lose it’ approach to allocated sites risks undermining faith in development plan system
The notion of taking allocated sites out of local plans where "there is no prospect" of a planning application being made has prompted warnings that this "use it or lose it" approach could undermine faith in the development plan system and lead to a welter of litigation over the meaning of "no prospect", without doing anything to boost delivery. Matthew Spry, senior director at consultancy Lichfields, said it would be an "unnecessary measure aimed at an illusory problem". Where sites are not coming forward, he said, it is generally because of practical barriers to implementation that the parties should be aiming to resolve together. David Rolinson, chairman of consultants Spawforth, pointed out that deallocation would require time-consuming local plan reviews. MORE.


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