How post-Brexit environmental rules could affect development

Government plans to leave environmental regulations virtually untouched after Brexit give welcome clarity to the sector but are unlikely to have much immediate impact on development activity, say observers.

Nature: Government says it plans to leave environmental regulations virtually untouched post-Brexit
Nature: Government says it plans to leave environmental regulations virtually untouched post-Brexit

Last week, the government published statutory instruments outlining the shape of environmental regulations as they affect the planning system when the UK leaves the European Union next March. The Ministry of Housing, Communities and Local Government (MHCLG) said the instruments leave the current system of environmental impact assessment (EIA) and strategic environmental assessment (SEA) substantially the same as at present.

But how much certainty, if any, is provided to developers of large schemes by continuation of the existing regime? An MHCLG statement accompanying the new regulations said the instruments will ensure the "continued smooth operation" of the SEA and EIA regimes relating to the environment and the planning system. The only changes to the existing regime, it said, is to remove references to European law that will no longer be relevant following Brexit.

But in July, a briefing note issued by the Royal Town Planning Institute suggested that project developers could put schemes on hold in the hope of a less taxing EIA regime following the UK's departure from the EU. Has that actually happened? Not according to sector commentators. "Any possible benefit from proposed regulatory change is so remote and uncertain at the moment that it would make little sense to hold back on development and incur the downsides of that," said Jamie Lockerbie, senior associate at law firm Pinsent Masons.

"We have experienced no evidence of applicants holding back on progressing EIA development projects because of uncertainty over the future of environmental regulations," said Jamie Alflatt, head of the EIA service in consultancy Bidwells' planning division. "Where projects have been delayed, this is more related to the uncertainty that surrounds the wider economic stability post-Brexit informing investment decisions, rather than applicants waiting to take advantage of potentially diluted environmental regulations."

Angus Walker, partner at law firm Bircham Dyson Bell, said there is little evidence that major projects covered by the affected regimes have slowed down due to the imminent departure of the UK from the EU. "If anything, the number of applications for development consent orders has picked up recently," he said. "The number of live applications was four in August 2017; now it is 20. The new regulations will not solve much at all as they are insignificant compared with the deal or no deal issue."

These views clash with a suggestion made by then foreign secretary Boris Johnson in February, when he highlighted the potential to "declutter" the planning system and speed up housing delivery as a key potential benefit of Brexit. He said: "We might decide that it isindeed absolutely necessary for every environmental impact assessment to monitor two life cycles of the snail and build special swimming pools for newts – not all of which they use – but it would at least be our decision."

However, commentators said developers are not surprised or disappointed that the government has chosen to leave the regulations more or less untouched at this stage. Lockerbie said: "Given how much uncertainty there is surrounding Brexit generally at the moment, I don’t think this is a missed opportunity. We don’t know to what extent we can effect regulatory change until we know what the final deal is." Lisa Hall, a planning associate at Bidwells, said the regulations provide "clarity to the industry on EIA and SEA after Brexit", adding: "A real positive is that there will be no need to re-examine any decisions made before Brexit, so it really is business as usual."

However, Lockerbie said the door remains open to any future government to introduce changes to the environmental regimes after Brexit. Walker took a more cautious line: "If the moment of leaving the EU is to be as seamless as possible, it would be foolish to tweak the law at the same time. That can come later if it is needed. There may be a hope that air quality legislation will be watered down, but it is probably too hot politically for that to happen for a while."

Others believe that, even in the medium term, a wholesale change of stance by the UK government on SEA and EIA is unlikely. "With the government agenda to maintain high environmental standards after we leave the EU, dilution of environmental regulation is not on the horizon," Alflatt said. He also pointed out that, notwithstanding the draft replacement regulations, the continued operation of EU law will apply to the UK during the transition period, which will continue until 31 December 2020 at the earliest.

In any case, not all UK environmental regulations are down to the EU. Emanuele Stella, a director at planning consultancy RPS, pointed the regulations were, in part, introduced due to meet the requirements of the United Nations’ Aarhus Convention, to which the UK will remain subject after Brexit. Stella said: "Even in the event of a direct intervention of the government to change the regulations after Brexit, there are other international agreements that will need to be considered in order to change the system currently adhered to in UK."

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