Planning, building and the environment

Planning fees frozen to help developers on the road to recovery

Published	20 January 2010

Planning Minister John Healey today pledged to freeze planning fees on applications to help developers through the economic recovery and keep builders on construction sites by saving them up to £23m a year.

To help companies generate jobs and homeowners make improvements to their homes, planning fees will be kept at their current levels. The money saved will provide a valuable cash boost for developers to invest in new projects.

Mr Healey also confirmed that fees for planning appeals will not be introduced this year to avoid placing any further burdens on businesses and householders during this difficult economic time.

This will mean that businesses will not have to pay for their decision to be reviewed by the Planning Inspectorate if their applications are rejected, and will give companies confidence to expand their business.

John Healey said:

"At a time when investing in new developments is difficult and when access to funding is hard, it would be wrong to increase the costs of developers who will help drive economic recovery. That's why I've decided to freeze planning fees and put appeal fees on ice.

"I recognise that as we start to work through economic recovery, we need to do what we can to keep builders on construction sites and keep plans on the table. It is important that we react to the economic circumstances and listen to the needs of people, industry and developers and we have done just that."

Background

1. Recent measures have streamlined the planning system, cutting red tape to help businesses deliver projects quickly and drive down costs during recovery. These include:

i.) introducing flexibility for planning permissions that will enable existing planning permissions to be replaced before they expire, allowing a longer period for implementation and saving businesses up to £69m a year;

ii.) cutting the amount of information required for planning applications which will save businesses up to £57m a year;

iii.) delivering a more proportionate, customer focused and efficient appeals service. Householder appeals are now decided in 8 weeks via the Householder Appeals Service and there have also been savings by ensuring all cases follow the appropriate procedure (written method, hearing or inquiry);

iv.) proposals to ensure councils and developers work together before applications are submitted and that the number of conditions applied to planning permissions is reduced. These are due to come into force in 2010, and will deliver up to £11m of savings for businesses and up to £25m for councils every year;

v.) proposals that will allow homeowners, developers and businesses to install their own on-site wind turbines, and air source heat pumps without the expense and red tape of planning permission;

vi.) reducing the maximum fee for certain applications such as habitat creation and farm diversification, ensuring projects such as the creation of fishing lakes will now face a maximum fee of £1,690.

2. In addition to freezing planning fees the Government is increasing funding for the provision of free, independent advice to individuals and community groups to help them understand and use all aspects of the planning system. Funding for Planning Aid has risen from £3.2m last year to £4.1m in 2009/10 and £4.5m in 2010/11.

3. In 2008 planning fees were increased by an average of 23 per cent which was expected to raise an additional £65m in fee income and thus enable local authorities to achieve cost recovery for the fee paying element of the planning service.

4. In February 2009, the Government, commissioned research from Arup which builds on the research undertaken for the 2008 fee increase. The research indicates that a further increase in planning fees of 10 per cent could be justified taking into account the current level of planning authority income from planning fees and the cost of the development control system.

5. A 10 per cent increase could potentially raise an additional £23m. However, this must be considered alongside the current economic climate and the additional cost to developers.