Building Homes By CPO

This blog post supplements a 27 October 2016 Planning Futures event  hosted by City University on the role of compulsory purchase in solving the planning crisis.
Any discussion like this needs to be in the context of wider legislative and policy initiatives in relation to the operation of the planning system, of seeking to ensure that development is viable and of the role of the public sector in delivery. There is a risk that it is treated by professionals in a silo as a specialist discipline, rather than as an inherent part of the planning system.
Compulsory purchase is not to be considered lightly. But it shouldn’t be written off as a potential tool in the right circumstances. 
LPAs commonly have various concerns over use of theIr CPO powers – that the process
– is time intensive

– is costly

– can be politically sensitive

– needs specialist experience

– gives rise to compensation liabilities

– should be a last resort. 

Much of this true. However the power in section 226 of the Town and Country Planning Act 1990 is there to be used and there is detailed, relatively up to date (2015), guidance. Whilst the procedure is still not simple (it never will be), substantial improvements are being made to the legislative basis. 
Without the threat of CPO, will some, otherwise suitable, sites come forward? Allocation is not always enough to secure development. Indeed, radical thought: should permission in principle under the Housing and Planning Act 2016 in some circumstances come with the threat of CPO if development doesn’t proceed without good reason? The threat could be made clear by the LPA when placing land on its brownfield land register or in any other allocation intended to lead to permission in principle. 
Compulsory purchase is a tried and tested process with city and town centre retail-led schemes, where there is familiarity with the steps and approach to be taken by LPA hand in hand with its developer partner, with the developer partner meeting costs and compensation liabilities by way of an indemnity agreement. Properly drafted, such agreements can avoid difficulties in relation to the duty to secure best consideration in section 123 of the Local Government Act 1972 (Standard Commercial Property Securities Limited v Glasgow City Council  House of Lords, 16 November 2006) or in relation to public procurement (see my previous Section 123…Go!  blog post for more). 
Nationally Significant Infrastructure projects of course have the benefit of the bespoke DCO process under the Planning Act 2008, under which compulsory powers are routinely secured. 
In contrast, CPOs are not so common for housing-led schemes but there is no fundamental reason why this is so. 
Recent and forthcoming improvements to the compulsory purchase system include:
– Those in the Housing and Planning Act 2016  (eg wider powers to enter and survey land and tightening timescales, including timescales for securing advance payments of compensation)

– The imminent freedom under section 160 of the 2016 Act for NSIPs to include related housing on the same infrastructure development site or close to it, with a 500 homes cap having been consulted upon in October 2015.

– Those in the Neighbourhood Planning Bill  (eg facilitating temporary possession of land, codifying and limiting the no scheme world principle and enabling GLA/TfL acquisition of land for joint purposes – no doubt to be relied upon so as to maximise the potential for housing development unlocked by Crossrail 2 when the Hybrid Bill for that scheme comes forward). 

The Act and Bill were both preceded by detailed consultation papers, in March 2015  and March 2016  respectively. 
The changes are for a reason – because the Government wishes to see the powers used!
I assume that there is also appetite from private sector developers willing to partner with LPAs through the process, where significant sites can be unlocked as a result. 
Other bodies of course have CPO powers that can be used to bring about more homes, for instance the Homes and Communities Agency’s wide powers in section 9 of the Housing and Regeneration Act 2008, as well as the Mayor of London and his Mayoral Development Corporations. There is also the intriguing power in clause 48(1) of the HS2 Bill  :
“If the Secretary of State considers, having regard to the relevant development
plan, that the construction or operation of Phase One of High Speed 2 gives rise
 to the opportunity for regeneration or development of any land, the Secretary 5 of State may acquire the land compulsorily”
Obviously there are still pitfalls in the CPO process. I referred to some of them in a recent blog post, Regeneration X: Failed CPOs  since when we have had the Seaton Carew decision letter  dated 13 October 2016 , where the Secretary of State rejected a CPO on the ground that a planning permission (for a community and leisure based project) not rooted in planning policy was not a sufficient basis for use of section 226. Whilst there will always need to be a compelling case in the public interest to justify compulsory purchase, are the Aylesbury Estate and Seaton Carew instances of where the tests are being applied too strictly, or perhaps even an indication that the legislation and guidance should be reviewed again to assess whether the bar is in fact set too high?
More generally, shouldn’t more encouragement (and funding) be given by Government for the use of compulsory purchase to deliver housing sites, whether this is either by way of 
– LPAs either acting for themselves where they have access to funding, or backed by private sector developer partners, to deliver specific schemes or 

– the HCA and other bodies with regeneration CPO powers looking to assemble sites and bring them to market?

Although it seems not to be a popular idea with Government so far, let’s also not forget the potential for expanding by legislation the scope of the DCO process to encompass the very largest urban extension and new settlement proposals. 

Simon Ricketts 28.10.16
Personal views, et cetera

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s