Growth and Infrastructure Bill
Public Bill Committee, 13 November 2012.
George Howarth (Labour, Knowsley)
It may be helpful before we commence proceedings if I make a few preliminary announcements. Members may, if they wish, take off their jackets during the meetings. It is no problem for me. Could we make sure that all electronic devices are turned off or switched to silent mode during Committee meetings? I would like to tell Members that my fellow Chair and I do not intend to call starred amendments that have not been tabled with adequate notice. The required notice period in Public Bill Committees is three working days. Therefore, amendments should have been tabled by rise of the House on Monday for consideration on Thursday, and by rise of the House on Thursday for consideration on the following Tuesday.
I suspect that not everybody is familiar with the process of taking oral evidence in Public Bill Committees, so it might help if I briefly explain how we will proceed. The Committee will first be asked to consider the programme motion on the amendment paper, for which debate is limited, if required, to half an hour. We will then proceed to a motion to report written evidence, and then a motion to permit the Committee to deliberate in private in advance of the oral evidence sessions, which I hope we can take formally. Assuming that the second of those motions is agreed to, the Committee will then move into private session. Once the Committee has deliberated, the witnesses and members of the public will be invited back into the room, and our oral evidence will begin. If the Committee agrees to the programme motion, it will hear oral evidence this morning.
Michael Fallon (Conservative, Sevenoaks)
I beg to move,
That—
(1) the Committee shall (in addition to its first meeting at 8.55 am on Tuesday 13 November) meet—
(a) at 2.00 pm on Tuesday 13 November;
(b) at 8.55 am and 2.00 pm on Tuesday 20 November;
(c) at 11.30 am and 2.00 pm on Thursday 22 November;
(d) at 8.55 am and 2.00 pm on Tuesday 27 November;
(e) at 11.30 am and 2.00 pm on Thursday 29 November;
(f) at 8.55 am and 2.00 pm on Tuesday 4 December;
(g) at 11.30 am and 2.00 pm on Thursday 6 December;
(2) the Committee shall hear oral evidence in accordance with the following table:
TABLE
Examination of Witnesses
George Howarth (Labour, Knowsley)
We will now hear oral evidence from Ministers from the Department for Business, Innovation and Skills, the Department for Communities and Local Government and the Department of Energy and Climate Change.
I understand that the Ministers have brief opening statements to make. It would be helpful if we do that now. I leave it to you which order you go in.
George Howarth (Labour, Knowsley)
Order. The timetable for these sessions is very tight. I am sure that the Minister is now bringing his remarks to a close so that we can get his colleagues in and complete the business.
George Howarth (Labour, Knowsley)
I hope that members of the Committee will take the opportunity to note the points that the Minister has not been able to cover and bring them up in questions, which hopefully will give him the opportunity to say what he needs to say.
George Howarth (Labour, Knowsley)
We have now overrun, but I intend to exercise a bit of latitude. Will Michael Fallon be as brief as possible in covering the ground that he needs to?
George Howarth (Labour, Knowsley)
Before colleagues ask questions, I remind all members of the Committee that questions should be limited to matters within the scope of the Bill. We must stick strictly to the timings, otherwise we will not be able to conclude the business. For this part of the proceedings, we have until 10 am. I hope to avoid it, but if necessary I will cut someone off in mid-sentence to ensure that we meet the necessary timings.
Mary Glindon (Labour, North Tyneside)
The planning Minister stated that the majority of local authorities are giving decisions on planning applications in a timely fashion and that it is the minority that are not achieving that. He gives a lot of facts and figures about those things. In the light of that, what evidence is there that the planning system in England is holding back growth?
Mary Glindon (Labour, North Tyneside)
Would the Minister please say how he will address the specific problem?
Andrew Stunell (Liberal Democrat, Hazel Grove)
I want to focus on clause 23, which is on employee owners. The part of the Bill that details which rights will be withdrawn is quite complete, but the first part of the Bill leaves a number of things for further explanation. I wonder whether the Minister could say something about what level of agreement is required. Could he say something about the position faced by new applicants for jobs in a firm that already has a substantial amount of employee ownership, if they were doubtful about exercising their new rights?
Andrew Stunell (Liberal Democrat, Hazel Grove)
Could I take another example? If we consider some of the companies that provide services to the House in terms of cleaning and so on, it is foreseeable that one or other of them might decide to follow the same route. I am concerned to understand, if there are vacancies and people present themselves for a job, whether they have a realistic right to refuse the offer of ownership and the consequential reduction of their rights. We are already concerned about the way in which people in this building get treated. Can you respond to that?
Roberta Blackman-Woods (Labour, City of Durham)
I would like to direct the planning Minister to clause 1. I think you were saying that you were looking at two areas for designation: major applications that take more than 13 weeks, and the percentage of major applications overturned on appeal. Will you enlighten us a bit more on the time period that will be considered, what is going to be in the consultation, and when we can expect the consultation to happen?
Roberta Blackman-Woods (Labour, City of Durham)
I am sure that the Minister meant Durham county council.
Roberta Blackman-Woods (Labour, City of Durham)
While I am on the subject, the Minister obviously knows which authorities are not going to be brought into the criteria. Perhaps he could enlighten us as to which ones he thinks will be brought into the criteria.
Also, will he look at how local authorities become undesignated? If most major applications are to go directly to the Planning Inspectorate, how will an authority build up an evidence base to get out of being designated? They will want to deal with major applications.
George Howarth (Labour, Knowsley)
I hope that we are coming towards the end of these questions.
Roberta Blackman-Woods (Labour, City of Durham)
Just one more. Will the Minister say something more about who is going to judge whether authorities are acting in line with their own plans in the NPPF? Will it be simply numerical, on the basis of those overturned on appeal?
Therese Coffey (Conservative, Suffolk Coastal)
I want to follow up on the business rates evaluation. I understand why the Government are trying to give certainty to businesses in the near future, but what will the Minister say to those who do not have confidence in the evidence in the written ministerial statement yesterday—who think that they are going to be a winner when the likelihood is that they will be a loser?
Ian Murray (Labour, Edinburgh South)
I want to concentrate on the employee owners part of the Bill. Minister, you said in your opening statement that you will publish the impact assessment when an analysis has been done of the responses to the consultation. Is that not slightly strange, given that the Bill is before us? Will the Government recommend removing the relevant clause from the Bill if the impact assessment so says?
Ian Murray (Labour, Edinburgh South)
If the impact assessment suggests that the clause should be withdrawn from the Bill, will you do so?
Ian Murray (Labour, Edinburgh South)
How will shares that are not listed be valued? Do you agree with the chief executive of Sainsbury’s, Justin King, who said that this could damage business even further in terms of reputation?
Ian Murray (Labour, Edinburgh South)
How will shares be valued if they are not listed?
Bob Blackman (Conservative, Harrow East)
To return to the planning issues, Minister, although there has been a drop off in the number of major applications approved within the 13-week period, I think I am right to say that 87% of major planning applications were actually approved by local authorities albeit outside the time limit. The productivity of planning officers has improved. One reason why the delay takes place is that local authorities agree with developers to extend the period by negotiation. How much of that have you taken into consideration?
Bob Blackman (Conservative, Harrow East)
Also in relation to the Bill, the proposal is that developers could go straight to national decision making; the Bill states that the consultation process for local people will not be as thorough and the national planning authorities will not have to do everything that a local authority does, but you seemed to contradict that in your answer to an earlier question. To clarify, what will be the consultation process when a developer goes straight to the national body, and what will the role of the local authority be in that process?
Nick Raynsford (Labour, Greenwich and Woolwich)
I draw attention to my interests as declared in the register and to three non-pecuniary interests relevant to the Committee’s proceedings: I am a director of the Town and Country Planning Association, an honorary fellow of the Royal Town Planning Institute and an honorary member of the Royal Institution of Chartered Surveyors.
Drawing on the evidence of one of those bodies, the TCPA, I ask the planning Minister if he agrees with its assessment that the effect of the reforms in clause 5 on section 106
“will be to reduce the quantum of land for affordable housing and risks increased social polarisation on particular sites”.
Nick Raynsford (Labour, Greenwich and Woolwich)
None of the expert witnesses we have received evidence from agrees with that assessment. All of them, including the RICS, expect the number of affordable homes to go down.
Nick Raynsford (Labour, Greenwich and Woolwich)
The opening statement from the RICS, in the first section of its evidence, says:
“Whilst it is clear is that affordable housing is often difficult for developers to make viable, potentially reducing obligations on developers to provide much-needed affordable housing risks reducing provision at a time when need is great and Government are unable to fund affordable housing delivery.”
Nick Raynsford (Labour, Greenwich and Woolwich)
At a time when affordable housing starts are at the lowest level seen for many years and the social housing programme has virtually halted, I have to say to the Minister that not many people will accept the claims he made a moment ago. May I ask him why the Government have not named a single affordable housing scheme to benefit from the Infrastructure (Financial Assistance) Act 2012, which is also one of the Government’s measures to try to get stalled projects going again?
George Howarth (Labour, Knowsley)
Order. I do not want to go too far with this line of questioning because we are straying towards the very outer limits of the scope of the Bill. If the Minister could be brief, I would like to move on.
James Morris (Conservative, Halesowen and Rowley Regis)
I have a question about clause 21 and infrastructure designation. The Bill provides that certain large commercial and business developments could be determined nationally rather than locally. What will be the criteria for determining the type of developments that fall within that ambit?
James Morris (Conservative, Halesowen and Rowley Regis)
What sort of projects are we talking about?
Simon Danczuk (Labour, Rochdale)
Am I right in saying that you have not consulted on clause 22—the postponement of business rate revaluation?
Simon Danczuk (Labour, Rochdale)
You have not consulted on it.
Your retail guru, Mary Portas, said that delaying the business rates revaluation is a tragedy for the high street. What do you say to your retail guru?
Simon Danczuk (Labour, Rochdale)
So Mary Portas has got it wrong; it will not be a tragedy for the high street.
George Howarth (Labour, Knowsley)
Order. This must be the last in this particular series of questions from the hon. Gentleman.
Simon Danczuk (Labour, Rochdale)
I understand that the system is revenue-neutral, but there are losers: 300,000 businesses will lose out. Just tell the Committee why a Conservative-led Government are making thousands of businesses pay more in taxes than they should, for an extra two years.
Gordon Birtwistle (Liberal Democrat, Burnley)
Over the past five to 10 years, we have had the hideous area action plans instructed on by local government. I am hoping that they have now been dispensed with because they created havoc within local government and in planning. Can the Minister confirm that all future developments will be delivered on local area plans, not area action plans that are creating nothing but grief?
Nicholas Dakin (Labour, Scunthorpe)
I want to come back to town and village greens. The Minister was very clear on the value of town and village greens in his opening statement and giving reassurance about protection for current ones. Why therefore prevent a process that has some purchase within localities and change it? People like the Open Spaces Society and the Campaign to Protect Rural England are saying that that is a sledgehammer to crack a nut and the wrong way of going forward.
George Howarth (Labour, Knowsley)
This will have to be the last question in this part of the proceedings.
Nicholas Dakin (Labour, Scunthorpe)
It seems to me that the town and village green process is localism at its heart. Is there not an opportunity to allow for that localist approach and the views of local people, notwithstanding the perverse outcomes that the Minister has talked about, and allow local concerns to be properly considered within the planning process?
Bob Blackman (Conservative, Harrow East)
In relation to broadband, there has been criticism of the impact on areas of outstanding natural beauty and national parks. Can we establish the purpose behind the changes to the legislation?
George Howarth (Labour, Knowsley)
Before the Minister responds, I will call Roberta Blackman-Woods so that we can deal with two questions together.
Roberta Blackman-Woods (Labour, City of Durham)
Can the Minister guarantee that clause 7 will not lead to mobile phone masts, telegraph poles and large cabinets cluttering up and ruining areas of outstanding natural beauty and our national parks?
George Howarth (Labour, Knowsley)
Order. I am afraid that brings us to the end of the time allotted for the Committee to ask questions of these witnesses. I thank the Ministers for their responses, and also the Committee for its disciplined approach. We managed to get every question into the time allocated. We will now hear oral evidence from the Local Government Association and the Association of Convenience Stores.
George Howarth (Labour, Knowsley)
I welcome our witnesses. I wonder whether they would like to briefly introduce themselves to the Committee.
Therese Coffey (Conservative, Suffolk Coastal)
May I ask Mr Lowman whether the certainty of the delay of the revaluation and knowing what your costs will be would be convenient for convenience stores and similar small businesses?
Roberta Blackman-Woods (Labour, City of Durham)
I am interested in knowing from all three witnesses whether they think that the planning system in England is holding back growth and, if so, how the Bill will address that.
Bob Blackman (Conservative, Harrow East)
What do you think the impact will be of the potential threat to planning authorities of decision making being taken to a national level if they do not make the decisions quickly?
Bob Blackman (Conservative, Harrow East)
What do you consider to be poor performance by a local planning authority?
George Howarth (Labour, Knowsley)
Is there anything the other witnesses wish to add?
Ian Murray (Labour, Edinburgh South)
Mr Raynes, with regard to clause 7 of the Bill on electronic communications, are there any concerns that the terminology to add the need to promote economic growth in the United Kingdom might trump other parts of the Communications Act 2003, with regard to areas of natural beauty? Is there concern that this may be used to install lots of infrastructure, in respect of the wide term “electronic communications”, in areas of natural beauty in the countryside?
John Glen (Conservative, Salisbury)
Given the resource constraints that we know exist, and which will exist, and given that the incentive regime that you set out and thought would be the most appropriate way to act is not delivering in any time frame that is going to realise an economic impact, is it not therefore right that the Bill seeks to make targeted interventions to speed up the delivery of the outcomes that we all want?
Simon Danczuk (Labour, Rochdale)
The Government are attempting to stimulate growth; that is in the title of the Bill. Let me create a dichotomy. I want to ask the panel this. The Government are proposing to amend the planning rules and tinker with business rates. Is the issue not really about the economy, getting people to get mortgages, businesses being able to borrow and improving retail confidence? Which is it? Is it the need to tinker with planning, James, or is it the need to stimulate the economy and get people borrowing? Which would you choose in terms of stimulating growth?
Andrew Stunell (Liberal Democrat, Hazel Grove)
I want to turn to the issue of section 106 renegotiation. Can we hear what the LGA view of that is? And perhaps Councillor Jones will say something about Cheshire West and whether its experience is that renegotiation takes place, what the outcomes are and so on.
Nicholas Boles (Conservative, Grantham and Stamford)
Councillor, do you think it is okay for authorities to refuse to negotiate at all on affordable housing agreements that were reached at a time when values were much higher so viability was a very different picture from what it is now? Would you support them?
Nicholas Boles (Conservative, Grantham and Stamford)
Is it not the case that in your survey you found that 40% of councils were willingly renegotiating, but 60% were not? So it is not one or two, is it?
Nick Raynsford (Labour, Greenwich and Woolwich)
Councillor Jones’s earlier comment suggested that there was evidence available in local government that the prospect of this provision is already having an impact in discouraging developers who may see an opportunity not to have to meet obligations that have been previously negotiated but that may well be viable. Is that in fact the case? Do you agree with the evidence we have received from expert witnesses that the effect of this provision in clause 5 is likely to reduce the amount of affordable housing generated?
James Morris (Conservative, Halesowen and Rowley Regis)
Do you think the Government are justified in changing the planning system to allow large commercial and business developments to go through the national infrastructure planning system?
Nicholas Dakin (Labour, Scunthorpe)
Is the process for registration of town and village greens being so abused by local people that provisions are needed in the Bill to address that?
Roberta Blackman-Woods (Labour, City of Durham)
May I return the panel to the point about designating local planning authorities as failing? I heard what you said earlier, Councillor Jones, but have the Government had any discussions with the LGA about what criteria should be used if they designate local planning authorities as failing? If they have not had such discussions, should they, and what is your opinion of the criteria that should be taken into consideration?
George Howarth (Labour, Knowsley)
Before we go any further, can I just check whether there are any questions that members of the Committee wanted to ask that they do not feel they have had the opportunity to?
Therese Coffey (Conservative, Suffolk Coastal)
I want to follow up on village greens. I understand what you are saying about democratic accountability. It is brave for a councillor to dob in their local constituents to their planning authority. As you will know as a councillor, planning is possibly one of the most difficult areas in representing your local area. There are examples out there of people coming up with questionable claims about the use of pastimes in the past, whether that is someone walking their dog or something like that, simply because they do not want allotments or housing right next to their houses. Is it not the case that councillors find it hard to go against their residents?
Paul Blomfield (Labour, Sheffield Central)
Can I get Councillor Jones’s and Mr Raynes’s reflections on how the involvement of the Planning Inspectorate would hasten or slow the process of decision making? I am conscious, for example, that in taking appeals over the past year, the Planning Inspectorate operated at perhaps the same level as local councils on householder appeals, but was slower on non-householder appeals.
Paul Blomfield (Labour, Sheffield Central)
So at the very best there would be no improvement, and potentially, there could be a worse position.
Roberta Blackman-Woods (Labour, City of Durham)
To follow up on my earlier question, I wonder whether any consideration has been given to how the provisions in the Bill might affect decision making in local authorities on planning applications. Is it likely to lead to more applications being approved even if they are inappropriate, because councils will be worried about the decision being overturned on appeal?
George Howarth (Labour, Knowsley)
We have made good time, not least because the witnesses were so concise in their responses. If there is anything that any of the witnesses feel that they would like to answer questions on and have not had the opportunity, I am happy to give them a chance now.
George Howarth (Labour, Knowsley)
In the brief time we have left, did you have a question, Ian Murray?
Ian Murray (Labour, Edinburgh South)
I was going to ask Mr Lowman if there is anything in the Bill that he would like to see for his own members, but he has answered that question already.
George Howarth (Labour, Knowsley)
I thank the witnesses for the efficient way in which they have conducted themselves this morning. We now move on to our next panel.
George Howarth (Labour, Knowsley)
I welcome the next set of witnesses from the British Chambers of Commerce and the Confederation of British Industry. Will the two witnesses identify themselves?
Roberta Blackman-Woods (Labour, City of Durham)
We have heard much from the Government—indeed, it is the premise underpinning the Bill—that the planning system is holding up development. Do you agree with the Government’s assessment? If so, what evidence base are you using for that?
Roberta Blackman-Woods (Labour, City of Durham)
Is the assessment of your members that the Bill is helpful because it helps to bypass some of the aspects of the democratic process that might slightly slow down the system?
Roberta Blackman-Woods (Labour, City of Durham)
Have you been advising the Government on the criteria to be used in judging whether a local authority should be designated? That is a question for both of you.
Henry Smith (Conservative, Crawley)
Clause 4 talks about restricting the amount of information that applicants would have to supply to planning authorities. What evidence do you have that too much information being required is a problem and a barrier to planning applications getting approval?
Henry Smith (Conservative, Crawley)
So the cost of additional consultants is a significant barrier that prevents applicants from submitting applications to planning authorities.
Simon Danczuk (Labour, Rochdale)
You will be familiar with the retail sector’s major campaign to get a freeze on business rate increases. How satisfied do you think the sector will be with the Government’s solution, which is to postpone the business rate revaluation?
Simon Danczuk (Labour, Rochdale)
So you do not think the retail sector will be happy, because it does not meet their demand?
Simon Danczuk (Labour, Rochdale)
A final quick question on this. The Government have introduced legislation on business rates. Is it a missed opportunity? Could they have done something different on business rates?
James Morris (Conservative, Halesowen and Rowley Regis)
On the provisions in the Bill for employee owners, do you think that the proposals will help develop a more entrepreneurial culture in Britain, encouraging companies to take on new employees and overcoming some of the barriers?
James Morris (Conservative, Halesowen and Rowley Regis)
What do you mean by a high tolerance of risk in the employee profile?
James Morris (Conservative, Halesowen and Rowley Regis)
In that regard, do you mean a small company where there appears to be a clear path to a good valuation on the potential shares that are offered and a pathway to a kind of reward at the end?
James Morris (Conservative, Halesowen and Rowley Regis)
But do you think it will encourage start-up businesses?
Ian Murray (Labour, Edinburgh South)
May I continue with that theme of employee ownership? Mr Spicer, you said that you think that it may encourage more start-ups. Are there any views from your organisation or your members that it may do the opposite, in the sense that small, high-growth start-ups may be reluctant to use these schemes on the basis that they want to restrict the number of shareholders they have or, indeed, the entrepreneurial organisation that is growing is at very, very high risk and, therefore, the employees may end up with nothing at the end of the day?
Ian Murray (Labour, Edinburgh South)
So there could be a set of circumstances in which employees are weaving in and out of these particular schemes as a company changes and grows, with different parts of investment coming in, diluting shareholding and so on?
Ian Murray (Labour, Edinburgh South)
Directing a question more to the CBI, I do not know whether the chief executive of Sainsbury’s is one of your members, but he did say that the reputation of business in the current climate has been damaged by the economic problems, and that any view of buying off people’s rights for cash essentially or, indeed, the prospect of cash, may damage business reputation further. What is the CBI’s view on that?
Ian Murray (Labour, Edinburgh South)
One final, quick question on this particular topic: if, in your view, these schemes will be directed towards a certain class of company, do you feel that perhaps the view that these will be voluntary may be slightly overcooked in the sense that a small, fast-growing software company that is in that particular marketplace may just advertise for employee-owner staff and, therefore, the voluntary element is slightly diluted?
Bob Blackman (Conservative, Harrow East)
Building on that, there is the potential with employee share ownership that you could have two streams of employees, one that owns the business and another that does not. Does that cause you any concern?
Bob Blackman (Conservative, Harrow East)
From the discussions you have had so far, do you see any need to change the Bill to make that clear?
Bob Blackman (Conservative, Harrow East)
Mr Spicer, do you have any views on this?
Bob Blackman (Conservative, Harrow East)
Do you think that there needs to be clarity to employees on their position in all this when a company decides to go down this route?
Bob Blackman (Conservative, Harrow East)
Who do you see doing that?
Nicholas Dakin (Labour, Scunthorpe)
You are very clear in expounding the advantage of share ownership to certain types of company or employer, what is less clear to me is the value to the employer of getting away with certain employment rights. From what you are saying, it sounds like that is a problematic area, so what would be the value to an employer in doing that?
Andrew Stunell (Liberal Democrat, Hazel Grove)
If I could just take you back a bit further, I think you have said that really you are talking about small companies with a high-skilled work force and shared values, and so on. I think some of the critics outside have seen it as being a big-company, low-wage, low-skill risk. Are you ruling that out? Are you saying that for a company whose work force is essentially low wage and low skill this is not at all an attractive option?
Paul Blomfield (Labour, Sheffield Central)
To return to the planning process and your opening comment that 97% of your members expressed concern about the planning process, the Minister has gone out of his way to assure us that actually the provisions of this legislation will affect a tiny number of local authorities—I think he said this morning not more than 10. How will that address the concerns of 97% of your members?
Paul Blomfield (Labour, Sheffield Central)
What confidence would you have that the Planning Inspectorate would be able to deal with decisions more quickly than local councils? For example, I am conscious that in non-householder applications over the past year the Planning Inspectorate was something like 30% slower than councils in dealing with appeals.
Paul Blomfield (Labour, Sheffield Central)
But you would have confidence in the Planning Inspectorate when its performance seems to be slower than that of local councils?
Therese Coffey (Conservative, Suffolk Coastal)
I have two different questions to ask, if that is possible.
First, this Bill very much focuses on the planning authorities. Has it been your experience with your members that some of the other consultees—say, the Marine Management Organisation, Natural England and the Environment Agency—can also add complexity, delay and cost to planning applications?
Therese Coffey (Conservative, Suffolk Coastal)
Does Miss Hall want to add anything?
Therese Coffey (Conservative, Suffolk Coastal)
May I move on to clause 7, which is about installation of telecoms equipment? About 40% of my constituency is in an area of outstanding natural beauty, but business is crying out for better broadband. Are there any concerns that have been raised by your members about the changes that the Bill will make, or are they welcoming them with open arms?
Roberta Blackman-Woods (Labour, City of Durham)
I assume from what you have both said already that you are in favour of clause 21, which will allow planning decisions on large commercial and business developments to be taken at national level through the national infrastructure planning system. Perhaps you will confirm whether you are in favour of that, and tell the Committee whether you have given any consideration to where the threshold should be for determining what is a nationally significant project?
Roberta Blackman-Woods (Labour, City of Durham)
Do you have any examples in mind?
Bob Blackman (Conservative, Harrow East)
To come back to the issue of broadband, obviously one area of criticism is that we might see poles and cables across areas of outstanding natural beauty and national parks. If the legislation were to be amended, either in primary legislation or by regulation, to require those cables to be buried in ducts, what would be the reaction of your members?
Ian Murray (Labour, Edinburgh South)
Coming back to clause 23 and employee ownership, Ms Hall, you mentioned that the CBI held a study recently, in which members had suggested that employee rights were a real issue in terms of bringing on staff. Could you submit that to the Committee?
Ian Murray (Labour, Edinburgh South)
Do you have any current views or survey data that would show whether any of your members have concerns about the potential increase in discrimination cases, which of course are more costly and lengthy, as a result of removing some basic rights while protecting the day one rights in terms of discrimination?
Ian Murray (Labour, Edinburgh South)
Would it be a worry for your members that there could be a propensity to tag discrimination cases on more regularly if someone felt that they have been unfairly dismissed but had given up their rights for, say, a nominal number of shares?
George Howarth (Labour, Knowsley)
If there are no further questions from Members to the witnesses—oh, I am sorry, there are.
Roberta Blackman-Woods (Labour, City of Durham)
I hope this will be the last question from me. If I can take you back, in a sense, to where we started, when I asked you both about evidence that planning was impeding growth, you both replied by telling us about surveys of your members. When the members were completing the surveys and saying that they thought planning was an issue in terms of growth, did they have to demonstrate that they had been in contact with the planning system in any way at all in the past three or four years? If so, have you got those data, and are they something that the Committee can see?
George Howarth (Labour, Knowsley)
Before I bring proceedings to a close, if there is anything the two witnesses want to add to the evidence they have already given, on the basis that they have not been asked the appropriate question, they should by all means feel free to do so.
George Howarth (Labour, Knowsley)
As there are no further questions for the witnesses, that brings us to the end of our business for the morning. The Committee will take further evidence at 2 pm this afternoon.
Philip Davies (Conservative, Shipley)
We will now hear oral evidence from the Country Land and Business Association, the British Property Federation, and the British Council of Shopping Centres. First, I ask our three witnesses briefly to introduce themselves.
Philip Davies (Conservative, Shipley)
Before calling the first Member to ask a question, I remind all Members that questions should be limited to matters within the scope of the Bill and that we must stick rigidly to the timings in the programme motion that the Committee has agreed to. I hope that I will not have to interrupt anyone mid-flow or mid-sentence, but I will do so if I have to.
Roberta Blackman-Woods (Labour, City of Durham)
Will the panel tell us whether they are broadly in support of the measures in the Bill, and will they quantify the benefits that they expect their members to derive from the Bill’s changes to the planning system?
Roberta Blackman-Woods (Labour, City of Durham)
Mr Cotterell, you mentioned particularly problems encountered by your members with the planning system. How widespread do you think the problems are with planning and, in particular, how many poor authorities do you think there are?
Roberta Blackman-Woods (Labour, City of Durham)
That is very interesting. Do you have actual evidence from your members about particular schemes being stopped or unduly delayed, or are you basing your comments on anecdotal information?
James Morris (Conservative, Halesowen and Rowley Regis)
I want to ask about clause 21, which is about planning decisions being able to be, as it were, escalated up to the national infrastructure planning system. What is your reaction to that clause?
James Morris (Conservative, Halesowen and Rowley Regis)
Sorry to interrupt, but what do you think the threshold should be?
James Morris (Conservative, Halesowen and Rowley Regis)
Any other thoughts?
James Morris (Conservative, Halesowen and Rowley Regis)
What about clause 21 of the Bill?
James Morris (Conservative, Halesowen and Rowley Regis)
Do you think this might be a contradiction?
Nick Raynsford (Labour, Greenwich and Woolwich)
This morning, we heard Ministers saying that they were introducing clause 22 to give greater certainty to business and to save business from unacceptable costs. We have heard both the British Property Federation and the British Council of Shopping Centres say to us very clearly that you are wholly opposed to clause 22. Could you explain why you object?
Nick Raynsford (Labour, Greenwich and Woolwich)
May I ask you to take a slightly wider look? In contrast with business rates, which are subject to regular, five-yearly updating, council tax has proved politically impossible for any Government to revalue since 1991, so we are locked into a notional 1991 value. Do you see a potential risk that, if postponement of business rates becomes politically acceptable, there could be a move towards a similar trend, where it becomes impossible to make a revaluation?
Nick Raynsford (Labour, Greenwich and Woolwich)
Finally, may I ask whether you feel that the transitional relief mechanism is the more appropriate means for dealing with short-term, adverse consequences of lifts in liability?
Andrew Stunell (Liberal Democrat, Hazel Grove)
May I go back to the point you made about developers not wanting to go to the Planning Inspectorate because of preserving their longer-term relationship with local authorities. Could you explore that for me a bit? The traditional thumbnail sketch, if I can put it that way, is that this is a very confrontational set of relationships. I was interested in your point about that.
Andrew Stunell (Liberal Democrat, Hazel Grove)
Can I take the other half of that? You said that if they could save a year, maybe there would be a trade-off. What level of saving would actually trigger that trade?
Nicholas Dakin (Labour, Scunthorpe)
To return to clause 22, the Bill is titled Growth and Infrastructure, but you seem to be saying that the clause will have the opposite effect in those areas of the country that had expectations of, to use your phrase, “relief” from 2015. Am I picking that up correctly?
Nicholas Dakin (Labour, Scunthorpe)
What you are saying is that this will quicken the decline of the high street in those parts of the country.
Nicholas Dakin (Labour, Scunthorpe)
You also said that it will impact badly on manufacturing in those areas of the country as well.
Nicholas Dakin (Labour, Scunthorpe)
Earlier, Ministers were saying that there were more winners than losers by the delay, but you do not agree with that.
Nicholas Dakin (Labour, Scunthorpe)
If you were writing a clause 22 on business rates for this, taking the opportunity of the Growth and Infrastructure Bill, what would you put in it?
Bob Blackman (Conservative, Harrow East)
We have heard evidence about the fall-off in the approval rates of major planning applications, particularly within the time scales that are required. I wonder whether there are particular parts of the country or particular planning authorities where your members have had a bad experience? What view would your members take on the clauses in the Bill?
Bob Blackman (Conservative, Harrow East)
I understand that. Is it smaller planning departments that you have problems with, or is it larger authorities where there may be more planning officers? Is there something in there that is of concern?
Bob Blackman (Conservative, Harrow East)
Do you have examples of where planning authorities have obstructed such sensible agreements?
Bob Blackman (Conservative, Harrow East)
Mr Cooke, I think you said earlier that it took 10 years to get a major development. Are we suddenly going to see planning authorities overridden by your members, saying, “It’s a waste of time doing the planning process. Let’s just go straight to the national position and try to short-circuit those 10 years to possibly a year. Who knows?”?
Bob Blackman (Conservative, Harrow East)
How much of a barrier is the current position on broadband to getting developments delivered?
Ian Murray (Labour, Edinburgh South)
My question was about broadband, Chair, and it has been asked.
Andrew Stunell (Liberal Democrat, Hazel Grove)
Can I just pick up on the proposals in the Bill about changes to section 106 agreements? It might be particularly relevant to rural areas, and Mr Cotterell might want to express a view about that issue in relation to mixed developments and so on. What is your approach to the proposals in the Bill, and do you have any comment on the direction of travel here?
Andrew Stunell (Liberal Democrat, Hazel Grove)
And in relation to our urban friends?
James Morris (Conservative, Halesowen and Rowley Regis)
On clause 1, we have talked about planning departments. What are your views on the criteria that will be used to judge whether a planning department is performing appropriately, other than time? Are there any other criteria that you would suggest?
James Morris (Conservative, Halesowen and Rowley Regis)
Are you suggesting that it is not possible to come up with criteria, or that it would not be helpful to do so?
James Morris (Conservative, Halesowen and Rowley Regis)
Any other views?
Roberta Blackman-Woods (Labour, City of Durham)
That was an interesting set of comments. I want to tease more out of what you said. Earlier, you said that the greatest benefit of the Bill might be that it will act as a deterrent. I want to know what you think is being deterred, if it is just a bit of tardiness in terms of decision making, whether it is something to be lost by an approach that concentrates just on speed rather than looking at the complexity of factors that can arise locally when an application is being determined.
Roberta Blackman-Woods (Labour, City of Durham)
That is an argument for certainty rather than speed. Is it one that Mr Cotterell shares?
Nick Raynsford (Labour, Greenwich and Woolwich)
I want to pick up again on the very interesting points about the difficulty of constructing any list of authorities that have either been tardy or else haven’t performed well in processing applications. We have been very conscious of the various lists that have appeared of authorities that are failing on one or other of the indicators. They have produced some rather odd outcomes with rather unexpected authorities like Torbay, and Kensington and Chelsea appearing to be very slow. Authorities like Manchester, which is seen as generally a very pro-development authority is appearing to have a high proportion of applications overturned on appeal. Therefore, the worry that one has is that any list that is produced is likely to be perverse in that it may include some authorities that are pro-development and not by any means hostile, but equally it might exclude some that are not performing very well. The latter will breathe a sigh of relief and feel that they are off the hook. This is an important point. If we proceed with legislation—Ministers have told us that they are going to construct this list based on objective criteria—are we going to create a monster that will have perverse and unsatisfactory outcomes?
Therese Coffey (Conservative, Suffolk Coastal)
Ms Peace, would you clarify why a judicial review was granted? It is usually on the grounds of process. I am a bit confused, because you say they are doing all the right things.
Therese Coffey (Conservative, Suffolk Coastal)
I’m not.
Therese Coffey (Conservative, Suffolk Coastal)
I am just interested in why you brought that up as an example when, frankly, the Bill does not necessarily change any of that. That is why I am a bit confused.
Philip Davies (Conservative, Shipley)
Nic Dakin has a quick question that he might want to get a quick answer to before time runs out.
Nicholas Dakin (Labour, Scunthorpe)
You seem to be warning us about the risks of trying to find criteria to measure a failing planning authority. The more I listen, the more you seem to be saying that numerical targets are very risky. Perhaps the criteria should be based on standards, which are a bit more complex. If you are going to have criteria, they should be on standards of behaviour, of ethos, of attitude.
Philip Davies (Conservative, Shipley)
If no one has further questions, we will move on to the next panel of witnesses. Time is up anyway. On behalf of the Committee, I thank the three witnesses. We will now hear oral evidence from the Chartered Institute of Housing, the Home Builders Federation, and the National Housing Federation.
Philip Davies (Conservative, Shipley)
Before we start the session, would the three witnesses like to introduce themselves?
Philip Davies (Conservative, Shipley)
Thank you very much.
Roberta Blackman-Woods (Labour, City of Durham)
Could the witnesses tell us whether they think planning is an obstacle to growth? Do they agree that it is helpful to have some local authorities designated as failing in order to put another system in place to hurry things up a bit?
Roberta Blackman-Woods (Labour, City of Durham)
Is clause 1 in particular going to speed up decision making on planning? Once we have a number of authorities designated as failing—I will come back to ask you about criteria—and people who are developing major applications can go straight to the Planning Inspectorate, will that speed things up or not? How many people do you think will use that route?
Roberta Blackman-Woods (Labour, City of Durham)
Mr Whitaker, you were suggesting that you think the stick is helpful, and the stick is the list of designated authorities. How are we to judge which authority should be on that list?
Henry Smith (Conservative, Crawley)
Clause 4 of this proposed legislation discusses restricting the amount of information that planning authorities can demand an applicant to produce. What effect do you think that will have from your perspectives?
Henry Smith (Conservative, Crawley)
Do your members raise as a complaint or a concern the cost of having to gather additional information when submitting plans to local authorities? Earlier, we heard an anecdotal example about flood assessments needing to be done for an application on the top of a hill. Is that something your members come to you about?
Ian Murray (Labour, Edinburgh South)
May I take the panel to clause 5 and ask first what you think will be the consequences for affordable housing of proposed changes to the conditions on section 106?
Ian Murray (Labour, Edinburgh South)
Can I unpack that a little more? Why do you think the Bill concentrates on the element of section 106 on affordable housing and not, as I think Mr Smart alluded to, the whole of section 106? Why is it concentrating only on affordable housing?
Ian Murray (Labour, Edinburgh South)
Are you saying that if you take out that major obligation from a section 106 agreement the consequences, particularly in the current economic climate, could be that it pushes land values up?
Ian Murray (Labour, Edinburgh South)
This is all predicated on economic viability. If removing affordable housing from a particular development can make it more economically viable, the consequence could be to make the land value higher to make it more economically unviable either for that particular site or for other sites in the locality. Is that essentially what you are saying?
Philip Davies (Conservative, Shipley)
Can I say to the Committee and the witnesses that we are now over halfway through the session. Three Members have asked questions, and there are at least four who want to ask questions, so if we are to get through everybody who wants to ask a question, and there may well be more, we may need snappier questions and snappier answers.
Nicholas Boles (Conservative, Grantham and Stamford)
I have two quick questions to direct towards Mr Orr. Do you have any reason to believe that the Planning Inspectorate, in assessing the viability of the site and therefore what proportion of an affordable housing commitment would need to be reduced in order to make the site viable, is somehow going to be less fair or less reflecting of true economic circumstances than one of the many local authorities that actively negotiates? That will be welcome, and what we are trying to do is to replicate it.
Nicholas Boles (Conservative, Grantham and Stamford)
One other question, if I may. On 6 September, when we announced this proposal, we also announced a further £300 million in subsidy for affordable housing. You said that if all affordable housing commitments in 106 agreements were cancelled completely, it would, in theory, lead to a loss of 30,000 or possibly 35,000 homes. You yourself said you did not think that that was going to happen, and I assure you now that it will not happen because the Planning Inspectorate would never agree to it. If you then add the further affordable houses that will be built as a result of the further £300 million of subsidy that is being provided by the Government in the same announcement, is that not more likely to produce a net increase in the level of affordable housing?
Nicholas Boles (Conservative, Grantham and Stamford)
On that we can agree.
Nick Raynsford (Labour, Greenwich and Woolwich)
May I ask Andrew a question? You said that your support for clause 5 was because it would allow developers to go back and renegotiate. What is stopping them doing so at the moment?
Nick Raynsford (Labour, Greenwich and Woolwich)
Are you familiar with my constituency of Greenwich and Woolwich?
Nick Raynsford (Labour, Greenwich and Woolwich)
You know that it contains a quite large number of regeneration development sites, such as Woolwich Arsenal, Greenwich Peninsula, Heart of East Greenwich, Lovell’s Wharf—I could go on naming them. Can you name a single one where the stall that occurred during the recession has continued because of reluctance to reach agreement on a modified section 106?
Nick Raynsford (Labour, Greenwich and Woolwich)
There are none. Can you understand the concern of some of us who have spent a lot of time working to ensure mixed tenure developments, where you get people of different incomes living side by side, that the effect of this particular clause could well be to create a rush of mono-tenure developments without any affordable housing?
Nick Raynsford (Labour, Greenwich and Woolwich)
You were not here this morning, but we heard from representatives of local government, who were expressing concern that already, in anticipation of this clause, some developers were taking a view that they would be able to appeal and get rid of obligations to produce affordable housing. Can you see that potential problem as a result?
Nick Raynsford (Labour, Greenwich and Woolwich)
But you understand that the representatives of local government who were here this morning felt that it was actually having a negative effect on development, because it was deterring schemes that might otherwise proceed.
Nick Raynsford (Labour, Greenwich and Woolwich)
Can I ask David Orr for his view?
Andrew Stunell (Liberal Democrat, Hazel Grove)
Fifty per cent of nothing is nothing, and there is a very difficult balance to be struck. I would be interested in the panel’s views about this. Other things being equal, clearly it is better for the developer to pay for affordable housing than the taxpayer, therefore section 106 has a lot of value. We have 400,000 permissions that have not taken place. What confidence would Mr Whitaker have that if the agreements could be renegotiated it would mean that we would get more houses built, rather than an addition to the stock of 400,000 that are not being built?
Andrew Stunell (Liberal Democrat, Hazel Grove)
Do you feel that clause 1 will accelerate that process?
Andrew Stunell (Liberal Democrat, Hazel Grove)
Your assumption is about who the buyer and seller is. Is it in fact the case that developers are very eager to develop but are frustrated, or are they rather relaxed, because they do not have a stream of finance to support the development in the first place?
Andrew Stunell (Liberal Democrat, Hazel Grove)
I take the point about its not being about land values, but what would your view be on this being a temporary requirement predicated on changing land values? Would your view be that we should make a step down to reflect the poor market conditions and a step up when the market conditions get better, or do you want to cash the benefit?
Bob Blackman (Conservative, Harrow East)
What evidence have you got that section 106 agreements, apart from the affordable housing requirements, are actually leading to housing developments being stalled?
Bob Blackman (Conservative, Harrow East)
How many units of housing at this moment in time are held up, other than because of affordable housing commitments?
Bob Blackman (Conservative, Harrow East)
Do you have a broad idea of how many?
Bob Blackman (Conservative, Harrow East)
What about section 106 obligations, which are clearly to do with transport, education and a whole variety of other things, that have not been spent by local authorities within the time frame that they should have been spent and your members have just said, “Forget about them”? How much money is knocking around on that side?
Bob Blackman (Conservative, Harrow East)
But you are not aware of any.
Bob Blackman (Conservative, Harrow East)
Mr Orr?
Bob Blackman (Conservative, Harrow East)
Do you have any evidence of stalled schemes on the basis of additional section 106 obligations?
Bob Blackman (Conservative, Harrow East)
Do you think the lack of willingness to negotiate on section 106 agreements should be considered as part of an underperforming planning authority?
Bob Blackman (Conservative, Harrow East)
May I ask one—
Philip Davies (Conservative, Shipley)
We have six minutes left with these witnesses. I have at least two, possibly three other Members who want to ask questions. I am hoping that we may be able to squeeze in one quick question from each, but it will require brief answers.
Nick Raynsford (Labour, Greenwich and Woolwich)
This is a technical question on David Orr’s point about what would happen if the Planning Inspectorate decided that more affordable housing might be justified. The Bill as drafted does not allow that. It says you cannot modify the obligation to make it more onerous. I have a concern about this, because I can see circumstances where, as part of a renegotiation, there would be an agreement to change the phasing. Different discounted cash flows would suggest that that might be more or less onerous, and there might not be clarity about something that everybody could agree: a rephasing of the obligation to make it more viable falling foul of this provision. Have you given any thought to that?
James Morris (Conservative, Halesowen and Rowley Regis)
May I come back to clause 1? The question is largely prompted by Mr Whitaker’s conjuring up this vision of Ofplan going round auditing local authorities. Just to get clarity, do we think it is possible to develop objective criteria to judge whether or not a planning department is failing?
James Morris (Conservative, Halesowen and Rowley Regis)
Mr Whitaker, what would be those criteria? If there were two top criteria, what would they be?
Roberta Blackman-Woods (Labour, City of Durham)
Mr Whitaker, I am terribly taken by your description of developers really desperate to develop, but being held back by 106 agreements. If the 106 agreements are renegotiated directly with the inspector, would you think it reasonable that a condition is then applied, so that the housing development has to come forward within a reasonable period, say two years of that decision?
Roberta Blackman-Woods (Labour, City of Durham)
That is why I am suggesting that a specific condition be applied that would require it to come forward more quickly.
Roberta Blackman-Woods (Labour, City of Durham)
But would you accept that if the renegotiation is taking place because of unviability in a certain set of economic circumstances, and that the development does not come forward within that same set of economic circumstances, it was simply not reasonable to go through the test of viability in the first place?
Roberta Blackman-Woods (Labour, City of Durham)
That is helpful. Thank you.
Philip Davies (Conservative, Shipley)
Would Bob Blackman like to get in for the last question? I cut him off in his prime earlier.
Bob Blackman (Conservative, Harrow East)
Yes you did. I will be quick. Obviously, the Bill is all about promoting growth and unlocking potential for development. Is there anything else that should be considered as part of the Bill that you, as representatives of the industry, would like to see included, but is not in it?
Bob Blackman (Conservative, Harrow East)
That is the one we heard about this morning, I think.
Therese Coffey (Conservative, Suffolk Coastal)
The Norfolk one?
Therese Coffey (Conservative, Suffolk Coastal)
Write in.
Bob Blackman (Conservative, Harrow East)
Is there anything else you would like to say?
Bob Blackman (Conservative, Harrow East)
Is that on information requirements?
Philip Davies (Conservative, Shipley)
Order. I am afraid that brings us to the end of the time allotted for the Committee to ask questions of these three witnesses. On behalf of the Committee, I thank you all for coming along. We will now hear evidence from the Royal Institute of British Architects and Shelter.
Philip Davies (Conservative, Shipley)
Before we start our questioning, would the new witnesses like formally to introduce themselves to the Committee?