Chamber response to Planning Obligation Agreements Consultation
Monday 31 July 10:46
The Chamber Of Commerce Building and Development Committee official response to the proposed new guidance for Planning Obligation Agreements (POA’s).
The Chamber Of Commerce Building and Development Committee has reviewed the proposed new guidance for Planning Obligation Agreements (POA’s) and we wish to comment as follows:
Our initial reaction to Planning Obligation Agreements is one of grave concern. The industry had been led to believe POA’s would supersede all other planning agreements. Having thoroughly read the proposals for POA’s, it is evidently clear that this is not the case and POA’s will be in ‘addition’ to existing planning obligation agreements and the new Community Infrastructure Levy (CIL), should this also be adopted.
The initial explanation of POA’s, were that they would simplify the planning process and make it fairer for all concerned. It must be pointed out, this sentiment was widely welcomed by the industry. However, this is clearly not the case and so it is extremely difficult to comment on POA’s in isolation, without a thorough understanding of what additional policies, red tape and measures will be in place should POA’s be adopted, as well as CIL. Therefore, we and the local development community must be allowed the opportunity to provide consultation on both systems together, if the CIL proposals proceed any further.
The proposed new guidance goes much further than the current guidance, which we believe, suggests a change in policy direction requiring the drafting of an order under the law. Both the law and the guidance must be in accord with each other. POA’s cannot merely be a shopping list, from which the development industry is expected to support the entire burden of the provision of infrastructure; social housing and other required public works. They must be proportionate and relevant to the development. As much as it has been stated in the document that planning permission cannot be bought, neither should planning permission be subject to an apparent form of legalised bribery as could become the case.
In summary, our requests are as follows:
- A definition of a planning obligation agreement must be included within the guidance directly related to the law on which it seeks to offer guidance.
- Allow for further consultation if CIL proceeds any further. New guidance should not be brought into force before this.
- The threshold set at 5 units is too low.
- Planning Obligations must be proportionate and relevant to the development that they are attached to.
- Planning Obligations must respond to a specific need in relation to the development and not be charged in advance for a perceived requirement that may never arise.
- A cap is required as a total amount payable in respect of all charges including public utility, POA’s, planning fees, CIL contribution etc.
- Monies received for Planning Obligations must be ring fenced and held separately to be used only for the items they were agreed for.
- A reporting mechanism needs to be implemented to demonstrate how monies collected are used and any non-spent funds should be returned.
- Calculations /quotations of any lump sum payments are required. Planning obligation agreements cannot be based on guesstimates. Developers should be allowed the option to provide the required item/facility themselves, or at the very least be able to tender to contractors to provide best value.
- It is not reasonable to expect the developer to pick up the legal bill for the POA. The States law office is not required to be competitive and fees are therefore not controllable. It is likely that developers will require their own legal team to assist on their part of the POA’s so it is completely unreasonable to think that they should also pay for the States legal team in addition to this. This is just cost on top of cost.
- Finally, we would ask whether the Department or the wider States body looking at implementing these obligations has carried out thorough impact assessments regarding the effect that POA’s and CIL will unquestionably have on development and house prices. If not already carried out, these must be done.
There is a very confusing message coming from the States and government currently. We are led to believe that Government are keen to provide affordable housing, yet this guidance and what is currently known of regarding the CIL proposals would appear to fly in the face of delivering this. Both policies will undoubtedly be inflationary, as developers cannot continue to absorb the constant additional costs without an effect on end product cost, therefore, increasing the cost of any development project including affordable housing schemes.
Furthermore, the islands infrastructure and general improvements should be provided for by general taxation, paid for by all, not one sector of commerce. Planning Obligation Agreements should only be used when there is a directly relatable link between a particular development and its impact on the infrastructure of the area. The guidance provided goes much further than this, the net effect of that could be that developments do not proceed at all. Clearly, this would not be to the benefit of anyone.
If we are to improve our island for the benefit of all, good development should be encouraged, after all, developers are responding to a need when they bring developments forward. If there were no need for such projects, it is unlikely they would proceed. So, contrary to the perception that developments are placing an additional burden on our island, they are in fact responding to demand that already exists and has not been provided for by other means.
I do hope that you will take the opportunity to carefully review our comments. If you need any further information or would like to meet with the committee to discuss the contents of the letter together with the guidance, we would be more than happy to do so.