Committee (11th Day)
Relevant documents: 24th and 31st Reports from the Delegated Powers Committee, 12th Report from the Constitution Committee
Clause 104: Completion notices
Debate on Amendment 261 resumed.
Lord Best Portrait Lord Best (CB)
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I think it falls to me to intervene at this point. I will speak to Amendment 269, which concerns the development of larger housing sites. I reiterate declarations of interest: I am vice-president of the Town and Country Planning Association and of the Local Government Association. I thank the CPRE, whose excellent legal advisers devised this amendment. I am delighted to see the good work being done by the CPRE in partnership with Shelter, the TCPA and others, to improve decisions on what and where new development takes place.

Amendment 269 seems a fairly innocuous and technical one, but actually it fundamentally changes the dynamics of new development on larger sites. It seeks to bring into play some of the recommendations from the 2018 review of housebuilding practices by Sir Oliver Letwin, who was working on behalf of the Government. The amendment addresses issues of diversification of housing and infrastructure on larger sites, as advocated by Sir Oliver. Diversification of providers and provision would replace the housebuilders’ model of one developer cramming in the maximum number of homes of the same house type for the same house buyers and selling them at the very slow but profitable buildout speed that the market will absorb. Instead, larger sites, said Sir Oliver, should be subject to a diversity of housing provision, where a number of different developers, including SME builders, housing associations, self-builders and so on, would build a variety of different sorts of housing for families for rent and for sale, perhaps student housing and certainly accommodation for older people, to which we have made reference under other amendments, with green spaces and infrastructure, as well as transport links for walking and cycling and public transport, not just private cars.

Those other providers would work together at the same time, building out the total development at a much faster rate than with single ownership by one volume housebuilder. That approach would diminish the dominance of the oligopoly of volume housebuilders, which have failed to deliver what society needs. Instead, the variety of developers and housing providers would work simultaneously in meeting the needs of the locality. The detail of the diversity of types and tenures of the new housing, including social housing, would be enshrined in the local plan—now the local development plan.

Sir Oliver saw much merit in local development corporations, at arm’s length but wholly owned by the local authority or combined authority. They could acquire sites and parcel them out within a master plan. In cases where the development corporation is unable to reach agreement with the landowner on the site’s value, compulsory purchase may be the only way forward. If so, the terms for the CPO would be set by the same requirements to meet the obligations laid out in the local development plan and national policies. The value of the site is thereby moderated by the necessity of complying with local and national mandates.

Where no development corporation is involved, and, indeed, whether or not a CPO is needed, a similar outcome could be achieved if this diversification and specificity was required for planning permission to be granted for any development of a site of more than 500 homes. In these cases, the value of the land would always be deeply affected by the insistence, built into the system by this amendment, that the local plan and national policies must be adhered to.

This amendment is one of a pair with my Amendment 312A, which we debated earlier in Committee. Both amendments seek to capture land value and enable a real shift in the social benefits that can flow from development of new housing in the UK. Amendment 312A was concerned with land in public ownership, seeking to ensure that it was made available for optimal economic, social and environmental use rather than being sold off to the highest bidder. This amendment is concerned with land in private ownership; again, to enable its development to serve the public good, not simply to achieve the maximum profit for the developer. The amendment will also secure in law clarity on the long-standing arguments around “viability”. It would make it clear that compliance with the requirements of the local plan and national duties is an essential part of the basis for valuing the land. Developers would no longer be able to claim that they are unable to meet the local authority’s demands for affordable housing or other amenities simply because of the price they paid for the site.

In fact, the courts have already made it clear that this argument must prevail. The now famous Parkhurst Road planning case concerning a site in Islington shed light on the legal position last August. The developer argued that because of the price it had to pay for the site, it could not afford to provide the affordable housing sought by the council, but the judge, the honourable Mr Justice Holgate, ruled that this excuse could not stand. Indeed, he took the RICS to task for not providing clearer guidance on such matters.

This amendment is intended to radically improve the development of all larger sites. It seeks to take back control from the housebuilders and developers which propose and build developments that do not make optimal use of land. The amendment would mean that all new developments would at last have to meet the policy objectives contained in local and neighbourhood—if they exist—plans, specifying the social affordable housing requirements and the mix of types and sizes of accommodation, and taking account of national policies. Land values would have to reflect these realities.

I realise that, as with my amendment on publicly owned land, the approach of this amendment is dependent on local authorities having and finalising local plans, but when they do this, when they have those plans, this makes them much more meaningful. The Minister may feel unable to accept my amendments, but perhaps consideration of this way forward, the follow-through of the admirable work of Sir Oliver Letwin, could start us down a path that achieves the same desirable outcome. I commend the amendment.

Baroness Pinnock Portrait Baroness Pinnock (LD)
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My Lords, I thank the noble Baroness, Lady Taylor of Stevenage, and the noble Lord, Lord Best, for raising these important points about buildout.

I will address the noble Baroness’s amendment first. Too many developers choose to land bank having achieved planning permission on a particular site. We know from Local Government Association data that there are more than 1 million housing units with existing planning consent that have not been built. The question we need to ask is: why, when as a country we are desperate for new houses, are we failing to take action to ensure that sites are developed promptly? Is the Minister able to provide any explanation for the long delays in developing sites? Will the Government provide proposals to prevent such delays?

I think we are all keen to have more housing units built, so we should focus on any delays in the system and try to improve buildout. From local experience I am aware of some of the reasons for delay. Where there are several sites with planning consent in the same locality, developers choose to delay construction in order not to have too many units on the market at the same time. That is an understandable commercial decision, but it delays the building of units of housing, which we desperately need. Developers also, understandably, want to create a steady flow of sites to develop as part of their business plans. These extend into several years, so it is not surprising that there is a slow output of new homes. What actions do the Government intend to take to address this issue?

The key issue in these amendments is the rate of buildout. One site in my locality has consent for 300 houses and plans to build out over an eight-year timescale. It wants only 30 to 40 new units on the market at any one time, to maximise its profit. That is a commercial decision, which I can understand, but it does not help the country in building a number of new homes very quickly, which is what is needed. It would be interesting to hear from the Minister how the Government can address that issue.
Amendment 269 in the name of the noble Lord, Lord Best, raises the important issues, which we have discussed to some extent in previous debates, of how we get more social housing on a site, how we get more housing appropriate for older people and how we get sites developed that reflect the needs of a particular locality. I agree totally with the objective of his amendment, but currently we have a landowner-led, developer-led process for building homes. At the outset of a local plan, the first step is the request to landowners to bring forward sites. Landowners do this because, once they get planning consent, the value of their land rises considerably.
The whole housing development process is in the hands of the providers, which provide what people may want and not what communities need. All our debates on planning so far have been about how we address need. The way the planning process is currently constructed enables developers to build what is wanted and not what is needed. There are very few levers, as I have tried to explain, to push developers to build what local areas need. Can the Minister explain how local and national plan policies can be enforced or at least implemented, which they cannot be to any great extent now? A negotiation goes on between the local planning authority and a developer; each pushes and negotiates, but in the end the commercial interest has the upper hand, in my experience.
For me, those are the issues at the heart of this. We have an urgent need for new housing in this country. The Government are not using the levers that the country needs to enable housebuilding to occur and to provide for the needs of our communities, rather than the needs of commercial construction and development companies.
Baroness Scott of Bybrook Portrait The Parliamentary Under-Secretary of State, Department for Levelling Up, Housing & Communities (Baroness Scott of Bybrook) (Con)
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My Lords, Amendment 261 tabled by the noble Baroness, Lady Taylor of Stevenage, proposes two fundamental changes to Clause 104, which modernises the procedure for serving completion notices in England. While I appreciate the intention, I remind your Lordships that completion notices—when served by a local authority or the Secretary of State—must provide the recipient with an opportunity to complete development. It is a “use it or lose it” power. Removing this opportunity for the developer to use the permission, as this amendment does, raises the prospect that compensation from the loss of the permission will be necessary as it is a revocation of a planning permission. I believe this would make completion notices less appealing to local planning authorities.

The second proposed effect of the amendment relates to the removal of finished parts of a development where a site could not be completed in full. Local planning authorities already have the power to require the removal of unfinished developments by order under Section 102 of the Town and Country Planning Act 1990.

The noble Baroness, Lady Pinnock, brought up one or two important issues. In the clauses already in the LURB, we have introduced two further provisions to ensure a better buildout rate of planning permissions in this country. First, the Government will require housing developers to report annually to local authorities on their actual delivery of housing. This will enable them to identify where sites in their area are coming forward too slowly. It will also help to inform whether to sanction a developer for failure to build out their schemes promptly. Secondly, the Government have introduced a new power that will allow local planning authorities to decline to determine planning applications made by developers that failed to build out at a reasonable rate earlier permissions on any land in the authority’s area.

To strengthen the package further, we will publish data on developers of sites over a certain size in cases where they fail to build out according to their commitments. Developers will be required to explain how they propose to increase the diversity of housing tenures to maximise development schemes’ absorption rate, which is the rate at which homes are sold or occupied. The NPPF will highlight that delivery can be a material consideration in planning applications. This could mean that applications with trajectories that propose a slow delivery rate may be refused in certain circumstances. We will also consult on proposals to introduce a financial penalty against developers that are developing out too slowly.

I disagree with the noble Baroness, Lady Pinnock, on houses that are not what a particular local authority wants. I believe that is up to the local authority. If the local authority has a local plan saying that it needs specific types of housing in the area, it needs to make sure that the planning applications that go through will have that in them. Local authorities know their area best, so it is up to them to make sure that their local plan is up to date and reflects what is required.

Baroness Pinnock Portrait Baroness Pinnock (LD)
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I thank the Minister for the information she has provided about sanctions and so on. I wait to see how firm those sanctions are. On the issue of local planning authorities having the power, basically, to dictate to a commercial enterprise what is developed on a site that the commercial enterprise owns, I would love to hear what powers the LPA will have in that regard.

Baroness Scott of Bybrook Portrait Baroness Scott of Bybrook (Con)
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The whole system is designed, after the LUR Bill, to be plan led. Therefore, planning applications should be in accordance with, first, national policies and, as importantly, local policies. If local policies say that you need, for example, houses for older people or disabled people, one should be agreeing only those planning applications that have those types of tenure within the developments that are coming forward through planning. If the system is plan led, I would have thought that the inspector should stick to the locally produced plan. On that basis, I hope this reassures the noble Baroness opposite that Amendment 261 is not necessary.

Amendment 269, tabled by the noble Lord, Lord Best, seeks to ensure that the development of large housing sites—defined as sites of 500 or more dwellings or more than five hectares in size where the predominant use will be housing, or designated as a large housing site within a development plan—is diversified in such a way that it provides a mix of new housing that reflects local needs, including social housing, in line with a local authority’s local plan requirements and national development management policies. While we agree with the sentiment of this amendment, we believe that there are better ways of achieving its objectives. The Government are of the view that diversification is best achieved by making this a stronger material planning consideration in the assessment of any housing application, and by requiring a buildout and diversification statement in all prescribed applications. We believe that this is best achieved via a new national development management policy, as that can be applied more flexibly compared to legislation and therefore address the different planning circumstances and housing needs that occur across the country, and that such a measure should not necessarily be limited to larger housing sites.

That is why the Government announced in December 2022—as part of the consultation Levelling-up and Regeneration Bill: Reforms to National Planning Policy—that developers will be required to explain how they propose to increase the diversity of housing tenures to maximise a development scheme’s absorption rate, which is the rate at which homes are sold or occupied. We invited views on the design of this policy, which will help to inform our thinking as part of our fuller review of national planning policy later this year. In these circumstances, while I very much agree with the objective of this amendment, there is a better way to achieve it via national planning policy, and I believe that it should be applied to a greater range of housing sites. This will ensure faster buildout rates and the diversification of those housing sites.

Government Amendment 261A will amend Clause 105 to strengthen the existing powers and hold developers more to account for unreasonably slow delivery or non-implementation of planning permissions. Currently, Clause 105 gives local planning authorities the power to decline to determine planning applications made by a person connected to an earlier planning permission on that same land which was not begun or has been carried out at an unreasonably slow rate. This amendment will enable authorities to exercise the power where an applicant is connected to an earlier permission on any land in their area which has not begun or has been built out unreasonably slowly. This change will send the message to developers that local planning authorities, as well as the communities they serve, expect new residential developments to come forward at a reasonable rate before new planning permissions are considered. This amendment will give greater powers to local areas to tackle cases of slow buildout.

Lord Best Portrait Lord Best (CB)
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I am encouraged by the tone with which these issues are being approached. As regards the placing of penalties upon those who are not getting on with the job by refusing future applications from that firm, I can see some hazards here, not least if the delay is happening in one area and the applications for further schemes are somewhere completely different. Is this new power of withholding permission for new applications because you have been so slow in building out the ones you already have to be transferred from one local authority to another, or is it confined to a local authority acting only with regard to interests within its own boundaries?

Baroness Scott of Bybrook Portrait Baroness Scott of Bybrook (Con)
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I believe it is in one local authority, but I will check that. I will let the noble Lord know and make sure that everybody else in the Committee is aware.

Baroness Taylor of Stevenage Portrait Baroness Taylor of Stevenage (Lab)
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I am grateful to noble Lords who have taken part in the debate and to the Minister for yet another thorough and thoughtful answer in response to the amendments.

When I moved my amendment last week, I said that I was pleased to see that the government amendment seemed to be complementary to my amendment, and therefore it was good to hear that some new steps are coming forward as regards placing some more requirements on developers in this respect. The Minister outlined some of those, such as publishing data on developers and diversity, the proposal on slow delivery and how it results in turn-downs, and financial penalties that we would be able to impose from local government, and so on. However, it would be good to see the details of those and how they are going to be incorporated. I assume they may go into the National Planning Policy Framework, but again, to echo the point we made several times, so far we have not seen that.

I remind noble Lords that the Local Government Association has said that it did not believe that “tangible powers” had been brought forward in the Bill to enable councillors to encourage developers to build out. I hear what the Minister said about secondary applications from those builders, but local authorities need powers to deal with current applications, where the buildout is slow too, so I hope some more thought might be given to that. The noble Lord, Lord Best, referred to the fact that builders may operate across different areas, which is a good point. However, if we take action on developers in the first instance, perhaps they will be encouraged not to go and apply elsewhere if they think that there will be action and that financial penalties will be imposed where they are too slow to build out.

I reiterate our strong support for Amendment 269 in the name of the noble Lord, Lord Best. On the issue of diversification in larger developments, I take the Minister’s point that that might also apply to other developments in terms of making sure they include all types of accommodation. We have had long debates in your Lordships’ House around supported accommodation, but it can also apply to student accommodation—I have a particular passion for social housing. That is important. I also wanted to make the point that those types of accommodation being requirements, whether it is through the local planning authority or as part of the National Planning Policy Framework, would also help encourage the development of specialist builders and help us to get a wider picture across the country with specialist builders who have great experience in developing for those particular areas.

The noble Baroness, Lady Pinnock, spoke about the viability issue, which I am sure has and will be the subject of discussions. On the Islington example she gave, those questions have arisen across the country. It is important we continue to debate that as part of the Bill, because I believe it is an opportunity to try to crack some of these issues around viability that we have been trying to wrestle with.

The noble Baroness, Lady Pinnock, gave examples of the huge failure to build out, which means that 2.8 million permissions have been granted since 2011 but only 1.6 million homes have been built. We desperately need those homes, so we need to do whatever we can to push that forward and end the delays in the system—from land banking but also from other issues.

I come back to the issue of diversification of property. If we are not going to have a proper diversification strategy built in, we need a proper definition of affordable housing, because the current definition just does not work; that has been a theme throughout discussion of the Bill. As the noble Lord, Lord Best, said, the affordable housing definition does not work for lots of people in our communities, as we have discussed many times in this House. For the moment, I beg leave to withdraw the amendment.

Amendment 261 withdrawn.
Clause 104 agreed.
Schedule 10 agreed.
Clause 105: Power to decline to determine applications in cases of earlier non-implementation etc
Amendment 261A
Moved by
261A: Clause 105, page 137, line 29, leave out “all or any part of the land” and insert “land all or any part of which is in the local planning authority’s area at the time the current application is made”
Member's explanatory statement
This amendment enables a local planning authority to refuse to determine an application for planning permission in certain cases where there was a previous application relating to land within the authority’s area and the development was not begun or has been carried out unreasonably slowly. The current power in the Bill would only be available if the previous application related to all or part of the same land.
Amendment 261A agreed.
Clause 105, as amended, agreed.
Clause 106 agreed.
Amendments 262 to 265 not moved.
Amendment 266
Moved by
266: After Clause 106, insert the following new Clause—
““Agent of Change”: integration of new development with existing businesses and facilities(1) In this section—“agent of change principle” means the principle requiring planning policies and decisions to ensure that new development can be integrated effectively with existing businesses and community facilities so that those businesses and facilities do not have unreasonable restrictions placed on them as a result of developments permitted after they were established;“development” has the same meaning as in section 55 of TCPA 1990 (meaning of “development” and “new development”);“licensing functions” has the same meaning as in section 4(1) of the Licensing Act 2003 (general duties of licensing authorities);“provision of regulated entertainment” has the same meaning as in Schedule 1 to the Licensing Act 2003 (provision of regulated entertainment);“relevant authority” means a relevant planning authority within the meaning of section 84 of this Act, or a licensing authority within the meaning of section 3 of the Licensing Act 2003 (licensing authorities).(2) In exercising any functions under TCPA 1990 or any licensing functions concerning development which is or is likely to be affected by an existing business or facility, a relevant authority shall have special regard to the agent of change principle.(3) An application for development within the vicinity of any premises licensed for the provision of regulated entertainment shall contain, in addition to any relevant requirements of the Town and Country Planning (Development Management Procedure) (England) Order 2015 (S.I. 2015/595), a noise impact assessment. (4) In determining whether noise emitted by or from an existing business or community facility constitutes a nuisance to a residential development, the decision-maker shall have regard to—(a) the chronology of the introduction of the relevant noise source and the residential development, and(b) what steps have been taken by the developer to mitigate the entry of noise from the existing business or facility to the residential development.”
Baroness McIntosh of Pickering Portrait Baroness McIntosh of Pickering (Con)
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My Lords, I am delighted to speak to Amendment 266, in my name and those of the noble Baroness, Lady Henig, and the noble Lord, Lord Foster of Bath, and I am extremely grateful to them both for co-signing. The genesis of this amendment, on the “agent of change” principle, came from the post-legislative scrutiny of the Select Committee on the Licensing Act 2003, which I had the honour to chair, and on which I served with the noble Lords in question and the noble Lord, Lord Brooke of Alverthorpe, who I am delighted to see in his place this afternoon. We did a great deal of work, assisted by our then clerk, Michael Collon, and our specialist adviser, Sarah Clover, and I thank them for their help in drafting the amendment before us today. Latterly, we were delighted to work with Hannah Murdoch in the follow-up to that committee.

Like so many policies, planning is about trying to achieve a balance between alternative and potentially conflicting uses, and this lies at the heart of what we are trying to achieve in the amendment before us. Modern planning policies, both local and national, encourage the regeneration of urban centres and the reuse of brownfield sites, formerly known as previously developed land. This preserves our greenfield countryside sites, which include the green belt and are a diminishing resource.

Urban centres already contain industrial, business and cultural land uses, including the night-time economy. Many of these uses are noise generators or sources of noise. Many have been in situ for a long time and are not contained in buildings that are suitable for mitigating their sound output. The law of nuisance does not protect those pre-existing businesses from incoming noise-sensitive, typically residential development. It does not matter how long those original businesses have been there; on the contrary, the law of nuisance tends to curtail and limit the noise-generating land use—for example, in noisy businesses such as pubs and music venues—and protect the new occupants who have chosen to come and live nearby. The same is true for any type of nuisance, including overlooking, light and odour.

This modern change in the way we develop our urban spaces—for example, converting office space into residential units under committed development and such—represents a significant shift away from the assumptions of the regulatory regimes, including planning, licensing and environmental protection law. Those are based on noisy businesses being located in urban areas and residential areas being located in quiet suburban spaces, with residents commuting between them, but that is no longer suitable as we seek to limit unnecessary travel to preserve air quality, protect the climate and more. Indeed, that is why we sought to draw the planning and licensing regimes together and encourage them to work more closely—a fundamental recommendation of our original inquiry and follow-up report. Our current regulatory regimes do not adequately protect existing businesses and the night-time economy.

Those of us who served on the committee that looked at the Licensing Act 2003 are extremely mindful of the highly difficult circumstances experienced by the night-time economy and the hospitality sector during the Covid pandemic and, more recently, through the cost of living constraints and—if I may say so—the disruption caused by rail strikes.

The agent of change principle is designed to provide the protection we are seeking. The amendment clearly states that it is

“the principle requiring planning policies and decisions to ensure that new development can be integrated effectively with existing businesses and community facilities so that those businesses and facilities do not have unreasonable restrictions placed on them as a result of developments permitted after they were established”.

So far, the agent of change principle is represented only in policy. It appears in paragraph 187 of the National Planning Policy Framework and in paragraph 14.66 of the Secretary of State’s Section 182 licensing guidance in virtually identical terms, with the same definition of “agent of change” given there as in the proposed new Clause, which I have just rehearsed. In my view, we need to put those protections in primary legislation, and this Bill provides a useful opportunity to do so.

Policy protection in itself is not enough. Planning and licensing policies compete with each other in a balancing act, as I referred to earlier. The decision-maker on each occasion must place weight on the competing policies on a case-by-case basis. Some policies, such as the need for new housing, may be deemed to outweigh the need to protect existing businesses. It is an important part of the planning and licensing regulatory regimes to place restrictions on developers and land users by way of conditions and obligations that they would not otherwise voluntarily adopt. Developers, perhaps not unreasonably, seek to maximise profit. Enhanced mitigation in the new development to protect local businesses from having unreasonable restrictions placed on them will cost the developer more.

It is precisely for that reason that it is for the regulatory regimes to impose that where necessary. The imposition of appropriate conditions and obligations must come from primary legislation. The strength of policy guidance is not enough. By way of example, primary legislation provides appropriate levels of protections for our heritage assets—listed buildings and national monuments, among others. Developers and decision-makers have statutory duties set out in primary legislation to protect heritage assets in any development decision. The same level of statutory protection is now required for existing businesses, particularly hospitality and cultural venues, that are placed under increasing pressure from the intensification of residential use of urban centres.

The impact of new residential development on the night-time economy and cultural spaces cannot be overemphasised. The phenomenon of residential complaints about music and other noise resources, exasperated by the coronavirus lockdowns to which I referred, has increased exponentially. Long-standing pubs, clubs and music venues have closed in alarming numbers, often due to residential complaints and resulting local authority enforcement action. Therefore, the agent of change policies of themselves are not enough. Amendment 266 would enshrine the agent of change principle in primary legislation and impose clear duties on planning decision-makers and developers to take full account of the environment into which the development will be introduced. This need not necessarily act as a dampener to new development, but it will ensure that all land uses can be integrated harmoniously together from the outset.
This is by far the best time to address these issues, rather than months or years down the line when complaints begin to arise. Appropriate mitigation can be built into the new development to insulate it from noise or other impacts of its environment. If required, mitigation can also be added to the existing businesses. Effective steps can be taken at an early stage using the new statutory agent of change principle which we set out, to ensure that existing and new land use can be made compatible and allow both to continue and flourish without future conflict, in the interests of both residents and the economy. This represents a long-term saving to local authorities, who typically must mediate or enforce the conflict that arises, perhaps years later, from incompatible neighbouring land uses. It represents a vital protection for businesses, including valuable cultural and hospitality spaces that are a fundamental element of the vibrancy of local areas and communities.
-The proposed amendment has three parts to it. First, in proposed new subsection (2) there is the duty of the decision-maker to address the agent of change issues appropriately at the decision-making stage. Secondly, there is a duty upon a developer intending to build near a licensed premises to ensure that a noise assessment is produced as part of the application. Thirdly, there is a potential defence for an existing noisy business if complaints arise from the new residential development in circumstances where the agent of change principle was not appropriately observed in granting that development.
I hope that my noble friend the Minister and her department will look favourably on this amendment. I beg to move.
Baroness Henig Portrait Baroness Henig (Lab)
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I am extremely pleased to support the noble Baroness, Lady McIntosh of Pickering, who introduced this amendment in, if I may say so, an extremely detailed speech, which means that I can be somewhat briefer. I think noble Lords will be pleased about that, because I have a dreadful cough which might manifest itself in the next five minutes. I apologise if it interrupts what I want to say.

I was a member of the committee that was so ably chaired by the noble Baroness, Lady McIntosh of Pickering, to carry out the post-legislative scrutiny of the Licensing Act 2003. There was an extremely strong team on that committee, quite apart from the chair and the House of Lords back-up team; Sarah Clover was an extremely helpful special adviser. I am grateful to Sarah for sharing with me her vast legal expertise on this topic, and for guiding me through the more arcane elements of this particular legal element.

The agent of change principle was one of the issues that came up during our proceedings. The Government professed themselves to be sympathetic to the problems being faced by the night-time economy. Indeed, their response to our recommendation that the agent of change principle should be adopted in both planning and licensing guidance was that they were consulting to see whether the agent of change principle should be emphasised by changes to the National Planning Policy Framework. That was in 2017; perhaps the Minister could tell me what the outcome of that consultation was, since the trail seems to have gone a little cold and I have not heard whether there has been any follow-up. I would be most grateful if perhaps the Minister could bring us up to date on that particular matter.

Now, of course, since 2017, the landscape has changed considerably for the worse as far as the night-time economy is concerned, as the noble Baroness, Lady McIntosh, quite rightly pointed out. It was decimated by Covid and is only just recovering from the impact. Along with the rest of the economy, the night-time economy faces critical staff shortages and considerable inflationary increases. Frankly, it needs all the help it can get. It needs the Government not to just pay lip service to helping the economy in these difficult times but to actually do something to assist.

This is one obvious way that the Government can help. Here is the Government’s opportunity to enshrine in primary legislation the agent of change principle, so that the interests of the night-time economy, local residents, and possible new local developments are all taken into account equably in planning decisions. It seems to me that that is a very important principle. Furthermore, it seems to me absolutely right, and very important, that this happens right at the outset of new developments, so that all interests at local level can be fully taken into account, difficulties can be pinpointed and ways to mitigate these difficulties can be identified early on.

Really, this is a very straightforward amendment to try to assist in the current process, and to improve it. Therefore, I commend it to the Minister as one which could bring great benefits up and down the country at, as far as I can see, hardly any cost. I very much hope it will be taken on board by the Government.

I will just add that the noble Baroness, Lady McIntosh, and I have some form in putting forward amendments which are then taken on by the Government and presented subsequently as government amendments. I am therefore extremely hopeful that this might happen in relation to this very constructive and helpful amendment, and I commend it to the Minister.

Lord Foster of Bath Portrait Lord Foster of Bath (LD)
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My Lords, I too served on your Lordships’ Select Committee on licensing in 2017, and on the subsequent follow-up committee. I join with the noble Baroness, Lady Henig, in heaping praise on the absolutely able chairmanship of the noble Baroness, Lady McIntosh of Pickering. As we have heard, both committees concluded that it was important to incorporate the agent of change principle in planning policy and guidance.

In case anybody is in any doubt what this means, the agent of change principle ensures that a new development must shoulder responsibility for compliance when situated near, for example, an existing music venue. Similarly, if a music venue opens in an existing residential area, it would be responsible for complying with residential requirements to minimise nuisance. For example, based on this principle, an apartment block built near an established music venue would have to pay for soundproofing, while a live music venue opening in an existing residential area would be responsible for the cost of soundproofing.

The committee was therefore very pleased that the Government agreed that the agent of change principle should be reflected in the National Planning Policy Framework and in Section 182 guidance. That has now happened. However, the follow-up committee heard that the principle as it stands, reflected in those documents, does not sufficiently explain the duties of all parties involved. The committee argued that the principle needs to go further to protect licensed premises and local residents in our changing high streets, and that a lack of consistency between the planning and licensing systems—something that it believed needed to be changed anyway—has led to, for example, live venues not being guaranteed to be protected. I will give two quick examples.

The Night & Day Café is a live music venue in Manchester’s Northern Quarter. It opened in 1991 and is the venue that launched the careers of, for example, Elbow and Arctic Monkeys. In November 2021, the venue was served with a noise abatement notice from Manchester City Council. This followed ongoing complaints from local residents who had moved into a new development—warehouses converted into flats—during the Covid pandemic when the venue was temporarily closed. The case provoked a huge degree of interest. Some 94,000 people have signed a petition asking for the notice to be withdrawn, with one signatory describing the situation as

“like moving to Leicester Square and complaining about there being too many cinemas”.

Night & Day Café’s appeal over the order has been adjourned until later this year. It has still not been resolved.

The Jago is a venue in Dalston that hosts live music events, screenings and workshops. It is registered as an asset of community value and is very highly regarded in the local area. It has hosted musicians for almost two decades, but since the pandemic many surrounding buildings have been converted into residential properties, which has led to an increase in noise complaints and, in June 2022, it received a noise abatement notice. It too has been the subject of a petition trying to help, with over 2,500 signatures. Again, its problem has not yet been resolved.

The committee recommended that, to resolve issues such as these, the Government should review and strengthen the agent of change principle and consider incorporating it into the current planning reforms in the Levelling-up and Regeneration Bill. The Government did not disagree, and themselves pointed to the then upcoming Levelling-Up and Regeneration Bill as a vehicle to address these concerns. This amendment is simply by way of helping the Government achieve what they agreed was needed: greater clarity about what is expected of councils and businesses. In that light, I hope the Minister will see that the amendment is designed to support and help the Government. I hope she too will support it.

Lord Brooke of Alverthorpe Portrait Lord Brooke of Alverthorpe (Lab)
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My Lords, I am grateful to the noble Baroness for moving the amendment and to others who have spoken. I too was a member of the original committee, although not the follow-up committee. It is amazing to look at how life has changed so quickly since the report in 2017 and the subsequent report. Since then we have had the pandemic and a whole new experience of living in a different world entirely, including a different world of work, from what we had in the past.

Leaving aside nightlife, look at what is happening with online trading and with the high street. When one wanders around Oxford Street one sees quite large premises now empty and not being used. The Strand has been transformed completely from what it was like 20 years ago. Companies that had been there for almost a century and a half have disappeared, yet the properties remain empty. What will happen to them? Without any doubt, if they fail to get commercial operatives they will be converted into residential premises in due course.

The issue that we have before us—leaving aside the nightlife—is one that was going to confront the Government anyway. I believe they have still not come to terms with the fact—I am not sure whether my party has—that the party that tells people they can work from home at least two, three or four days a week is going to get the votes of workers in this country. They do not want to travel, with all the inconvenience that goes along with it. They do not want to be in the city centre, with all the pressures. They want to be working at home, close to their families, and to have greater freedom and control of their lives. That is going to happen, particularly as we start moving into the metaverse and the completely different way of working that comes with that. That has a knock-on effect on accommodation, with changes at home for people to work there and, more particularly, with what happens to empty offices and the nightlife that takes place around them.
The present arrangements are far from suitable for dealing with changing circumstances. For example, if something else came along quite unexpectedly, like Covid-19 did, we could again see massive changes taking place in a very short space of time, when we have not even coped with the knock-on effects from the last change. I hope the Government are going to be reasonable this time around. This is a reasonable amendment that should not be lightly dismissed or ignored in the way that it has been previously.
Earl of Lytton Portrait The Earl of Lytton (CB)
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My Lords, the noble Lord, Lord Brooke of Alverthorpe, raises a matter which concerns me. I congratulate the noble Baroness, Lady Pickering, on this amendment. I am not, and never have been, a member of the licensing committee, but I am bound to admit that I have enjoyed many of the venues that are facilitated by the licensing process.

My example is a little different, because this is not just a matter of licensing. It concerns the 24/7 use of an urban industrial area not very far from one of London’s major international airports—hence it is 24/7. It is an older industrial estate that had been subject to periodic, sporadic, upgrades of buildings. However, the local authority, in its infinite wisdom, gave consent for a piece of land on the edge of this industrial area, which I think had previously been residential back gardens, to be used for a residential development. This triggered a change of policy within the local authority, such that every time somebody wanted to do anything on the industrial estate—change a roller shutter door, have a better loading canopy or something like that—an hours of work restriction would be imposed, so preventing it being used 24/7. I challenged a local elected member on this, who was unaware of what his council had done and what the implications were.

I accept that that is a different situation from what one might call the shared space of a town centre, but I think it is relevant that we have—sorry to use the awful phrase—joined-up policies in relation to all these things, unless we want situations happening on our high streets such as those to which the noble Lord, Lord Brooke of Alverthorpe, referred to. Later on, we will get to what happens with vacant properties in high streets when—when—we get to the group that is currently number 28 on the Marshalled List before your Lordships. My Amendment 426 in that group is on this issue.

One other issue is what we might call the administrative framework aspect of all this. I think of circumstances to do with the way in which local government or contractors organise such things as waste collection from premises in urban centres; refuse collectors can turn up in the small hours of the morning and cause disruption. I wonder whether we are not sometimes making a rod for our own backs by not thinking ahead about how we organise these things. Some are displaced by concepts such as core time servicing and other such matters relating to our town centres. There tend to be rather individual, single-issue decisions, without looking forwards, backwards or sideways.

I offer a word of caution to the noble Baroness, Lady McIntosh of Pickering, on the wording “can be integrated” in the amendment. The phrase “can be integrated” does not necessarily mean that a new development will be integrated. I interpret “can” as facilitative, “will” as something more demonstrative. If the administrative rollout is subject to all manner of change going forward, without a statement of principles and constant monitoring of the unfolding process, we may end up with decisions made on a “moment in time” principle rather than having the dynamic under constant review and consideration.

There is obviously a resource implication here but, unless we do this, as the noble Lord, Lord Brooke of Alverthorpe, says—given what has happened in just the last few years and post Covid, with the changes in demand, journeys to work and work-life balance—we will not be anywhere near ahead of the curve in getting this right. Other than that, I strongly support the principle of this amendment; I think it a really worthwhile amendment for consideration by your Lordships.

Baroness Hayman of Ullock Portrait Baroness Hayman of Ullock (Lab)
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My Lords, this has been an interesting debate; I thank the noble Baroness, Lady McIntosh of Pickering, for bringing it forward. I also thank the licensing committee and its members for their considerable work on this. Listening to the debate, one thing that comes over very clearly is that it is time to review the status and look at the current situation. As the noble Baroness, Lady McIntosh, said, we now have the change of use from office to residential space in town centres, and my noble friend talked about the many empty town centre premises. There will be a lot of change in ways that we have not seen before and new challenges, especially for the night-time economy, as has been discussed.

As I said, the agent of change principle has been with us for some years now, which, again, is why it is time to look at this. We know that it is in the National Planning Policy Framework, but what strikes me from the debate is the question of whether it is fit for purpose. I have a number of questions for the Minister following on from this. Is the agent of change principle having a meaningful impact at the moment? Does the licensing guidance reflect the principles in the NPPF itself? We need to ensure that the NPPF is fit for purpose, as well as the agent of change principle within it. The question on my mind is: will the NPPF, when we get to see it, reflect the likely focus of future planning decisions? How will it all fit together?

As my noble friend Lady Henig said, this is an opportunity to enshrine this principle in legislation. We need to make sure that we get this right—that it is fit for purpose and does what it is supposed to do: work to protect both sides. It is important that the Minister is able to assure us on that matter.

My noble friend Lady Henig also asked about the current status of the consultation that took place in 2017 on the housing White Paper in relation to this issue. Not to have heard back from that consultation in 2017, six years ago, is a bit concerning. Since then, as my noble friend Lord Brooke mentioned, we have had the pandemic and so much has changed, so is that consultation even still relevant? Perhaps the Government need to revisit that completely. I would appreciate the Minister taking that back to her department.

Baroness Scott of Bybrook Portrait Baroness Scott of Bybrook (Con)
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My Lords, Amendment 266, tabled by my noble friend Lady McIntosh of Pickering, tackles the important issue of the agent of change principle in planning and licensing—that is, the principle that existing businesses should not be negatively affected by restrictions on them resulting from new development in their area. National policies and guidance already provide strong support for that principle, and we will continue to make sure that authorities have the tools needed to deliver it. The Government therefore do not consider the amendment necessary.

I agree with my noble friend that preventing this happening is important to so many businesses, especially in the night-time economy, where these issues most regularly occur. That is why we amended the National Planning Policy Framework in 2018 to embed these principles, with paragraph 187 of the current framework saying:

“Existing businesses and facilities should not have unreasonable restrictions placed on them as a result of development permitted after they were established”.

In answer to the noble Baronesses, Lady Henig and Lady Hayman of Ullock, that came after the consultation, so it was partly a response to it. The framework goes on to highlight that, where there could be “a significant adverse effect”, the onus should be put on the agent of change proposing the new development to provide suitable mitigation before it has been completed.

We are also introducing national development management policies through the Bill. In future, and subject to further appropriate consultation, these will allow us to give important national planning policy protections statutory weight in planning decisions for the first time.

We believe that the proposed requirement for a noise impact assessment to be undertaken for relevant development would duplicate existing guidance for local planning authorities. Planning practice guidance published by the department is clear that the agent of change will need to clearly identify the effects of existing businesses that may cause a nuisance to future residents or users of the development proposed.

The guidance also sets out that the agent of change is expected to define clearly any mitigation that is proposed to address any potential significant adverse effects, in order to try to prevent future complaints from new residents or users. Many local planning authorities also make this assessment of effects a part of their local lists of information required to be submitted alongside relevant planning applications. After such assessment of the effects, reasonable planning conditions can be used to make sure that any mitigation by the agent of change is completed, as agreed with the local planning authority when planning permission is granted.

Importantly, the Government agree that co-ordination between the planning and licensing regimes is crucial to protect those businesses in practice. This is why in December 2022 the Home Office published a revised version of its guidance, made under Section 182 of the Licensing Act 2003, cross-referencing the relevant section of the National Planning Policy Framework for the first time. Combined with our wider changes in the Bill, we will make sure that our policy results in better protections for these businesses and delivers on the agent of change principle in practice.

I hope I have demonstrated that the Government’s policies embed the agent of change principle and that we will continue to make sure it is reflected in planning and licensing decisions in future.

Baroness McIntosh of Pickering Portrait Baroness McIntosh of Pickering (Con)
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My Lords, I am grateful to all who have spoken in this debate, particularly those who gave their strong support to this amendment. A number of questions were raised, in particular by the noble Baroness, Lady Hayman of Ullock, which have not necessarily been answered in the debate. The noble Baroness, Lady Henig, and the noble Lords, Lord Foster and Lord Brooke of Alverthorpe, have stated why, in the Committee’s view, it is very clear that this amendment is needed. As I tried to explain to my noble friend, the policies and planning guidance on their own are not sufficient. So I would like to go back and discuss with those who have spoken whether there is cross-party support for bringing this forward at a later stage—but, for now, I beg leave to withdraw the amendment.

Amendment 266 withdrawn.
Amendment 267
Moved by
267: After Clause 106, insert the following new Clause—
“Local authorities and development management services(1) A local planning authority may set a charging regime in relation to its development management services.(2) In setting the amount of a charge under subsection (1) a local planning authority must secure that, taking one financial year with another, the authority’s income from charges does not exceed the cost to the authority of delivering the development management services for which the charges are imposed.”Member’s explanatory statement
The amendment would allow local authorities to develop a planning fees schedule that would enable the full costs of delivering its development management services, including the processing of planning applications, to be recovered.
Lord Young of Cookham Portrait Lord Young of Cookham (Con)
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My Lords, Amendment 267 is in my name and that of the noble Baroness, Lady Thornhill. This amendment has the support of the LGA and it would enable local authorities to charge planning fees that met the cost of providing the service, but would prevent them making a profit from it.

One of the themes of our debates on the Bill has been the importance of local authorities providing up-to-date plans. Indeed, my noble friend has made the point that up-to-date plans are more likely to produce the increases in housing that the country needs. But if we are to do that and have up-to-date plans, we need properly resourced planning departments. We also want to see planning applications promptly processed so that development can go ahead, again to meet housing need. That requires properly resource planning departments, but we know that they are all under pressure. Of the respondents to the Home Builders Federation’s recent SME development survey, 92% said that lack of resource in local planning authorities was a major barrier to growth—up from 90% in 2021.

Planning departments will also need to respond to proposals in the Bill, which has 47 clauses that relate to planning. They are going to have to get up to speed with that if they are to succeed in the Government’s ambition to improve the planning system. They are going to need to digitise and streamline the planning process. They will have to understand the implications of the NDMP and the new NPPF. They will have to deliver the new environmental assessment procedures and the new procedures on heritage and for neighbourhood plans, along with other changes to the planning system that we have been debating—not to mention the implication of street votes.

At the moment, planning fees do not cover the cost of processing planning applications. According to the LGA, council tax payers subsidise the planning system to the tune of £180 million per annum—money that could be spent on social housing. I know that the Government are consulting on an increase, but there are two problems. First, even if granted, the increase will not meet the gap or give us the well-resourced planning departments we need. Secondly, it will not enable individual local authorities that have active planning departments to set fees that cover their costs.

Recently, the Government have tabled Amendment 285C, but I am not sure that it addresses the problem. That amendment will allow certain bodies to charge fees for advice in relation to planning applications. My noble friend will explain what that means; I suspect that it is a response to Amendment 283 and will enable bodies such as the Environment Agency and Natural England to charge for advice on planning applications. In any case, the wording of the Government’s amendment would not cover the ability for local authorities to charge fees for the processing of planning applications, because it refers to the ability to charge fees for “advice” in relation to applications, and, of course, the authorities can already do that.

However, there is a wider principle at stake here. This Bill was going to be called the “Devolution Bill”. The Government want to decentralise and give local authorities the ability to respond to local needs, so here is a golden opportunity to put that policy into practice. I was rereading the foreword of the levelling-up White Paper published in February last year. It said:

“We’ll usher in a revolution in local democracy”.

It seems to me that here is a good opportunity to put that ambition into practice.

Finally, this central control sits uneasily with the freedom local authorities have to set building control fees, which are part of the same planning family. That is an anomaly I find difficult to explain. There is no central government control over parking charges, school meal costs, rents or swimming pool tariffs. Why are the Government so insistent on retaining control of planning fees? I ask my noble friend whether she is prepared to relax the Government’s vice-like grip on local authority. I beg to move.

Baroness Parminter Portrait Baroness Parminter (LD)
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My Lords, in the absence of the noble Baroness, Lady Young of Old Scone, who cannot be here this week, I will introduce her Amendment 283, to which I and the noble Baroness, Lady Hayman of Ullock, have added our names. As it is her amendment, I will not do what I normally do and speak off the cuff. I have some notes from her, and I will, unusually, read from them.

A number of statutory consultees receive requests to provide expert information and opinion on planning applications and other planning cases. Indeed, the noble Lord, Lord Young of Cookham, just mentioned some of them. The main statutory consultees include Natural England, the Environment Agency, the Health and Safety Executive, Historic England and Highways England.

The volume of planning application requests has increased by 38% over the six years up to the financial year 2021-22. It is estimated that this trend will continue. Natural England alone received almost 18,000 requests in the last financial year. In 2019 the main statutory consultees estimated the total cost of providing this advice at approximately £50 million. Obviously, costs will rise with volume.

Amendment 283 inserts a provision into the Town and Country Planning Act. It would allow the Secretary of State to make regulations to allow statutory consultees to charge developers and others for the provision of such advice and information about planning applications and other planning cases put forward by developers and others to local planning authorities. This provision would bring the cost-recovery arrangements for the majority of planning applications under the Town and Country Planning Act, in line with the proposals in Clause 118, which will allow cost recovery in the case of nationally significant infrastructure projects.

Amendment 283 lays out what particular provisions the regulations may make, including who should pay, how much and when. It also defines an “excluded person” who cannot be charged, unless that person is the applicant for the planning permission. Broadly speaking, in at least the first instance, it seems that the charges would be for the planning applicant or developer to pay, and charges would not be levied on the planning authority. It is all very straightforward and essential if our hard-pressed statutory consultees are to provide a prompt and efficient service to both planning authorities and applicants in the face of the growing case load.

The Minister has ostensibly agreed, as the Government have laid what seems like a similar amendment, Amendment 285C. However, proposed new subsection (3)(b) in the government amendment could be interpreted as prohibiting a statutory consultee charging fees to a planning applicant in respect of the provision of advice to a local planning authority by any route. It could even prohibit current scenarios where a developer is willing to meet those costs under a voluntary agreement, for example under a planning performance agreement or a service level agreement. If that is not the intention in proposed new subsection (3)(b) in the government amendment, the ambiguity needs to be removed.

It would be good to have confirmation today from the Minister that the Government intend to ensure that the statutory consultees can recover their costs. I ask the Minister whether she might be prepared to meet the noble Baroness, Lady Young, and other interested Peers between now and Report to identify a mutually satisfactory and unambiguous version of these two amendments.

Baroness Pinnock Portrait Baroness Pinnock (LD)
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My Lords, I speak to my Amendment 287, which would achieve a planning fee system that would cover costs for local planning authorities. It largely mirrors Amendment 267 in the names of the noble Lord, Lord Young of Cookham, and my noble friend Lady Thornhill. I concur entirely with his arguments, but have some additional points to make in support of the plea to enable local planning authorities to set their own fees.

Too often planning applications, especially those that are complex, such as a major commercial development, have a set fee that nowhere near covers the costs, simply because there is so much more to planning applications than simply considering the plan details submitted at the first stage. I give an example of a recent application near me for a very large commercial development of 1 million square feet—probably a bit more than that—with a fee of £300,000. That is, and sounds, a considerable sum. However, in the end there were more than 200 different elements of the planning application to consider, 96 of which were amendments to the original plan. One of those, which I endeavoured to read, was of itself more than 100 pages long.

Understandably, these applications are hugely complex and require considerable expertise within the local planning authority to understand and respond to them. They are not just about the design and features of the building itself—there is also highway access, road safety, landscaping, biodiversity, trees, noise and light pollution, and the impact on the landscape. In my local authority, they have to consider drainage and, in this instance, 14 attenuation tanks had to be built in the end to deal with run-off from the development. Hugely complex issues are being considered, and it all has to be done within that set fee, regardless. It took nigh on two years for that application to be fully considered and ready for a planning committee. Clearly, the fee failed to cover the costs of the details of the application.

There are implications to all this. The Royal Town Planning Institute reckons that there were 42% cuts in planning budgets over the 10-year period from 2008. There have been increases since, not all of which have been directed towards day-to-day planning officers. Digitisation was one of the issues rightly being considered by the Government. As the noble Lord, Lord Young, has said, the information is that local council tax payers are subsidising planning applications. If I told local people where I am that that was the case, they would rightly be very concerned, when other vital services have insufficient funding.

The RTPI research showed that one in 10 planning officer roles was unfilled. The reason for that is that so many expert planning officers find life much better rewarded—in many ways, not just financially—in private practice. The draining of local planning officers from the system is putting immense pressure on dealing with planning applications, and the timeliness of those, which again is hindering the Government’s aim to build more housing. None of this is helpful to achieving that.

We need local planning authorities to be able to set their own fees, not to make a profit but to cover their costs. I obviously support the amendment in the name of the noble Baroness, Lady Young, which my noble friend spoke to, because that too makes good sense. Why should Natural England, Historic England and all the other statutory consultees have to fund advice to planning applications from their own budgets? That does not make sense when planning applications are a commercial business. There is a really good argument for enabling local planning authorities to set their own fees and the statutory consultees, such as have been described, to recover their costs as well. I hope the Minister will be able to respond positively to all the amendments in this group.
Baroness Thornhill Portrait Baroness Thornhill (LD)
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My Lords, I do not want to take up too much time, because much has already been said, but I want to add a couple of points that have perhaps not already been made and expand on one point from the noble Lord, Lord Young. It is really important to acknowledge that the Government have found the means to increase planning fees for major and minor applications to 35% and 25% respectively. That is a positive move in the right direction and it has to be applauded.

As always, the noble Lord, Lord Young of Cookham, has nailed Amendment 267 and I want to expand on one of his comments, on devolution. In reality, councils are effectively asked—and in effect taxpayers are asked—to subsidise a whole range of services, not just planning services. Licensing fees are one, and the one that really gets my goat is supplying credit agencies with the electoral register. There is a statutory cap on what can be charged, regardless of the actual cost. Even with land searches, which councils have to do the work on, the Land Registry actually gets the cash. I think it is an area that is ripe for looking at, particularly as we are in cash-strapped times; other agencies and other companies, not just the taxpayer, should pay the bill.

My only caveat about letting each individual council area decide absolutely on its fees is that “To those who have, more shall be given”. In areas where developers want to build—they are usually the areas where it is most lucrative and they will get the most profit—they will be able to get away with charging much higher fees simply because they can. I think the opposite should be true, so Amendment 267, which refers to the actual costs, is the fairest way of dealing with this, especially as salaries and other incidentals also vary depending on the geographical area that a council sits in.

Lord Moylan Portrait Lord Moylan (Con)
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My Lords, I will speak briefly in giving general support to the thrust of the amendments, not only on the grounds advanced by other noble Lords but because they would mitigate something I regard as a positive evil. It has become possible in recent years for major developers proposing major projects to offer to local planning authorities to fund the salary of a planning officer to help deal with their case. When I had responsibility in a London borough for planning policy, I resisted accepting that sort of offer, but perhaps we could afford to do so.

This strikes to some extent at the heart of public confidence in the planning system, which is always a little fragile. Noble Lords who have been involved in it will know that there are always people who suspect that there has been a fix and that something corrupt is going on, but that is not the case in my experience. However, to allow a developer to fund a planning officer only exaggerates that perception and damages public confidence in the planning system. The way out of this, not least in the context of devolution, must be to allow the charges to cover the costs. It also seems appropriate if we want to empower elected officials in local authorities. It is open to the possibility of abuse, as the noble Baroness, Lady Thornhill, said, and a local authority could seek to deter applications by setting punitively high fees, but my noble friend Lord Young of Cookham’s amendment broadly addresses that possibility. It might need a little refinement, but the principle is none the less clear and acceptable. I encourage support for this amendment because we are not taking sufficient notice of the evil I mentioned, which harms the planning system.

Baroness Taylor of Stevenage Portrait Baroness Taylor of Stevenage (Lab)
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My Lords, Amendment 267 in the names of the noble Lord, Lord Young, and the noble Baroness, Lady Thornhill, was music to my ears; Amendment 287 from the noble Baroness, Lady Pinnock, is very similar. I have never understood why the public purse—the hard-pressed local government public purse at that—has to subsidise the development industry even for the very largest and most profitable developments. We have long spoken about a “polluter pays” principle in discussions on the environment; perhaps it is time we had a “profiter pays” principle in planning.

This issue has long been debated in local government. It is the subject of general incredulity that, at this time of financial crisis for local government, it is still allowed to continue. The Local Government Association has lobbied consistently on this point, stating in its recent response:

“We welcome the proposal to increase planning application fees, as it has for a long time been our position that there is a need for a well-resourced planning system. However, the Government should go further by allowing councils to set planning fees locally.”

I do not think it is a surprise to any noble Lords that local authority planning departments are at full stretch already. The noble Lord, Lord Young, referred to how they will respond to the 47 clauses in this Bill, never mind the issue of street votes—they will have plenty of work to do, that is for sure. It is an area of specialism where there are considerable shortages of professionals. In spite of a great deal of work being done to encourage young people to consider planning as a career and increase the number of routes into the profession, there remain difficulties in recruitment and retention. This is even worse in areas surrounding London, where it is almost impossible for local authorities to compete with the packages offered to planning officers in London.

This is exacerbated by the pressure of work; I know that many noble Lords in the Chamber will have sat through contentious planning application hearings, and I do not think any of us would be surprised to learn that our officers subject themselves to considerable stress. Therefore, it is only right that the industry makes a fair contribution to the cost of processing applications where it will reap substantial developer profit. This will enable local authorities to ensure that their planning teams are resourced adequately.

We also strongly support Amendment 283 in the name of my noble friend Lady Young, and so ably moved by the noble Baroness, Lady Parminter. She is absolutely right that statutory consultees, often hard-pressed themselves, should be able to recover the costs from applicants. I understand that of the £50 million bill for this, cited by the noble Baroness, Lady Parminter, 60% was incurred by Natural England and the Environment Agency as the two statutory consultees dealing with the greatest number of planning consultations. It was as far back as 2018 that the top five statutory consultees came together to form a working group to identify potential alternative funding mechanisms to address the increasingly critical and unsustainable position. They made recommendations to DLUHC in March 2019. This work highlighted the need for a change in primary legislation to provide a broad enabling power under which statutory planning consultees could pass on the costs incurred in providing statutory advice to applicants, either as part of the existing planning fees or as an additional separate charge.

We welcome the inclusion of a power in the LURB to enable statutory consultees to recover costs incurred in providing advice on nationally significant infrastructure projects. That alone, though, makes only a modest contribution to addressing the challenge of establishing the sustainable funding model. I believe for Natural England, approximately 70% of the statutory consultation work will continue to be reliant on grant in aid. Will the Government introduce a power that will help us? If not, the Government are, in effect, committing to rely on the Exchequer as the primary means of funding the essential role that statutory consultees play in support of the operation of the planning system.

There is also the danger that we will create an inconsistent funding model between NSIP cases and non-NSIP cases that are of a comparable size or impact, such as large-scale housing developments. That could result in the need to prioritise resources for NSIP work over non-NSIP work, create inconsistency in service levels and potentially disadvantage large housing developments, which would be the exact opposite direction to the way we want to go. I hope that the strength of my noble friend Lady Young’s amendment will be taken into account.

Consideration should also be given to other statutory agencies. We have seen similar pressures on colleagues in the National Health Service, for example, where they have to comment on planning applications. There is also pressure on the resources of county councils to respond to matters relating to highways, flood risk, education and adult and children’s care provision—to name just a few—which is required on almost every major application and some smaller applications. It is simply not right that those costs should fall on public agencies whose funding is limited. If they were adequately recompensed, their ability to respond to applications in a timely manner might be improved.

Government Amendment 285C is similar to that proposed by my noble friend Lady Young—I hope we can at least agree on that—but, as the noble Lord, Lord Young, pointed out, this may not refer to charging for local authorities. We would want to see both local authorities and statutory consultees able to charge something like the recovery of the costs they incur in relation to the planning system.

Baroness Scott of Bybrook Portrait Baroness Scott of Bybrook (Con)
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My Lords, Amendments 267 and 287 have been tabled by my noble friend Lord Young of Cookham and the noble Baroness, Lady Pinnock, respectively. I assure your Lordships that the Government understand the concerns about stretched resources in local planning authorities. However, we do not believe that enabling local planning authorities to vary fees and charges is the way to answer resourcing issues, and it does not provide any incentive to tackle inefficiencies. Local authorities having different fees creates uncertainty and unfairness for applicants and, if set too high, could risk unintended consequences by discouraging development.

My noble friend Lord Young of Cookham and the noble Baroness, Lady Pinnock, both brought up the question of whether we could loosen the local authority planning fees. As I have said, having different fees creates inconsistency, more complexity and unfairness for applicants, who could be required to pay different fee levels for the same types of development. Planning fees provide clarity and consistency for local authorities, developers and home owners. However, we are consulting on fees. We are seeking views on whether the additional income arising from the proposed fee increase could and should be ring-fenced for spending within the local authority planning department. Past increases have required a written commitment from all local planning authorities in advance of implementation.
The noble Baronesses, Lady Pinnock and Lady Taylor of Stevenage, also brought up the issue of capacity and capability in local planning departments. We recognise the challenge that many local planning authorities are facing. We aim to ensure that local authority planning departments can build the capacity and develop the skills to support the design of our neighbourhoods, in order to regenerate our towns, deliver levelling up and implement the changes proposed in the Bill. We continue to work with local planning authorities and the broader planning sector to design and, we hope, deliver the support needed so that planning authorities have the skills and capacity necessary to modernise and implement change. Some of those things are in the Bill—for example, in respect of using technology.
Our priority is to ensure that all local planning authorities are able to increase their fees through a national fee increase. As we have heard, we are currently consulting on proposals to support the greater resourcing of local planning authorities through an increase in planning fees by 35% for major applications and by 25% for other applications. Subject to the outcome of this consultation and parliamentary approval, we would seek to introduce a fee increase at the earliest opportunity this year.
Amendment 283, tabled by the noble Baroness, Lady Young of Old Scone, and introduced by the noble Baroness, Lady Parminter, seeks to enable statutory consultees, who are required to provide expert advice to local planning authorities and other planning decision-makers, to recover their costs from applicants seeking planning permissions. I thank the noble Baroness, Lady Young, for tabling this amendment. We share the view that there is an increasing need for further funding opportunities to help key statutory consultees secure the right resources at the right time, so that they can continue to provide expert and timely advice in respect of proposals coming forward through the planning application process. That is why we have tabled our own Amendment 285C, to enable more cost recovery for work dealing with planning applications. This amendment bears many similarities to the proposal of the noble Baroness, Lady Young.
Our amendment will also allow statutory consultees to set their own charges for applicants, subject to limitations, and ensure that there is transparency as to the services provided and what is being charged, as well as empowering statutory consultees to withdraw their services when fees or charges have not been paid. The Secretary of State will also reserve the right to make regulations to manage any impacts on applicants—for instance, in relation to SME developers and householders. As this government amendment is being brought before the House today, I gratefully request that the noble Baroness, Lady Parminter, on behalf of the noble Baroness, Lady Young of Old Scone, does not press her amendment. The noble Baroness, Lady Parminter, brought up the issue of ambiguity. We have been engaging with colleagues across His Majesty’s Government. While we are satisfied that this does not inhibit applicants paying for advice provided on planning performance agreements, we would like to avoid ambiguity, so I am happy to take this into further consideration. Perhaps she could let the noble Baroness, Lady Young, know that.
On government Amendment 285C, statutory consultees play an important role in the planning application process, providing expert advice to local planning authorities and applicants on technical matters such as flood risk, biodiversity, heritage and highways safety. Going forward, they will continue to play an important role through our planning reforms. These bodies are pivotal in shaping development proposals, but such organisations face growing financial and resourcing pressures which will become more acute as the volume and complexity of projects increases.
Our estimates indicate that the main national statutory consultees currently deal with around 50,000 applications per year, many of which involve substantive engagement with the applicant to address the issues. We estimate that this overall service costs around £60 million per year. This does not include the thousands of applications dealt with by locally based but equally important statutory consultees such as local highways authorities and lead local flood authorities.
In the other House we moved a clause to introduce statutory consultee cost recovery within the nationally significant infrastructure project regime, and today I propose a similar measure to allow cost recovery on activities relating to applications under the planning Acts. This power will allow prescribed bodies named in regulations to charge fees for providing advice or information in connection with applications or proposals under the “planning Acts” as defined in Section 336 of the Town and Country Planning Act 1990. This includes activity related to planning applications under that Act, as well as applications for listed building consent and hazardous substances consent. This will cover substantive engagement throughout the process—from pre-app discussions all the way through to the discharge of conditions and reserved matters—between the statutory consultee and the applicants.
The Government recognise that many local planning authorities, as well as the wider planning sector, are facing capacity and capability challenges. That is why this power ensures that those who benefit from the advice foot the bill for it, so the cost of the advice will not be passed on to the decision-maker. In addition, elsewhere in the Bill we are taking powers to speed up the planning system, and we also want to ensure that smaller-scale applicants are not priced out. That is why we are taking powers to make regulations which exclude certain advice, assistance or information from charging. This should allow us to create a system which does not create additional barriers to SME developers and householders.
This measure will enable the establishment of a system that allows key statutory consultees to recover costs for the planning advice they give to applicants on a wide range of applications and related activities. I hope that noble Lords see how important this is to enable more effective and self-sufficient statutory consultees within the planning application process, and that they will support this important amendment.
Lord Shipley Portrait Lord Shipley (LD)
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May I ask the Minister to clarify one issue? I have listened very carefully to this debate but there is an issue that I have not fully understood. I heard her say that prescribed bodies will be able to secure cost recovery, but she has not said that local planning authorities will be able to recover their costs. She said that there could be an increase in the fees they are allowed to charge following the consultation, but that is not the same thing as permitting cost recovery; indeed, a lack, as yet, of a definition of cost underpins this whole debate. To my way of thinking, there is the immediate cost of administering and managing a planning application, with all the costs that may apply to that application. However, there is also the cost that a local planning authority might have in terms of the provision of IT services to the planning system, web services, office costs, heating, lighting, and so on—essentially, the overhead cost. As the Minister is going to think about all these issues, I hope very much to hear that the Government will consider full cost recovery for local planning authorities. However, as I say, I have not yet heard that during this debate.

Lord Young of Cookham Portrait Lord Young of Cookham (Con)
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My Lords, I am grateful to everyone who has taken part in this debate. There have been a lot of Youngs involved, and I will try to respond on behalf of both of them. Let me say straightaway that I very much welcome the government amendment, and I am sure that, in her absence, the noble Baroness, Lady Young of Old Scone, would also do so.

On the rest of it, I had hoped that, with this group of amendments, we might have found a chink in the Government’s armour that has been deployed throughout our debates. I am disappointed that we have not been able to make progress, and I know that the Local Government Association will also be disappointed.

I am grateful to all those who took part. The noble Baroness, Lady Pinnock, made the valid point that the flat rate prescribed by the Government simply does not reflect the costs to a local authority of a complex planning application that spans a number of years; that point was not adequately dealt with.

I was most concerned to hear what my noble friend Lord Moylan said about developers offering to second to an overstretched planning department a planner who might assist them. That is rather like me saying to Test Valley Borough Council, “I understand your electoral department is under some pressure; I would like to second a returning officer to the forthcoming election”.

Lord Moylan Portrait Lord Moylan (Con)
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If my noble friend will allow me to say so, I did not suggest that they were offering to second somebody but to fund a planning officer who would be recruited from the pool of available planning officers.

Lord Young of Cookham Portrait Lord Young of Cookham (Con)
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I am grateful to my noble friend. None the less, the principle that he ended his speech with is still valid: a local authority should not be dependent on the good will of a developer to process that developer’s planning application. That goes against most of the codes of independence for local government.

In response to my amendment, my noble friend the Minister said that she could not accept it because of the uncertainty that might confront developers and the costs might be too high. But the charge under my amendment could only reflect the costs. A local authority could not charge a fee as a deterrent if it was not substantiated by the underlying cost.

As for uncertainty, what developers, housebuilders and any planning applicant want is for their application to be processed promptly and efficiently by a well-resourced planning department. That is their priority. I do not think that uncertainty about future fees comes into it, or it is right down their list of priorities.

Also, I do not see how this central control of planning fees sits with the whole language of the Bill, which is about empowering local authorities and giving them more autonomy to reflect local needs. It appears that, despite all that, we cannot trust them to set planning fees. I think the Government’s stance on this group of amendments sits uneasily with their whole philosophy, but, while I reflect on what to do next, I beg leave to withdraw the amendment.

Amendment 267 withdrawn.
Amendments 268 to 270 not moved.
Lord Geddes Portrait The Deputy Chairman of Committees (Lord Geddes) (Con)
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My Lords, as Amendment 270 has not been moved, I cannot call Amendments 270A or 270B, as they were amendments to the said Amendment 270.

Amendments 271 to 273 not moved.
Lord Geddes Portrait The Deputy Chairman of Committees (Lord Geddes) (Con)
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My Lords, as Amendment 273 has not been moved, Amendment 273A cannot be moved, as it was an amendment to it.

Amendment 274
Moved by
274: After Clause 106, insert the following new Clause—
“Building Safety Remediation Scheme(1) Planning permission must not be granted to any developer or associate responsible for the construction or sale of units in a building with a building safety risk until the Secretary of State has established a Building Safety Remediation Scheme. (2) Schedule (Building Safety Remediation Scheme) makes further provision for the establishment of a Building Safety Remediation Scheme.(3) This section comes into force six months after Royal Assent.(4) “Associate” has the meaning given in section 121 of the Building Safety Act 2022.”Member's explanatory statement
This clause inserts a new Schedule to implement a building safety remediation scheme to ensure that buildings with building safety risks are put right without costs to leaseholders.
Earl of Lytton Portrait The Earl of Lytton (CB)
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My Lords, in moving Amendment 274, I will speak also to Amendment 318 in my name and that of the right reverend Prelate the Bishop of Chelmsford. In doing so, I draw your Lordships’ attention to my professional interests.

I have two other amendments in this group: Amendments 320 and 325. They are on a related issue but, given the detail that I need to provide in relation to Amendments 274 and 318, I will do no more than signify my firm support for them and leave the heavy lifting on them to my co-signatory, the noble Lord, Lord Young of Cookham; I thank him very much for agreeing to do that.

While I am talking about the other amendments in this group, let me say that I agree that Amendment 504GJD in the name of the noble Baroness, Lady Hayman of Ullock, is certainly worthy of consideration in terms of providing better passive fire safety measures.

I turn to Amendments 274 and 318. I express my thanks to the Bill team for their engagement; to campaign groups across the country for maintaining awareness of the issues; and to the members of the policy team who have supported me. There are too many of them to name but they know who they are and I am very grateful to them. Most of all, I am grateful to the more than 200 individuals and leaseholder residents’ groups who have written to me over the past four weeks both to support me and to tell me about the tragedies and individual concerns that have beset their lives. It is particularly to give them a voice that I raise this issue today.

Amendments 274 and 318 concern, I believe, matters of great social and economic importance. Despite the Government’s measures in the Building Safety Act 2022, far too many leaseholders remain adversely and significantly affected by serious defects in the original construction of the buildings that they occupy or own. Although the BSA was a significant first step in solving the building safety crisis, it leaves significant numbers of leaseholders without adequate protection from, variously, cladding and non-cladding costs, and much of it is based on extra-statutory commitments of one sort or another. So we have a situation where enfranchised leaseholders and buy-to-let owners with more than three properties are excluded, while residents living in buildings below 11 metres in height receive no protection from non-cladding costs at all.

Correspondents tell me that the Government’s remediation scheme is not working for them and that there is confusion about the process, qualifying interests and building height calculation, with gridlock until all the complex arrangements are in place. The most frequent comment is that owners are still locked into unsaleable properties with waking watch and massive insurance costs, as well as high remediation bills in prospect without any early or firm date for resolution. I now learn that many conveyancers may even be reluctant to take on work involving buildings over 11 metres high because of the complexity and professional risks that face them.

I welcome the announcement that many of the country’s largest developers have committed to remediating buildings that they were responsible for, but I am concerned that their contractual obligations are limited to life-critical fire safety defects, rather than the wider definitions in the Building Safety Act. Furthermore, the developer contract apparently covers only around 10% to 15% of buildings that require remediation and appears to absolve developers of responsibility for those waking watch and other consequential costs.

Statutory liability for remediation itself is placed on landlords but without consideration of whether they have the resources to deal with this issue and are able to cover the costs. The DLUHC impact assessment admits that it has no cost estimates when it states:

“For buildings above 11 metres that have historical non-cladding fire safety defects, there is no reliable data”—

not even estimates—

“on the prevalence, or extent, of these costs”.

However, an Association of Residential Managing Agents survey suggests that the non-cladding remediation costs in buildings above 18 metres are, on average, £25,671 per flat and, in buildings below 18 metres, £38,184 per flat. There appears to be no data on the sub-11-metre block remediation issues. We do not know how many we are dealing with. By my reckoning, more than 200,000 individual flats are significantly affected in England alone. Others have arrived at higher totals. So my first question for the Minister is: will she be kind enough to tell us what figure her department is working to?

Some landlords have the resources to meet these remediation obligations but it is not universal. Several large groups are in fact thinly capitalised or have significant indebtedness. For example, the three groups that comprise what is known as the Long Harbour fund appear to have relatively modest net assets, while the Consensus Business Group has significant borrowings from insurer Rothesay Life. They are unlikely to have the free cash to fund remediation works as well as servicing their bondholders and lenders if the incidence of defects and the average remediation costs, to which I have referred, are totted up.

As noble Lords will know, freeholds are typically valued by capitalising the sum of the net ground rents. In value terms, however, they are small by comparison with the collective of leaseholds. High remediation liabilities may make them worse than valueless. So if landlords’ interests are negative and they become insolvent—bear in mind that some of them are dealt with through special purpose vehicles—these freeholds, with their negative value, are likely to be disclaimed by liquidators and escheat to the Crown, with all the delays and uncertainty that that entails. I foresee a legal limbo with unsaleable flats; although this would be unprecedented at scale, it is far from improbable, yet nobody in DLUHC admits to having done the calculations to assess the impact.

My fear is that the Government’s approach creates new credit risks for lenders, particularly in relation to buy-to-let portfolios. If excluded leaseholders are unable to pay their share of the remediation costs, schemes of remediation risk simply being stalled. In such circumstances, leases could be forfeited, widening out their lender security unless extra capital is given. Such a forfeiture would providentially give landlords a windfall gain. Historically, few leases have been forfeited because rebalancing the mortgage has been the preferred course of action. However, it is one thing to have a debt of a few thousand pounds on a service charge in arrears; it is another thing to have the much more costly and complicated scenario of remediation costs, which may run into tens of thousands of pounds. I do not believe that historical forfeiture data gives an accurate picture of the new scenario going forward. Credit risk and mortgage interest recalibration are likely to have impacts on the wider financial system and, in turn, effects on other derivatives and insurance policies. I believe that this is something that has some way yet to unravel.

This is not only about the free market; it is about the social sector as well. Many shared equity owners have told me that, although they have a minority equity stake, they are being made responsible for a 100% share of the remediation applicable to their unit of occupation. That seems grossly unfair. Amendments 274 and 318 would avoid all this and provide for an alternative, comprehensive solution to the building safety crisis that protects all leaseholders from past and future issues.

Amendment 274 would mandate the Government to establish a building safety remediation scheme—BSRS. Amendment 318 would create a new schedule setting out guidance for its key features, all intended to dovetail with the principles of the existing building safety fund. The intention is to protect all leaseholders—indeed, all owners of buildings of whatever height and tenure—from the costs of remediating buildings that are unsafe in their construction and the interim safety measures in circumstances where they are entirely innocent of the causes of these defects.

Where a building constructed since 1992 did not comply with the regulations in force at the time, strict joint and several liability for remediation of all material building safety defects would be placed on a developer and principal contractor. If neither is able to pay, or if a building met the regulations that were in force at the time of construction but is now seen as unsafe, which can happen, remediation funding would come from a much wider levy on the construction industry and materials providers as a whole, rather than just developers, as is currently proposed by the Government. Once a significant effect is established, there is no need for property owners to apportion blame; the industry can sort that matter out for itself.

Remediation will be carried out to standards under the BSA to avoid concerns about remediators effectively policing themselves and, worse, using their own selected approved inspectors. These may be the same firms that previously signed off things that they should not have.

Noble Lords will excuse me for not explaining Amendment 318 line by line given its length, but I seek brevity. Anyone wanting further detail can go to a resource at The approach has been scrutinised by a leading construction counsel, a planning KC, parliamentary counsel and other legal minds, as well as by building control, construction and fire safety practitioners. I am extremely grateful to them all for their input. It has attracted support from Ted Baillieu, former state premier of Victoria, Australia, and co-chair of the Australian cladding task force. This matter is attracting international interest around where we go with these sorts of defects. It has also attracted the interest and support of other organisations, including the Association of Mortgage Intermediaries, ARMA, the British Property Federation, the Intermediary Mortgage Lenders Association, NAEA Propertymark, the National Residential Landlords Association, and many others.

Developers should have been the first stop in the Government’s waterfall principle that we discussed just over a year ago. The BSRS bolts on to the existing government commitment, gives leaseholders and lenders more certainty of remediation, and puts them in a greater degree of control. However, it does not just deal with the present crisis. It covers similar situations in the future, and will, I believe, make short-cutting in building standards unworthwhile going forward. We all know that the race to the bottom on quality must cease. The BSRS provides a necessary layer of protection, especially as the Building Safety Act specifically excludes enfranchised leaseholders and commonhold unit owners from all its protections.

The Government do not have the money to solve the problem and are, at present, as I see it, unprepared to place the responsibility on the construction industry that has created this situation over decades of marking its own homework. I believe that the proposals I am advancing would deal with this. Echoing what one commentator said to me last week, if we do not get this right then the taxpayer could end up meeting the entire cost and we will go on building homes badly. We cannot allow that to happen.

All that apart, this is a fundamental matter of justice and equity. It is about protecting the innocent and vulnerable from the cost of failures by profitable enterprises—businesses that would be held liable for their actions in any other mercantile circumstances that one might conceive of. Indeed, the most basic function of government should be the protection of the citizen and society. Meanwhile, my mailbox continues to be filled with tales of individual tragedy, lives on hold, unsellable property, finances in disarray, fear of imminent bankruptcy, careers and retirements wrecked, mental health threatened, weddings shelved, the starting of families put off, forced evacuations—25 blocks is the tally since 2017—and much more misery besides. This crisis is not over until everyone is protected. I beg to move.

Lord Young of Cookham Portrait Lord Young of Cookham (Con)
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My Lords, I am grateful to the noble Earl, Lord Lytton, for introducing this group of amendments, for setting the scene for this important debate on building safety, and for putting forward his own solution. I will try to respond to his exhortation to do some heavy lifting.

The question underlying this debate is simple. Have the Government done enough to tackle the problems arising from the Grenfell tragedy or do we need to build on the Building Safety Act 2022 in the light of experience to address unresolved issues? I will argue that further action is essential.

I begin by recognising the progress that has been made by the Government. Some leaseholders have been given legal protection under the Act. Most developers who have been asked have agreed to pay up—well done to the Secretary of State—and the major lenders have agreed in principle to offer mortgages on blocks of flats with safety issues, although this does not seem to be reflected in practice. Good progress is being made with high-rise blocks that are owned by local authorities and housing associations. I know that my noble friend and her predecessor are sympathetic to those who have been in touch with them to discuss the issues that remain.

However, there is still a mountain to climb. A recent survey by the End our Cladding Scandal campaign in last month’s Inside Housing magazine found that

“only 21.8% of leaseholders in dangerous blocks have seen remediation work start. For 44.1%, a date has not even been identified for work to begin … and only around 10% expect them to do so within the next 12 months”.

As the noble Earl, Lord Lytton, has just said, hundreds of thousands of leaseholders face an indeterminate wait for complex remediation, and they cannot move in the meantime.

On top of the estimated 3,500 high-rise buildings which need remediation there are between 6,000 and 9,000 medium-rise buildings which need life-critical safety work. While 43 of the UK’s largest developers have signed up, this covers only about 1,000 blocks. What about the rest of them? Some 90% are reliant on support from the building safety fund, which is slow to release funding, or from leaseholder contributions or from freeholders. The Government’s funding stream for medium-rise blocks is not yet open for bids, but when it is it will cover only cladding removal, despite these buildings having other problems and serious compartmentation defects which need to be fixed. Non-cladding works can push costs up to £100,000 per flat.

The Government’s response, if there is no developer to sue, is to charge the building owner, if the building owner has a stake in the building worth £2 million. However, this involves a complex remediation order under the Act. Can my noble friend say how many have been secured? Initial hearings for a remediation order for blocks in Queen Elizabeth Olympic Park were adjourned in February and are unlikely to commence this year. It is a long and legally complex process. Those who then enforce the process—the fire authorities and the local authorities—must at times deal with intransigent developers, who then challenge the assessment of what work is necessary, building in further delay and cost. Some large freeholders are claiming to have net assets of less than £2 million per building, as the noble Earl, Lord Lytton, said, or that they are not part of a wider group, meaning that they are not liable under the so-called waterfall provisions. We have seen the unedifying dispute with the well-resourced railway pension fund.

Furthermore, even if you get a remediation order, freeholders are liable only for the costs of qualifying leaseholders. Again, as the noble Earl, Lord Lytton, pointed out, if the non-qualifying leaseholders—the buy-to-let landlords—cannot afford their contribution then remediation of the block simply will not go ahead, and you have deadlock. If the freeholder does not have the funds to pay, the leaseholders must pay up to the cap, which is £15,000 in London, with the balance coming from a yet to be determined government pot; work will not start until this is established.

The position is even worse for those in blocks under 11 metres, whom I and others tried unsuccessfully to protect last year when the Bill went through. They are non-qualifying leaseholders and so have no protection and face uncapped bills. The Government have said these should not need work, as blocks below 11 metres are, in their words, on the whole safe, but the guidance that has been issued says otherwise. At least one building under 11 metres, in Romford, has identical cladding to that at Grenfell Tower—the primary cause of the rapid fire spread. An assessment under PAS 9980, which is the UK national standard, unsurprisingly reached the conclusion that the cladding should be removed. The developers have no liability for work under the Act or indeed under the remediation contract with the Secretary of State, so no help is available to the leaseholders. That is simply indefensible.

In several cases, insurers are insisting on work on buildings under 11 metres going ahead or they will withdraw insurance cover. That leaves the owner with no choice at all. They are actually excluded from the duty to pursue alternative routes for funding; they simply pass the costs on to leaseholders. Against that background, the fire at Richmond House—below 11 metres—burned it to the ground in less than 11 minutes.

Here is quote from a letter from a leaseholder in one such building:

“I am a leaseholder in a building well under 11 metres. We are three storeys high with 10 flats. We are therefore excluded from any support from the Government, yet our freeholder/managing agent is taking us to court on Friday to ask them to agree to us having to pay for the cost of remediation—a £26,000 service charge in 2022 per leaseholder. We are told the freeholder does not have the means or obligation to pay for these works that we need to reduce the annual insurance premium. We are told that the only way to pay for these works is via the leaseholder and that we will be legally responsible to fund the money and pay it upfront so that the management agent has the means to pay for works.”

There are also reports of other leaseholders in buildings under 11 metres being forced to pay for remediation as a condition of continued insurance cover.

Last year, I was promised a case-by-case review of these blocks, but the evidence presented to the Select Committee in another place on 13 February this year said:

“We have not seen any progress with the case-by-case review in respect of under 11 metre buildings”.

The position for leaseholders in blocks of flats who have followed the policy of successive Governments and enfranchised by buying the freehold is also indefensible. Despite repeated commitments given to me by the Minister at the time that they would be treated as leaseholders and would therefore be entitled to protection under the Act, the Bill treats them as freeholders and penalises them for enfranchisement. This is what I was told in Grand Committee by the then Minister:

“They are effectively leaseholders that have enfranchised as opposed to freeholders. I hope that helps”. [Official Report, 28/2/22; col. GC 262.]

My amendment to deliver that commitment on Report was resisted, and enfranchised leaseholders remain outside the protection available to other leaseholders.

There is an enfranchised block in Manchester with serious non-cladding defects, and there was a fire in a flat there last year. The enfranchised company, which is actually the leaseholder, is required by law to resolve these as soon as possible. Government policy is that blocks should enfranchise, but those who do are excluded from protection.

Looking at the picture as a whole, three years on from funding being made available, only 28 eligible buildings had been signed off by the Building Safety Fund by the end of last month, out of a potential 3,500 or so buildings eligible for support. In the meantime, most leaseholders are still unable to sell and move on with their lives. Despite six high-street lenders announcing in January that they would offer mortgages on flats with issues as long as the leaseholder protections were in place, this is just not happening on the ground. In the meantime, insurance costs have soared and service charges have escalated.

Freeholders and managing agents are refusing to withdraw service charges for items such as waking watches in buildings covered by the Act, but which were issued before the Act came into force. They also rushed to issue fresh demands on leaseholders before the Schedule 8 protection came into effect on 28 June last year. Leaseholders incurred the substantial costs of waking watches and increased insurance before the Act was implemented, but clause 6 of the final contract with developers excludes this. If money is to be recovered, the leaseholders have to litigate.

There are also early reports—the noble Earl, Lord Lytton, may have touched on this—of conveyancers saying they will no longer accept instructions to work on sales of leasehold flats in buildings of any height. That is because certain lenders—I have heard Nationwide mentioned—are imposing requirements on them to check the statements made in landlord and leaseholder certificates, which they are unable to do.

The original proposal of the Select Committee in another place was that there should be a comprehensive building safety fund, fully funded by government and industry, and the Government should establish clear principles regarding how the costs should be split between the two. Where we are sits uneasily with commitments given by Ministers last year. Last year, Michael Gove said:

“leaseholders are shouldering a desperately unfair burden. They are blameless, and it is morally wrong that they should be the ones asked to pay the price. I am clear about who should pay the price for remedying failures. It should be the industries that profited, as they caused the problem, and those who have continued to profit, as they make it worse”. [Official Report, Commons, 10/1/22; cols. 283-84.]

The then Minister wrote to noble Lords on 20 January last year, when the Building Safety Bill arrived in your Lordships’ House. Under the section headed “Protecting Leaseholders from Unnecessary Costs”, he said:

“The Secretary of State recently announced that leaseholders living in their homes should be protected from the costs of remediating historic building safety defects”.

Then there was the Statement on building safety made in the other place by the Secretary of State on 10 January last year:

“First, we will make sure that we provide leaseholders with statutory protection—that is what we aim to do and we will work with colleagues across the House to ensure that that statutory protection extends to all the work required to make buildings safe”. [Official Report, Commons, 10/1/22; col. 291.]

As I have tried to show, where we are falls well short of the commitments given, but it is not too late for the Government to act. My amendment is a peg on which to hang the debate. I end with the two questions I started with. Are the Government satisfied with the current position? If not, what do they propose to do about it? I know my noble friend is sympathetic to the case I have made. I know that many leaseholders are watching this debate and hoping for a positive reply.

Lord Bishop of Guildford Portrait The Lord Bishop of Guildford
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My Lords, for six years in the early 90s I was a priest in Notting Hill, in the Royal Borough of Kensington and Chelsea, and had never lived in a place where the vision of levelling up was quite so necessary and quite so localised. The very wealthy were often living cheek by jowl with the very poor, and meanwhile, on looking north from one of our churches was the unmistakeable sight of a brutalist 24-floor block of flats on Grenfell Road, which 25 years later was to become the scene of an unspeakable, though sadly not quite unimaginable, tragedy.

Making buildings safe for leaseholders has since become a priority for the Government, which is to be welcomed. As the noble Lord indicated, this support remains both limited and partial, creating a new distinction between the haves and have-nots of leaseholding when it comes to the most basic of principles: that the homes in which we live, work and raise our families should be safe. I happened to meet one of those have-not leaseholders this morning, for whom insuring his flat, let alone selling it, has become virtually impossible.

My friend Graham Tomlin, the Bishop of Kensington during the unfolding of those terrible events in June 2017, has written movingly in this regard. He speaks of how a “pattern of moral compromise” had become embedded in parts of the construction industry, as revealed by the public inquiry into the Grenfell tragedy. He goes on to suggest a firming up of the responsibility of developers to make good their work, along the lines of the amendments of the noble Earl, Lord Lytton. His insights have been fed into the second of the five basic principles of the Archbishops’ housing commission: that

“Good housing should be sustainable, safe, stable, sociable and satisfying”.

One of the very few cases I still vividly remember from my original legal training is the landmark decision in Donoghue v Stevenson in 1932, which involved a Mrs May Donoghue discovering a decomposed snail at the bottom of her bottle of ginger beer, and a Mr David Stevenson, the owner of the ginger beer company. This famous snail resulted in a bout of gastroenteritis for Mrs Donoghue and a rather hefty fine for Mr Stevenson, while simultaneously forming the surprising basis of our modern law of negligence, and of a duty of care which does not depend on a direct contractual relationship between the parties involved. So how odd and morally indefensible it is, more than 90 years on, that the construction industry has been able to allow metaphorical snails to slide into its ginger beer bottles: to be negligent, bordering on reckless, when it comes to basic principles of safety, without a straightforward system of remediation which places responsibility where it patently lies.

The noble Earl’s amendments seem both right and practicable in that regard, given the idea of a levy to the remediation fund, which helps to answer concerns about affordability. Developing new confidence in the construction industry and driving up its standards will also help to protect the long-term reputation of the industry itself, which can be only a win-win for all concerned, or at least for all committed to the vision of good housing rather than a race to the bottom. I therefore support the noble Earl’s amendments and the principles behind them in this crucial area of our national life.

Baroness Fox of Buckley Portrait Baroness Fox of Buckley (Non-Afl)
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My Lords, I thank the noble Earl, Lord Lytton, and the noble Lord, Lord Young, for explaining so very comprehensively what the issues are. The key question is whether the Government have done enough. I do not intend to go into all the detail but I have a couple of observations and a query, because I really do not know how to solve this crisis and I need to be convinced that what is being put forward is the solution.

One thing that has been very important is that so many categories of leaseholders were left out of previous arrangements. That has caused immense pain, hardship, a sense of unfairness and so on, as has been described. As we have heard, in the popular imagination this is all about solving the cladding crisis, but actually it goes far beyond cladding and covers a wide range of remediation work. Also, we have ended up in a ridiculous situation of people in the wrong size blocks of flats still having to pay but not being covered by protection and legislation.

I really appreciate all these different difficult dilemmas, and like everybody I had hoped that the work that had been done in the building safety legislation that many of us were involved in would be a great source of relief and excitement for leaseholders. It has not been. People are still absolutely in a very bad situation. The Government have to know that because I know they want to help. Therefore, we should consider our options.

These are my slight concerns. A lot of the problems that leaseholders face are based on the way that people are reacting to remediation work that will need to be done because of the building safety legislation that we passed. There is an atmosphere of risk aversion that means you cannot sell a leasehold flat now because of all the reasons that have been given. The lenders say, “Well, it’s leasehold; there may be future remediation work to be done”, and so on. It has become an absolute nightmare. It seems ridiculous, in the middle of a housing crisis, that people are unable to sell their flats, not because they are too expensive but because they cannot proceed. There is a kind of glut in the flat market at the moment: people cannot move on but people also cannot buy the flats that they urgently need to live in.

My concern is to make sure that we do not always describe this through the issue of critical safety work. Even during the building safety discussions, I was concerned that we would become too risk averse—that the whole process of building and construction would be so mired in fear of what might happen and the idea that fires would burst out at any moment that it would become impossible to build anything with the stipulations that were put forward. With the broader problem of housing supply and the housing crisis, I am terrified that we will end up with nobody building anything anymore because there will be too many risks in doing so because of the legislation that we have brought in. That is one problem.

The other thing that I am concerned about in relation to the polluter pays issue is that we might end up destroying the construction industry. I am more than aware of the fact that there are problems with parts of the construction industry. I do not doubt that there are what used to be described as cowboy builders and so on. I see serious problems when I look at all the work being done by the leaseholder groups to expose the terrible circumstances where people are living in flats that are not fit for purpose. I am not suggesting in any way that those things are not true but I am also very wary of demonising the construction industry and effectively destroying it at the very time when I want it to be hyperactively building houses all over the place to solve the problems of homelessness, the fact that people have nowhere to live, the affordability crisis and so on. Maybe the noble Lords could just answer how we deal with that.

So that we do not focus just on the construction industry as though it is solely the bad guys, I say that I am very frustrated about the fact that the banks are embroiled in holding things up. They will not lend to people who want to buy leasehold properties. That is a real problem; is it something we need to look at? As has already been discussed, and I have raised in past contributions, the role of the insurance industry has also been hugely problematic, with the cost of insurance. That all trickles down and the leaseholders end up being the people who suffer. As I said, I am very nervous about making our focus just on the construction industry.

The thing about the polluter pays model that I am concerned about is who gets labelled as the polluter. I have just walked past the demonstration in which the polluter in that instance apparently is the fossil fuel industry, the energy industry, or people who create cars. Those demonstrators say that the polluter should pay for all the problems in society. I am wary that this is oversimplistic as a solution. However, I say to the Government and to the Minister that saying that the status quo ante is sufficient is a betrayal of the promises that they, and in fact many of us, made to leaseholders last year.

Baroness Hayman of Ullock Portrait Baroness Hayman of Ullock (Lab)
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My Lords, I have an amendment in this group that I shall speak to, but I will first make a few comments about the amendments in the name of the noble Earl, Lord Lytton. I thank him for his extremely detailed and thorough introduction to what is a very complicated issue.

As we have heard, the noble Earl proposed similar amendments to the then Building Safety Bill, which the Government rejected in favour of Schedule 8 and the other leaseholder protections that were eventually included in the Act. I commend him for his continued efforts in the work he does to support leaseholders, and the noble Lord, Lord Young. They have been absolutely unassailable in not wanting to give up on this.

I am sure that the Minister will repeat some of the reasons given during the passage of the Building Safety Bill as to why the Government are unable to accept these amendments in this legislation. My recollection of the reasons given is that the amendments would require a sizeable bureaucracy to be set up to deal with the thousands of buildings that would potentially be caught, and concerns about litigation risk. However, the noble Earl, Lord Lytton, is absolutely right to press that something should be done for buildings that are under 11 metres and resident-owned buildings. As was said during the passage of the Building Safety Bill, part of the problem is the number of buildings. Something has to be done to help all these people. During the passage of that Bill, the Government promised that something would be done. The noble Lord, Lord Young, quoted from the debate on the building safety Statement the Government’s continued promises to help those leaseholders who have still been left out, but this has not been done.

If the Government are going to push back again on this issue, when are they actually going to address this, as they have has previously promised to do? As the noble Earl, Lord Lytton, said, there are still significant numbers of leaseholders unprotected from often huge costs, and the situation is not resolved until everybody has proper protection. The noble Lord, Lord Young, asked the very pertinent question, “Have the Government done enough?”—and then I think he answered his question, and the answer was no. The Government need to fulfil the promise made during the passage of that Bill and look at how that issue can be resolved.

It has been said that building safety remediation is very complicated. But it is not complicated at all and is actually something the Government could do very quickly and easily to improve the safety of buildings in multiple occupancy. My Amendment 504GJD states:

“Within 60 days of the passing of this Act, a Minister of the Crown must make a statement to each House of Parliament outlining their position on whether building regulations should require the installation of more than one staircase in large multiple-occupancy residential buildings for the purposes of fire safety”.

This has been a concern for some time, and Grenfell made issues of fire safety even more important. But the reason I want to bring this up is because the National Fire Chiefs Council has argued that second staircases should be mandatory in blocks above 18 metres in height. It states:

“In the event of a fire, a correctly designed second staircase removes the risk of a single point of failure, buying critical time for firefighting activities, and providing residents with multiple escape routes”.

It points to London Fire Brigade figures which show that from

“1 April 2019 to 31 March 2022 … 8,500 residents chose to evacuate buildings rather than stay put”.

We are really pleased that the Department for Levelling-up, Housing and Communities has been carrying out a consultation to mandate second staircases in new residential buildings above 13 metres. The consultation paper states that

“the provision of a second staircase can provide some benefits for very tall residential buildings such as added resilience for extreme events and reduced conflicts between emergency responders entering a building and those trying to escape, reducing the risk of the smoke ingress into an ‘escape’ stairwell”.

It also states that a second staircase would provide a second means of escape if one route were filled with smoke.

We welcome the fact that the department has been carrying out this consultation. It closed very recently. I would be very pleased if the Minister could give some update on when we are likely to hear the outcome and the Government’s response to the consultation, but, in the meantime, if she were inclined to accept our amendment, it would help progress.

Lord Cromwell Portrait Lord Cromwell (CB)
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My Lords, I apologise to the Committee for not speaking in previous stages of the Bill: commitments elsewhere made it impossible. I shall speak briefly in support of Amendments 274 and 318 from the noble Earl, Lord Lytton. Reading the email circulated, citing powerful support for these amendments from expert commentators, government figures, individual leaseholders and associations from across the whole world, not just the UK, the rest of us can only look on in envy at the level of support that he has generated for his amendments. I congratulate him and the noble Lord, Lord Young of Cookham, on championing this cause and on the powerful and detailed speeches which they gave us earlier, along with the right reverend Prelate.

The approach taken in these two amendments, which are founded on the polluter pays principle, make complete sense in putting right work that was in breach of building regulations at the time across a wider range of premises and a wider range of defects. I have some sympathy with the points raised by the noble Baroness, Lady Fox, about looking after the construction industry. The fact is that, in a way, the polluter pays principle does not quite work here because, if building works were not done in accordance with the building regulations, it is quite clear who is responsible, whereas you could argue more widely about, for example, a leak from an oil tanker being a pollution incident. But, fundamentally, what this comes down to is, if not these solutions, what do the Government propose? I look forward to hearing.

Baroness Pinnock Portrait Baroness Pinnock (LD)
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My Lords, the Grenfell fire tragedy of June 2017 has rightly ensured that many of us in this Chamber have put our minds to the outrageous way in which the construction industry failed to meet existing building safety regulations and how material manufacturers knowingly sold flammable cladding materials to be put on high-rise blocks of flats. That is not me saying that; the inquiry into the Grenfell fire said that.

We have over the past six years in this House tried two ways, so far, to address those issues, first through the Fire Safety Act and then through the longer, more detailed Building Safety Act. Right from the outset, I and others have said quite clearly that, whatever happens in putting right the wrongs of 20 years or more, the leaseholders are the innocent victims in this situation. They have done everything right in their lives and nothing wrong, and they should not be asked to pay a penny piece towards putting right the wrongs that have been done to them, which were concealed from them when they entered into a contract for their property.

We have, with the Government, tried hard to put this right. We have heard from the noble Earl, Lord Lytton, and the noble Lord, Lord Young of Cookham, who have been on this route march, as it seems, from the beginning, trying to find the answer to the question, “As the leaseholder must not pay, who must?” The noble Lord, Lord Young of Cookham, asked the right question—of course, he always does—which is, “Has the Government done enough?” Some of us, including him at the time, said we did not think so, and so it is proving.

Not only we in this Chamber but thousands of leaseholders are saying that the Government have not done enough. Not only is the construct in the Building Safety Act of the waterfall of responsibilities failing to ensure that remediation takes place promptly or at all, but, meanwhile, as we heard from the noble Earl, Lord Lytton, many leaseholders have awful tales to tell about anxiety caused, mental health that has broken down, financial burdens that cannot be met, ensuing bankruptcy and life chances blunted—and no responsibility of theirs.

Why would any of us involved in legislation allow thousands of our fellow country men and women to be put in this position, where they are being seriously adversely affected, in emotional, financial and social ways, and not do anything—or enough—about it? The noble Lord, Lord Young of Cookham, rightly said again that the Building Safety Act, despite our best efforts, excluded certain groups of leaseholders: those living in blocks under 11 metres, enfranchised leaseholders and, indeed, some buy-to-let leaseholders. That is clearly not acceptable, because those leaseholders are suffering immensely; the noble Lord, Lord Young of Cookham, gave a vivid example of that.

So the challenge to the Government and to the Minister, which I hope she will take up and respond to, is: what, then, can be done? The Government have tried to put in place a series of funding mechanisms and responsibilities, but that is clearly failing to help thousands upon thousands of leaseholders.

The Minister was unfortunately—or fortunately, for her—was not part of the long discussions on what became the Building Safety Act. We were promised at the time that leaseholders would not be expected to pay, but that is clearly not bearing out in practice. Therefore, I hope the Minister will go back to her department and ask those fundamental questions. The Government’s purpose, as expressed by the Secretary of State Michael Gove, was that it was morally reprehensible for leaseholders to pay. If that is the case, let us put that into practice and find a route through, so that no leaseholder pays anything. They have done nothing wrong and they should not be expected to pay.

In his proposed new schedule to the Bill, the noble Earl, Lord Lytton, has made a very detailed proposal about the polluter pays principle. I concur with the principle that those who cause the damage—the construction companies and the materials manufacturers—must pay. We have to find to find a way for that to work in practice. I am hoping that the Minister will come up with some answers.

Finally, the noble Baroness, Lady Hayman of Ullock, has once again raised the issue of second staircases in high-rise buildings and houses in multiple occupation, which we debated during the progress of what became the Fire Safety Act and also the Building Safety Act. Most of us said that, yes, that was the expert advice from the fire service chiefs and that is what we should do; but, unfortunately, that was not accepted by the Government.

I agree with the noble Baroness’s amendment, but I go back to the key to all this. My view—and that of all who have spoken, through all the outcomes that followed the Grenfell fire tragedy—is that, however the remediation of these buildings, of all heights, is resolved, when it comes to the leaseholders, whether enfranchised or unenfranchised, whatever happens, they must not pay. I look forward to the Minister’s response.

Baroness Scott of Bybrook Portrait Baroness Scott of Bybrook (Con)
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My Lords, in his Amendments 274, 318, 320 and 325, the noble Earl, Lord Lytton, returns us to subjects that we debated extensively this time last year in what was then the Building Safety Bill. I say to the noble Earl, with the greatest of respect, that this House and the other place considered his arguments carefully last year and rejected them. I really do not think that this Bill is an appropriate place to try to reopen these issues.

Last year, the Government opposed the noble Earl’s scheme and proposed an alternative, the leaseholder protection package, which was agreed by your Lordships and the other place. As your Lordships will be aware, the leaseholder protections in what is now the Building Safety Act 2022 have been in force since June 2022 and form part of the Government’s response to the need to fix defective buildings, alongside a number of other measures that my right honourable friend the Secretary of State set out recently in a Statement in the other place, which was repeated for your Lordships.

Those protections are complex. I would be very happy to have a meeting with interested Peers to discuss the Government’s actions in detail if that would be helpful. If any noble Lord would like to do that, they can get in touch with me or my office and we would be very happy to set that up. But, as I said, the protections are complex and it is true that it has taken time for the various professionals working in this space to get to grips with them. None the less, there is now progress on getting work done, getting mortgages issued on affected flats and moving the conversation forward with the insurance industry to ensure that remediation can be undertaken and that building insurance premiums, which had been excessively high, reflect this reduction in building risk.

I want to be clear with your Lordships: the leaseholder protections are working. The first remediation contribution order to get money back for leaseholders has been made by the tribunal and is being enforced now. In response to my noble friend Lord Young of Cookham, I can say that there have been a further 12 applications for remediation orders to the First-tier Tribunal and nine for contribution orders; that is up to the end of December—we do not have any further updated figures.

The Government’s recovery strategy unit is litigating against large freeholders, and leaseholders have the peace of mind that the remediation bills they were facing—sometimes for more than the value of their home—are no more. I emphasise to your Lordships that changing the basis on which leaseholders are protected would set back by months the progress of remediation work, which is finally happening at pace, and would create further uncertainty in the market.

In addition to the inevitable delay to remediation that would be caused if the noble Earl’s proposals were adopted, I must emphasise that the objections set out by my noble friend Lord Greenhalgh, when he spoke from this Dispatch Box last year, are still relevant. The building-by-building assessment process that he proposes would be both costly and time-consuming, which would not be in anyone’s interest.

While the noble Earl says that his scheme seeks to avoid litigation, our experience shows that the level of complexity and the sums at stake in this field mean that litigation is inevitable—and will necessarily take place in the High Court, rather than the expert tribunal already dealing with disputes under the leaseholder protections, increasing costs and the time taken to resolve cases. I should also make it clear that the Government’s package of measures in this space goes much further than the leaseholder protections set out in the Building Safety Act.

At this point, I would like to answer a few questions. Both my noble friend Lord Young and the noble Earl, Lord Lytton, brought up the point of “under 11 metres”, which I know has been an issue raised. I think I have said many times at this Dispatch Box that the views of the independent experts are clear: there is no systematic risk in buildings under 11 metres. However, we continue to look at these on a case-by-case basis and provide any help to those leaseholders accordingly. If my noble friend Lord Young of Cookham would like to let me have the letter that was sent to him, I would be happy for the team to look at it.

There are other non-qualifying leaseholders, as we have heard, who are not protected under the Government’s scheme. The protections were always intended to protect people from the cost of fixing their homes. They spread the cost among the various parties who have invested in property—be that developers, freeholders or commercial leaseholders—on the basis that all investments carry a degree of risk.
The leaseholder protections already provide a number of protections for those leaseholders who do not qualify for full protection. First, where landlords are, or are connected with, the developer, all leaseholders are fully protected. In other buildings, where some leaseholders are qualifying, the non-qualifying leaseholders cannot have their share of the costs increased to meet a shortfall in funding. Non-qualifying leaseholders are able to seek a remediation contribution order from the tribunal against a developer, contractor et al in exactly the same way as qualifying leaseholders. In addition, where a developer has signed the developer remediation contract, they will fund all necessary remediation work, both cladding related and non-cladding related, irrespective of whether individual leases in those buildings are qualifying under the protections or not.
My noble friend Lord Young of Cookham asked whether the Government have sufficient funds to pay for remediation. The purpose of the building safety levy is to raise funds to cover the cost of the remediation of historic building safety defects. The Bill was amended to expand the scope of the levy and raise the revenue required to fund essential remediation work, so there is enough money in the pot.
My noble friend is absolutely right about enfranchisement. We have been out to consultation. We are now considering the responses on enfranchised buildings and will bring forward proposals in due course.
The noble Baronesses, Lady Hayman of Ullock and Lady Pinnock, asked when the Government will resolve the issues of protecting leaseholders. We are carefully monitoring the operation of the leaseholder protections. If any changes are necessary, we will bring forward appropriate guidance or legislation to make those changes as soon as possible. We have a recovery strategy unit that is taking forward litigation against large property owners to ensure that they meet their responsibilities. So we have not forgotten them; we are continuing to monitor the issue and will make changes as required.
So far, so good. I shall now address Amendments 274 and 318 in detail. The amendments call for the creation of a building safety remediation scheme with powers to halt development through the planning system. I point out that the Building Safety Act already enables the Government to do that. Using powers provided by the Act, the Government intend very soon to lay regulations to establish and implement a responsible actors scheme and, subject to parliamentary approval, the regulations are expected to come into force in early summer 2023. To join the scheme, eligible developers will have to enter into, and comply with the terms of, the developer remediation contract. As of today, 46 developers have signed the developer remediation contract, including all the top 10 housebuilders.
The developers that sign the contract are contractually obliged to fix life-critical fire safety issues in all residential buildings over 11 metres in height that they had a role in developing or refurbishing in England in the last 30 years. The scheme will recognise the positive action of responsible developers. Eligible developers that do not enter into and comply with the terms of the developer remediation contract and join the scheme will be prohibited from carrying out major developments and gaining building control sign-off.
The scheme is an important step towards resolving the cladding crisis and is an important part of the overall strategy to protect leaseholders from bearing costs unfairly, while making sure that industry contributes to the cost of putting right historic building safety defects. Where developers or building owners do not take responsibility for cladding remediation, the Government have committed £5.1 billion, including £4.5 billion for the building safety fund, to address life-critical fire safety risks associated with cladding in high-rise residential buildings of 18 metres and over in England.
Amendments 320 and 325 would mean that proceeds from the infrastructure levy could be used to support building remediation. Using powers under the Building Act 1984, the Government will lay before Parliament affirmative regulations to enable a new building safety levy to be imposed. The purpose of the building safety levy is to meet building safety expenditure. The building safety levy funds will be used to offset the costs incurred by the public purse in providing financial assistance to improve the safety of buildings in England. The new levy will apply to new residential development unless the development is excluded. It is anticipated that the building safety levy will raise £3 billion to address cladding, as well as other building safety issues, in cases where developers do not take responsibility.
It is important that local planning authorities can use infrastructure levy revenues to fund local infrastructure in their area, such as affordable housing, GP surgeries, schools and roads, to mitigate the impact of development on an area. It is therefore right that the introduction of the building safety levy will support building safety matters separately.
Amendment 504GJD, tabled by the noble Baroness, Lady Hayman of Ullock, would require Ministers to make a Statement to Parliament outlining their position on single staircases in large multiple-occupancy residential buildings within 60 days of the passage of the Bill. The department has been clear in our commitment to ensure that residents are, and feel, safe in their homes. I agree with the noble Baroness that that is vitally important.
In December 2022, we launched a consultation asking for views on the provision of single stairs in residential buildings. Our consultation contained a clear proposal to introduce, for the first time in England, a maximum height threshold of 30 metres for using a single staircase in residential buildings. The consultation closed on 17 March. We have received over 280 responses, and it is right that we carefully consider the responses received to ensure that all the evidence is considered. We will set out further information on the timing and policy direction at the earliest opportunity.
In conclusion, I hope that the reasons I have set out provide sufficient assurance that the noble Earl, Lord Lytton, will be able to withdraw his amendment, and that he and other noble Lords will not press the other amendments. I hope this has also provided positive news for the noble Baroness opposite and that she will agree not to move her amendment when it is reached.
Earl of Lytton Portrait The Earl of Lytton (CB)
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My Lords, this has been an extremely interesting debate. I thank all noble Lords for their contributions on this group of amendments.

I thank the noble Lord, Lord Young, for covering all the technical bits that brevity forced me to omit; I am grateful to him for that. The right reverend Prelate the Bishop of Guildford gave an outstanding and thought-provoking commentary on, among other things, corporate motivation and where that should sit in the rules-based order.

The noble Baroness, Lady Fox, asked me some specific questions. I will give it a go in terms of giving her a brief response, but if she wants more information then I ask her to let me know because I may need to write to her. She asked me about the potential damage to the construction industry. My belief is that the construction industry should be able to build its way out of the liability—admittedly, probably at a lower profit margin, but that should be a viable option for it, so I do not see this as being a total loss. One of her later points was about market damage. The best estimate at the moment is that about 10% of the blocks are affected, which effectively means that 90% of them are built to good standards and do not present a problem. The risk is that if we do not deal with those forthrightly, and if the Government’s programme is not continually ahead of expectation, the rotten apples will end up infecting a much wider cohort than would otherwise be the case.

The noble Baroness also picked me up on the demonisation of the term “polluter pays”. I hope that I avoided using that term in referring to the building safety remediation scheme, but I know that outside it has attracted that moniker. That is of course a reflection on the environmental liability; coming further forward in time from that strict liability, we have a more direct example. It is of health and safety, particularly on construction sites. The strict liability that was imposed under that regime substantially improved the rate of death and injury in construction. I believe the same focus that this liability would generate is applicable here, bearing in mind that we are talking about vulnerable people in their own homes and that they are asleep and unconscious for maybe 25% to 30% of the time. They really need to know that that is their safe haven and not to feel threatened in it by issues of safety or finance, such as not being able to transact their property.

I thank the noble Baronesses, Lady Hayman of Ullock and Lady Pinnock, for their support. The noble Baroness, Lady Pinnock, has been an absolutely doughty supporter of the principle throughout. I pay tribute to that, as I do to my noble friend Lord Cromwell for his contribution. I am most grateful.

I thank the Minister for her response but I am disappointed. The fact of the matter is that a very large number of flats are excluded. There is no prospect of any early protection from costs that their owners are not responsible for. Litigation against freeholders is all very well, provided that the freeholders were those who were responsible for the problem in the first place. But if they are not, because they just happen to be from a pension fund that picked it up along the way, no doubt relying on the same sign-off and building warranties as all the occupiers, then I have to say that this looks like the Government plucking at low-hanging fruit for the purposes of PR and marketing. I am sorry, but I do not buy the principle that letting others off the hook should necessitate going after people who may themselves be, beyond peradventure, innocent.

The Minister also referred to the comment made just over a year ago saying that the amendment I moved then, of which I hope this one can be regarded as a new and upgraded version, was not cost effective because it would require a building-by-building assessment. But you do not establish anything unless somebody goes and looks at the building on an individual basis; I know that as a surveyor. I have looked at hundreds of buildings in my professional life and that is where it starts. The Government’s own approval to any sub 11-metre matters is described as being on a case-by-case basis, so what is the difference?

The views of the independent expert panel were referred to, and a very worthy panel it is, but I saw that the issue of where this critical life safety came out had a different algorithm. It was a different function of the problem from the one that I am trying to address. The noble Lord, Lord Young, referred to the fire at Richmond House in Worcester Park, which happened about 11 months before the independent expert statement was published. My understanding is that fatalities there—mercifully there were none and, I gather, no injuries—would have been far more likely had the “stay put” instruction not been ignored by the residents, who got themselves out of the building, and just as well. But that exemplifies the fact that low rise does not mean zero risk; it is a matter of judgment as to whether the risk is acceptable. If you look at risk on the spectrum that we are considering, you simply would not accept that level of safety in a car or in many household goods.
I am sorry to say to the Minister that I do not follow the arguments here. I do not regard the rather labyrinthine approach that the Government are embarked on as satisfactory. I will ponder what she says but I may very well return to this issue later in the Bill’s progress, as it is clearly not going away and there is a huge expectation outside this House that something is going to be done about it. The Government seem to be relying on levies and developer contributions. I am not clear whether that adds up to anywhere near what some industry observers, with no axe to grind, are suggesting will be the totality of billions that will be involved in remediation on a national scale. Having said that, I will consider this further and while I hope that the noble Baroness, Lady Fox, will tell me if I have not succeeded in answering her questions, for the time being I beg leave to withdraw the amendment.
Amendment 274 withdrawn.
Amendment 274A not moved.
Clause 107: Time limits for enforcement
Amendment 275
Moved by
275: Clause 107, page 142, line 8, after “completed,” insert “or 4 years if there is a significant impact on the local environment,”
Member's explanatory statement
This means that the extended time limits for enforcement of planning controls does not apply when there is a significant impact on the local environment.
Baroness Taylor of Stevenage Portrait Baroness Taylor of Stevenage (Lab)
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My Lords, I shall also speak to Amendments 277, 280 to 281B and 282 in the name of my noble friend Lady Hayman and in mine. I shall also make some comments in relation to Amendments 276, 278 and 279, in the name of the noble Earl, Lord Lytton, and Amendment 281C in the name of the noble and learned Lord, Lord Hope of Craighead.

The increasingly acrimonious circumstances in which planning is often discussed, debated and granted has significantly increased the burden of enforcement. This is combined with a contraction of local authority planning teams due to reductions in local authority funding, which is putting increasing burdens on the planning process, as we have already debated today in Committee. Our amendments are in recognition of that and to ensure that timescales, fines and practices are developed in a way that is proportionate to the current circumstances.

As one brief example, most local councillors will be familiar with their weekly planning list having a number of certificate of lawfulness applications—they are a particular bugbear of mine. These mean that the applicant has not applied for the appropriate permissions in advance and, having now built out their development, is only now seeking the approval of the planning authority. There is little if any appropriate sanction for this behaviour, which seems grossly unfair to all those who take the necessary steps to submit their applications properly in advance of building.

It is fair to say that such developers face the risk of the planning authority turning down their retrospective application, and there have been notable examples of authorities requiring buildings and/or alterations to be taken down. However, with the powers of enforcement diminished, both in this respect and for straightforward breaches of planning, simply by the lack of resources to deal with enforcement, the danger is that we continue to see from the worst offenders a cavalier approach taken to the planning process.

Amendments 275 and 277 in the name of my noble friend Lady Hayman of Ullock are designed to draw attention to the fact that it may be necessary to foreshorten the extended time limits for the enforcement of planning controls where there is a significant impact on the environment. We appreciate that the 10-year window is necessary for raising issues relating to planning enforcement, but it will be important that all involved in development understand that, if enforcement relates to an issue where substantial harm is being caused to the environment, planning officers will expect these to be dealt with more quickly. We hope this amendment will give them the power to do so. The amendment aims to prevent a delayed response from developers, not to limit the amount of time planning controls can be exercised over environmental matters. This should be 10 years, as for all other matters.

We have discussed previously in Committee the need for rapid digitisation of the planning process, where that has not already been done. Amendment 280 is a probing amendment to ensure that this is the case for the enforcement aspects of planning as well.

As in other parts of the Bill, we believe that new burdens may be imposed on local authorities in relation to enforcement. Amendment 281 in my name is to flag up again that there will be a need for an overall assessment of all parts of the Bill to understand the likely financial impact on local authorities. We have received previous assurances from the Minister on new burdens funding. It would be good to know that relevant professional and representative bodies will be consulted on this important issue as quickly as possible after the Bill passes into law, so that no undue financial burdens are placed on already hard-pressed local authorities.

As we have discussed in previous clauses, the financial burden of planning does not fall proportionately on the developer, which is true of enforcement too. Amendment 281A in the name of my noble friend Lady Hayman of Ullock is included to ensure that we do not inadvertently create an enforcement fine regime where it is more cost effective for the developer to breach planning rules and guidelines because the cost of non-compliance is less than the profit they are likely to make from any breach.

My Amendment 281B seeks to introduce a very important provision that would prevent developers applying for an exemption to the provisions in a planning application to deliver affordable housing in a development. We are all very familiar with the long wrangles that planning authorities are having over viability. Our concern is that, if this exemption from enforcement clause were to apply to the delivery of agreed affordable housing, it would simply be another get-out clause in the armoury for developers, with their significant legal firepower, to avoid providing much-needed affordable housing.

Clause 116 is concerned with ensuring that the planning process works as efficiently as possible and makes best use of digital technology. My Amendment 282 seeks to set the purpose of this in the Bill, so there can be no doubt that it is the intention to avoid delays wherever possible.

Amendment 276 is in the names of the noble Earls, Lord Lytton and Lord Devon. Just as our amendments recognise the importance of a shorter enforcement period for environmental issues, it recognises the importance of changes of use to a dwelling house. We agree that, where enforcement relates to somebody’s home, a shorter time period than 10 years would be preferable.

Amendment 278, in the names of the noble Earls, Lord Lytton and Lord Devon, recommends consultation with affected parties on extending the time limits for planning enforcement from four years to 10 years. We would always support such steps, as professional bodies and local government representative bodies can be essential consultees in ensuring that all consequences are understood from the outset and that any unintended consequences can be predicted and mitigated.

On Amendment 279, in the names of the noble Earls, Lord Lytton and Lord Devon, we will be interested to hear the Minister’s response on whether it is the intention for the provisions of the Bill to be retrospectively applied to developments which, under current legislation, have reached the time limit for enforcement. Is the legislation to apply only to enforcement for developments started after the commencement of the Act? Will there be a transition period, or will it automatically apply to all developments that have reached the current four-year limit?

Amendment 281C in the name of the noble and learned Lord, Lord Hope of Craighead, seeks to insert in the Bill the explanation of the purpose of Clause 113, as is contained in the Explanatory Notes. We have had a number of examples during our examination of this Bill where the absence of these explanatory clauses could potentially cause ambiguity in their interpretation. Therefore, we support this sensible move to insert the explanatory clause in the Bill. I beg to move my amendment.

Earl of Lytton Portrait The Earl of Lytton (CB)
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My Lords, probing Amendment 276, and Amendments 278 in 279, are in my name and that of the noble Earl, Lord Devon, who is regrettably unable to be with us today. Apart from declaring an interest as a property owner, I must also explain that I have in the past been threatened with enforcement proceedings—so guilty as charged, or perhaps not guilty as charged. I am very grateful to a number of planning practitioners who explained some of the finer points of all this to me.

These amendments relate to Clause 107 and refer to what is known as the four-year rule. The current position is that, if works to a property have been undertaken more than four years previously, the owner is immune from enforcement action by the local authority. The equivalent period for changes of use, which of course may be harder to spot, is 10 years. A minimum of 10 years unchallenged enjoyment of both works and change of use is required before a lawful use certificate can be claimed. If you like, the entitlement at that stage becomes absolute.

I should add that, for works or changes of use to a listed building or, I think, for one in a conservation area, time does not run against the enforcing authority, and so protection of heritage is not an issue. Furthermore, works of development that are done secretively or by concealment are, I believe, also not protected by the four-year rule. So the building of a house within the confines of an agricultural barn, as happened in one rather infamous case, would not escape.

The system has operated for many years, quite successfully as far as I know. In the most recent review of the arrangements, the four-year cut off remained unamended. My own sense is that, if works have not been spotted after four years, it is quite unlikely that they will be spotted more readily in years five to 10. Indeed, one might conclude that, if it is that unobtrusive, it should scarcely be a planning concern anyway. It is more likely that it will crop up to ensnare an unwary owner who makes a subsequent application and some historic non-compliance is spotted at that stage.

The four-year rule also recognises that planning is complex, with many pitfalls for the unwary, and that it is not necessary or desirable to micromanage planning uses of land and buildings. For instance, erection of deer fencing, construction of ponds and the placing of certain structures on land may in some cases require consent but in others they do not. A movable item nearly always does not trigger a planning issue but leaving it in the same place for too long does.

Many households think that a permitted development right absolves them of the need for any consent at all. I believe it is government policy to reduce burdens on householders. Furthermore, where a local planning authority has issued what is known as an Article 4 direction, removing permitted development rights for certain types of development, owners may not be aware of this or be made aware, even in a purchase situation. As in one instance which occurred in my professional career, a shopkeeper might find that they are subject to enforcement procedures for displaying an internally illuminated sign fixed to the interior of their shop window glass, but not if it is a foot or two further back. The rules are opaque, convoluted and may be interpreted differentially per authority. As I see it, the four-year rule served to prevent this becoming a more serious issue.

But Clause 107 would remove this protection. I know of no justification for doing this, nor any public consultation that underpins that decision to include it in the Bill. I think that most householders, and possibly quite a few lenders, would view this with concern. But the removal would have, in my opinion, a somewhat more sinister side-effect. I know of instances whereby an annoyed builder has set out to shop a property owner who did not award him a contract of works, or shopped the successful contractor—or a neighbour averring to the authorities that works in non-compliance are taking place, either because of neighbourly detestation or, as in one case known to me, because the neighbour took umbrage about the builders’ vehicle parking and plant-unloading arrangements in the street outside their home. So to leave the door open for an additional six years to this sort of risk of a snooper’s charter is socially, economically and administratively undesirable.

Other noble Lords may refer to specific instances that I have not covered, but one that seems to me to apply is the conversion of attic space into living accommodation, where permitted development may allow it and half the rest of the street may have done it. That might be one particular instance. The objection might be not the principle of the conversion but about the materials and finishes, hidden away in some local design code, with a footnote about not using, say, PVC, about which the householder could not normally be expected to know, having never been notified of any such requirement. Why would they inquire, given every other similar local project in the street had used PVC? I use that just as an example.
Planning should not be the stuff of oppressive or intrusive regulatory control, save in areas where it is necessary. In any event, I have severe doubts whether local planning authorities have the resources to make any better use of the enlarged timeframe. So these amendments attempt to modify the effect of Clause 107 and provide a better degree of fairness and balance.
There is a specific issue about dwellings and, especially as I perceive it, the lack of planning compliance of works not always being identifiable on normal property searches. It may not be at all clear how long some feature has been in place. Amendment 276 attempts to address this. I mentioned the lack of consultation, and Amendment 278 seeks to address that. I think that there should be consultation, and an analysis of responses, before Clause 107 is put in place. What happens to a property with unconsented works carried out five years ago, where under the existing rules they would be immune, but under the new rules, introduced by this Bill, they would not? There is no provision in the Bill for transitional process. That needs clarifying, and Amendment 279 seeks to do just that.
Lord Hope of Craighead Portrait Lord Hope of Craighead (CB)
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I shall speak to Amendment 281C. I am grateful to the noble Baroness, Lady Taylor of Stevenage, for her introduction and support for that amendment. It is one of two amendments which I have tabled to give effect to recommendations by the Constitution Committee, of which I am a member, seeking to promote the principle of legal certainty. The problem which concerned the committee in this case relates to the width of the power in the new Section 196E, introduced by Clause 113.

The Explanatory Notes say that the position at the moment about decisions

“to take enforcement action in response to breaches of planning control is at the discretion of the local planning authority”.

New Section 196E seeks to give power to the Secretary of State to provide relief from enforcement and planning conditions in a particular way, by providing that a local planning authority

“may not take … relevant enforcement measures”

or is subject to particular restrictions as to whether it should take that step.

The reason given in the Explanatory Notes is really a bit of history. In the difficult circumstances that arose as a result of the Covid-19 pandemic, with a later acute shortage of heavy goods vehicles,

“local planning authorities have been encouraged to be flexible in terms of enforcement action of non-compliance with conditions imposed on grants of planning permission which govern construction working hours and delivery hours”.

Those are the kind of conditions put forward to protect the environment of local residents, and so on—and, obviously, when they are imposed, they are imposed for a very good reason. But the Covid-19 situation, with the acute shortage of heavy goods vehicles, made it desirable that these hours should be extended, instead of being restricted to hours that would not interfere with people’s sleep, or whatever else it would be. There was a good reason for being more flexible and allowing the hours to be extended.

That is the background to the step being taken here, but the Constitution Committee’s concern was about the width of the power being sought under new Section 196E. The section is carefully drafted, because it says that what the Secretary of State may do by regulations is to give direct attention to

“relevant enforcement measures in relation to any actual or apparent failure to comply with a relevant planning condition”.

Those expressions, “relevant enforcement measures” and “relevant planning condition”, are carefully defined in this new section and are wide in their scope. “Enforcement measures” includes all the powers that one might expect—the powers to apply for enforcement orders, injunctions and entry without a warrant, and so on, to see what is going on, and to deal with issues about planning contravention notices, temporary stop notices, enforcement notices, warning notices and so on.

The new section is very carefully drafted. What it does not do is contain any kind of limit on the extent to which the power might be used, which is why the Constitution Committee, in its report, said that it was concerned by the breadth of the power and recommended that the clause should be amended to ensure that the power was limited to

“emergency situations or other forms of serious disruption”,

following the example set out in the Explanatory Notes. My amendment provides simply that the power may be exercised only

“in the event of an emergency or other form of serious disruption which makes it necessary for the local planning authority to be provided with this relief”.

As I said, the background is that, in any case at the moment, the local authority has a discretion as to how far it should go in dealing with breaches of planning conditions, but the power is actually giving directions. Therefore it is necessary, in the interests of legal certainty, that the scope of the power should be limited along the lines that my amendment suggests.

Baroness Thornhill Portrait Baroness Thornhill (LD)
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My Lords, this is a really interesting group of amendments and clearly very technical and detailed. The Minister may be relieved that I shall keep my comments quite simple, to address certain principles.

Clause 107 represents a radical change. There is quite a difference between four years and 10 years, which will apply to all forms of unauthorised development. As has already been said by the noble Earl, Lord Lytton, the Explanatory Notes do not actually give any rationale for the actual number of years. Is it a proposal following consultation of some sort, or just a figure between four and 10—in which case, may I suggest six? I would be interested to know how it was arrived at.

I am also interested in the Minister’s response to the noble Earl’s Amendments 278 and 279 on transition and consultation, which both seem reasonable and sensible, given that this is a significant time change, with consequences following from the scale of the change.

I agree that there is definitely some sense in bringing about a single limitation period, beyond which all such development is lawful, to put an end to the fraught arguments and confusion of what applies to which and when and why. Such confusions, in my experience, come from all parties—council officers, definitely residents and even on occasion legal representatives. It is not straightforward. When is a garage not a garage? What is a garage? I remember that one vividly.

Amendment 276 in the name of the noble Earls seeks to retain the four-year rule where a breach—I am choosing my words very carefully—involves a place where people live. From my urban experience, I have seen too many “beds in sheds” where, at worst, people are living in conditions not fit for animals and at best, they are massively overcrowded with inadequate facilities. Nobody should get away with exploiting vulnerable people, who are living in those conditions because they are desperate, just because the breach was reported only after four years and one day.

On Amendments 275 and 277 in the name of the noble Baroness, Lady Hayman of Ullock, I seek clarification from the Minister and I accept that I may have got this wrong. Given that I agree with many of the noble Baroness’s amendments and her way of thinking about the Bill, I am, in a sense, sense checking. As I read it, the Government’s intention in this clause is to give local planning authorities a considerably longer timeframe—some might say too long—to intervene in a breach of unlawful planning that has been brought to their attention. I would say that was a good thing from the point of view of the local authority, affected residents and communities. Therefore, would her two amendments, if passed, mean that despite the breach having

“a significant impact on the local environment”,

the noble Baroness is seeking to reduce the time that residents have to notice it and their council to respond? It is the time to enforce and not the time to comply with enforcement: that is my understanding. Perhaps the Minister can clarify that and put me right.

Amendments 281 and 281A in the names of the noble Baronesses, Lady Taylor and Lady Hayman, deal with council finances. The situation was described well, so I do not need to repeat that, but what I will say is that enforcement is a very important service. We all want and need more effective enforcement. Poor enforcement across a whole council can undermine all our efforts to improve the place we live in. Enforcement is a big signal to residents that their council cares about what goes on in their areas and will do something about it. Over the years, I found it was a trust issue with residents, about “Whose side are you on?” Helpless cries of, “Well, it’s outside the four-year period” cut no ice.

The harsh reality, particularly in district councils, is that, increasingly, councils are responding only to breaches that are brought to their attention, rather than proactively going out looking for them, which I think is something we all think they should do and which should cut across a wide range of council functions. The reality is that, due to the reduction of available funding and a decline in the number of skilled staff over many years, that is not happening. Capacity and capability is an issue here too. The real skill in enforcement work is to bring about compliance without the need to serve notices and go to court, with all the additional cost and time that that incurs, in order to perhaps get a paltry fine. In my experience, most council officers will seek not to do the sorts of things that the noble Earl, Lord Lytton, mentioned; they actually work very hard to take proportionate and flexible actions with minor infringements.

On Amendment 281B in the name of the noble Baroness, Lady Taylor, about social housing, we all know that of all the current Section 106 obligations that developers try to wheedle out of, social housing is their number one target. Reducing the wriggle room and strengthening this obligation is surely a good thing. We have several ex-council leaders in the Chamber who will all have experienced occasions when a developer has found it more cost effective to breach the rules and pay the fine. Chopping down trees covered by tree preservation orders is a regular example that springs to mind. We are all battle scarred, hence our cynicism regarding some developers and the desire to recover full costs, as in our earlier debate.

I agree wholeheartedly with Amendment 281C in the name of the noble and learned Lord, Lord Hope of Craighead. The Bill is riddled with two very worrying threads of intention. Yet again, even more powers will be given to the Secretary of State to intervene and, yet again, exactly how, when and why are to be given in subordinate legislation: the often-mentioned revised NPPF, the contents of which we still do not know. The power given to a Secretary of State to overturn the legal and democratic process is necessary but rarely used—and then only in extreme circumstances—for very good reasons. However, that has been undermined in recent years and most recently by announcements by the current Secretary of State. I therefore understand and share the noble and learned Lord’s concerns.
Earl Howe Portrait Earl Howe (Con)
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My Lords, all the amendments in this group relate to the enforcement clauses in the Bill and it may be helpful if I begin by explaining briefly the rationale for the package of enforcement measures that the Bill contains. The Government recognise that effective enforcement is vital to maintain public confidence and trust in the planning system. The noble Baroness, Lady Thornhill, made that point very powerfully. Local planning authorities already have a wide range of enforcement powers, with strong penalties for non-compliance, to tackle breaches of planning control. The Bill’s measures are intended to strengthen those powers so that local planning authorities are better able to take the robust action their communities want to see.

Amendments 275 to 279 inclusive all deal with Clause 107 on enforcement time limits. Amendments 275 and 277, tabled by the noble Baroness, Lady Hayman of Ullock, seek to retain the current four-year time limit for commencing enforcement action against breaches of planning control where the breach has a significant impact on the local environment. Amendments 276 in the name of the noble Earl, Lord Lytton, seeks to retain the four-year time period after which enforcement action cannot be brought where there has been a breach of planning control consisting of the change of use of any building to use as a single dwelling house. Amendment 278 in the name of the noble Earl would require consultation to take place and a report to be published before Clause 107 can come into force. The noble Earl’s further amendment, Amendment 279, seeks to add to the Bill confirmation that breaches of planning control which are currently immune from enforcement action will remain immune following the passing of the Act.

Let me give the Committee some background on the need for Clause 107. Currently, Section 171B(1) of the Town and Country Planning Act 1990 imposes a four-year time limit on local planning authorities beginning enforcement action against a breach of planning control consisting of building, engineering, mining or other operations. Section 171B(2) imposes the same four-year time limit for a breach of planning control consisting of a change of use of any building to use as a single dwelling house. All other breaches of planning control are subject to a 10-year time limit. However, we have heard from key stakeholders the very point made by the noble Baroness, Lady Thornhill, that there are some cases where the current four-year time limit is not long enough and the opportunity to commence enforcement action is inadvertently missed.

For example, a person may not initially raise concerns with a local planning authority, assuming a neighbouring development has the correct permissions or will not cause disturbance. Should the development prove disruptive, they may then try to come to an agreement with the person responsible for it. However, by the time they raise their concerns with the local planning authority, the opportunity to commence enforcement action may have passed.

We have also heard that having two timescales for enforcement can unnecessarily complicate cases. For example, where a new building has been constructed on land, enforcement action could be taken against the construction of the building itself, subject to the four-year rule, or against the material change of use of the land brought about by the construction of the building and its subsequent use, subject to the 10-year rule. This uncertainty can lead to lengthy and resource-intensive appeals and court cases debating the starting point for immunity.

Clause 107 seeks to address all these issues by making the time limit 10 years for all breaches of planning control in England. This will create greater certainty and consistency for all parties involved in the planning enforcement process and ensure that the opportunity to commence enforcement action is not inadvertently missed. To be very clear, Clause 107 is not about delaying the enforcement process unnecessarily. The expectation will remain that local planning authorities should act promptly to investigate and remedy breaches of planning control as quickly as possible.

Amendment 278 is about consultation. As I have already explained, we have engaged with key stakeholders during the preparation of the Bill. This package of enforcement measures is what the profession identified would most help it carry out its job more effectively. On the noble Earl’s Amendment 279, we will make transitional provisions in regulations to ensure that breaches of planning control that are currently immune from enforcement action will remain immune following the passage of the Bill. I hope that, with these reassurances, he will agree that these amendments are not required.

Amendment 280, tabled by the noble Baroness, Lady Taylor of Stevenage, seeks to probe how technology can be used to support the new planning process. The Government share this ambition. We are keen to modernise the planning process and make better use of technology; amendments in Chapter 1 of Part 3 of the Bill, on planning data, are designed to do just that.

The new enforcement warning notices that we are introducing through the Bill may be served in a number of ways, including by electronic means, but I do not think it would be appropriate to make this the only means of serving such a notice. Enforcement warning notices are a planning enforcement tool. It is therefore vital that, if a local planning authority is beginning enforcement action, those against whom action is being taken receive the notices. Some do not use or have access to digital communication tools, and we must ensure that they are not disadvantaged. There is also the issue that an enforcement warning notice may be served on someone who has not engaged with the local planning authority and so the authority would not have an email address for them. I hope that, with this explanation, the noble Baroness will agree that this amendment is unnecessary.

Amendment 281, tabled by the noble Baroness, Lady Taylor, is about local authority resources. The measures in the Bill are designed to make the existing framework easier to use for enforcement officers. Where we are introducing new powers such as enforcement warning notices, their use is discretionary. As such, I do not think these measures will create significant additional burdens or resource pressures for local planning authorities.

However, we recognise that many local planning authorities already face capacity and capability challenges and we are taking steps to address this issue. We are currently consulting on proposals to increase planning application fees. In the enforcement context, this includes a proposal to double the fee for retrospective applications, in recognition that they often create additional work for officers over and above what is required for a regular application. To ensure that local planning authorities are well equipped and supported to deliver their existing requirements as well as the changes set out in the Bill, we have already started to work alongside the sector to design targeted interventions to support the development of critical skills and to build capacity across local planning authorities. With these reassurances, I hope the noble Baroness will agree that Amendment 281 is unnecessary.

I turn to Amendment 281A, tabled by the noble Baroness, Lady Hayman, and spoken to by the noble Baroness, Lady Taylor. The level of fine for failure to comply with a breach of condition notice is currently level 4 on the standard scale—a maximum of £2,500. The purpose of Clause 112 is to make fines for this offence unlimited, bringing them into line with the levels of fine for other planning enforcement offences. Amendment 281A would introduce a new sentencing requirement for this offence which would not apply to sentencing for other planning enforcement offences. It would not be reasonable to create a more punitive sentencing regime for the offence of non-compliance with a breach of condition notice than for other planning enforcement offences.

This amendment would also cut across the national approach to sentencing set out in the Sentencing Code which courts refer to when sentencing offenders. It is for the courts to determine the appropriate level of fine for an offence, taking into account its seriousness and the financial circumstances of the offender, including for this offence. Therefore, while I appreciate the sentiment behind this amendment, I feel that it is not appropriate for those reasons.

Amendment 281B, tabled by the noble Baroness, Lady Taylor, would ensure that relief from enforcement action under Clause 113 cannot be granted for any planning conditions relating to the type or volume of affordable housing. While I appreciate her concern about the power being used to restrict conditions about affordable housing, I reassure her that this is not the intention. Clause 113 has been brought forward to provide a statutory route to provide relief in future from planning conditions that unnecessarily impede economic activities during periods of disruption and uncertainty. This is in response to the experience during the height of the Covid pandemic to enable key business sectors to respond and recover from its impacts where we discouraged enforcement through policy.

Here, we focused exclusively on conditions related to the operative use of land or premises, such as construction working hours or delivery times. We would expect these types of conditions to provide relief from enforcement action in future. Conditions related to affordable housing were not in scope. More importantly, affordable housing provision is primarily secured through Section 106 planning obligations, rather than by condition. The concern that affordable housing provision could be affected by the use of this power is therefore misplaced. It does not affect Section 106 agreements.

Amendment 281C, tabled by the noble and learned Lord, Lord Hope of Craighead, seeks to limit the use of the power under Clause 113 to periods of emergency or serious disruption. I recognise that the Delegated Powers and Regulatory Reform Committee has recommended that this power should be limited to periods of emergency or serious disruption. We are carefully considering its recommendations and will respond to the committee before Report. However, I reassure the noble and learned Lord that I believe the committee has made some valid points on the scope of the power. It is intended to be used in emergencies and periods of disruption, and it will not be used lightly. We recognise that planning conditions are an important way of making development acceptable to communities and we want them to continue to be used.

Finally, Amendment 282, tabled by the noble Baroness, Lady Taylor of Stevenage, concerns the speeding up of the planning system. There are around 400,000 planning applications every year. The Government have heard many representations that the planning application process is too slow and inaccessible for some users—notably those without expertise, such as ordinary laypeople. Therefore, it requires improvement and modernisation. The powers being brought forward in Clause 116 enable to Government to apply a more consistent, streamlined and digitally enabled approach to the way applications are made, making it easier for everyday people to submit a planning application. This will also make planning data more accessible.
My department is already working with local authorities to tackle the very issue this amendment raises. We are working collaboratively with local authorities through the Open Digital Planning project, which aims to increase efficiencies in the development management process through creating modern development management software. The local authorities that are using the modern development management software we are trialling have seen an estimated 35% time saving in the pre-validation process, when an application is first submitted, and, post validation, in the process the reach a decision. Before enacting these powers, we will fully engage with local planning authorities and the sector as a whole. Given that one of the core aims of this power is to streamline the process, we will, of course, consider the impact on speed of decision-making. So, while I support the intention of this amendment, I hope the noble Baroness will be content not to move it when it is reached.
Baroness Taylor of Stevenage Portrait Baroness Taylor of Stevenage (Lab)
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My Lords, I am grateful to all noble Lords who have participated in this debate. I am also grateful to the noble Earl, Lord Howe, for his response. I am afraid that enforcement is an element of planning that is little understood by the public; they often think that our powers and resources are much greater than they are to deal with some of the issues that arise. I pay tribute to planning officers who field all of this on a daily basis. Even in our short discussion here, it has been clear that it is not always very straightforward. We are all striving to improve confidence in the process as we go through the amendments to the Bill.

Some confusion has arisen around the proposed amendments to the time periods, but, having had the explanation from the noble Earl, that is a bit clearer. It was about whether the four-year time limit was there to begin enforcement action and that was now being moved to 10 years, which gives a longer wind. I accept all the comments that have been made—particularly by the noble Earl, Lord Lytton—asking whether, if nobody has noticed it in four years, they will notice it in 10 years, and whether it really matters if they do. However, these issues can be very serious, as we have heard in previous debates in this Committee. I think a longer time period for enforcement to be able to be taken does not make sense, particularly where, as explained, there are two timescales at play in the Town and Country Planning Act.

Our concern is that this might give reasons for delay to the enforcement action itself, particularly for issues around environmental action. We need to make absolutely sure that we are not going to give any opportunity for delay in responding to enforcement action. If there is going to be a delay in the reporting of it, that is one thing. If there is going to be a delay in responding to it, that is a whole other issue. In terms of the points made by the noble Earl on engagement with key stakeholders, I was reassured to hear him say that the delay to the time period had come directly from the key stakeholders involved.

We have had plenty of discussions in previous Committee sessions on the Bill about digitisation. I think that local government has gone quite a lot further than some of the people in DLUHC might think. I will leave that there, but of course we can always do better on digitisation.

The issue of local authority resources is very important to all of us, as we are constantly debating. There are quite a lot of acutely aware people in the public who might see the introduction of enforcement notices, potentially creating an expectation that we are going to have further action on them. We always have to be careful that we look at the resources that are going to be required to deal with new measures, and the same applies to this part of the Bill. I was extremely pleased to hear about the increase in fines for retrospective applications, which have been a long-standing bugbear of mine, as I said earlier.

The noble Earl mentioned that it is not the intention to give relief from affordable housing provisions. I understand what he said: that that provision is directed at emergency provision for construction sites. Those of us who were in local government at the time had plenty of contact from both the construction sector and from members of the public about changes to that—there was a need for emergency procedures then. We will take a closer look at that, as we believe there could be unintended consequences—particularly on the provisions for affordable housing—from that issue.

I will now turn to some of the comments made by other noble Lords. I have already mentioned the comment by the noble Earl, Lord Lytton, who asked whether, if something had not been spotted in four years, it was really an issue at all. It is often surveyors who pick up these issues at the exchange of property: a surveyor might go in and realise that something is not quite right with the property. I was quite surprised to hear the noble Earl say that there should be a line drawn under this after four years. Owners may not be aware of the Article 4 directions; I do think there is a very widespread lack of understanding around Article 4 directions and what they can mean. The rules are certainly a bit opaque, but I do not think it is repressive and intrusive local councils that are causing the problem here.

We do have the issue around HMOs and permitted development—which the noble Baroness, Lady Thornhill, referred to very powerfully—where you end up with these beds in sheds developments. The permitted development and HMO regimes exacerbate that and may need just as much attention as the enforcement mechanisms. I would agree that a better outcome would be trying to get compliance, rather than going into litigation. I really chimed with her point about people chopping down trees with TPOs—they would do that and then worry about the TPO afterwards.

I am grateful for all the responses to the points that have been made. I do remain concerned that the Bill is not terribly clear about whether it is enforcement or reporting of enforcement breaches that are extended to 10 years. That could do with some clarification. We will take a further look at that. With that, I withdraw my amendment for the time being.

Amendment 275 withdrawn.
Amendments 276 to 279 not moved.
Clause 107 agreed.
Clause 108 agreed.
Clause 109: Enforcement warning notices
Amendment 280 not moved.
Clause 109 agreed.
Amendment 281 not moved.
Clauses 110 and 111 agreed.
Clause 112: Penalties for non-compliance
Amendment 281A not moved.
Clause 112 agreed.
Clause 113: Power to provide relief from enforcement of planning conditions
Amendments 281B and 281C not moved.
Clause 113 agreed.
Clause 114 agreed.
House resumed. Committee to begin again not before 8.30 pm.