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The price of planning

A new report suggests clients should pay higher planning fees so local authorities can redress their funding gap

Arup and others delivered a 170-page report to the deputy prime minister last month called The Planning Service: costs and fees. * This was the culmination of work first commissioned in 2000, billed as a 'fundamental review' of the costs of planning departments.

The culture of local government means that establishing the costs incurred in providing a particular service, let alone in processing a particular planning application, is extremely difficult. The consultation provides a basis for this to become much easier. It reports that:

lthe annual estimated fee income in England is £174 million derived from 640,000 applications;

lthe total cost of the planning service in English local authorities is about £900 million; of this, fee-charging development control activity is estimated to cost between £199 million and £242 million;

la fee increase of between 15 per cent and 39 per cent would be required to achieve 100 per cent cost recovery across development control work presently covered by fees;

lcosts and overheads vary greatly between authorities;

laverage annual salary for the 15,000 people employed is £23,700 per head;

lcost recovery is particularly low for the largest applications thanks to the maximum fee;

labout 2,700 maximum-fee applications are made each year with costs exceeding fees by between 104 per cent and 520 per cent.

You get what you pay for It has been government policy for some time to recover 100 per cent of the costs of the development control services which are subject to fees. It is widely agreed that there is a need for additional resources and an improved service but there are concerns that increased fees may not be ring-fenced and could be used to reduce the public contribution to the cost of a service.

The consultation recommends that there be a nationally set fee scale regularly reviewed; that the present charges should be simplified; and that the cost of pre-application advice should be factored into the fee and not charged separately - to avoid deterring such consultations. There are differing views as to which activities should be covered by fees. The consultants accept that there will be a degree of cross-subsidy between applications but these should be minimised. Locally set fees and variable fees have been rejected.

The report recommends that maximum fees should be redefined as a first threshold for a defined quantity of development as at present, over and above which there could be scope for individual voluntary payments at the applicant's discretion, but these should be a matter of public record. A maximum fee of £50,000 (against the current £9,500) 'could be justified'.

Guidance on fees for mixed-use applications should be clearer, being the sum of the fees for each use proposed.

Outline housing applications should command a fee of £660 for every 0.1ha against the current £220, in view of the latest PPG 3 guidance on densities. Fees should not be refundable if an application cannot be entertained, nor where it is processed but refused.

'Free go' resubmissions should remain and their cost factored into overheads.

The consultants recommend increasing fees to achieve 100 per cent cost recovery of fee-charging applications by a combination of across-the-board increases and substantially raising maximum fees. It is recognised that the yield from large applications will vary with the state of the property market.

In my discussion of the seminar held by the report's consultants at the ODPM (AJ 30.1.03) I reported the development sector's view that, while fees might be raised to recover costs, there should be two main consequences: sanctions and competition (for larger applications, at least).

Without these, there would be little change in the culture which today provides a patchy, often inefficient, and unpredictable service.

'Sanctions' refers to the model of Building Regulations fees being returned if deadlines are missed.

'Competition' recognises that planning applications have to be determined through a local democratic process. It is the processing of applications, not their determination, which ought to be capable of objective management.

Thus, an applicant might have the choice of authority or agency (including certified private firms) to whom their applications might be submitted.

The agency checks, registers, consults, negotiates and relates the application to the approved development plan and material policies and considerations.

Just as a planning inspector has to, it prepares a report and recommendation and submits it to the relevant planning authority. The latter (who shares the fee, having liased with the processing authority) determines the application in the light of the report.

The procedure will test the 'plan-led' system but is no more challenging than for architects, who manage to prepare and submit applications all over the country, taking account of local policies and issues.

More than ever, applicants and architects will have to prepare their applications thoroughly and will be on the receiving end of claims for delay if they don't. But maybe it is about time architects made the case for reciprocal sanctions and for competition to be introduced to sharpen up the planners' act. It goes without saying that a properly resourced planning department exists for the benefit of the community and the economy.

Brian Waters is principal of the Boisot Waters Cohen Partnership. Email brian@bwcp. co. uk Footnote * www. odpm. gov. uk

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