Planning application fees should only go up if the process improves also

Planning application fees are going up again.

The government’s rationale for doing so is sound - planning departments are significantly under-resourced, with income falling way below expenditure (although the gap has narrowed over the last 15 years) and application fees failing to cover the cost to local authorities of determining them. Under the proposals to improve resourcing, councils will be allowed to charge fees equivalent to 90% of the typical cost of processing an application – the proposed discount is to encourage the pursuit of cost efficiencies.

Some of the fee increases will be substantial. A full application for 50 homes will cost 24% more. The fee for an outline application on a 2.5 hectare site is set to increase by 37%. Councils will even be allowed to charge more than those national fees if they can demonstrate they need to.

However, despite the good intentions, it’s hard not to see this as a simplistic answer to a more difficult problem. The planning system is under-resourced not just because fees are too low but because it has become increasingly complex and inefficient.

More burdens have been placed on applicants and officers alike without anything being taken away. The longer it takes to decide an application, the more it costs as officers spend more time interacting with applicants and consultees – and decision times have increased substantially in recent years. There has been no commensurate increase in the quality of decisions. 

The planning system is under-resourced not just because fees are too low but because it has become increasingly complex and inefficient

For example, the cost of processing an outline application is so much higher than the fee charged because applicants are being asked to submit far more information than was originally envisaged. Requests for ever more detailed drainage schemes, intrusive site investigations and detailed design parameter plans are becoming ever more common, despite all relating to matters that can and should be dealt with as part of reserved matters applications. 

Any proposal to increase application fees should, therefore, be done in parallel with reform of the decision-making process. We need to remove the grit from the machine and the sludge from the system – not just charge more. 

That reform should start with the pre-application process. The purpose of pre-application discussions, we are told, is to speed up decisions. But for applicants, the relevant time period is not the application itself, but how long it takes to get from deciding to submit an application to receiving a final decision. Moving part of that process from the formal, monitored application period to the informal, unmonitored pre-application one, does little more than create the illusion of faster decisions. A standardised pre-application process, with meaningful responses and monitored response times would make it far more valuable.

Validation checklists, which set out what information is required for applications of differing types, should also be reviewed to make sure the reports requested are genuinely needed.

Outline applications should be limited to information which is needed to decide if the principle of development is acceptable. There’s no need for that to include an illustrative masterplan, for example. If the outline application is for “up to 100 homes” but an appropriate layout showing that number of homes can’t be produced at reserved matters stage, then that number of homes won’t ultimately be permitted. 

Outline applications should be limited to information which is needed to decide if the principle of development is acceptable 

The requirements for smaller applications – whose disproportionate costs are a key factor in the demise of SME developers – should also be heavily reduced. More than three quarters (76%) of SMEs cite the slow planning process as one of the main barriers to growth. What information is really needed to decide a smaller application? Can the agricultural land quality of a 2 hectare site ever be determinative in the planning balance, for example?

And no application, regardless of type or size, should be required to deal with issues that are managed by other regulatory regimes. Compliance with building regulations is not dealt with by the planning system. Similarly, compliance with environmental health regulations should not need to be demonstrated by a construction management plan.

Partly in an understandable effort to head off the threat of judicial review, committee reports routinely run to a hundred pages or more, increasing the time they take to write, while reducing the chance that anyone – including committee members – will actually read them. Planning inspector’s decision letters, in contrast, are shorter and more succinct, covering the important ground in a way that is far more accessible and much more likely to be read. Committee reports should be too, with clear guidance on what they should and should not cover, and template reports to help officers understand the appropriate level of detail. 

No application, regardless of type or size, should be required to deal with issues that are managed by other regulatory regimes” 

Once an application is through planning committee, standardised Section 106 Agreements would avoid the site-by-site, authority-by-authority negotiations that characterise the current system.

And when application fees do cover costs, Planning Performance Agreements should be abolished for all but the very largest schemes. Their whole reason for being – to deliver an improved service by better matching the fee paid to the cost of processing the application – will be gone, and eliminating them will remove another point of negotiation, another cause of delay.

Increasing application fees without de-gritting and de-sludging the planning process is just asking developers to fund inefficiency, burdening them with another cost at a time when development viability is already under significant pressure.

Charging more for a broken system doesn’t fix the system.

Paul Smith is managing director of the Strategic Land Group