Commercial Property

Planning Reforms 2022

Further planning reforms have been confirmed following the Queen’s Speech (given by Prince Charles) on 10th May 2022.

20 May 2022

The reforms are part of the Levelling Up and Regeneration Bill announced in 2021 and, according to the speech will “give residents more involvement in local development”. This appears to be a nod towards the proposal for ‘street votes’ allowing local residents to decide upon the development rules for their roads and communities.

One of the most controversial changes expected is likely to involve the scrapping of the Section 106 Agreement. Broadly speaking, until now, this had involved entering into an Agreement with the relevant local planning authority to make contributions (usually including a financial contribution) to the council with the aim of mitigating the impact of the development upon the local community.

The scrapping of this scheme is unwelcome news for many developers who had become well versed with these Agreements and had enjoyed the certainty that the established system has created. Instead, it is anticipated that a new infrastructure levy will replace the Section 106 agreement. It is understood that the levy aims to fund the provision of affordable housing and that the rates will be set by the local authority. However the exact details are currently unknown and are expected to take shape in Summer/Autumn of this year.

The Bill is due to have its second reading on 8th June 2022 where the terms will be debated. We will be watching this space to see how the Bill progresses.

M&P Commentary

Sophie Williamson, an Associate Solicitor in our Commercial Property team, said:

“It remains to be seen how successful the proposed changes will be. There have been numerous attempts over the years to replace the Section 106 agreement, but this has held strong until now. Whilst the Government’s aims for levelling up are undoubtedly desirable, it’s difficult to see whether this will work in practice or if the proposed changes will have the opposite effect of slowing down development.”

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