Renegotiation of Section 106 Planning Obligations

The Government is consulting on a proposal to relax the circumstances in which a formal request to reconsider the terms of a planning obligation (made pursuant to Section 106 of the Town and Country Planning Act 1990) can be submitted to a Local Planning Authority (LPA).

A right to submit a formal request to reconsider an obligation currently arises only five years after the date it is entered into.  If the LPA refuses a formal request made after five years then there is a right of appeal to the Secretary of State (see sections 106A and 106B of the Town and Country Planning Act 1990).  In the intervening period a voluntary renegotiation of a planning obligation with a Local Planning Authority (LPA) can take place at any time after its completion.  However a successful voluntary renegotiation relies upon the agreement of the LPA.  A refusal by the LPA to agree to a voluntary renegotiation can be challenged only by way of Judicial Review.

The Government considers that the presence of planning obligations negotiated in different economic conditions is contributing towards the high number of stalled developments, particularly housing schemes.  There is a concern that the Government’s encouragement to LPAs last year to consider carefully whether voluntary renegotiation of obligations is appropriate needs to be taken further.

The proposal is that the existing legislation be amended to enable a formal request to be made for the renegotiation of any planning obligation agreed on or prior to 6 April 2010.  However a request can only be made within one month after the introduction of the new regulations.  There will be a right of appeal if the LPA refuses such a formal request.

The Government has stressed that the proposal is not intended to permit unsustainable development.  There must be a strong justification for any change and the amended obligation must still be sufficient to make the development acceptable in planning terms.  The main test will be whether the obligation “no longer serves a useful purpose” or “continues to serve a useful purpose…equally well if it is modified”.

One main area of concern is affordable housing and the fact that high affordable housing requirements are making development unviable and resulting in no development at all (affordable or otherwise).  The suggestion is that if this is the case then relaxing the requirements will help bring forward more affordable housing than would otherwise happen (i.e. some affordable housing is better than none).  However, affordable housing obligations still need to serve their purpose “equally well” and the Government has suggested various options for ensuring this (e.g. different phasing of delivery, reducing overall requirements but requiring delivery within an agreed time frame etc.).

There will be no change to the ability to renegotiate obligations voluntarily at any time.  Indeed the Government sees this as the preferred option, with a formal request being pursued only as a last resort.

The consultation runs until 8 October 2012.  A copy of the Consultation Document and Response Form can be found at http://www.communities.gov.uk/publications/planningandbuilding/renegotiationobligationsconsult

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About waltonandco

Planning Law firm based in Leeds. Advising upon major infrastructure projects and more complicated negotiations is our forte but we are experienced in all aspects of planning law and policy. In the latest rankings within Chambers UK 2017, Walton & Co has been ranked as a leading firm. In addition, a significant part of our practice is advising upon highway and transportation matters, which may often form pre-conditions to the commencement of development. Compulsory purchase law and compensation form an increasing proportion of our work, where we often work with clients' retained property and agricultural lawyers and surveyors. We also advise local and public authorities including Parish Councils upon planning related administrative issues.
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