Levelling up & Regeneration Bill – The Impact on Compulsory Purchase

Levelling up is the Central Government’s agenda to reduce inequalities between regions and cities and to bring investment outside of London with the aim to improve economic activity and standards of living.

The Levelling Up and Regeneration Bill was introduced into Parliament in May this year.

The Bill includes several proposed changes to the Compulsory Purchase Order (CPO) process with the aim to incentivise local governments to pursue regeneration by including measures to speed up the delivery of projects where compulsory purchase is needed and clarify the local authorities’ powers for using compulsory purchase.

A number of the key changes proposed include:

The assumption of Alternative Development

Currently, if it is deemed that the subject site could be suitable for alternative development the claimant is able to claim development value without having to provide comprehensive scheme plans for a specific development. The claim may then include a significant element of Hope Value.

The Bill proposes the need for planning certainty, through the requirement to obtain a Certificate of Appropriate Alternative Development (CAAD) confirming that planning permission could be obtained for the possible alternative development on the site, rather than there just being a possibility of planning being obtained.

The purpose of this amendment is to prevent the so called ‘inflated sums’ being paid by acquiring authorities where claimants are claiming for alternative development.

If enacted, in order to obtain a CAAD, there would be increased costs to the claimant, such as planning and architects’ fees. There are further proposals being made to remove the ability for these costs to be recovered by the claimant

Ultimately, it feels like the Bill will unfairly penalise landowners who can genuinely demonstrate that they could have redeveloped their land in the no scheme world. The impact is likely to elongate timescales and potentially create a two-tier market whereby land acquired under a CPO is less than the value which would have been paid by the market.

Online Publicity

A copy of the compulsory purchase order must be published on an appropriate website, including a corresponding schedule and map of affected properties. This is a process which is generally carried out in practice today, however the Bill proposes to make this a statutory requirement to improve accessibility of information to the public.

Removal of the right to inquiry

Objectors to a CPO currently obtain the right to express their objections at a public inquiry. This is to be replaced with a ‘right to a hearing’ which offers a more informal basis whereby objections can be heard. Whilst a public inquiry involves both written and oral evidence, with the opportunity for the cross examination of individuals, a hearing comprises a more informal discussion which could greatly incentivise more public participation.

Conditional Confirmation

This allows for conditions to be set for an acquiring authority to be able to proceed with the CPO. For example, a CPO can only be implemented if the required funding has been obtained or the relevant planning permission has been granted. These conditions are to be specified by the confirming authority on confirmation of the Order.

Flexibility for authorities to exercise CPO powers for a period longer than 3 years

This is to be granted by the confirming authority where appropriate. The aim being to allow for alternative solutions to be explored between the parties before the need of the acquiring authority to vest the land. In reality, this may simply prolong the uncertainty for a landowner if an acquiring authority decides to delay implementation for any reason.

Ability for the acquiring authority and landowner to agree a later vesting date to that specified within the General Vesting Declaration

Again, whilst this may allow for greater flexibility, it may also add to the uncertainty for a landowner.

The Bill is currently at Report Stage within Parliament which allows for all MPs to suggest amendments to the Bill before proceeding to a third reading within the House of Commons. At Roger Hannah we are closely following the passing of the Bill through Parliament and the likely impacts of the Bill on the compulsory purchase process.