Levelling Up and Regeneration Bill, Report Stage, House of Lords, 11 July 2023

• The Levelling Up and Regeneration Bill acts upon long running asks from councils and the LGA for further devolution in England. We are pleased that the Government has proposed to speed up the process and make good on its commitment to offer all of England the opportunity to benefit from a devolution deal by 2030. It is also important that councils of all sizes are engaged in the devolution process.
• The Bill includes (Part 1, Clause 4) information on draft metrics proposed in the Levelling Up White Paper to measure progress towards the twelve missions. This is a good first step, but they still fall short of the full breadth of what is needed to create thriving and inclusive communities. The LGA is supporting amendments which ensure that progress towards the missions is followed closely.
• However, we are seeking an amendment which would ensure that demographic disparities are also addressed as part of the levelling-up agenda. Research published by the Local Government Association, A vision for urban growth and recovery, indicates that the health and economic welfare of BAME residents and young people in urban areas was put at greater risk by the coronavirus pandemic.  While the Government's ambition to address regional disparities between places is laudable, we remain concerned that particular communities within places will continue to experience economic and social disadvantage unless demographic disparities are also addressed as part of the levelling up agenda.  
• We support the measures, set out in clauses 75 and 76 of the Bill, which give councils more power to charge premium council tax for long term empty and second homes as it will give councils more power to influence local housing markets.
• We are deeply concerned that the proposed risk-mitigation measures in clause 74 of the Bill potentially give the Secretary of State significant powers to intervene in a local authority. There is a danger that the formula-based approach outlined in the Bill could impact more widely than intended. It is vital that the Government undertakes full engagement with the sector, including full consultation before enacting the regulations arising from the Bill. Advice from the sector could assist the Government in preserving the key concept of prudential borrowing while ensuring the new arrangements address genuine government concerns. We therefore supported an amendment in Commons Committee stages which would ensure that the Government undertakes a consultation with all local authorities before making regulations for all the subsections of 12b (2). We welcomed assurances from the Minister that the Government would consult more widely before laying the regulations and look forward to hearing further detail as the Bill enters the Lords.
• The LGA supports the Government’s plans to introduce a permanent pavement licensing regime. It is welcome that officials at the Department for Levelling Up, Housing and Communities (DLUHC) have engaged with councils to make improvements to the temporary regime and that this Bill increases pavement licence fees, provides a longer consultation and determination period, and improved enforcement powers for councils. However, we would support the creation of a specific offence of breach of a pavement licence, and for this to be dealt with by a fixed penalty notice rather than by the power to seize and store furniture, which is what councils are currently expected to do. Some councils have concerns about the logistical challenges associated with the current enforcement provisions in the Bill.
• Clause 77 sets conditions for councils when changing street names. The LGA is seeking to remove the clauses in the Bill, and replace with new clauses which would require local authorities to consult residents and the wider community before making changes to street names, and to have regard to the outcomes, but allow flexibility over the method adopted to consult. As the Bill continues in the Lords, we will still be looking to encourage Government to make these changes to the Bill. The original clause is unworkable in practice and too narrow and prescriptive as it may exclude those who use a street but not live there. It is welcome the Minister has given assurances that the Government will be setting out clear, transparent and robust arrangements for the consultation process in secondary legislation.
• In the final stages, the Government tabled a new clause 210 which makes regulations requiring or permitting the registration of specified “short-term rental properties”. At Remaining Stages, the Government confirmed they will be consulting on this issue, and hope to bring in legislation as a result. This change to the Bill is welcome as LGA and member councils submitted evidence outlining the impact that unregulated lets were having on local areas.
• Also in the final stages, the Government introduced new clauses which create an obligation on water companies to go further to address nutrient pollution and clean up our rivers. We have concerns that these clauses only apply to water companies in England. This is a problem for councils on the border with Wales (the Wye and Lugg river catchments) as Welsh water companies could continue to discharge sewage that ends up in England. We ask the Government to clarify how this clause would work for water companies on the border with England and Wales.
• In addition, these clauses only impact water companies, although agriculture is a significant source of pollution. In 2021, the Environment Agency reported that about 70 per cent of total inputs of nitrates in water came from agriculture, with the secondary contributor nationally being sewage effluent at 25-30 per cent.

• Councils are broadly supportive of the guiding principles of the planning reforms, to embed a plan-led system; empowering local leaders and communities; with stronger regeneration powers; and a stronger framework for protecting and enhancing the environment. However, some detail is needed ensure these guiding principles can be applied in practice. We want to work with the government to support the effective implementation of the reforms and ensure that the reforms are a success for local government.
• The Levelling Up and Regeneration Bill also introduces a number of reforms to the planning system:
  • A new Infrastructure Levy. The LGA, along with 29 other bodies across the sector, have written to government to urge them not to introduce the proposed Infrastructure Levy (IL). We have significant concerns that the proposed IL will result in fewer, not more, affordable homes delivered, will expose councils to excessive levels of financial risks, and be increasingly burdensome and complex for local authorities to implement and manage. The signatories propose that retention and improvement of the current developer contribution system is the most appropriate solution. 
  • New powers for councils to bring vacant properties back into use. This high street rental auction power is an encouraging step, and we will work with the Government with the objective of ensuring that it is simple, inexpensive and effective for councils to use.
  • A proposal to introduce a new approach to environmental assessment. We will work with the Government to ensure it strengthens environmental protections whilst ensuring that councils can still deliver the new homes and supporting infrastructure that the country needs.
  • Changes to neighbourhood planning and digitalising the system in order to make local plans more accessible.

• The Secretary of State’s Written Ministerial Statement of 6 December 2022 asserted that the National Development Management Policies will not constrain the ability of local areas to set policies on specific local issues. However, in reality, local plans will be constrained in the event that they conflict with National Development Management Policies, in which case the latter will take precedence. We have previously sought an amendment to reverse this proposal so that local plans will take precedence in the event of conflict. This is critical to ensure that that one of the key principles of the planning reforms - ‘a genuinely plan-led system’ - is enshrined in the Bill.  Further, local plans are subject to robust and extensive testing during its preparation with communities, which includes a thorough examination process to establish its soundness. Therefore, local plans should carry full legal weight and particularly over policies and plans that are not subject to the same level of scrutiny. But if the government decides to retain the current proposal, then flexibility must be built into the system to enable councils to respond to local, complex and changing circumstances. This is because we are concerned that setting generic planning policies at national level will leave councils unable to tailor such policies to local circumstances. The policy must be workable at local level.
• Councils are committed to working with government and developers to build the housing the country needs, with land for more than 2.6 million homes allocated in local plans and nine in 10 planning applications being approved. The introduction of commencement notices in the Bill is a welcome starting point for addressing the ongoing challenges around build-out of schemes following planning permission. It is good that this measure will be introduced alongside powers for councils to deter and tackle non-compliance, including the possibility of a fine. We welcome the Secretary of State’s commitment to bring forward additional measures to tackle slow build-out. Specifically, we would welcome the introduction of powers to allow councils to charge full council tax for every unbuilt development from the point the original planning permission expires. It should also be made easier for councils to use compulsory purchase powers to acquire stalled housing sites or sites where developers do not build out to timescales contractually agreed with a local planning authority.
• We broadly welcome the announcement to remove the requirement for a rolling five-year land supply as it will curb speculative development and it will give more weight to local plans when making decisions on planning applications. However, we urge the Government to urgently revoke Permitted Development Rights in order to strengthen the role of local plans. As a result of Permitted Development Rights, more than 20,000 affordable homes have been lost and therefore this policy is at odds with the national ambition to increase the supply of affordable housing.
• The introduction of measures that will genuinely make the Compulsory Purchase Order (CPO) process more streamlined and efficient for councils is an encouraging step. It is good the government has stated its intention to reform the Land Compensation Act (1961) to diminish the hope value (the term used to describe the market value of land based on the expectation of getting planning permission for development on it) and allow councils to purchase land closer to its existing use value, which will make CPOs less costly for councils to use. However, we urge the government to remove the hope value entirely from the Land Compensation Act so that land can be purchased at its existing use value. This will ensure that compensation is fair and compulsory purchase orders can be used more easily by councils, when necessary, as a last resort.
• We support the principle of councils being able to set up locally-led urban development corporations for the purpose of supporting regeneration projects and also the principle of being directly accountable to councils, rather than the Secretary of State. It is good that the cap on the number of board members and the aggregate borrowing cap are to be removed. We have long been calling for the removal of the borrowing cap, which limits the scope of Development Corporations, creates uncertainty about investment beyond the cap and affects the delivery of Local Plans. We would also welcome powers to enable the creation of zero carbon and nature-rich places; the power to use a CPO; and ensure there is clear guidance and policy support in place for councils looking to establish successful Development Corporations.
• We welcome the confirmation by the Secretary of State that although targets will remain, they will be a starting point with a flexibility to take account of local circumstances. This is because the algorithms and formulas used by the Standard Method can never be a substitute for local knowledge and decision-making by councils and communities who know their areas best. We also welcome the commitment to consult on how the targets can better take account of local density. However, it would be helpful to have clarity about what “advisory” means in practice. We need to increase and accelerate the delivery of affordable housing – largely at social rent. It is our view that 100,000 new social rented home per annum is required to meet the housing needs of communities. We recognise that if advisory housing targets are to hold any credibility, those targets must be realistic and achievable. Therefore, advisory housing targets must be aligned – and must continue to be re-aligned going forward – with the latest population projection data published by the Office for National Statistics. The principle in planning of using the most up to date evidence must always be upheld. The most recent 2022 projection, which is based on the population estimate from 2020, indicates that population forecasts for both mid-2030 and mid-2045 are at its lowest point in eight years.
• Councils must have the flexibility to set planning fees at local level, or at the very least be able to vary planning fees and charges to cover their costs relating to planning. This would put councils in a stronger position to address the skills and capacity challenges in planning departments... We welcome the Government’s proposal to increase planning application fees. However, our modelling has shown that even if all application fees were uplifted by 35 per cent, the overall national shortfall for 2020/21 would have remained above £80 million. Planning fees do not cover the true cost of processing planning applications. In 2020/21, 305 out of 343 local authority planning departments operated in a deficit, which totalled £245.4 million. Therefore, while we welcome the Government’s commitment to increase planning fees alongside the Bill, it does not go far enough to deliver a well-resourced planning sector.

Amendment relating to virtual council meetings

(Baroness Mcintosh of Pickering) After Clause 70, insert the following new Clause— “Local authorities to be allowed to meet virtually"

This new would enable local authorities to meet virtually. It is based on regulation 5 of the Local Authorities and Police and Crime Panels (Coronavirus) (Flexibility of Local Authority and Police and Crime Panel Meetings) (England and Wales) Regulations 2020, made under section 78 of the Coronavirus Act 2020.

• The LGA supports this amendment. The LGA has long called for urgent legislation to allow councils the flexibility to use virtual meeting options.
• Under the Local Government Act 1972 local authorities cannot meet virtually and councillors joining a council meeting virtually cannot be recorded as attending, vote or be counted toward the quoracy of the meeting. A High Court judgement confirmed this interpretation of the legislation in 2021, putting it beyond doubt that councillors cannot attend council meetings virtually under the current legislation.
• During the Coronavirus pandemic, legislation was passed allowing councils to meet virtually. This gave councils the opportunity to test new virtual meeting technologies and see the impact of this flexibility in practice.
• Despite the numerous benefits and calls from the sector to legislate to allow virtual attendance permanently, the Government chose not to do so and instead launched a call for evidence on remote meetings, which closed in June 2021. Two years later, the Government has failed to publish any results, analysis or response to the call for evidence, and the sector continues to make strong arguments in support of legislative change.
• LGA research in 2021 found that most councils supported the retention of powers to hold public meetings virtually (74 per cent and all respondents). Further to this, in a new survey to mark the second anniversary of the closing of the call for evidence, the LGA has found that the requirement to meet in person is having very real negative impacts on local democracy, including:
  • One in ten councils have had at least one councillor step down from their elected role due to the requirement to attend meetings in person
  • Nine in ten councils have disabled councillors who would make use of virtual meeting attendance as a reasonable adjustment if it were permissible
  • Seven in ten councils reported that councillors have enquired about virtual meeting attendance for other reasons, most commonly work commitments, travel distances and caring commitments.
• The LGA is very concerned that the requirement to meet in person is putting good people off from local democracy and pushing dedicated councillors out of their democratically elected roles.
• The Local Government Act, drafted more than fifty years ago, has had the unintended consequence of requiring in-person attendance despite modern developments in technology that have created a similar level of experience virtually as in person, with the added benefit of lowering the barriers of engagement for many people who would find in-person attendance prohibitive. This includes parents, carers, disabled people and working people – all groups under-represented in councils.
• Local councillors are passionate about representing their local community and can make a massive difference to the quality of life of their residents. Good democratic decision-making needs people who reflect the range of experiences, backgrounds and insights that exist in their local communities, including women, parents, carers, workers and disabled people. We at the LGA and in local authorities work hard through our ‘Be a councillor’ campaign to encourage people to stand for election, but the requirement to attend council meetings in person is a significant deterrent to many people and for others, is impossible, essentially barring them from standing for election.
• In addition, some council meetings convened under legislation other than the Local Government Act, such as licensing hearings, school admission appeals panels and regional floor and coastal committees, have been able to continue to use virtual meeting options to hold their meetings. This has created a two-tier system where councils can reap the benefits of virtual attendance at some meetings but not others and demonstrates that councils already deliver accountability and good governance in hybrid meetings.
• Our recent survey of councils shows ongoing and consistent support in the sector for councils to be trusted with the powers to use virtual and hybrid technologies for statutory council meetings. In the interest of strengthening the inclusivity and functionality of everyday and emergency decision-making, we are calling on Government to permanently allow councils the flexibility to use virtual meeting technologies for council meetings. In addition, it is essential that Government is not overly prescriptive about the circumstances under which councils can use virtual hybrid meeting formats, allowing councils to decide how and when to use different meeting formats to ensure they can realise the benefits of different meeting options to suit their local context.

Amendment relating to the National Planning Policy Framework

(Baroness Thornhill) - Clause 88, page 95, leave out lines 30 to 37 and insert new amendment

This amendment stipulates the process for the Secretary of State to designate and review a national development management policy including minimum public consultation requirements and a process of parliamentary scrutiny based on processes set out in the Planning Act 2008 (as amended) for designating National Policy Statements

• The LGA support this amendment.
• We have previously highlighted our concerns that any proposed changes or to additions to NDMPs, following implementation, would be made solely by the incumbent Secretary of State, and not subject to the same rigorous consultation and community engagement as local policies are through the plan-making process.
• We would urge the Government to continually consult with local government, and other stakeholders, on the specific content of and changes to NDMP’s to ensure they are workable at local level.

Amendment relating to planning determinations

(Lord Lansley) Clause 88, page 95, line 26, after “to” insert “the processes or criteria by which any determination is to be made under the planning Acts, as regards”

This amendment would limit the scope of NDMP to those policies which govern the determination of planning applications, not policies which are to be included in the Local Plan relating to the use of land.

• In the absence of any material detail on the type and scope of NDMP’s it is impossible to comment on the real impact they may have on local authorities to plan or make decisions effectively at the local level.
• We are concerned that setting policies at national level will leave councils unable to tailor such policies to local circumstances. Flexibility must be built into the system to enable councils to respond to local, complex and changing circumstances.

Amendment relating to community engagement

(Lord Young of Cookham) Leave out – Clause 100, 101 and 102

• In principle the LGA support this amendment. It is vital that a local, plan-led planning system underpinned by community engagement remains in place.
• The Bill is light on detail at this stage, but we have concerns that the proposals on street votes could add another layer of complexity to the planning system. This risks undermining the ambition in the Levelling Up and Regeneration Bill to simplify and standardise the process for local plans, so that they are produced more quickly.
• The introduction of street votes risks stifling the production and implementation of local plans, which will prevent the fast delivery of the affordable homes and the infrastructure that communities need. We want to work with the government to enhance opportunities for engagement and reach a wider audience within the process of developing local plans.

Amendment relating to declining planning applications

(Lord Lansley) Clause 107, page 137, leave out lines 6 to 8

This amendment would limit the power to decline to those persons who made a previous application, not those with an undefined connection with the earlier application.

• In principle, the LGA welcome the Government’s aspiration to take an applicant’s past behaviour into account in decision making. This may help to both improve build out rates and tackle poor developer behaviour and improve public confidence in the planning system.
• Should this mechanism be introduced, there would need to be clearly defined parameters set out in the NPPF or planning guidance to ensure that local authorities can make evidenced decisions, and not be subject to legal challenge.

Amendments relating to Healthy Homes

(Lord Crisp, Lord Young Of Cookham, Lord Blunkett, Lord Stunell) After Clause 128, Clause 231, Schedule 7, after Schedule 11

• The LGA support the amendment to include “healthy homes principles” in the Bill, placing a duty on the Secretary of State to promote healthy homes and neighbourhoods.
• The personal, economic and social costs to inadequate housing are substantial. This is why councils, and our partners in the health and care sector know how vital it is to improve unsafe existing homes, and to build good, safe and appropriate new homes to meet residents’ needs.  

Amendment relating to planning fees

(Baroness Pinnock) After Clause 128, insert the following new Clause—

“Planning application fees” –

(1) Section 303 of the Town and Country Planning Act 1990 (fees for planning applications etc.) is amended as follows.

(2) After subsection (4) insert—

“(4A) A local planning authority may make provision as to how a fee or charge under this section is to be calculated (including who is to make the calculation).””

This would allow local authorities to set the fees for planning applications, in order that the cost of determining an application is reflected by the fee charged.

• The LGA welcomes the government’s commitment to increase planning fees, as it has for a long time been our position that there is a need for a well-resourced planning system. However, the proposed increase for major and minor applications of 35 per cent and 25 per cent respectively will not on its own be enough to comprehensively address the issue of resourcing in the planning sector.

Amendments relating to the Infrastructure Levy

(Baroness Pinnock) - Leave out - Clause 129, and Schedule 12

• The LGA support this amendment.
• The LGA, along with 29 other bodies across the sector, have written to government to urge them not to introduce the proposed Infrastructure Levy (IL). We have significant concerns that the proposed IL will result in fewer, not more, affordable homes delivered, will expose councils to excessive levels of financial risks, and be increasingly burdensome and complex for local authorities to implement and manage. The signatories propose that retention and improvement of the current developer contribution system is the most appropriate solution.

Amendment relating to smoke free pavements

(Lord Young of Cookham) - Schedule 20, page 460, line 25, at end insert—

“8A In section 5 of the 2020 Act (conditions), after subsection (2) insert—

“(2A) Pavement licences can only be granted by a local authority subject to

the condition that smoking is prohibited.””

The purpose of the amendment is to ensure that all pavement licences are smoke free.

• The LGA supports this amendment as it will set a level playing field for hospitality venues across the country, ensure outdoor drinking and dining is a family friendly environment and have the added public health benefit of protecting people from unwanted second-hand smoke.
• Prohibiting smoking in an area where a pavement licence has been granted will also make the legislation clearer for businesses and easier for licensing authorities to enforce.
• We support this amendment as it would enable local authorities to set planning fees at a local level, including those for dealing with permitted development applications and discharge of planning conditions. This would enable councils to deliver responsive council planning services that are crucial to growth and building the homes we need