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Compulsory purchase remains vital to facilitate urban regeneration

Jonathan Bower, Planning Partner at law firm Womble Bond Dickinson LLP

New figures released by law firm Womble Bond Dickinson LLP reveal a dip in the use of Planning Compulsory Purchase Orders (CPOs).  Submissions of Planning CPOs, which are often deployed to facilitate complex large scale development projects, decreased by 30 per cent in 2016 with 40 applications compared to 57 in 2015 and 58 in 2014. However this is still higher than the 36 submitted in 2013 – the lowest level since 2003.

Housing CPOs also saw a dip from 54 submitted in 2015 to 39 in 2016. These figures are toward the lower end of the range of CPOs submitted annually in the years 2003-16 covered by our previous research.

Planning CPOs can be a powerful indicator of economic confidence – the making of a CPO is often a key step in commitment by both the public and private sectors towards a major development scheme.  The continued use of CPOs and their high success rate is therefore encouraging. However, the use of Planning CPOs in 2016 still falls short of pre-recession levels and a ‘new normal’ for a lower number of CPO submissions made each year appears to have been established.

Success rates for both kinds of CPO remain high. The figures indicate that for Planning CPOs at least 87 per cent in 2015 and 82 per cent in 2016 succeeded. This may be even higher when considering withdrawn CPOs due to acquisition by agreement. For Housing CPOs the equivalent figures are at least 93 per cent in 2015 and 94 per cent in 2016. This level of success is consistent with previous years and demonstrates an established, long-term trend.

The regional hot spots for use of compulsory purchase submissions between 2003 – 2016 are the North West of England and London, followed by the West Midlands. CPOs are used nationwide but the report suggests that while many authorities have used their compulsory purchase powers they do so sparingly. A relatively small number of authorities account for a significant proportion of CPOs made.

CPO totals in the London region reflect a wider and more regular use of powers. Even against that background of broader usage the programme of Housing CPOs made by Newham stands out. In the North-West, the extensive use of housing compulsory purchase powers by Burnley and Wigan Councils, and of planning compulsory purchase powers by Liverpool and Manchester City Councils respectively, contribute significantly to the results. In the West Midlands, Birmingham and Wolverhampton Councils have made substantial numbers of Housing CPOs, with the former also making 19 Planning CPOs.

Given the high success rates of CPOs there is scope for greater use by those authorities that already use the powers and for other authorities to consider their use. However it is also worth noting why CPOs fail so that lessons can be learned. For Housing CPOs a lot of these are fact specific but for Planning CPOs reasons for them not being confirmed include: a failure to assess alternative schemes, planning permission not conclusive of need and Public Sector Equality Duty issues.

For the Aylesbury Estate decision (which is to be the subject of a new public inquiry) the detail of that decision potentially opens the door to a much increased need to give weight to the personal circumstance of individual residents and their current community life when it could be difficult to elicit the information. Where a case is finely balanced the “benefit of doubt” will rest with the objector. Hopefully greater clarity will flow from the new decision on that scheme.

Jonathan Bower, Planning Partner at law firm Womble Bond Dickinson LLP, commented: “Our fourth report echoes many of the key messages of previous reports: CPOs are a vital tool for regeneration, success rates for both Planning and Housing CPOs remain high and there are a range of reasons, from technical to evidential, why a small percentage of CPOs are not confirmed. A significant number of local authorities make use of compulsory purchase powers but generally they do so sparingly.

“Acquiring authorities can take comfort from the good prospects of success but must use CPOs with care and pay close attention to the circumstances of each case to meet legal and policy requirements.

“The use of compulsory purchase requires a supporting policy base and it is most successful when there is strong political will to use the powers.  Yesterday’s publication of the draft London Plan sets a framework for the future use of CPO powers in conjunction with the London Boroughs to deliver new housing in particular.”

Melanie Leech, Chief Executive of the British Property Federation, commented: “Compulsory purchase can be incredibly helpful to investment and community building, when used appropriately by local authorities, helping them bring forward much-needed housing and package parcels of land in ways that support regeneration. Despite its benefits, this report confirms that CPO remains an under-used process – particularly when compared to the frequency of applications during the pre-recession period.

“With the country facing a housing crisis, proposals for Garden Towns/Villages and more development on complex urban sites will likely gather pace and local authorities therefore need to be supported in the understanding of the tools at their disposal. Increased use of CPOs will not act as a silver bullet to addressing these challenges, and there are other means of supporting the development of new housing and regeneration – better resourcing of planning departments; improved and more transparent engagement between the public and private sector; and innovative thinking around infrastructure funding, for example.

“However, even if we are to accept these relatively low levels of use as the “new normal”, it is clear that increasing its use could still go a long way to unlocking more sites and more housing.”