'Alternative provider' proposals scrutinised by UK peers, property industry and planning professionals

Members of the House of Lords have agreed a series of amendments to the parts of Housing and Planning Bill that will allow the communities secretary to test the proposals.

Under the amended provisions, the communities secretary will be able to introduce temporary pilot schemes in discrete areas for a maximum of five years. A consultation will need to be carried out before regulations are made introducing such pilot schemes and the communities secretary will be required to report to parliament on the outcomes of the testing.

A new subsection of the Bill will allow regulations to require alternative providers to process 'connected applications' alongside any application for planning permission they have been chosen to process. The changes to the Bill also clarified that any advice provided to a local authority (LPA) by an alternative provider will not be binding.

The government's consultation on the implementation of planning changes (64-page / 803 KB PDF) closed on 15 April. Responses received included recommendations that only accredited planning professionals should be allowed to act as alternative providers and that competition should only be allowed for the processing of minor applications.

The submission from solicitors' representative bodies the Law Society and the City of London Law Society (the Law Societies) recommended that planning consultancies and legal advisers with sufficient expertise and experience should be able to compete to process applications. Both property investors' trade body the British Property Federation (BPF) and planning professionals' representative body the Royal Town Planning Institute (RTPI) said only RTPI-accredited planners should be allowed to compile reports in competition with LPAs.

The Planning Officers' Society's (POS) submission said the POS was "very concerned" about the proposals and could not see any benefits to allowing private operators to process planning applications. The POS suggested instead that alternative local authorities could be chosen, to "encourage competition and high standards in LPAs rather than a brain drain to approved providers".

The Law Societies said that, in order to avoid potential conflicts of interest, it should be LPAs, not applicants who decide whether an alternative provider will process an application and which provider takes an individual application. Respondents agreed that the alternative provider process should be restricted to less complex or sensitive applications.

The RTPI said LPAs should be able to invoice alternative providers for any costs incurred in assisting with an application. They said this could include recovery of "the costs of scanning files, uploading and archiving files, council officer involvement, planning history research work and determination service of the chief planning officer".  The Law Societies suggested that application fees should be paid to LPAs, who should then decide whether to pass any or all of the fees over to the relevant provider.

The POS raised concerns that the information-sharing required in order to process an application externally could introduce "massive inefficiencies" and involve commercially sensitive data. The RTPI was satisfied that "it should not be too difficult for local authorities to grant remote password access to their systems" and suggested that "alternative providers should be bound by non-disclosure agreements".

The BPF and the RTPI agreed that the government should report back fully on the results of the pilot testing, and the RTPI suggested a parallel test should be carried out to evaluate whether increased resources, rather than the use of alternative providers, could help speed up the decision-making process.

Planning expert Elizabeth Wiseman of Pinsent Masons, the law firm behind Out-Law.com, said: "There has been much debate over what has been termed the 'privatisation of planning' with many expressing their concern that the introduction of 'alternative providers' will have a negative impact on the legitimacy and governance of the planning system."

"To understand the impact that the introduction of ‘alternative providers’ will have on the planning system further crucial details need to be understood," said Wiseman. "For example: which planning applications may be processed by 'alternative providers'?; will local planning authorities still have the ability to ultimately determine the planning application?; who will be able to provide an ‘alternative provider’ service? Many questions remain."

"It will only be once this detail is released that the true impact will begin to be understood. What is clear is that innovative ways of streamlining the planning system and reducing the pressure on local planning authorities should be explored. However, whether the introduction of ‘alternative providers’ is the answer remains to be seen," Wiseman said.