A package of planning system reforms saving developers time and money to help them complete building projects during the recovery have now been approved by parliament, Planning Minister John Healey confirmed today.

Businesses that need to extend existing planning permissions to allow more time to build new developments will now pay significantly lower fees which, along with other measures to improve the flexibility of planning permissions, will help save up to £69m a year, giving a valuable cash boost for developers so they can keep investing in new projects.

John Healey said:

“At a time when funding for new developments is difficult, I have changed the planning rules to give developers longer to build new projects that will help drive economic recovery.

“Now I am able to cut and cap the fee for extending existing planning permissions. As we work to secure a strong economic recovery, we need to do what we can to keep plans for new development on the table. The planning system has to adapt to current economic circumstances to help homeowners, industry and developers, and we have done just that.”

New measures that enable businesses and homeowners to extend existing planning permissions without the expense and red tape of a new planning application were introduced in October 2009.

The fees for extending planning permissions are now being reduced so the fee for a major development that was previously as high as £250,000 will now be £500, the fee for smaller developments that was as high as £3,000 will now be £170, and for householder projects the previous fee of £150 will be reduced to £50.

John Healey also confirmed a further boost for small businesses by ensuring those affected by disruption from new public building works and compulsory purchase orders are able to claim compensation.

The new rateable value of a business property below which the owners can claim certain types of compensation against compulsory purchase orders and disruption will increase from £29,200 to £34,800 from 1 April 2010. The rateable value is the rent a business could expect to pay to occupy the property and the change ensures no businesses will lose out because of the five-yearly review of rateable values.

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