A flaw in the plan

As the guillotine comes down on the three-month consultation period for draft PPS6 two important questions remain. The first is procedural: has there actually been proper consultation here? The second is substantive: what now for town centre planning?

Proper consultation

The government has been told before what proper consultation requires - see for example Sullivan J's 2005 decision with regard to the Airports White Paper. In R v Secretary of State for Social Services ex p. Association of Metropolitan Authorities [1986] 1 All ER164 Webster J observed that '.. . in any context the essence of consultation is the communication of a genuine invitation to give advice and a genuine consideration of that advice. In my view it must go without saying that to achieve consultation sufficient information must be supplied by the consulting to the consulted party to enable it to tender helpful advice . . . '.

With regard to draft PPS6, the government's consultation invitation has doubtless been genuine but the problem is that the government has not yet put all its cards on the table. This means, in short, that consultees have not had all the necessary information to enable them to respond properly. The Planning and Environment Bar Association has taken this view in its consultation response to DCLG. By way of example, whilst draft PPS6 makes reference to a competition test it does not explain what is intended and pays no regard to the Competition Commission's recent findings, which are under challenge by Tesco.

Some explanation is provided by the Department for Business and Regulatory Reform's press release of 29 July 2008: 'The government will reflect further on this recommendation following the CLG consultation on revisions to town centre planning policy and the conclusion of the legal challenge launched by Tesco on 30 June. It does not want to prejudice the outcome of this appeal.'

Plainly, if national policy is to contain anything approaching a 'fascia test' then fairness demands that consultees will need to be given the opportunity to comment. That opportunity has not yet been provided.

Good practice guide

Equally, we are promised a 'good practice guide' to explain how the new policy should be implemented. This will obviously be a very important document, dealing both with development plan preparation and development control. It should have been issued in draft alongside Draft PPS6 so that consultees could understand how the government envisages the new policy will work. It remains to be seen whether a second draft of the new policy will be issued or whether it will simply now be published in its final form. The government will have to take account of its legal obligations and its own policy on consultation. As things stand, and in the light of the current economic climate, there must be a realistic prospect of the draft policy being reformulated with further consultation ensuing. Given the problems with the substantive guidance we identify below, that can only be a good thing.

Substantive policy

Impact test

The headline policy change is the abandonment of the 'needs test' and its replacement with a new 'impact test'. The demise of the needs test has come as no surprise. In her December 2006 Review of Land Use Planning Kate Barker concluded that the needs test protects existing operators and that its retention would be 'likely to result in more limited choice and higher prices of goods in stores'. The government's May 2007 White Paper Planning for a Sustainable Future described the needs test as a 'blunt instrument' and confirmed that it would be dropped in favour of 'a new test which has a strong focus on our town centre first policy, and which promotes competition and improves consumer choice'. Hazel Blears picks up on this theme in her foreword to the draft PPS6, stating that '. . . too often [the needs test] causes planners to get caught up in debate about technical definitions, and overlook the vital question of what the proposed development actually means for the town centre and the people who rely on it'.

However, as we shall see, rumours of the death of the needs test have been greatly exaggerated.

The new impact test is the central feature of the new system of development control envisaged by draft PPS6. Essentially, the impact test is a long list of factors that decision makers are required to take into account in their determination of applications for retail development. These are divided into two main types: 'key town centre impacts' and 'wider impacts'. So far so good, but four preliminary points can be made.

Clumsy wording

First, the draft PPS6 fails to make it sufficiently clear how, and in what circumstances, the impact test is to be applied. Town centre planning should be transparent but the structure and formulation of the new test is both clumsy and confused. For instance, the draft PPS6 tells us at para.3.5 that new development should 'satisfy' the test that 'there are no unacceptable impacts arising from the proposed development, including on existing centres'. But this is irreconcilable with the subsequent advice in para.19f to the effect that development which would have an adverse impact on the town centre should nonetheless be considered favourably if this impact is 'likely to be outweighed by significant wider economic, social and environmental benefits'. Equally, there is no guidance on what should happen where the development would have a positive impact on the town centre. Should planning permission then be granted without going on to consider any of the wider economic, social or environmental impacts? Given the exhortation in para.3.5 that there should be no 'unacceptable impacts' we assume that regard must be had to these additional factors, but the guidance is silent on the point. In short, it appears that some sort of overall balancing exercise is required. These points serve only to highlight the importance of the impending good practice guide.

Wider range of factors

Second, contrary to the government's stated aim for a more streamlined planning system, the new impact test will make the system more cumbersome. It is true that much of the new impact test contains nothing new. By way of example, the 'town centre impact considerations' include: how the development relates to the development plan; the impact on investment in the centre; the scale of the development; the impact on trade and turnover; and whether the proposed development will promote local consumer choice and retail diversity in terms of the range, type and quality of goods. Similarly, the 'wider impacts' to be taken into account include: the site's accessibility to a choice of transport modes; the use of previously-developed land; and the extent to which the proposal will 'claw back' trade. All of these concepts are readily recognisable to retail planners. Indeed, the requirement to assess the impact on trade and turnover means that examination of retail expenditure capacity within the catchment, that is the assessment of need, remains notwithstanding the government announcement that it has gone.

But there is a much wider range of factors to be taken into account, including the impact on out-of-town sites that are allocated in the development plan; the extent to which the development will assist in achieving regeneration over a five-year timescale; and whether the development makes efficient use of land. In addition to all of this, much greater prominence is to be given to good quality design and sustainability. In short, larger retail development is going to have to be accompanied by an impact assessment which will be a document of the same sort of complexity as an environmental statement.

Unfocused

Third, the impact test will introduce a greater degree of uncertainty into the development control process. The current absence of a properly formulated competition test is compounded by an unfocused emphasis on 'local consumer choice and retail diversity in terms of the range, type and quality of goods'. The draft PPS clearly encourages LPAs to formulate detailed policies directed at the composition of their town centres. There is plainly the prospect of 'small shops' policies emerging in future development plan documents and the range, type and quality of goods will also be up for grabs. In addition, it raises the prospect of the refusal of permission based upon the identity of the retailer where to grant permission would not promote local consumer choice or retail diversity, that is some form of fascia test. This in turn leads to the conclusion that planning permissions that are personal to particular operators may become far more commonplace.

Lack of guidance

Fourth, as already mentioned, the draft PPS6 calls for a balance to be struck between the various impacts. In carrying out any balancing exercise that has to be done, obviously weight has to be attributed to these impacts both positive and negative. However, the draft PPS6 provides almost no real guidance as to how weight should be ascribed to the various factors. This leaves the planning decision maker (that is local councillors) free, within the limits of rationality, to ascribe weight to these factors as they wish. Their attitudes will inevitably be shaped by local political considerations. The proposed changes to PPS6 could therefore result in considerable variation in approach from authority to authority, and from application to application, and in politically motivated refusals disguised as the exercise of legitimate planning judgement.

In conclusion, the government has consulted on a draft policy without letting the consultees see the full picture. The absence of any clear guidance on the issue of competition or as to the application of the new impact test is especially worrying. The new assessment framework in some respects re-packages elements from the old, but it also significantly broadens the range of factors that have to be taken into account. By broadening the range of matters to be considered, the new regime is likely to be a recipe for a more complicated decision-making process. This in turn will in turn lead to slower decision making. The direction of travel is clear but the new PPS6 is unlikely to lead to faster, more efficient town centre planning.

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