Truss/Kwarteng Investment Zones Leave Experts Unimpressed

The 'investment zones' introduced by Chancellor of the Exchequer Kwasi Kwarteng in his Friday minibudget are unlikely to lead to the “faster and streamlined” planning system the Chancellor promised, and as a result unlikely to lead to a step-change in development.

So said planning specialists on the basis of the first full explanation of the investment zone plan, published over the weekend, examining early government proposals for up to 38 such zones across England

“The need for planning applications will be minimised and where planning applications remain necessary, they will be radically streamlined,” HM Treasury said on Friday.

The latest document makes it clear that investment zones will mostly already have passed through the planning system to some extent. It refers to sites that have already been identified in existing local growth strategies and transport plans or “already have a masterplan, development order or outline permission”.

The prospectus said it will relax EU requirements that “create paperwork and stall development but do not necessarily protect the environment” but does not identify those requirements, and promises to “relax key national and local policy requirements,” also not specified. 

Yet the document added that “national policy on the Green Belt, [to] protect our heritage, and address flood risk, highway and other public safety matters — along with building regulations — will continue to apply”. 

“It is very difficult to see how you can identify more land for development, given that Liz Truss made it clear in her leadership campaign that green belt land is sacrosanct, and that the document says this, and most locations are green belt constrained,” Barton Willmore Associate Director Matthew Dawber told Bisnow.

“The only streamlining space left, by the look of it, would be to water down environmental protections for protected habitants, sites of special scientific interest and so on, and you would need new law to do that. And in any case you only need a habitat assessment if you are likely to impact on a protected habitat, same with environmental impact assessments.”

What slows the planning system down is not red tape but a lack of resources, Dawber said. There are not enough council planners to handle the volume of work already coming in, and if the tax incentives work, and it generates more applications, then the delays will get even worse unless there are more resources to deal with the extra workload.

“There’s also a problem in that many of the authorities listed as sponsors of investment zones do not themselves have town planning powers, Dawber added. So it is unclear how the zones fit into the local planning system. "Will it mean a review of existing local plans, because if it did that will take time. And if it doesn’t, how will they exempt some applications from the local plan process? The document doesn’t add up. It certainly doesn’t look like a silver bullet.”

The response from other commentators was not overwhelmingly enthusiastic.

Savills pointed out that the latest approach represented the third attempt at major planning reform since 2020. Detailed enabling planning mechanisms aimed at speeding these projects through the ‘red tape’ could require legislative change, or revised local plans, which will take time, it said. 

“Where this leaves local plans, intentions for design codes, and environmental considerations remains to be seen,” Savills Planning Director Jay Patel said.

Planning simplification has a long history of not happening. Lawyers pointed to 32-year-old legislation that allows for simplification, but which has rarely been used. 

“In planning terms the Town and Country Act 1990 already allowed for simplified planning zones and enterprise zones to grant consent for certain types of development for certain periods, so the legislative infrastructure is already there," Forsters LLP counsel Matthew Evans said. "It is therefore likely that today’s Growth Plan aims to revive the idea, with most local authorities having never introduced such a zone. So the next step will be to re-examine to find out how these things work.”

The full list of candidate investment zones — which includes the Greater London Authority, Greater Manchester Combined Authority and the West Midlands Combined Authority — can be found here.