Planning matters

The Government recently issued a written response (6^th February 2025) to the House of Lords Built Environment Committee's report, 'High Streets: Life beyond retail?’ published in November 2024. This blog covers the Government's response to recommendations, following our earlier analysis of the original report in December.

The Government's response points to measures such as High Street Rental Auctions, alongside wider aims for devolution and local authority investment to promote micro interventions at the local level. There is admission that a full response, including on any policy updates, is deferred, but the report nevertheless provides 'the most up-to-date position as of now'. Central is the Government’s commitment to empowering local authorities to take local action to enhance vitality and viability, in recognition that each high street has a unique combination of issues amongst recurring themes: high vacancy rates, falling footfall, changing consumer habits and in some cases, a need for imaginative repurposing.

In acknowledgement of this need for localised and, in some cases, bespoke solutions, and in accordance with its broader strategy, the Government’s response points towards ambitions of further devolution, coupled with financial support for local government backed initiative for achieving the recommendations set out in the House of Lords Built Environment Committee's report. Indeed, this constituted the bulk of the responses to recommendations relating to as diverse topics as enhancing transport networks, local markets, local authority property acquisition, and it also forms the mechanism for the new Community Right to Buy. It was also cited in the answer to the Lords’ suggestion for dedicated ‘town centre managers’. An earlier Lichfields blog suggests this unlikely to be implemented consistently because of resourcing and funding disparities.

The Government’s response references specific measures for the ‘rebuilding’ of local government, through targeted funding such as the Recovery Grant to address regional disadvantages and removal of competition for funding streams. By targeting financial improvements to Local Authorities, much of the Government’s response is delegated to equipping Local Authorities to take local action, which includes decisions on whether a ‘town centre manager’ is appropriate use of individual budgets, or whether such resource is better utilised elsewhere.

However, increased local authority powers and funding must be paired at the national level with clear policy and guidance to create consistent planning conditions to attract town centre investment. In terms of this national framework, and any future National Development Management Policies to protect town centres, the Government’s response was limited in detail.

Our previous analysis pointed to the need for an update to the ‘Town Centres and Retail’ parts of the Planning Practice Guidance to improve consistency of decisions and reduce delays. There is yet no update; but the Government has voiced its intention to consult on National Development Management Policies in the Spring.

Beyond this potential for updated guidance there is no indication of significant changes to established policy. Whilst it will be kept under review, the Government has confirmed that it has no plans yet to extend Class E or amend Permitted Development Rights. The sequential test will continue to apply to retail, but will not be expanded to cover public services as suggested in the Lords’ Report. Whilst the Government has acknowledged the value of local service provision on the high street, location will continue to be decided by broader infrastructure delivery strategies and at the local level.

The Government’s response did not directly respond to the Lords’ recommendation that the ‘town centre first’ approach be maintained in the NPPF. The response instead referenced the sequential test. Rigid application of the ‘town centre first’ approach often catches developments which cannot be accommodated in these locations. Future consultation may provide an opportunity to embed additional flexibility to more closely align with a changing commercial occupier market, enabling Local Authorities to consider the needs of individual developments and their contributions to local requirements and growth, in balance with the need to direct appropriate development to the high street.

The Government’s growth agenda has been applied to the high street through support for businesses, reiterating in its response the proposed reforms to the business rates system, and signposting to the publication of the Small Business Strategy later this year. The Government is also expanding the tools available to Local Authorities: not through planning policy reform, but through initiatives such as the High Street Rental Auctions. An Early Adopters programme has been launched to provide actionable feedback, with Bassetlaw, Darlington and Mansfield councils as confirmed participants.

The Government’s response also pointed to the Long-Term Plan for Towns, High Steet Accelerators, and Community Right to buy to emphasise the role of community and business involvement in partnership working for regeneration. There was mention of forthcoming plan-making reforms to support community involvement, requiring local plans to be shorter with increased community engagement. These measures sit firmly within the devolution agenda, establishing frameworks for action by communities, local business, and local authorities.

In this context of devolution, there perhaps remains a gap for strategy at the regional level. At the end of January, North East Mayor Kim McGuinness announced plans to form a High Streets Commission along with other local leaders. As identified in our recent blog, this could form an important strategy for ensuring devolution delivers the right benefits, tailored to ensure that diversification and re-purposing contributes to broader strategic goals. We have previously emphasised the need for greater regional collaboration in the plan-making process; and perhaps strategic initiatives such as this Commission will occupy the currently vacant space between national planning policy and local implementation tools.

The Government has responded to the Lords’ recommendations in part, with a fuller response outlining policy implications expected in due course. However, in doing so it has been helpful for the Government to further outline the tools available, and has suggested that financial support for business is likely to come in future through local channels via devolution and increased financing of local government. This will assist, in our view, local entrepreneurial reponses, such as those being trialled in the North East and an increasing array of initiatives delegated through local action, recognising that there is not a ‘one size fits all’ solution to achieving renaissance within our town centres.

There is, however, little indication of the direction of travel for bolstering national guidance and planning policy for town centres, but by its own admission, a full policy response remains in development, with suggested additional consultation in the coming months. There remains, in our view, a need to consider the potential of Class E in support of regeneration, and greater understanding of changing operator needs, which may be reflected through greater policy flexibility. In the meantime, regional strategies such as the High Streets Commission may take the reins, and provide a template for local, Government backed entrepreneurial initiative.