Planning matters

 The Planning and Infrastructure Act (“the Act”), which gained Royal Assent in December 2025, includes scope for further changes to the planning fee regime. These include localised planning fees and surcharge payable to statutory consultees. We explain the proposed changes to fees below, with brief discussion on other potential changes to fees that have been mentioned by the Government.  Lichfields’ ‘Surcharge to supercharge?’ blog discusses the proposed surcharges payable to fund statutory consultee engagement with planning applications. Cost recovery for Nationally Significant Infrastructure Projects, also provided for by the Act, will be discussed in a future blog.

Planning fees have been subject to a few amendments in recent years as the Government has sought to respond to shortfalls in funding for local planning authorities (LPAs) and improve the performance of the planning service[1]. Changes made last year, including the first year of indexation[2], which came into force on 1 April 2025 and are discussed in further detail here[3].

 

The provisions in the Act discussed in this blog will require secondary legislation before they come into force. It is anticipated that further details of a local fee setting model, surcharges and the benchmarking of associated costs will be consulted on in early 2026[4].  

 

The Act provides for the Town and Country Planning Act 1990 (TCPA) to be amended to give LPAs autonomy to set planning fees[5] themselves, but not exceeding cost recovery levels. 

The September 2025 Planning and Infrastructure Bill ‘Factsheet’[6] on local fee setting sets out the rationale for the change:

and

Once brought into force, the Act will amend section 303 of the TCPA, allowing regulations that authorise or require an LPA or Mayor of London[7] to set the level of a planning fee or charge.

The Regulations must include procedures for or set out:

1. consultation to be carried out in relation to the setting of the level of a fee or charge;
2. the criteria to be applied when setting the level of a fee or charge;
3. publication of information or reports;
4. obligations to notify the Secretary of State; and
5. reviews of the level of a fee or charge.

Income raised via these new provisions must be spent on development control, enforcement, advertisement consent, tree preservation order, listed building consent, certificate of alternative development, mayoral development orders or neighbourhood amenity duties[8].

The ringfencing of planning fees is a big shift, as the Government emphasised in the Commons, when seeking to reassure MPs of the controls on very high fees being imposed:

“We are also introducing safeguards to ensure that the fees are reasonable and directly invested in improving planning performance, and that they are not used to fund other council services. Planning fee charges will not be able to exceed the cost to local planning authorities in determining a planning application. That will prevent disproportionate or unjustifiably high fees being set. That is an important point, because one of the concerns we have had is about the ability, without the provision being in place, of local authorities that do not want to see development to set extremely high fees to deter applications. To ensure transparency, local planning authorities will also be required to consult on any fee increases and publish evidence to justify the fees that they charge. Finally, and most importantly, income received from planning fees will be ringfenced, as I have said, so that it can only be used in the determination of planning applications”.

To safeguard against exceedance of cost recovery, the Act affords the Secretary of State powers to intervene and to direct LPAs to amend planning fees or charges. Indeed, the Secretary of State may intervene if fees are considered disproportionately too high or too low, or if the requirements for setting or varying fees are not adhered to. This comprises a two-stage process, with the Secretary of State first directing the relevant charging authority to undertake a review of the level of fee or charge, and provide appropriate evidence for the result of the review. Subsequently, if following review, the fee or charge remains set at a level not considered appropriate by the Secretary of State, an imposed fee or charge can be set directly by the Secretary of State, as considered appropriate.

Interestingly, the Act also provides scope for a retrospective refund mechanism, whereby the charging authority would be responsible for reimbursement of applicants where any inappropriate fee or charge is reduced as a result of Secretary of State intervention.

But this is still a fairly loose framework, with the Regulations being key to how fee localisation will operate.

 

 

The approach to fee localisation was first consulted on in July 2024[9]. That consultation included different approaches to localising planning fees[10].

The February 2025 outcome to that consultation[11] provides an indication of how the localisation of fees are intended to be taken forwards and what the Regulations might require.

The outcome states that 49% of all respondents and 63% of LPA respondents considered that each LPA should be able to set its own (non-profit making) planning application fee. Almost half of all respondents supported a local variation model, where a national fee is maintained and LPAs can opt to set local fees. Whereas only 15% supported a full localisation model. The ‘key points’ summary in the consultation provides an interesting perspective on the perceived pros and cons[12].

Notwithstanding the finely balanced consultation responses, the Government said it would take forward a fees model that allows for location variation from a default national planning fee.

How ‘cost recovery’ will be quantified, and importantly standardised between LPAs, will be established through further consultation. The Government has said:

“We will also undertake a benchmarking exercise to establish a robust baseline for full cost recovery of fees and to inform a national default fee”. 

The Chief Planner’s newsletter on the 16th December set out that “a consultation on the proposed national default fee and guidance on local fee setting will be published in early 2026”.

Work carried out by the Planning Advisory Service (PAS) is likely to inform fee benchmarking. The Explanatory Notes[13] for the version of the then Bill, as brought from the Commons, were clear that cost recovery cannot include wider planning services such as plan-making or enforcement, but can include other technical specialists within the LPA that contribute to planning decisions.

 

PAS sent a National Planning Fees Survey[14] to each LPA, in August 2025. Under the national fee schedule cost recovery section, it asked for “your planning team’s views on how closely the national fee set for a wide range of planning applications achieves full cost recovery in terms of the resources used to process them”.

Other sections of the survey included:

• Costs and hourly rates – asking how LPAs put together discretionary fees such as PPAs
• Sharing any work already carried out on localised fees
• Understanding the cost recovery models associated with NSIPs, particularly PPAs
• Appetite and priorities for localised fee setting
• The views of LPAs on local fee setting generally

Regarding work carried out on localised fees, some LPAs officers and respondents to the Government’s consultation advocate for ‘regional’ collaborative fee setting, albeit there will, of course, always be a boundary where the fees shift and local costs might be above or below the LPA fee.

Prior to the survey, PAS had published a blog[15], explaining:

“we are working on a model to allow councils to set their own fees (if they want to) and to promote a way of thinking about what a good planning service should look like”. 

The blog explained that PAS was working on a light-touch review of the national fee schedule and a sector-owned method for setting localised planning fees.

The PAS author opined “The objective is to help ensure local fees are robust, justifiable and transparent. While we will be looking at setting more realistic fees, I think we can expect there to be a continuation of £0 fees for particular application types”.

The Government intends to carry out a full review of all national fees, as part of establishing a robust baseline for full cost recovery of fees and setting a national default fee.

The Government has committed to implementing Section 73B, a new procedural route to amending planning permissions.[16] In the February 2025 Government response to the national policy consultation[17] the Government said it would introduce a banded fee structure for s73 or s73B applications, reflecting the varying amounts of input required by LPAs when assessing these applications. This has been introduced for s73 applications, indicating that the fee for s73B applications is likely to be banded similarly. 

In May 2025, the Government published a policy paper regarding reforming site size thresholds[18] to better support housing delivery on different types of sites. The policy paper noted that, once the reforms to planning fees as outlined in the Act have been implemented, shorter determination periods for particular sizes of site may become more appropriate. This is an example of the Government seeking to respond to calls for a stronger connection between the level of time spent determining an application and the fee charged. However, this particular example is perhaps more reflective of the Government’s strong desire to encourage SME builders. 

In addition, the current national policy consultation says that the Government intends:

“to extend the Permission in Principle application route to sites suitable for medium development. […]. This will enable SME builders to test the principle of development for residential development on more sites without the burden of preparing applications for planning permission”.   

It will consult on the fees for such applications as part of the imminent wider consultation.

The Act does not provide any additional controls on the setting of fees for LPAs’ pre-application advice services or Planning Performance Agreement (PPA) services. The interrelationship between the recovery of application fee costs and additional revenue raised through PPAs will need careful consideration, given that a direct function of PPAs is to safeguard supplementary finances for necessary resourcing on large scale planning applications. The Government has said that it considers that PPAs help to ensure that applications can be determined in timely and effective manner.

Additionally, no commentary is provided on the incorporation of third-party review costs within localised fee setting, required when LPAs do not have in-house resourcing for technical reviews such as viability or daylight/sunlight. However, such reviews are typically borne directly by the applicant in addition to application fees.

The provision relating to new localised fees for local authorities is currently in force for the purpose of making regulations; fully coming into force on a date to be ‘appointed’.