Taxpayers will continue to subsidise planning services by almost £5 million a week until the Government finalises measures to increase fees to cover the cost of processing applications, councils have warned.
The Government has committed to raising planning fees by 35 per cent for major applications and 25 per cent for minor and other applications, laying the regulations in Parliament before the summer recess. These now need to be voted on by both the House of Commons and the House of Lords before they can come into effect.
The Local Government Association, which represents councils, is urging the Government to urgently make parliamentary time to introduce the fee uplift, following the return of MPs to Parliament.
Planning fees currently do not cover the true cost of processing planning applications, with 305 out of 343 local authority planning departments operating in a deficit totalling £245.4 million in 2020/21.
LGA modelling has shown that in order to ensure all councils in deficit are able to balance the books, fees would need to be increased by 57 per cent, far higher than the proposed increase, highlighting the need for councils to have the flexibility to set fees at a local level to cover their individual costs.
However, any delays to the proposed increase would mean further costs placed on the taxpayer.
As the House of Lords debates the Levelling Up and Regeneration Bill today, the LGA has reiterated calls for councils to be able to set their own planning fees.
Cllr Darren Rodwell, LGA planning spokesperson, said: “It is good the Government has recognised the resource issues facing council planning teams and announced it will increase planning fees.
“While this will not resolve all the capacity challenges within planning departments or prevent a significant national funding shortfall, it is vital the Government does not delay introducing the fee uplift, or taxpayers could be faced with a cost of subsidising the planning system to the tune of almost £5 million a week.
“Only by giving councils the flexibility to set planning fees at a local level can they cover their full costs relating to planning. This would help to future-proof the sector and ensure planning departments can continue to support the delivery of much-needed new homes, including the affordable homes and infrastructure that the country needs.”
