Considered in Grand Committee
My Lords, the Localism Act introduced neighbourhood planning which enables communities to have a far greater say in deciding the future of the areas where they live and work—deciding, for example, where homes, shops and offices are built and which green spaces should be developed or protected. Parish councils and designated neighbourhood forums can use these powers to produce neighbourhood plans, which can become part of the statutory development plan for the local area as long as they meet certain conditions such as being in general conformity with the strategic policies of the local plan and neighbourhood development orders that again, subject to meeting basic conditions, can grant planning permission, removing the need for planning applications where development is consistent with the order.
Parish councils and community organisations could also use these powers to introduce a community right to build order, a type of neighbourhood development order that enables communities to bring forward small-scale, site-specific, community-led development.
Once a neighbourhood plan or order has passed independent examination and met certain legal tests, the Localism Act requires that the plan or order should be put to a referendum of the electors in the area concerned. The referendum is important in retaining the credibility of the principle that the community is in the driving seat of planning at the neighbourhood level. A referendum will give everyone in the community the opportunity to have their say and demonstrate evidence of community support in a manner which cannot be demonstrated through a petition or consultation.
The Neighbourhood Planning (Referendum) Regulations 2012 are not about the principle of whether a referendum should be held. This principle has already been established in the Localism Act which gained Royal Assent in November 2011. The purpose of these regulations is to provide for the conduct of referendums in relation to whether a neighbourhood plan, a neighbourhood development order or a community right to build order should come into effect. These regulations follow existing practice and largely replicate the Local Authorities (Conduct of Referendums) (England) Regulations 2012, which the House has recently considered. Council election officers are familiar with those.
May I answer that question before we finish?
We consulted the independent Electoral Commission, which undertook a public consultation on the referendum questions set out in Schedule 1 and on the ballot papers. As a result, the Government have adopted the questions and the form of the ballot papers exactly as recommended by the commission. Provision has been made, if appropriate, for combining polls for neighbourhood planning referendums and elections. The decision on whether to combine polls is at the discretion of the counting officer in discussion with the returning and counting officers of any other polls.
We already have more than 200 front-runner communities taking forward the new neighbourhood planning powers. The Neighbourhood Planning (Referendums) Regulations provide for the final step in the process by ensuring that the wider community has the final say on whether the plans or orders come into legal force. The regulations set out the necessary rules for ensuring effective administration of such referendums, in which the electorate can have confidence. They follow a well tried practice and will help ensure efficient, effective and consistent administration of any neighbourhood planning referendum. I commend the regulations to the Committee.
My Lords, I thank the noble Baroness for the clarity with which she presented the regulations. As your Lordships will be aware, councillors play a central role to facilitate, encourage and champion local people becoming involved in planning. The LGA, of which I am a vice-president, has consistently supported the principles of neighbourhood planning as a tool available to local authorities, but has also highlighted the unnecessary bureaucracy of the Localism Bill.
These concerns have not prevented the LGA from working very constructively alongside DCLG and member councils on more than 200 front-runner pilots to test out the neighbourhood planning approach. Throughout the passage of the Bill, the noble Lord, Lord Best, strongly argued that neighbourhood planning referendums would be wasteful, expensive and divisive. I agree with him and the LGA on this matter. With 241 clauses and 25 supporting schedules, the size of the Localism Bill is quite something. In keeping with that scale of detail, these regulations add a further 122 pages of prescription to the 38 pages of detail on neighbourhood planning already found in the Act. It is disappointing that the new regulations are so lengthy, indicating Whitehall’s control over the minutiae of how the localist agenda works on the ground.
What are the problems with referendums? The first is expense. Actions with Communities in Rural England estimates that the cost of parish polls will range from £300 to £8,000. In line with this figure, the LGA estimates that running a referendum on the neighbourhood plan will cost in the region of £5,000. In the current economic climate this level of public expenditure is a core reason why it can be argued that referendums should be avoided it unless they are expressly required by local people, whereupon the cost could be justified.
Secondly, the process is wasteful. Local referendums are time-consuming, complex and expensive. A referendum would be important where there was a local disagreement, but surely they should not be required as a result of national diktat.
Thirdly, local referendums can be divisive. Local experience has proved that community-led planning works most effectively when it is based on consensus building, consultation and discussion. It would be far more appropriate to hold referendums only as a last resort if consensus could not be reached through other means.
Schedule 1 to the regulations details the questions that should be asked in a referendum. While the questions are clear and accessible, by their nature they give communities an either/or option. This reinforces why a referendum is not the most appropriate tool for community decision-making on a neighbourhood plan that may deal with a number of issues. Confusion could easily occur where respondents agree with some but not all parts of a proposed plan.
It is crucial that neighbourhood planning is not considered as the only mechanism for community involvement but is presented as one of a range of measures sitting alongside tried and tested local approaches.
My Lords, I shall say a word or two about legitimacy and the ballot box. Development plans and orders and community right to build orders are extremely important matters, and decisions made on each of them have to be legitimate and to be seen to be so. I understand my noble friend Lady Eaton’s position and indeed, as one of its vice-presidents, that of the Local Government Association, and I understand that some think that the proposed process is expensive and bureaucratic. However, I have concluded that there has to be a link between the ballot box and approved neighbourhood development plans and orders and community right to build orders.
Parish councils are elected and have a clear mandate for the decisions that they make. Neighbourhood forums, however, are designated—they are not formally elected through the ballot box—and it is not clear that they have the same degree of democratic mandate. It is possible anyway that the parish council, when elected, may have a split vote in adopting a plan or an order. For that reason, I have concluded that the regulations before us are correct in principle; that localism cannot just be about the rights of principal councils; that localism is about neighbourhoods, parishes and the rights and responsibilities of the people who make up those neighbourhoods; and that, if we are serious about trusting the people, the only way in terms of neighbourhood planning is to be certain what people think. That implies a referendum and the use of a secret ballot through the ballot box.
My Lords, I thank the Minister for introducing these regulations. I am not sure whether they are meant to provide us with some light relief from the Local Government Finance Bill but they certainly offer almost as many pages as the council tax support default scheme, so the DCLG is keeping us busy. I shall pick up the theme of the LGA and the contribution from the noble Baroness, Lady Eaton.
The LGA points out that 122 pages of prescription are added to the 38 pages of detail in the Act regarding neighbourhood planning. The briefing that we have received from the LGA took us back to some of our debates on the Localism Act. Its view at the time, with which we have some sympathy, was that to insist on a referendum in all cases could bring about unnecessary bureaucracy and, as the noble Baroness has pointed out, could be expensive and indeed divisive.
On the matter of expense, the LGA estimates that a neighbourhood plan referendum could cost in the region of £5,000. Could we be clear that in relation to the costs, whatever they are, the Government see these as new burdens that would be funded centrally in respect of not only the cost of the referendums but all the other aspects of neighbourhood planning that require the local planning authority to support and, if necessary, offer finance to local regions?
There is the question of why we should incur these costs when there is clear support for a proposition that can be evidenced in a number of ways. I understand the point made by the noble Lord, Lord Shipley, that if there is a local development plan from the local planning authority, councillors are elected on that, as indeed they are on the parish council. However, there will be occasions when it is abundantly clear from local ward meetings or from local councillors for a particular ward that something is overwhelmingly supported, and that to force a referendum on that seems unnecessarily bureaucratic. Still, we are where we are on that.
The question asked in the regulations is very stark and demands a yes or no response to a particular proposition. Is not planning often more nuanced than that? By focusing always on the referendum with its stark yes or no choice, we will miss an opportunity where there is still room for a bit of exploration into the final shape of the plan. However, we are where we are, with a central diktat over every dot and comma.
The LGA reminded us that the Minister at Third Reading pointed out that the use of existing mechanisms for the creation of local government plan documents was an alternative route for a neighbourhood forum to go down—one which would avoid a referendum. Has this route been adopted in any of the front-runner pilots that are under way?
The Localism Act requires an additional referendum where the draft order for a neighbourhood development order relates to a neighbourhood area that has been designated as a business area. Paragraph 4.6 of the Explanatory Note states that the duties to hold an additional referendum are not to be commenced. Does that mean that no neighbourhood areas are to be designated as business areas, or simply that the requirement for the extra referendum is being put on hold? Either way, will the Minister explain why this is? Do any of the front-runner pilots involve a neighbourhood area that has been designated as a business area?
I have a small question on the procedures in the referendum requirements. Perhaps the Minister will say a little more about the appointment of counting observers in Regulation 19(2). We are likely to be dealing with a referendum that is not fought on party-political lines—although it might be. Is it intended that the observers will include representatives of those who are supporters of the proposition, who will be readily identifiable via the parish council or neighbourhood forum, and of those who take a contrary view? That is the sort of balance one would normally expect to see at a count. Those who take a contrary view might not be formally constituted and may be less easy to identify.
Paragraph 9.2 of the Explanatory Note indicates that further consideration is being given to guidance on neighbourhood planning. Can we have an update on this? If the Government have a one-in, one-out policy on regulations, can we be clear whether this is just one regulation, and what is coming out?
My Lords, I thank those who contributed to this rather short debate. It is an extremely important point—and these are important regulations that set the basis for the processes that will be involved.
My noble friend Lady Eaton referred to the expense of holding a referendum. I was much gratified to have the support of my noble friend Lord Shipley for the proposition that referendums are an important part of the process. The inevitability that some people will not take part in the consultation on the neighbourhood plan or will otherwise be left out cannot be overstated. The process involves neighbourhood forums, and not everybody has to be part of a neighbourhood forum. Although the neighbourhood forums will have to undertake consultations, it is not impossible that some people may miss them—but they will not miss a referendum. It also seems appropriate, as the process is coming up from the grass roots, that the whole of the grass roots should be able to comment.
There are sound reasons for having a referendum. The cost, as we explained, will be borne by the Government until 2015. The Government have provided £50 million of new burdens money. I confirm to the noble Lord, Lord McKenzie, that the new burdens money will be there. That is to make the neighbourhood planning a success, and to ensure that local authorities can fulfil their legal duty to support groups and parish councils. It is pretty all-embracing as to what a new burden involves. As the noble Baroness, Lady Eaton, has said, the costs are estimated at between about £5,000 to £8,000. That, as I say, will be borne by the Government.
On business areas and additional referendums, which the noble Lord, Lord McKenzie, asked me about, it will not be possible to have a referendum of any kind in a designated business area until we make the business referendum rules. Those are not yet out, so these refer only to the neighbourhood planning, not the business area planning.
The noble Lord’s understanding is correct.
I was asked whether neighbourhood plans always require a referendum. They do under the Localism Act 2011. Under the Planning Acts they do not. It would be perfectly possible for a neighbourhood to put together a plan. As long as it conforms with the local plan being processed under the Planning Acts, it would not require a referendum. If it were done under the Localism Act, it would.
That probably covers the main points. The noble Lord, Lord McKenzie, asked me a couple of others, which I have temporarily lost.
I am so sorry; I was shuffling away trying to find this. These are referendum orders for England only. Wales has not indicated that it needs them; if it does, that would be considered separately.
The noble Lord, Lord McKenzie also asked about the guidance on neighbourhood planning. To clarify the position on that, following the publication of the National Planning Policy Framework, planning guidance is now being reviewed with the practitioners to see that it is also enforced. We will be making an announcement shortly about when the guidance will be available.
The counting observers are permitted to view key parts of the election process to ensure that they are transparent. Whether they are individuals or organisations, observers must be accredited by the Electoral Commission. The agents of campaign organisations may attend only those parts of the process that they are specially permitted to attend, such as the counting of votes. The rules for their involvement in the process are clearly set out. My understanding would be the same as that of the noble Lord, Lord McKenzie: there will clearly be observers for those both for and against.
My Lords, I have no doubt that this will not be the last time that we blame the forthcoming Olympics, or at least the Olympic road network. The Minister is unfortunately not fully briefed on the next item of business at this stage. I suggest that the Grand Committee sitting is suspended until 4 o’clock.