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CPO – gentrification or regeneration?

The recent refusal by the Secretary of State to confirm Southwark Council’s CPO for the next phase of the Aylesbury Estate development demonstrates a meticulous adherence to  parts of the CPO Guidance which have largely been paid lip-service to in many previous CPO decisions.

The mantra that a compulsory purchase order should only be made in the “public interest” is often justified by the inevitable regenerative benefits of development projects.

And that should be good enough, should it not?  – when not a day goes by that the news is reminding us of our housing crisis, that our town centres are failing, of the social divides which exist within our local communities and, as we wait with bated breath, to see what long-term impacts Brexit will have on construction, funding and development, once that axe is finally swung.

Indeed, both the Secretary of State and Inspector agreed that the redevelopment of the Aylesbury Estate would provide social and economic benefits to the area.  However, it was concluded that these benefits were not so significant to justify the lawful interference with the Human Rights of those objecting to the Order.  This was largely based on the conclusion that existing leaseholders, without investing significant savings or taking out new mortgages, would not be able to afford to relocate into new properties provided by the redevelopment and therefore forced to move away from their local community.  He also reached the conclusion that not enough effort had been made to acquire the outstanding interests by agreement.

gentThe decision raises some real issues for the CPO industry.  It paints an uncomfortable picture of CPO being a tool of gentrification, driving residents and small businesses out of their communities on account of rising land values and rents; the polar opposite of what a CPO is intended to achieve, which should be to improve and restore vitality to a local area.

It also creates a real tension with the current reforms to CPO compensation, which essentially seeks to ensure that those subject to compulsory acquisition should not gain any benefit from any enhanced value created by the regeneration scheme underlying a CPO.

It raises the question of whether Council’s should wrestle back control from developers when seeking to engage with those affected by CPO.  Most CPOs are developer-led and their surveyors will be at the fore of seeking to negotiate acquisition of land by agreement, albeit with a duty of care to the Council.  This possibly creates the wrong perception that there is a lack of engagement by the Council.  Greater visibility of the Council promoting the CPO and a genuine strategy to engage will be important.

Whilst the decision is, in some respects, a breath of fresh air that reminds us the impact CPO and redevelopment can have on individuals and local communities must be given more careful consideration together with a thorough review of solutions which can be put in place to maintain the identity of the local community.  One does have to question how genuinely balanced the decision was when the majority of existing residents had raised no objection, the scheme was set to deliver over 800 new residential units and other benefits; yet the CPO failed on the back of only 8 outstanding objections.

Southwark Council has announced they will be judicially reviewing the decision; a sensible move given its ramifications.

Brexit: A week later

flagWhat are the likely effects of the Referendum decision on planning? The real answer is that nobody knows but here is a guess:

  • There will be more devolution to city regions. There is clearly a distrust of Westminster and “experts”. Expect to see devolution being set in more of a sub-regional framework.
  • Although there will be delays, the further drop in interest rates and the need for investment will mean more emphasis on new infrastructure. Now is the time for city regions to refine their infrastructure plans, making sure that they fit comfortably within the National Infrastructure Commission ambitions.
  • More of the investment will be outside London. London has succeeded in part because of the staggering levels of infrastructure investment that have been made. Other regions deserve their turn.
  • The planning system will not change.  There is no “European” element that can be stripped out. Much that is blamed on Europe is, in fact, common sense and best practice around the world. For example, does anyone seriously anticipate that we will not environmentally assess plans for large scale development proposals?  Similarly, we already have international and national commitments on climate change. Expect no change.
  • There will be some siren calls to put the brakes on housing delivery. It will be argued that, with lower levels of immigration, objectively assessed needs will fall. In reality, immigration is unlikely to fall significantly or soon. In fact DCLG figures already assume a material reduction. And, if successful in reducing immigration, the likelihood is that there will be a need to accommodate some of the Brits presently living in Europe.  Expect no change.

Perhaps the greatest effect will be that Parliamentary time will focus on managing the crisis and broader constitutional issues. Hopefully, that means that there will be less time for planning reform and we can all move calmly to a proper plan-led system of the type envisaged by the Local Plan Expert Group.  This should be supported by a slightly simplified CIL regime after the Review with a less febrile property market and one better balanced around the country.