Impact of a No Deal Brexit on planning and development - an opinion by Partner and head of planning Paul Fong
8 October 2019 | Ridge News
With the UK government launching a ‘Get ready for Brexit’ public information campaign to help ensure the general public and businesses are ready when the UK leaves the EU on 31 October, we take a look at how a no-deal Brexit could impact planning and development.
An element of the English planning system is intertwined with European Law, particularly with reference to environmental considerations. One of the impacts of a no deal Brexit is that the UK would no longer be bound by the obligations sets out in the EU EIA Directive. In response to this, a new institution has been set up; the Office for Environmental Protection (OEP), and draft clauses for the Environment (Principles and Governance) Bill were published on 19 December 2019. They aim to enshrine environmental principles in English law. The question remains however as to whether the OEP will be ready in time for 31st October.
Further impacts could be had upon housing projection figures; there may be changes to demographic projections and planners (in particular those within the local authority) may have to contend with rapid changes in housing need numbers. There will therefore be a need to update local plans to ensure that they remain in date and therefore continue to carry weight in the decision-making process.
A major concern expressed by business leaders and politicians alike is that a no-deal Brexit could result in an economic downturn. This could have a knock-on effect which would be felt by the property industry. This could be caused by a predicted rise in interest rates which could result in problems for developers as funding becomes more difficult thus creating a slowdown in development. Such a slowdown could also be exacerbated by a shortage in skilled and unskilled labour in the construction industry; many developers rely on foreign workers for construction.
However, should a no deal exit lead to the widely predicted economic downturn, it is likely that the Government will do everything in its power to stimulate growth. As such, it is expected that the Government will pursue changes to the planning system to encourage growth. It is likely that it will lean on the need to meet the housing crisis to promote development, perhaps reviewing the issue of affordable housing. Indeed, in line with this agenda, a discussion paper was released by Housing Secretary Robert Jenrick in August of this year entitled Making Home Ownership Affordable.
Whilst there are certain areas within planning which rely on EU regulations (mainly relating to EIA Directives), the majority of the planning system within the UK is enacted within the domestic legal jurisdictions that do not depend upon such regulations and is therefore independent of the EU. As such it is believed that the planning system will be the subject of little change, however, in the event of an economic turndown, policies may change to artificially encourage and stimulate further growth.
At present, we have not seen any real indicators of a slowdown in the market place and there is plenty of activity with new projects emerging. Perhaps one of the only real concerns in the market place is if there is a further delay to Brexit leading to further uncertainly. Irrespective of your thoughts on Brexit, it is now becoming more apparent that most businesses simply want to get on and work through the deal or no deal that we may get.
Amongst all the uncertainty, we can be sure that whatever the outcome on 31st, the Ridge planning team will remain at the forefront of the planning profession and will ensure that our clients are informed of any potential changes to the UK planning system arising from it, advising on the best way to respond to changing circumstances.