land and assets

Asset disposal shouldn’t be a fire sale

This article originally appeared on British Politics and Policy, part of LSE Blogs at the London School of Economics.

In late January reports emerged that Westminster is quietly pushing forward plans to loosen budget rules for councils, enabling them to sell off their assets in order to fund front-line services like adult social care, children’s safeguarding and waste collection. While, on the face of it, this looks to be a welcome gift for the many councils currently facing bankruptcy, this change in the rules is potentially fraught with risk.

The danger is that – desperate to raise cash – councils will enter a fire sale of their assets to the highest bidders, fuelling the extraction of wealth from land and assets with the potential to create public value. What needs to happen instead is for councils to be given the opportunity to pass on their assets in a manner that supports the local community and economy, while also raising necessary funds.

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Progressive planning frontiers

This article originally appeared in the Municipal Journal.

The origins of the English planning system can be traced to an increased awareness of the role of the built environment in public health outcomes which came to the fore in the 1870s, following decades of cholera epidemics in cities and London’s Great Stink. The goal of formal planning rules, as they emerged in 1909 – to improve the basic living standards of the most vulnerable – evolved over subsequent decades to become an ambitious system of state-led powers for local authority control over development. Today, however, many of those early principles have been lost.

Local development and regeneration activity is now predominantly delivered by the private sector, and concerns are often raised that objectives to support good, healthy lives for local communities have taken a backseat to the need to capture value through rents and tax income.
“councils are understandably wary”
While most councils are still able to exercise control over local development, through responding to applications for planning consent, the scope for refusing them has narrowed. The Town and Country Planning Act enables a local authority to impose “such conditions as they think fit” on applications, which could be a lever to place obligations on developers to contribute to progressive local outcomes, councils are often wary of pushing developers too far. Many local authorities rely on the private sector, not only to create development in their places, but also to bolster much needed council tax and business rate revenue – placing extra conditions raises the risk that those private developers will choose another place to do business. Outright refusal is similarly fraught with danger, and councils are understandably wary of costly High Court appeals by disappointed applicants.

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