§ 4.23 p.m.
§ LORD MESTON rose to ask His Majesty's Government what is the practice and policy of the Central Land Board in determining the amount of a development charge where planning permission is given for only a limited period. The noble Lord said: My Lords, I beg to ask His Majesty's Government the Question standing in my name. The point is a small one, but I hope that it will not be thought entirely unimportant. It sometimes happens" that planning permission is given for only a limited period of time—it may be, for example, a period of five years. In those circumstances, it would be interesting to know, in cases where development charge is leviable, upon what basis the Central Land Board assess the development charge. I have in mind a specific case. I am afraid I have been remiss in not giving the Government details of what I am actually asking, but I believe that such a thing has happened before, and it is likely to happen again. A man is desirous of erecting a factory in Brighton, and he has obtained limited planning permission for a period of five years. Notwithstanding his protest, the district valuer, supported by the Central Land Board, has insisted on assessing the development charge on the basis that the factory has a physical life period of fifty years. That strikes me as being unfair, and that, among other considerations, has prompted me to ask this Question.
298§ 4.24 p.m.
§ THE PAYMASTER-GENERAL (LORD MACDONALD OF GWAENYSGOR)My Lords, the Central Land Board, in accordance with the requirements of the Act, normally determine the development charge as the difference between the value of the land with the limited planning permission and its value without that permission. This produces a low charge in respect of the limited period. But if permission is granted for a further period a higher charge will be payable. This may cause hardship. The Board, therefore, offer developers the choice of an alternative assessment under which the charge is calculated on the rent that would be payable for the land by anyone contemplating erecting the building thereon. This method produces the same charge for the initial permission as for any further permission of the same duration, and many developers prefer it.
With regard to the specific case referred to by the noble Lord, as he has said, he has not apprised me of it earlier. But I have come across a case not unlike the one to which the noble Lord has referred, and perhaps I may supplement the official reply I have given by referring to this other case. The Central Land Board's practice can best be illustrated by it. A developer is granted a planning permission to erect a factory on an undeveloped plot of land, and to use it for five years, on condition that at the end of the five years the factory is pulled down. If the factory is really going to be pulled down at the end of the five years it is obvious that this planning permission has a relatively small value. The Board, in assessing the charge, have to ascertain the difference between the value of the undeveloped land with the planning permission and its value without that permission. In view of the cost of the erection of the building, and of its destruction at the end of five years, the value of the land with permission cannot be high, and the development charge assessed on this basis is accordingly low. If, however, at the end of the period—and this may interest the noble Lord—the factory is not pulled down, but planning permission is obtained to retain it for a further five years, then the further development charge is the difference between the value of the land with a factory on it, with permission to use the factory for five years, less the value of the land with a factory 299 on it which cannot be used for any purpose. It follows, accordingly, that the development charge is relatively high. A low charge followed by a high charge in this manner may well cause hardship. Accordingly, the Board offer developers who obtain planning permission for a limited period the choice of an alternative assessment. I think that that is all I 300 can say to the noble Lord on this Question.
LORD MESTONI am very much obliged to the noble Lord for the answer he has given. I am afraid that I did not follow it all in detail, but that is my fault and not his.
§ House adjourned at twenty-seven minutes past four o'clock.