New rules give greater flexibility for businesses - but at what cost for Neighbourhood Plans?

by Ed Dade

Posted on July 28, 2020

From 01 September 2020, shops, businesses and other services can diversify and change to other uses without needing to apply for planning permission. This post outlines these new rules and considers the implications for Neighbourhood Plans.


Overhaul of 'Use Classes'

Planning law organises different types of housing, businesses, commercial and community facilities into various 'Use Classes'. The current regime was introduced by the Use Classes Order (1987), which has been gradually amended over the years.

The latest set of regulations to make changes to the use classes system (Town and Country Planning (Use Classes) (Amendment) (England) Regulations 2020 (2020 No. 757)) were made by parliament on 21 July 2020. These new rules present a radical overhaul of the current use classes system. The government hopes these new changes will

" our high streets and town centres to provide more space for new businesses and help them to adapt quickly to what consumers and businesses need."

Outline of main changes

The following is intended as a brief outline of the main changes to the Use Classes Order. If you wish to dig into the detail, including the transitional arrangements for how these changes will be implemented, see the Explanatory Memorandum which accompanies the new regulations.

At present, the Use Classes Order categorises land and buildings based on their main function and activities into four main types - 'A' to 'D'. These are further divided into various numerical subcategories. For example, at present, shops usually fall in use class 'A1', offices in 'B1(a)', dwellings in use class 'C3', and cinemas in 'D2'. Uses which do not fit in any use class are defined as sui generis i.e. 'unique'. A petrol filling station is an example of a sui generis use.

To change land or buildings from one use class to another often requires planning permission, unless the change is allowed under a 'permitted development right'.

Through the Explanatory Memorandum the government asserts that the use classes system "requires a complete overhaul to better reflect the diversity of uses found on high streets and in town centres and to provide the flexibility for businesses to adapt and diversify to meet changing demands".

Introduction of new Class E, Class F1 and F2

The new regulations introduce the following new use classes, due to come into effect from 01 September 2020:

  • Class E: Commercial, Business and Service;
  • Class F.1: Learning and Non-residential institutions; and
  • Class F.2: Local community.

The majority of existing uses in the current A, B1, and D use classes will be 'lumped' together into the new 'Class E'. For example, Class E will include shops, financial and professional services, restaurants and cafes, offices and light industry, gyms, nurseries and health centres, and other uses suitable for a town centre area.

Certain buildings which are regularly in wider public use, such as schools, libraries and art galleries will be incorporated into the new 'F.1' use class.

The new 'F.2' class includes various recreation and leisure uses. It also includes community buildings, and provides additional protections for small, local shops in meeting the day to day shopping needs of local communities.

In addition to introducing these new classes, the existing 'A4 Drinking establishments' (i.e. pubs and bars) and 'A5 Hot food takeaway' use classes will be removed.

As a result of these changes, existing use classes A, B1, and D will in effect, cease to exist.

Implications for neighbourhood planning

Through the new regulations, the government has radically overhauled the use classes system. Inevitably, these new rules will have implications for what communities can and cannot do through their Neighbourhood Plans.

Greater flexibility for commercial and business uses

Through the introduction of Class E, the government captures a wide variety of different types of commercial activities into a single use class. This will allow businesses far greater flexibility to change their function and activities without needing to first seek planning approval. Yet a Neighbourhood Plan's policies only have an effect where a planning application is being determined. Consequently, the introduction of Class E limits the opportunities for Neighbourhood Plans to shape the development of commercial uses, businesses and services.

For example - whilst a Neighbourhood Plan may seek to preserve town centre shops for retail use, the new rules allow shops to change into another 'Class E' use without needing to submit a planning application. Similarly, policies to safeguard existing employment areas may lose their intended effect, as business units and offices will be free to transform into a myriad of other uses such as supermarkets, restaurants, or day nurseries. Under the new regime, site allocations for 'employment' uses will, by default, also permit a host of other activities.

Introduction of the new Class E will remove the boundaries between employment, retail, leisure and other uses. This will inevitably change some characteristics of communities. Business parks may no longer simply be for business. The focus on town centres as the main place to go shopping may be further eroded. Shops and leisure facilities may begin to pop up in locations where they wouldn't previously be allowed. The way a community functions, and the ways people move around, may change as services and facilities have more freedom to locate in different places.

Many people may welcome the changes, which will make it easier for communities to grow and change to meet the demands of local people - without the 'red tape' of the planning system.

Others may feel they are losing their ability to shape their local area, such as through preparing a Neighbourhood Plan or commenting on a planning application, as changes can go ahead without the scrutiny of the planning process - and may have concerns for the long term sustainability of their community.

Greater say on pubs and takeaways

Through the new rules, the government recognises that protecting local pubs, and the prevalence of hot food takeaways are significant issues for some communities.

The new rules remove the use classes covering drinking establishments and hot food takeaways. This may provide greater opportunities for plan-making and local decision-making. Proposals to open or alter such facilities will need to submit a planning application, and therefore must also comply with policies set out in Local and Neighbourhood Plans.

Protection of important community facilities and services

The new 'F2- Local community' use class seeks to provide protection for certain facilities which meet the needs of the community they serve. The ‘Local community’ use class groups together uses which provide for group activities of a more physical nature – swimming pools, skating rinks and areas for outdoor sports. It also includes the use of buildings principally used by the local community, such as community halls.

The present use classes system categorises land and buildings based on their main use. Through the new F2 class the government takes a slightly different approach by taking into account contextual factors such as the relationship and importance to the local community.

For example, shops will typically fall into the new Class E. However, small, local shops which meet the day to day shopping needs of local communities will be classified into the new F2 class. This provides some protection for shops of community importance, which would not enjoy the same freedoms to change as a shop in Class E.

Shops which qualify for inclusion in class F2 are defined as "a shop mostly for the sale of a range of essential dry goods and food to visiting member of the public where there is no commercial class retail unit within 1000 metres and the shop area is no larger than 280m2". Most shops will not satisfy this definition.

What happened to a plan-led approach?

The Explanatory Memorandum which accompanies the new regulations claim that:

"These reforms are primarily aimed at creating vibrant, mixed use town centres by allowing businesses greater freedom to change to a broader range of compatible uses which communities expect to find on modern high streets, as well as more generally in town and city centres."

However, the changes apply across England, and are not limited to town centres, high streets and city centres. There is a fear that such a policy may have unintended consequences, and result in commercial uses being developed in unsustainable locations - which may even compete with town centres, causing further harm to their vitality.

Through its changes to the use classes system, the government appears to be taking powers to shape local areas away from communities - instead handing this power to businesses, leaving it at the mercy of the market to decide how places grow. The government appears to have subscribed to a view that the planning system is somehow a 'barrier' to growth.

The new protections offered by Class F feel tokenistic in comparison to the great freedoms offered to businesses through Class E. In effect sidelining Neighbourhood Plans to protect the 'local pub' or 'village shop', rather than being enabled to provide a coherent strategy for economic growth across the local area.

The government could have taken the opportunity to deliver this much needed economic growth through a plan-led approach. It could have placed local communities at the forefront of delivering growth in their local area - but it did not.

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