Has the rise of financial viability assessment in the British planning system reinforced the asymmetry in relationship between the property industry, local authorities, and the communities that they serve?
5 Pages Posted: 26 Mar 2019 Last revised: 26 May 2020
Date Written: December 19, 2018
Financial viability assessment was first introduced to the UK planning system through paragraph 173 of the 2012 National Planning Policy Framework (NPPF). It was described by Colenutt, et al. (2015) to have inevitably shifted the balance of power and influence between the property industry, local authorities and communities that they serve.
This paper aims to demonstrate that the shift in power and influence has predominantly favoured the property industry in the following ways. Firstly, the test for economic viability has provided developers and landowners with the means to challenge and even undermine the affordable housing agenda and priorities of planning authorities and communities. Secondly, confidentiality clauses allowed the property industry to hide the full contents of their financial viability assessments from public review resulting in the unequal access to information. Thirdly, the introduction of viability assessment to the planning system disadvantaged local planning authorities because of their disparity in technical resources and knowledge-gap from private property developers. The lack of expertise from planning authorities and communities curtailed their ability to interpret, let alone, contest viability assessments.
However, this paper concludes that while viability assessments gave developers and landowners the incentives and opportunities to exert greater influence over planning, it did not intend to reinforce the asymmetry between the property industry, local authorities and communities. Ultimately, it was the government’s limited guidance and failure to establish a standardized valuation methodology that contributed to this imbalance.
Keywords: financial, viability, assessment, urban, planning, real, estate, uk, british, bob, colenutt, property, industry, NPPF
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