The Localism Act

The Localism Act 2011

The Act runs to nearly 500 pages with much of the provisions requiring Secondary Legislation to take affect.  The Key Provisions are

  1. A  General Power of Competence

This re-visits ‘the Ultra Vires’ Principle. A Local Authority is deemed to have all the    powers that are enjoyed by an Individual and can do anything, provided it does not break the Law. In the past Local Authorities have considered that they are restricted to what the Law expressly says it can do.

            This is likely to come in from April 2012

  1. Abolition of the Standards Board

The Standards Board was set up to oversee the conduct of Councillors and investigate complaints concerning their conduct. In its place, Councils will set up their own Code of Conduct for their Councillors. It will be a Criminal Offence for a Councillor to deliberately withhold or misrepresent a financial interest   

  1. Rules on Pre-determination

Councillors will not be deemed to have predetermined an issue simply because they have taken part in debates with constituents on an issue

  1. Setting Business Rates

Councils will be able to offer discounts on Business Rates to encourage greater investment in their locality and promote jobs. However any shortfall must be made up by a Council from elsewhere in its Budget

  1. Directly elected Mayors

8 Cities outside London will be given the chance to vote in a Referendum as to whether they want an elected Mayor. The referendums will be held in May 2011 and where there is a positive vote – mayor elections will take place shortly afterwards. Other areas will able to call for their own referendum where there is support

  1. Governance Structures

Councils will be able to best decide whether they want to be run by Council Leader / Mayor or by Committee Structure

  1. Devolving Power from Central Government and Quangos

Many Local Functions currently carried out by central government bodies and quangos are to be transferred to Local Authorities

  1. Community Right to Challenge

This will allow Community / Voluntary Organisations, Parish Councils and groups of Local Authority Employers the chance to take over existing Local Authority functions. Where an approach is made the Local Authority must carry out a procurement exercise to investigate the proposed “takeover” 


  1. Community Right to Bid for Assets which have a Community Value

The Act requires that Local Authority maintain a List of Assets of Community Value which are recommended to this list by Community Groups. Once an asset is on the List, the Asset cannot be sold or ownership change, until Community Groups are given the chance to raise capital to buy the Asset at its then market value. There is in affect a six months moratorium whilst the Community Group explore whether they can buy it.

Once Property is on the list it is registered as a Local Land Charge. It remains on the List of Assets of Community Value for 5 years or such shorter time as the Local Authority directs.

In greater detail

Section 87 requires the Local Authority to keep a List of Assets of Community Value

To qualify Section 88 provides two alternatives to the listing of land as having a Community Value

(1) “a building or other land in a local authority’s area is land of community value if in the opinion of the authority—

(a)an actual current use of the building or other land that is not an ancillary use furthers the social wellbeing or social interests of the local community, and

(b)it is realistic to think that there can continue to be non-ancillary use of the building or other land which will further (whether or not in the same way) the social wellbeing or social interests of the local community.

(2) For the purposes of this Chapter but subject to regulations under subsection (3), a building or other land in a local authority’s area that is not land of community value as a result of subsection (1) is land of community value if in the opinion of the local authority

(a)there is a time in the recent past when an actual use of the building or other land that was not an ancillary usefurthered the social wellbeing or interests of the local community, and

(b)it is realistic to think that there is a time in the next five years when there could be non-ancillary use of thebuilding or other land that would further (whether or not in the same way as before) the social wellbeing or social interests of the local community.

Sections 89 and 90 sets out the procedures for buildings and or other land to be placed on The List of Assets of Community Value. Section 89 states it must be by way of  Community Nomination  which would be by

  • A Parish Council or
  • Other Community or Voluntary Group which has a connection with the locality
  • Such other person/ organisation recognised in Regulations introduced by a Local Authority

Section 90 requires the Local Authority to accept the nomination if the Section 88 requirements above are satisfied and the Building or land comes within its geographical area

Section 91 covers the notification procedures where Buildings or Land are placed on the list. Notice must be given to the owner and occupier of the land and the Nominee

Section 92 allows the Owner and or Occupier of the Land and Buildings the opportunity to ask the Local Authority to review its decision taken under Section 88? The Local Authority is obliged to give reasons for its decision on review. Local Authorities will be required to publish Regulations for how the Reviews will be conducted.

Where Buildings and or Land has been the subject of community nomination but the nomination has not been accepted by the Local Authority, its details must remains on a separate list called List of Land Nominated by Unsuccessful Community Nominations 

Details to include why the nomination was not accepted will remain on the list for a maximum of 5 years- Section 93

Section 94- states that a Local Authority must provide free of charge copies of the two lists

Sections 95 and 96 contain the restrictions on disposal of land and buildings registered on the List of Assets of Community Value. They apply where there is a Non-Exempt Disposal

Disposal means any of the following under section 96

  • The Freehold to Buildings and or Land with vacant possession
  • The Leasehold to Buildings and or Land with vacant possession where the term of the Lease was originally granted for at-least 25 years

An Exempt Disposal is any of the following under Section 95(5)

  • By way of Lifetime Gift
  • By way of a gift upon death (an Assent) under the terms of a Will or Intestacy
  • To pay of Inheritance Tax or other debts to include administration expenses accruing on death or to pay specific pecuniary legacies under a Will or Intestacy
  • Where one or more of the persons making a disposal is a member of the family of one of the persons acquiring the interest
  • Where the Building and or Land is a Partnership Asset and there is a change in partners
  • Where the Building and or Land is a Trust Asset and there is a change in Trustees

Implications- where Buildings and or Land is registered on the List of Assets of Community Value, a Non Exempt Disposal cannot take place unless all of the following three conditions under Section 95(2) (3) and (4) are complied

(2) Condition A – the owner of the Buildings or Land notifies the Local Authority of an intended disposal

(3) Condition B-  either a 6 week period following the Local Authority receipt of the notice (the Initial Moratorium Period) has elapsed without any potential bidder registering an interest or  a 6 month period following receipt of the Notice (the Full Moratorium Period) has elapsed.

(4) Condition C- the Protected Period ( a period of 18 months) commencing from the receipt of the notice by the Local Authority has not expired

Section 97 deals with the procedures that the Local Authority must follow upon receiving a Notice of Intended Disposal under Section 95(2)- give notice to the Community Nominator and publish on the List of Assets of Community Value the following

  • The date the Notice was received
  • The end date for the Initial Moratorium Period ( 6 weeks from the date of receipt)
  • The end date for the Full Moratorium Period ( 6 months from the date of receipt0
  • The end date for the Protected Period (18 months from the date of receipt) 

Where a potential bidder, termed ‘a Community Interest Bidder’, registers an Interest in buying the Buildings and or Land within the Initial Moratorium Basis, the Local Authority must advise the Owner- Section 98

The Local Authority is required to publish regulations on Compensation- who to pay it, the method of calculating, underSection 99

The Owner of the Land or Buildings is under no obligation to sell to the Bidder. However the Act does put potential time delays on an Owner seeking to sell an Asset once it has been registered as an Asset of Community Value.

10.   Community Involvement in setting rises in Council Tax

Currently the Secretary of State for Communities and Local Government has the power to “cap” Council Tax Increases. The Act will give this power to local communities, in the following manner.

  • The Secretary of State will set a level for Council Tax Increases as approved by Parliament (“the cap limit”)
  • Where a Council sets an increase above the cap limit, it will have to hold a referendum to give approval for an increase.

11.  Abolition of Regional Spatial Strategies

This set out designated development areas across the regions. The present Government considered that these were centrally driven, bureaucratic and undemocratic as local people had vey little say in their preparation.

12.  Neighbourhood Plans

Neighbour Plans can be prepared by Parish Councils and other groupings called Neighbourhood Forums. Such Plans can identify where they consider new forms of Development should go and their appearance

Neighbourhood Plans will still need to be in “general conformity” with the strategic policies of the Local Plan and be approved by at least 50% of the Vote in a Local Referendum.

Planning Applications which accord with a Neighbourhood Development Plan can be approved by such a Neighbourhood under Neighbourhood Development Orders, without the need for Planning Permission.

Neighbourhood Development Orders are highly controversial because Critics say that the most active in a neighbourhood may be able to have an unfair advantage in the Planning Process. 

13.  Community Right to Build

This will allow Community Groups the opportunity to build new houses, shops and business premises, playgrounds and meeting halls where their Development Proposals accord with the Local Plan and are approved in a Referendum, without recourse to a traditional Planning Permission. The money raised must be ploughed back into the Community and would suggest that Community Groups will have to be established as a Charitable Trust  

            This is likely to come in from April 2012

14.  Change to Planning Enforcement Rules

The statutory time periods for enforcement (4 years for operational development from, the date of substantial completion, 4 years for change of use to residential, 10 years for change of use to non residential, 10 years for breach of planning conditions) will not apply where there has been a deliberate concealment of the breach. In such circumstances the Local Authority may apply to the Magistrates Court for a Planning Enforcement Order. Upon an Order being made, the Local Authority has one year commencing 22 days after the making of the Order to start enforcement action notwithstanding that the normal time periods for taking enforcement proceedings have already elapsed- Section 124 Localism Act introduces a new Section 171BA to the Town & Country Planning Act 1990

This puts into Statute the Court Decisions of Fidler v Secretary of State for Communities and Local  Government & Reigate / Banstead Borough Council 2009 { F built a house in the form of a mock gothic castle around a 40 foot high wall of straw and occupied for over 4 years before removing the wall)

R v Hatfield and Welyn Garden City (ex parte Beasely) {B got Planning Permission to build a hay barn- its external appearance conformed to a hay barn but internally was in fact a house. Once 4 years had passed B applied for a Certificate of lawfulness of established use and development, arguing that in fact the building has been used as a house for the prescribed period. Supreme Court dismissed his application on two grounds. (a) for a change of use there had to be an existing use to change- here there was not one (b) B should not be allowed to benefit from conduct which was based on deceit.   

The Local Authority must commence proceedings in the Magistrates Court within 6 months of becoming aware of the concealment. A Local Authority certificate of when it became aware is conclusive- Section 124 inserts a new Section 171BB of the T&C Act 1990.

The  Magistrates Court can only make a Planning Enforcement Order (POE) where it is satisfied on a “Balance of Probabilities Test” that there has been a deliberate concealment of the Development and it would be just to make a POE

15.  Reforming the Community Infrastructure Levy

The Community Infrastructure Levy is being widened so that the payment made by a Developer can be used for more than just Infrastructure Benefits to the Community. Local Authorities will get greater flexibility in setting the levels of the Levy.

      16.  Abolition of Infrastructure Planning Commission

            The IPC had been formed to deal with planning matters for regional and national

             Infrastructure Projects such as high speed railways and power stations. Such

             decisions will now be taken by Government Ministers. The argument being that the

IPC was not politically accountable in the same way as Government Ministers

  1. Reform of Social Housing (housing provided by Public Sector Bodies)
  • Local Authorities will have a greater discretion as to who can apply to go to their Waiting List for Housing. Those who are most vulnerable in society however will remain priority needs under the Housing Homeless Persons Act
  • Existing Social Tenants will not have their right to lifetime tenancies affected, but future Social Tenants housed by a Local Authority will be offered fixed term tenancies- the idea is that with social housing limited, those most in need will have a better chance of securing accommodation that they need at a prevailing time- The minimum length of tenancy will be two years but it is expected that five years will be the general limit. Local Authorities will retain a discretion to award life time tenancies
  • Rents received by Local Authorities will be retained by them and can be applied towards renovations, repairs and improvements to their housing stock. {previously all rents collected had to be paid to central government who then distributed a sum from the national collection back to Local Authorities}  
  • Complaints about Social Landlords will be dealt with by a new body The Independent Housing Ombudsman.
  • Introduces a National house Swop Scheme in the Social Housing Sector

This is likely to come in from April 2012

Prepared by Malcolm Buck

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