“Sound foundations” required for Locally Led New Town Development Corporations

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Government sets high hurdles for authorities wishing to build new towns.

Government has now issued guidance notes* on its ‘Locally Led New Town Development Corporations’  (LLNTDC’s).  The hurdles an authority, or group of authorities, will have to jump are rightly set high.

Before the Inspector’s letter last month, the authorities behind the North Essex Garden Communities** were  enthusiastic about creating a LLNTDC.   They have already set up North Essex Garden Communities Ltd (NEGC) as a delivery vehicle. The intention was to submit a bid for LLNTDC status later this year.

The guidance, combined with the contents of the Inspector’s letter***, will prove a set-back for the authorities.  Generally authorities will not be expected to bid for LLNTDC status until the new town land is included in an adopted Local Plan.    The Inspector has rejected the NEGC proposals, requiring a new sustainability appraisal.  He stated in his letter that the work he requires will take two/three years, thus delaying any bid from north Essex.

It is clear that government recognises the many problems and pitfalls of creating new towns, The guidance states that the Secretary of State will want to test that a project of such ‘scale and complexity‘ rests on ‘sound foundations‘. The Secretary of State will examine the robustness of any proposals put before him and will consult with local community representatives.   He will have to be satisfied that it is “expedient in the national interest” to grant new town status.

Authorities bidding for LLNTDC designation will need to show the following:

A) evidence of community participation and consultation.    That’s a likely fail for NEGC.   The Inspector said (paragraph 109), that the Sustainability Appraisal report is likely to breach legal requirements to provide an outline of the reasons for selecting alternatives dealt with, and for the public to be given an effective opportunity to express their opinion on the report...”   Consultation has been a one-way process, and consultation responses ignored.

B) Deliverability.  Probably the most important aspect for tax-payers.  Viability will be robustly assessed against a range of scenarios and assumptions, with financial modelling over the whole delivery life cycle. In addition the Secretary of State will need to be satisfied about peak debt requirements and that the model takes account of the implications for public sector expenditure and borrowing and, where possible, to minimise these.

Again, a fail for NEGC.  The Inspector says, in paragraph 86, “…it has not been demonstrated that the garden communities proposed in the submitted Plan are financially viable.”  Specifically, the model “does not deal adequately with transport infrastructure costs, land purchase and interest, or contingency allowances”   In a CAUSE paper, ‘Small is Beautiful’, we have demonstrated that proposals of this scale cannot be viable without significant government subsidy – around £1.8bn for so-called ‘West Tey’, the largest proposal.

C) that this level of public sector intervention is needed.   Again, the Inspector has views.   In paragraph 89, he states, about locally-led new town status, “…this is not a legal or practical requirement.  In principle the role could also be performed by a private-sector body.”

D) robust governance proposals.   CAUSE has already raised concerns about the likely democratic deficit of a LLNTDC created by four authorities, detached from the local electorate and normal scrutiny.  We will keep a close eye on details in any proposals submitted.

E) robust proposals for place-making.  This must be more than a statement of intent. A set of garden city principles is not sufficient.   There must be detail, for example on delivery of sustainable transport.    In north Essex, to use just one example, the Inspector finds proposals for a rapid transit system to be at a very early stage and lacking, from both a financial and a feasibility perspective (paragraphs 40 and 66).

F) environmental impacts.   There is strong emphasis on the environment in the guidance.  The authorities must consider carefully the environmental impacts, including significant effects on EU sites, Habitats Directive, Srategic Environmental Assessment and Appropriate Assessment.

The Inspector reminded the authorities of a judgement by the Court of Justice of the EU on 12 April 2018 which ruled that mitigation measures should be assessed in an appropriate assessment not at screening stage.

And finally, this may fail on the smallest thing.  A name is required for the new town.   Locals call the largest north Essex proposal ‘West Tey’, the original name proposed by one of the land owner consortia.  Following recommendations in the independent review carried out in 2017 by Lord Kerslake that an identity is required for each site, the authorities attempted a rebrand. Locals have been encouraged to refer to West Tey as the very catchy “CBBGC” (Colchester Braintree Borders Garden Community).    The north Essex garden communities may not get beyond the brain-storming meetings for the new name, let alone ever pass the tests required to be awarded the LLNTDC prize.



*See Guidance on the New Towns Act 1981 (Local Authority Oversight) Regulations 2018 https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/721078/New_Towns_Guidance.pdf )

**Braintree, Colchester, Tendring, with support from Essex County Council, proposing three garden towns – East Colchester c9,000 homes, West Tey c24,000 homes, West of Braintree c10,000-13,000 homes.