British Landowners To Lose Development Value

Northern Advocate, 8 January 1947, Page 5

British Landowners To Lose Development Value

(Rec. Noon)

Land in Britain is not to be nationalised. but sweeping controversial changes are proposed in the Town and Country Planning Bill published today, says Reuter's lobbyist. The Minister of Planning (Mr Lewis Silkin) will move the second reading at the end of January and the bill may be law by July. The bill defines two elemnts in land values:—

(1) Value for the purpose for which it had been used. This is defined ns existing use value. (2) The value for a potentially more profitable use, for example development of farm land as a building estate or replacement of houses by siiops or cinemas. This is defined as development value. The bill provides:— (1) No land 'developrqpnt may occur without permission. The landowner will be free to continue using the land for existing purposes but the question of whether land may be developed will be governed by tiro interests of the community.

| (2) When permission US develop is refused no compensation will be payable except in a few special cases, i (3) When development is permitted j any resulting increase in land value ' will be collected by the state as a [ development charge, which is payable j before development can be carried out. Any increase in value which accrues without the development will remain with the owner. BASED ON PRESENT USE The effect of these three provisions together is that , the market value of land will be reduced broadly to the value attributable to its'"present use. Landowners will thus lose their development values immediately, and the bill provides for payment to them on this account. ■ A central land board will be established with the prime duty of collecting and re-allocating development charges. An accompanying White Paper says the Government’s view is that when community activities increase the existing value of land, the betterment should be collected by the State instead of the landowner and that owners who lose development value through the bill are not entitled to compensation as a legal right.

The Government, however, recognises that if no payments are made hardship could be caused to many who acquired land in expectation of development. COMPENSATION PAYABLE

A capital sum of £300,000,000. therefore, will be made available to meet claims for payment made to the central land board.

The effect of the development charge system will be that land bought for development will change hands at about its face value for existing use.

The purchaser, in reckoning how much he can afford to pay, will take into account what he wiil have to pay to the central land board. ) In total he will pay no more than he ! would pay at present, but instead of paying all to the owner he will pay part to the owner and part to the central land board. FEW AFFECTED A Reuter's lobbyist says me bill will not touch the average person. It is officially calculated that 85 per cent, of houses and other properties in the United Kingdom are not involved because they are not connected with development projects. While taking away from owners the development value of their land, the bill leaves them its existing value.

LONDON, Jan. 7

Farmers can continue iarming, the ordinary householder can continue his normal life, and the position of the private land developer is also unchanged, except that he will have to pay a proportion of the price of land as a development charge. The bill does not interfere with a person selling his house at a profit, cq no development is involved. The house is changing hands, but its use is not changed. NEW I’LANNING SYSTEM

This compensation and betterment problem has been regarded as the great obstacle. Once it is out of the way the new planning system can go •-(head.

This provides that local planning authorities will have to submit development schemes within three years. These plans will be reviewed every five years. County councils, for the first time, are given direct planning functions. All purchases of land for public use will be at the existing use value, the 1939 standard being retained.

Outdoor advertisements, such as hoardings, will be controlled and historic buildings preserved.