Government's Eased Acquisition of Property: How Mandatory Purchase Orders Facilitate Land Seizures by Authorities
Unveiling the New Compulsory Purchase Order Landscape
The world of Compulsory Purchase Orders (CPOs) is changing, and it's crucial for property owners to understand these shifts. Recent government modifications to planning laws have made CPO threats more imminent and widespread.
These alterations aim to accelerate and simplify the CPO process, which means homeowners and landowners could potentially lose their property for development projects with ease. Let's dive into the details and see how these changes affect you.
Who's in the Firing Line?
Anyone with an interest in land can find themselves under the CPO radar. This includes:
- Property owners, whether freehold or leasehold
- Business and residential occupiers
- Individuals with rights over land, like a right of way or right to light
When a CPO is drafted, the parties potentially affected are outlined. If negotiations for a settlement with the acquiring authority are successful, some individuals or organizations may be excluded from the final CPO. If not, the authority gains possession of the land, and compensation is assessed later on.
Can You Appeal a Compulsory Purchase Order?
Direct appeals against CPOs are not an option, but you can challenge or object to one. If you have an interest in the land, or your legal rights would be affected, you can submit an objection once notified. The acquiring authority must then attempt a settlement, modify the order, or proceed to a public inquiry if negotiations are unsuccessful. Your only legal option to challenge a CPO is through judicial review in the High Court, based on legal or procedural errors.
Shifting Sands: Government's Approach
The Government's latest Planning and Infrastructure Bill (PAIB) introduces changes to expedite and lessen the cost of the CPO process, particularly for large-scale development. Key reforms include:
- Electronic delivery of statutory notices
- Simplified public notification procedures
- Delegation of more authority to be made
- Faster land possession
In addition, the PAIB revamps compensation rules, with restrictions on so-called "hope value," which can affect the amount of compensation landowners receive.
While the government hopes these reforms will lower the number of challenges they receive to CPOs, law firm Hogan Lovells cautions that the changes are unlikely to significantly reduce the number of references made to the Upper Tribunal (High Court).
Compensation: What Can You Expect?
Compensation for CPOs can be intricate and based on several factors. One significant development is the removal of "hope value" – the premium based on the land's potential for future development.
Under the Levelling-Up and Regeneration Act 2023, and now extended under the new Planning and Infrastructure Bill, local authorities can apply to exclude hope value from compensation in certain cases, particularly when the land will be used for affordable or social housing.
This could mean that some landowners receive significantly less than market value for land with potential for redevelopment, leading to concerns across the property sector.
Compulsory Purchase Orders and Land Value Capture
To support affordable housing delivery, the government is exploring land value capture, the principle that public authorities should be able to buy land at existing use value rather than future development value.
The Planning and Infrastructure Bill would provide local planning authorities with the power to acquire land via CPO at reduced prices by eliminating speculative uplift from potential planning permissions.
While this could unlock more sites, it has raised concerns among landowners who may feel pressured to act swiftly to avoid reduced compensation later on.
Balancing Act: CPO Reforms and Fairness
CPO reforms aim to speed up the process and promote development in the public interest, but they also raise questions about fairness and compensation for landowners. Seeking legal advice early, exploring your options for objection, or negotiation, and understanding how recent legislative changes may impact your rights and potential compensation is crucial if your property could be affected by a Compulsory Purchase Order.
- For those planning home renovations, education on Compulsory Purchase Orders (CPOs) becomes essential due to the government's latest changes, as these reforms could potentially disrupt self-development projects.
- With the PM's intent to boost sports infrastructure, sports enthusiasts should be aware that their local courts or fields may be subject to CPOs, leading to potential changes or relocation.
- As the government introduces new strategies for affordable housing, homeowners with properties holding development potential should consider prompt action to build or sell homes, following fears of decreased market value due to CPO reforms and the removal of hope value.
