Competing on an unlevel playing field

Principal Transport Planner, Richard Allman, reviews the challenges faced when unprecedented highway contribution requests coupled with time constraints threaten a development programme.  He emphasises the importance of early engagement and a robust, evidence-based approach to negotiation.

Time is money, and failure to reach agreement with the local highway authority for that all-important committee date can have dire consequences for developers.  A protracted period of correspondence typically follows, and if officers are unable to respond quickly, negotiations can take place at the eleventh hour.  This inadvertently puts developers at a disadvantage and leaves them vulnerable to agreeing inappropriate levels of highway contributions.

Under the National Planning Policy Framework, obligations should only be sought where they meet all the three tests: 1) necessary to make the development acceptable in planning terms; 2) directly related to the development; and 3) fairly and reasonably related in scale and kind to the development.  However, this guidance is subjective, making it open to interpretation and difficult to translate into an appropriate magnitude of contributions or interventions.  This creates challenges for highway officers and consultants alike.

Where no clear highway contribution framework exists, and as new policies emerge, the methods used for calculating highway contributions can vary widely.  In the absence of a thorough understanding of what is ‘reasonable,’ and the evidence required to prove it, developers can find themselves confronted with the difficult decision of either accepting the requested contribution costs without challenge, or risking delays or a potential refusal on highway grounds.

Whilst applicants can appeal, the process adds further time and costs with no certainty of outcome.  Therefore, developers understandably prefer to reach an agreement with the highway authority within the application process and can unintentionally pay over the odds.  Regardless of whether developers can afford the additional cost, the financial viability of the scheme may be compromised, and there is the further risk of being seen to be ‘paying for a permission’.  Equally, this sets a precedent for future development.

Managing risk

So, what can be done to manage this risk?  In the absence of transparent guidance on contributions, the importance of engaging with the highway authority at the earliest opportunity cannot be underestimated.  Opening an early dialogue allows issues to be identified from the outset, affords all parties the time to develop a level of understanding, and demonstrates the willingness of the developer to cooperate.

Of course, early engagement doesn’t guarantee agreement or prohibit new issues emerging late in the application process, and with high stakes at play, negotiations can easily become adversarial.  This is where mature industry experience combined with exhaustive, diligent research can make a valuable difference to the outcome.  As transport consultants, an integral part of our role is to protect our clients’ interests without frustrating their objectives.  We achieve this through the provision of robust, factual and reasoned argument, ongoing support and advice, and resilience under intense scrutiny and opposition.

An abridged version of this article first appeared in the Winter 2021-22 edition of Insight.