Government Proposes Reforms to Compulsory Purchase Order (CPO) Powers to Support Affordable Housing Development
The Labour Government has unveiled proposed reforms to Compulsory Purchase Order (CPO) powers to make it easier and more cost-effective to deliver affordable housing and other public interest developments. Announced by the Ministry of Housing, Communities and Local Government (MHCLG) on December 20 2024, this proposal builds on the reforms introduced by the previous Government’s Levelling Up and Regeneration Act (LURA). This brought directions to be included in CPOs to remove “hope value” (the value above current use value, which reflects the potential for development or alternative use) from compensation calculations to the landowners. By excluding this factor, councils and public bodies like Homes England could acquire land at lower prices than would be likely achievable on the open market.
The consultation states that CPOs made under Section 125 of the Local Government Act 1972 on behalf of town and community councils “should have the ability for directions to be included to remove hope value where the underlying schemes are facilitating affordable or social housing.”
Additionally, the Government proposes changes to streamline the CPO approval process and suggests an alternative route for councils to nominate sites which are suitable for housing but where no application has come forward. The consultation on these proposals closes on February 13, 2025.
Sworders will monitor the proposals as they evolve and are in agreement with the comment made by Country Land and Business Association (CLA) President, Victoria Vyvyan who said “Compulsory purchase is notorious for delivering years of stress and delays, and it will harm communities and individuals alike without delivering affordable housing. Punishing landowners isn’t the solution – fixing the planning system is.”
| Rachel Bryan |