Government Property Unit under the microscope

Some interesting commentary this week on the subject of the Government land and built estate ownership and occupation.  The cross party Publlic Accounts Committee, chaired by the Rt.Hon Margaret Hodge, has published a report recommending that improvements in building occupancy should be achieved, that unoccupied buildings should be made available to mall businesses to rent and that the Government should continue to realise value from built assets i.e. sell surplus real estate.

The drive is to save the UK tax payer in excess of £800 million per year in operating costs and to realise capital receipts.  Last year the Government Property Unit achieved sales on over 250 freehold assets, realising £640million of cash for the coffers.  In addition to this, co-sharing and more efficient usage of space and facilities has saved over £48 million, GPU claim.

The Government is the UK’s biggest property owner and also the biggest tenant.  Staggeringly, the property portfolio is worth in the region of £370 billion (even in this market?!) and costs £25 billion a year to run.  A Cabinet Office spokesperson has said that the recommendations will be considered carefully and the potential for savings taken into account with those savings already achieved.

James Alexander can help your organisation review your property and land portfolio and develop strategies for better usage and utilisation, as well as determining strategies for asset divestment, or acquisition.  Get in touch and see how we could help.  innovation@jaltd.co.uk

D Day for Planning

Today’s the day.  The new National Planning policy framework will be announced by Ministers at lunchtime.  Following a much criticised consultation process with developers, environmental groups and other during last year, the new framework will come into force immediately.

Opponents of the change are badging the reforms as a “developers’ charter” whilst the Government are confident that reforms will simplify the existing complex and confusing system and help boost growth. 

One of the key points of contention is the definition of what is meant by the phrase “sustainable development”.  Speaking on BBC Radio 4 this morning Planning Minister Greg Clark explained that sustainable development meant that  "If there are reasons, for example if it destroys the environment, if it builds on the green belt, if it builds outside a town centre if it's a commercial premises when you want to keep town centres thriving, then that would not be sustainable, it would not be in the public interest and so it should not go ahead."  The framework also indicates that the default answer for development proposals should be yes, and this is where the nub of the matter lies.

To date the planning process has proved to have been a rather inaccessible matter for most people to engage with.  Part of the objective of the new framework has been to simplify and make the process more accessible.  1,300 pages down to 50, quite a change. There is a perception that this slimming down of the “rules” will allow developers to ride roughshod over local wishes and turn swathes of the greenbelt into housing estates.  Government has given assurances that this is not the case.  However, vocal opponents including the National Trust, the Campaign to Protect Rural England (CPRE) and Friends of the Earth believe this is exactly what will happen and our green and pleasant land will be no more.

Currently 11% of the area of the UK is developed.  It will be an interesting watch to see what transpires from this new framework.

Nuclear New Build UK Sites Announced

The Government has released details of the locations for the sites of the next generation of new build nuclear power generating stations.

The locations are at Bradwell in Essex, Hinkley Point, Somerset, Oldbury in Gloucestershire, Sellafield in West Cumbria, Sizewell in Suffolk and Wylfa on Anglesey, Hartlepool, Teeside & Heysham in Lancashire.  Each if the proposed sites is adjacent to an existing licensed nuclear site owned by either the Nuclear Decommissioning Authority (NDA) or British Energy (BE).  During 2009/2010 the Government instructed that surplus land adjacent to licensed sited that were in public ownership be disposed of, netting a very tidy sum for the public coffers and it is anticipated that this land will form part of the new build programme.

The development of new power generating capacity for the UK is essential as by the end of the decade a significant proportion of the existing capacity will close, indeed by December 2017 there will a significant downturn in output as the generating capacity of some of the older generating stations is scheduled to come to an end.

Time passes slowly in the nuclear industry and the announcement of the sites is but the first step in the construction and commissioning of a nuclear power station.  There is the not insignificant challenge of tackling that other leviathan that is the planning process.  It is assumed that applications will come under the auspices of the Major Infrastructure Planning Unit, although how long this process will take is debatable.  With the huge numbers of interested parties involved the hoped for swift and efficient planning system may be stretched to the limit.

Govt to release land for building

The Government plans to release 1,000s of acres of previously developed land for alternate usage. It is expected that by the Autumn this year each Department with significant surplus land holdings will produce plans detailing those areas to be made available. This Central Goverment initiative is expected to be followed by local Councils, many of whom also retain surplus land banks.
The potential impact on the housing sector is anticipated to be significant, with many in the sector already welcoming this initiative.