Local finance considerations under section 70(2)

Section 70(2) of the Town and Country Planning Act 1990 tells an authority what to have regard to when it determines an application: the provisions of the development plan so far as material, any local finance considerations so far as material, and any other material considerations. The middle limb was added by section 143 of the Localism Act 2011, and local finance considerations under section 70 have been misunderstood ever since, usually by someone arguing that a council should approve a scheme because of the money it will bring in.

The subsection does not say that. It adds a defined category to the list of things to which regard must be had, and it keeps the materiality filter in place.

What the subsection requires

The duty is to have regard. That is a procedural obligation to consider, not an instruction to give weight, and the courts have long distinguished the two. An authority that identifies a local finance consideration, considers it and concludes that it carries no weight in the particular case has complied with the subsection.

The decision itself is still governed by section 38(6) of the Planning and Compulsory Purchase Act 2004, which requires determination in accordance with the development plan unless material considerations indicate otherwise. Local finance considerations enter on the material considerations side of that balance, where they have to compete with everything else.

Note the qualifier: so far as material to the application. The drafting makes materiality a condition of the duty rather than an afterthought.

The statutory definition, and what falls outside it

Section 70(4) defines the term, and the definition is narrow. It covers a grant or other financial assistance that has been, or will or could be, provided to a relevant authority by a Minister of the Crown, and sums that a relevant authority has received, or will or could receive, in payment of Community Infrastructure Levy.

The exclusions matter more than the inclusions. Advocates routinely describe future council tax income as a local finance consideration, and it is not one. Whether it could be a material consideration in the general sense is a separate question, and the practical answer is that it attracts no real weight, because the planning system does not exist to raise revenue.

One caution on the New Homes Bonus: the scheme has been scaled back and its future has been under review, so confirm whether it still operates and at what level before citing figures for it.

The weight such a consideration can carry

Weight is for the decision maker, subject to rationality. What guidance supplies is the test for materiality: whether the consideration could help to make the development acceptable in planning terms.

That test does real work. Levy receipts can bear on acceptability where the infrastructure they will fund addresses an effect of the development, because the question becomes whether the harm is mitigated rather than whether the council gains. A grant that will deliver a road improvement, a school expansion or a flood scheme serving the site is capable of being material on the same reasoning.

What is not capable of being material is the bare fact of income. The distinction is between money that bears on the planning merits and money that simply arrives, and it is the same discipline that applies when judging how de minimis judgements are made: the question is always what the consideration does to the planning balance.

Why revenue cannot buy a permission

National guidance on determining a planning application is explicit that it would not be appropriate to make a decision based on the potential for the development to raise money for a local authority. Several principles sit behind that sentence.

Planning powers must be exercised for planning purposes. A decision taken to generate income is a decision taken for an improper purpose, and it is vulnerable to challenge however sound the planning case might have been.

Probity requires it. Guidance on probity in planning, published for councillors and officers, treats the separation of the authority's financial interests from its decision-making role as fundamental, and members are advised not to refer to the authority's income in debate.

And there is a practical reason. If revenue could justify permission, every scheme would be assessed on the size of its cheque, and the plan-led system would stop meaning anything.

How the issue arises in a committee report

In most authorities the subsection is handled by a short standing paragraph: the report identifies the levy the scheme would generate and any grant implications, then records whether the officer considers them material and what weight is recommended. Usually the answer is none.

Three situations make it live. Where a scheme's levy receipts are earmarked for infrastructure that the scheme itself makes necessary. Where a grant is conditional on the development proceeding and the grant would deliver a planning benefit. And where a member raises income in debate, at which point the chair's handling of the point becomes part of the record.

For an applicant, the sensible approach in the Planning Statement is to deal with the subsection in a short paragraph that identifies the local finance considerations, states the levy position accurately and says plainly that no weight is sought on revenue grounds. That removes an easy criticism and demonstrates that the right framework has been applied.

Where genuine economic benefits are in play, make the argument properly instead. An Economic Impact Assessment covering construction and operational employment, local supply chain effects and support for town centre vitality is the right vehicle, and those are ordinary material considerations with nothing to do with section 70(4).

The relationship with planning obligations

Planning obligations sit under a different and stricter regime. Regulation 122 of the Community Infrastructure Levy Regulations 2010 provides that an obligation may constitute a reason for granting permission only where it is necessary to make the development acceptable in planning terms, directly related to the development, and fairly and reasonably related in scale and kind.

That test is statutory, it is applied to each head of terms individually, and it does not care how useful the money would be to the authority. An obligation sought as general revenue fails it.

Keeping the two concepts apart is also a drafting discipline. A statement that mixes the levy, the obligations and the grant income into a single paragraph about community benefit invites the objection that the applicant is trading cash for permission. Deal with each under its own heading and its own legal test.

Arguments that overstate the point

Four appear regularly, and none of them works.

The applicant's version: the council will receive a large levy payment and a grant, so the scheme should be approved. This asks the authority to do what guidance says it should not.

The objector's version: the council is biased because it will receive money, so the decision is unlawful. Predetermination and bias arguments of this kind rarely succeed, because the statutory scheme expressly contemplates the authority having regard to the money.

The housing supply version: the grant depends on completions, so approval is needed to hit the trajectory. Housing delivery arguments belong with the housing trajectory and the buffer, assessed on supply rather than on income.

And the conflation version: economic benefits and authority revenue presented as the same thing. Jobs, output and town centre vitality are material. The authority's bank balance is not.

One honest uncertainty: the line between infrastructure funding that bears on acceptability and income that does not is a matter of judgement at the margins, and a well-drafted statement explains which side of it the argument sits on rather than leaving the officer to work it out.

Enter your postcode on PlanScope to see which statements and assessments your application is likely to need.

This is general guidance, not legal advice; check the position with your local planning authority or a qualified professional before relying on it. PlanScope provides AI-assisted draft reports for planning applications. Reports should be reviewed before submission. We do not guarantee planning approval.