Tougher test to safeguard small shops and curb clone towns

New tough planning rules will help councils better protect small shops through the current economic difficulties and create more vibrant town centres, Communities Secretary Hazel Blears announced today.

The new proposals strengthen Planning Policy Statement 6: Planning for town centres (PPS6) - the Government's 'town centres first' policy - and give councils more scope to refuse out of town development proposals that threaten the survival of high streets and small shops, are published today for consultation.

The policy has already helped revive town centres. There is more retail development in and around town centres than at any time during the last decade. But the Government wants to do more now to protect local shops at the heart of communities - particularly when we know that many are currently experiencing tough times on the high street.

These revised planning rules keep the important 'sequential test' that requires the most central town centre sites to be developed first.

A tougher 'impact test' is being introduced which will give councils a better tool to prevent big developments that put small shops and town centres at risk. Using this test, Councils will now examine more factors including retail diversity, consumer spending, loss of trade, impact on town centre investment, scope for regeneration and job creation to ensure the vibrancy of town centres and high streets is protected against harmful development.

The revised policy will also remove the blunt and simplistic 'need test', which has unintentionally stifled diversity and consumer choice, by only assessing whether there was enough consumer expenditure capacity to support new retail floorspace such as an out of town supermarket. This has led to some new retail schemes on the fringes of the town centre - which could benefit the centre - being ruled out because out of town developments already fulfil that function.

The Competition Commission investigation into the supply of groceries in the UK market published its final report in April 2008. A key recommendation of the report was that Government should introduce a 'competition test' into the planning system requiring local authorities to assess planning applications for new grocery floorspace over 1,000 square metres for their impacts on competition, in consultation with the Office of Fair Trading. The Government will formally respond to the Commission's recommendations, including the competition test proposal shortly, but today's consultation on PPS6 is a clear signal of intent that will reassure town centre managers and independent retailers up and down the country.

Launching the consultation in a keynote speech at the Royal Town Planning Institute Annual Convention, Communities Secretary Hazel Blears said: "Town centres are the hearts of our communities. I want to see our town centres and independent shops busy and thriving and I'm absolutely committed to help defend their future.

"That is why we need to ensure that our policies maintain their effectiveness and they are responsive to future challenges. We need a policy which provides the right degree of protection for smaller retailers who are facing very challenging trading conditions and increased levels of competition."

"I'm keen to see this stronger PPS6 working for town centres... it is imperative that we support them during the challenging times they are facing. I believe that the strengthened rules will guide future town centre development by giving Councils the tools to attract investment and protect and promote their high streets."

Specifically the revised PPS6 consultation:

• Reinforces our policy of "town centres first". 
• Ensures that the planning system promotes the vitality, viability and the unique character of town centres. 
• Requires local authorities to proactively plan their town centres; to plan for sustainable economic growth through policies which are responsive to economic change. 
• Promotes consumer choice and retail diversity and recognises that the planning system can help to support small shops and the identity of town centres. 
• Keeps the important 'sequential test' that requires developers to seek the most central sites first. 
• Remove the dysfunctional 'needs test' which can unintentionally stifle diversity and consumer choice in town. In some cases new shops were ruled out because out of town developments, such as big supermarkets, already provided that function. 
• Creates a new tougher 'impact test' that assesses economic, social and environmental criteria so councils can better assess the impacts on the town centre. It tests whether impact is positive or negative on town centre consumer choice and retail diversity; investment and town centre trade and gives councils powers to cap the size of big retail developments where this is justified. 
• Tests the design quality of development. 
• Considers the wider benefits to communities, but ensures that the size of development is not out of scale with a town centre. 
• Ensures development is accessible by a range of transport modes. 
• Encourages cleaner safer, greener town centre environments and introduces sustainable development as an impact issue. 
• Encourages investment in disadvantaged areas creating new employment opportunities. 
• Makes clear that where negative impacts on the town centre are significant this will normally justify a refusal of planning permission.