News 28th Oct 2020

Poor safeguards against corruption in planning are leaving councils open to allegations of impropriety

Steve Goodrich

Senior Research Manager

Steve is Transparency International UK’s Senior Research Manager. He is responsible for managing TI-UK’s research unit and is our specialist on lobbying accountability, party funding and open governance. Before joining TI-UK in May 2015, Steve worked as a Senior Policy Adviser at the Electoral Commission. He has over five years’ experience working on political finance regulation, legislation and data.

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Related Publication

Permission Accomplished

Publication

This report focusses on specific corruption risks in major planning decisions, an area where there is often a large amount of money at stake. It is also very contentious, with many new developments resulting in a net loss of social and genuinely affordable housing, which in many areas are in short supply.

To understand what could undermine openness in the planning process and what local authorities are doing to stop this, we have collected evidence from across England. Although there are some examples of good practice, generally the results make for a worrying read.

Unminuted, closed-door meetings with developers and excessive hospitality undoubtedly undermine confidence in the planning process, yet too many local authorities have weak rules to stop this from happening. Even fewer councils have control measures for major conflicts of interest, with far too many decision-makers also working for developers on the side. Moreover, when councillors behave badly, there are no clear or meaningful sanctions available to councils that could act as an effective deterrent against serious misconduct by them or others in the future.

To address these issues we propose ten practical solutions, none of which are beyond the means of those who need to implement them. All reinforce existing guidance and good practice recommended by anti-fraud and corruption initiatives here and internationally. Some even reflect existing practice in particular parts of the UK, such as Scotland.

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Delivering major housing developments is challenging at the best of times. Developers have to find land, finance and a skilled workforce. They have to win over the local community which in some way or another will be affected. Whilst the planning system is heavily in favour of development, with few grounds for councils to object, things can and do go badly wrong.

This is the starting point for our latest report, Permission Accomplished. It examines how councils across the country have left themselves open to allegations of impropriety through poor safeguards against improper conduct by those empowered with making planning decisions. Let’s be clear: we have not found a widespread abuse of power, but we have found policies and behaviours that do not meet good practice standards, which in over a dozen cases have led to serious headaches.

Take, for example, a major regeneration scheme in Liverpool. Both Transparency International UK and the Local Government Association recommend that meetings with developers should be attended by at least one officer, with notes taken and minutes provided on file for transparency. Yet for this scheme, which has since collapsed and is now under investigation by the Serious Fraud Office, no details of these meetings are available. At least £200 million of investors’ money has been lost.

Then there’s the former planning chair in Westminster City Council, who received so many gifts and hospitality from developers and their agents that he was investigated by the authorities’ legal officer. He resigned, but the damage was already done – to his career and his council’s reputation. And these are not the only examples.

Across the country, we found similar cases in authorities of all different political stripes. Broadly speaking, there were three key areas where issues arose:

  • Councillors’ external engagement: including holding meetings with developers behind closed doors, receiving hospitality and gifts.
  • Managing councillors’ private interests: including external employment that poses a conflict of interest and the revolving door between the council and private sector.
  • Regulating councillors’ conduct: including training on conduct with integrity and protocols for any planning decision.

After an extensive review of research on the subject and interviews with over 40+ experts and campaigners, we developed a tool to help review how councils across England try to address these risks. Using a simple 0-100 scoring system, we assessed how a sample of 50 local authorities from across the country performed against good practice standards recommended by Transparency International UK, the Local Government Association (LGA) and the Committee on Standards in Public Life (CSPL), an ethics watchdog. The findings are undoubtedly worrying.

On average, the 50 local authorities in our sample only scored 38 out of 100. In particular, many had insufficient safeguards to manage the risks of impropriety when it comes to councillors’ engagement with developers and their agents. A substantial number also allowed those in important decision- making positions to work for developers at the same time, which does nothing for perceptions that the planning process is captured by the industry. And although we didn’t find widespread examples of malpractice, like the CSPL, we noted the absence of sufficient sanctions to deter egregious behaviour short of criminal conduct.

Our report highlights what can go wrong for councils when it comes to major planning decisions. The good news is that some of the solutions are relatively simple and straight forward. Eight of the ten recommendations in our report can be implemented by councils themselves without recourse to legislation. A lot of what we’re proposing is merely adopting what others have called for and is not a major drain on councils or their members’ resource and time. There are also changes the lobbying industry can make too without any need for a change in the law, such as banning its members from employing sitting councillors, as it does for other forms of elective office. Given the amount of money at stake, and the pressure to build, this is a very small price to pay for reducing the risk of some very big headaches for councils further down the line and creating a more open system less susceptible to corruption and abuse.