Planning fee rises may not increase council income, service chief warns

Elgan Hearn, Local Democracy Reporter

Price hikes for processing planning applications will come into force next month, but this won’t mean that a council will make more money, a chief of planning services has claimed.

At a meeting of Powys County Council’s Economy, Residents and Communities scrutiny committee on Thursday, November 6, councillors looked at the impact of cuts and savings delivered by a number of council departments last year that come under their remit.

This included the Planning and Regulatory Services who made savings of £531,575 during 2024/2025 but just under £219,000 worth of proposals had to be rolled over into this year’s budget.

This was part of an overall council expectation to make £12.9 million in cuts and savings last year.

Unlike other parts of the council, there is more emphasis on the Planning and Regulatory Service to make money through fees being paid for its work.

This means that the “savings” they produce is mostly made up of income generation targets.

Head of Planning and Regulatory Services, Gwilym Davies told councillors that the “cost of living crisis is effecting demand” on services.

Cllr Pete Lewington (Conservative – Newtown West) said: “I guess it’s a very difficult one to budget for the demand.”

Mr Davies agreed that it was in some cases and provided an example in the upcoming changes to planning fees.

Mr Davies said: “You will see that the Welsh Government are going to increase planning fees potentially by 50 per cent.

“But we don’t know what that demand will be and whether there will be a decrease.

“With a lot of these you have to monitor the trends over the years and see how they do progress.”

Offset 

For those targets that cannot be met, Mr Davies said that “offsetting” them with income from those that are above target is something he’s looking to do.

Committee chairwoman Angela Davies (Liberal Democrat – Rhayader) asked: “So within your service it’s not achieving those income target which is the biggest challenge for you going forward?

“Yes,” replied Mr Davies.

From December 1, planning fees will increase throughout Wales, with future annual adjustments linked to inflation and provisions for full cost recovery.

The government’s intention is that will help address: “the existing deficit between the cost of determining applications and the income received for providing this service.”

In December 2023, Council Leader, Cllr Jake Berriman in his previous role as the Cabinet Member responsible for Planning had a notice of motion unanimously backed by councillors to lobby the government to allow Powys to set its own planning fees.