Iain Johnston, Planning Partner at law firm Brabners Chaffe Street and a nationally-recognised expert on HS2 comments on the Spring ‘Safeguarding Direction’:
The Government has completed the consultation exercise on the Safeguarding process and the separate consultation on Property and Compensation. Issued in October 2012 the Government’s timetable indicates that they will seek to issue a Safeguarding Direction to all local authorities affected by the route of Phase 1 of HS2 between London and Birmingham in the Spring.
The principal effect of a Safeguarding Direction is to preserve the integrity of the proposed railway line and to restrict any new developments that may compromise the rail lines. The Safeguarding Direction will mean that all proposed new developments that are within or partially within the Safeguarding area will need to be referred to HS2 Limited as a consultee. If a development would affect the construction or operating of the line then any new planning permission would be refused. Consideration of the technical documents for HS2 indicate that the rail line area in general will be 22m in width. The Safeguarded area will in general be an area 60 metres either side of the 22 metre area.
The other main effect of a Safeguarding Direction is to trigger the “statutory blight” process set out in the Town & Country Planning Act 1990. This effectively allows a qualifying property owner to serve a Blight Notice on the Government to acquire the land or property now rather than wait for the Government to use its compulsory purchase powers to acquire the property in what is an uncertain number of years. It is a form of speeded up compulsory purchase and allows a landowner some increased certainty that his property will be acquired at a time which is more convenient to him.
It should be noted that qualifying property owners are – residential owner occupiers, owner occupiers of small business premises and owner occupiers of agricultural units. Please note for above purposes small business premises are those with a rateable value up to £34,800. Therefore this does not cover owner occupiers of business premises above £34,800 or the landlord or tenant of commercially let premises, large or small.
In the Property and Compensation consultation the Government sets out some enhancements to the blight process under its Advance Purchase Scheme. It has decided that if a qualifying property owner is within the Safeguarding area then they will accept a Blight Notice at an early stage and there will be no need to demonstrate reasonable endeavours to sell the property or business on the open market. This would be, even if it was not clear, that the property would ultimately be required to be demolished to allow construction or operation of the line.
Under the Advanced Purchase Scheme, in terms of compensation, a landowner would get the unaffected open market value/rate for the property together with a home loss payment of up to 10% of the value for the property and reasonable moving costs.
Another important concession set out in the Government’s Consultation is that of the Voluntary Purchase Zone applicable only in rural areas. This is up to 120 metres from the rail line area. Any qualifying property owner within this area can require the government to purchase their property. However in this case the property owner would simply receive the unblighted open market value of the property. He would not receive any home loss payment or reasonable moving costs.
So the bottom line is this – if you are a qualifying property owner in an urban area and you are within the Safeguarding area then you will receive full market value compensation etc for your property. In addition if you are located in a rural area and you are within 120 metres of the railway line area then you will be able to request that your property is acquired by the Government at full market value. However, if you are not a qualifying property owner or within those areas then you are entitled to very little in the way of compensation for the “blighting” effect of the project on your property.
You may unfortunately be a landowner or business owner who is just outside the Voluntary Purchase Zone and therefore not able to qualify for any of these schemes. Are there any other potential options for compensation?
There is the proposed Long Term Hardship Scheme which the Government will promote. However it is important to realise that this is a discretionary scheme and experience indicates that it is quite difficult to convince the relevant government panel of exceptional hardship.
The only other potential avenue to receive limited compensation for depreciation in value would be during construction of the line and after its construction and operation for one year. These avenues of claim can be pursued but in no way compensate for the long term blighting effect that such schemes have on property.
As with other major infrastructure schemes the Government has to drawn the line somewhere as to who is eligible for compensation. There will be many people saddled with properties near to rail line but outside the Safeguarding area and the Voluntary Purchase Zone who will have to suffer devaluation in their property for many years and great difficulty in selling their property at a realistic price. The Government is unfortunately sacrificing those potential voters!
