Only the name has been changed

Section 4 of the Property Compensation consultation document sets out Question 2 to Question 5 for the consultation, together with the supporting information for each question. Question 2 is, “What are your views on our proposals for an express purchase scheme?” and the supporting information is in Section 4.2.

The first thing to realise is that the express purchase scheme is a new name for what is basically the same as the advanced purchase scheme that was proposed for the original property compensation consultation. We are told by the Government that the new name “more accurately reflects [the scheme’s] aims”.

The key to understanding this scheme is to appreciate what compensation provisions are available due to the body of statute and case law covered by the collective term “the compensation code”. These provisions are outlined in Annex A to the consultation document and we are warned from the outset that “the existing law around compensation and blight is complex”. Despite this warning, I attempted for the original consultation to summarise the compensation code provisions in my two blogs Crumbs of comfort (posted 4 Jan 2013) and A few crumbs more (posted 6 Jan 2013). I hope that these two blogs helped then, and suggest that they may also help now (provided that you do not rely legally on anything that I say – refer to the “Important note” at the foot of each of the blogs).

As far as the proposed express purchase scheme is concerned, the two concepts of the compensation code that are particularly relevant are “safeguarding” and “statutory blight”.

Safeguarding is described in the consultation document as “the means by which the Government and HS2 Ltd will protect the land that is needed to build and operate the railway from conflicting development” (Annex A on page 59). More specifically, it is the “area of surface interest” that concerns us here; different safeguarding provisions apply where it is necessary to protect only the land under the surface because HS2 will be carried in a deep-bore tunnel. Much of the proposed route of HS2 Phase 1 was safeguarded on 9th July 2013 (with updates applied and further areas brought in on 24th October 2013), and maps showing the safeguarded area by grey shading have been e-published. I reviewed the principles of safeguarding in my blog Keeping things safe (posted 29 Dec 2013).

Statutory blight is the compensation regime that applies to properties within the safeguarded zone, and the owners of properties to which this applies may serve a “Blight Notice” requesting an “acquiring authority” – in this case the Transport Secretary – to buy the property. Since maps of the safeguarded zone are published, and the provisions of the compensation code now apply, it is possible for owners of properties that are within the safeguarded zone for HS2 Phase 1 to serve a Blight Notice. However from reports that I have heard, the Government is currently treating such applications in the standard way required by the compensation code, and is rejecting (by issue of a “Counter-Notice”) any application where it does not think that a compulsory purchase will be required to build HS2, or where it does not consider that the owner has made “reasonable endeavours” to sell the property (see paragraph 4.2.5 of the consultation document).

If the Government’s proposals for express purchase are adopted for HS2 Phase 1 it will waive its right to issue a Counter-Notice where the property is wholly within the safeguarded zone, even if it is not considered that a compulsory purchase will be required (paragraph 4.2.11 of the consultation document). Neither will the applicant have to demonstrate efforts to sell (paragraph 4.2.14 of the consultation document). Where the property in question lies only partially within the safeguarded zone the Government will, we are told, apply discretion, but will only issue a Counter-Notice in “exceptional circumstances” (paragraph 4.2.12 of the consultation document).

In the second half of my blog A little bit more (posted 14 Jan 2013), I discussed the advanced purchase scheme, which was the subject of Question 1 in that original consultation. I suggested three comments that respondents to that consultation could make:

  • That the concessions on offer, over and above the statutory provisions, are limited and that only a small number of properties stand to benefit.
  • That the lack of clarity regarding the treatment of properties only partially within the safeguarding zone is unsatisfactory.
  • That under the statutory compensation eligibility requirements only owner-occupied buildings may be the subject of a blight notice, and that is unfair on landlords and owners of second homes.

These three comments still apply, and a fourth should now be added:

  • That unsuccessful Blight Notice applicants should be allowed to reapply when the express purchase scheme becomes operational.

It may also help you to read the analysis of the responses received to the original consultation that can be found in Chapter 5 of the Dialogue by Design report. Additional points raised by respondents to that consultation include:

  • That the business rateable value limit of £34,800 is too low.
  • That the home loss payment is insufficient and should not be capped.
  • That the standard 60 metre limit for the safeguarded zone is arbitrary and does not reflect the degree of impact.
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