Summary: Mr X complained the Council introduced planning validation fees that had no legal basis. We found this was a matter for the courts but there was fault by the Council as it failed to show its action in not returning the full planning fee when rejecting invalid applications was consistent with the relevant regulations. The Council has agreed to apologise to Mr X, refund his fees and review its policy which we consider provides a suitable remedy.

The complaint

1. Mr X complains the Council has introduced a validation planning administration fee that has no legal basis. Mr X says the Council is charging his clients additional, unavoidable fees which he considers are wrong, arbitrary and disproportionate.

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The Ombudsman’s role and powers

2. We investigate complaints about ‘maladministration’ and ‘service failure’. In this statement, I have used the word fault to refer to these. We must also consider whether any fault has had an adverse impact on the person making the complaint. I refer to this as ‘injustice’. If there has been fault which has caused significant injustice, or that could cause injustice to others in the future we may suggest a remedy. (Local Government Act 1974, sections 26(1) and 26A(1), as amended)
3. We consider whether there was fault in the way an organisation made its decision. If there was no fault in how the organisation made its decision, we cannot question the outcome. (Local Government Act 1974, section 34(3), as amended)
4. If we are satisfied with an organisation’s actions or proposed actions, we can complete our investigation and issue a decision statement. (Local Government Act 1974, section 30(1B) and 34H(i), as amended)

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How I considered this complaint

5. I considered evidence provided by Mr X and the Council as well as relevant law, policy and guidance.
6. Mr X and the Council had an opportunity to comment on my draft decision. I considered any comments before making a final decision.

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What I found

Background and legislation

7. Section 93 of the Local Government Act 2003 provides the power for relevant authorities to charge for discretionary services. Section 93(3) and (4) place a duty on such authorities to ensure that, taking one year with another, the income from charges for each kind of discretionary service does not exceed the costs of provision.
8. Discretionary services are those services that an authority has the power but not a duty to provide.
9. Section 95 (1)(a) provides the Secretary of State with the power to authorise relevant authorities to do for a commercial purpose anything which they are authorised to do for the purpose of carrying on any of their ordinary functions.
10. The Town and Country Planning (Fees for Applications, Deemed Applications, Requests and Site Visits)(England) Regulations 2012, section 3(5), as amended, (the Regulations) state that any fee paid for a planning application will be refunded if the application is rejected as invalid.

What happened

11. In September 2023, the Council’s Cabinet agreed to a proposal to transform the Council’s planning service. New charges came into effect in April 2024 and the Council informed planning agents it had introduced ‘non-statutory fees.’
12. The Council’s website confirms that there are two relevant sets of new charges/fees which I have defined as follows:

• the 10% ‘Administrative Charge’ which is taken from the refund due to applicants where applications are returned on the basis that they are invalid;
• the ‘Invalid Advice Fees’ which are part of what is described by the Council as an ‘optional invalid advice service’; and
• together the ‘New Charges/Fees’.

13. The Administrative Charge is explained by the Council on its website in the following terms:

If your application is not valid, we will contact you to let you know why your application is not valid. At this point, you can either withdraw your planning application which will mean we will let the Planning Portal know to issue you a refund, less a 10% administration charge to cover our time for having reviewed your application.

14. Mr X, who acts as an agent on behalf of planning applicants, wrote to the Council on 31 May 2024. He asked the Council to provide the legal basis it was relying on to make a charge for invalid planning applications with reference to two applications he had made. Mr X highlighted the additional information that had been requested by the Council for each application had been immediately provided but he was still required to pay an additional charge of £180 for each application. Mr X considered the charges to be wholly disproportionate for what he described as minor transgressions. Mr X further considered the administration of such matters was already covered in the planning application fee and so the Council was effectively charging twice. Mr X outlined his interpretation of the relevant legislation and view the charge was not lawfully made. Mr X also sought information under the Freedom of Information Act (FOI) and details of the Council’s complaint procedure.
15. Mr X sent a reminder to the Council on 1 July as he had not received a response.
16. Mr X chased the Council on 15 July about a refund of the application fee for an application that it had invalidated on 3 May.
17. The Council received an acknowledgement on 5 August and an apology for the delay in dealing with his correspondence of 31 May.
18. The Council provided a substantive response on 15 August and apologised for the delay. This response referred to the Council’s decision to ‘transform the Council’s Planning Service’ and referred to legal advice sought on the matter. The response went on to describe the fees introduced as ‘non statutory fees’ which include ‘invalid application fees and ‘amendment fees’ and which ‘sit alongside the statutory fees’. Section 93 of the Act is referred to as the ‘legal basis’ for the ‘new non statutory fees’. The Council explained it had written to all its regular planning agents (including Mr X) on 6 April 2024 to notify them of changes being made including the introduction of non-statutory fees. The Council noted this information was also updated on its website. The Council provided a response to each of the two specific planning applications Mr X had raised and accepted that one of the two £180 fees should be refunded and provided its reasons. The Council also sought the time period for the information Mr X had requested in his FOI request.
19. Mr X responded to the Council on 15 August. Mr X questioned a phrase in the Cabinet Report he had received which referred to the new and amended discretionary fees and charges generating additional income. Mr X noted this was at odds with section 93 of the Local Government Act 2003 to recoup actual costs only. Mr X set out his view that the statutory fee already contained an element to cover administration costs and the time taken to invalidate an application and send a notification of the same did not justify the fee being charged. Mr X asked the Council to demonstrate how it was complying with section 93 of the Local Government Act 2003 having particular regard to The Town and Country Planning (Fees) Regulations 2012 paragraph 3(5) (as amended).
20. Mr X sent reminders to the Council on 19 September and 7 October as he had not received a response to his further complaint or original FOI request.
21. The Council provided a response to Mr X’s FOI request on 11 October and a response to his further points of complaint. This response included the statement: ‘We sought extensive legal guidance on these points and were considered legally sound. The legal advice is subject to legal privilege so we can’t share, but no doubt you are aware that we are one of many councils introducing admin charges to our planning service.’
22. Mr X asked the Council on 14 October to explain how the figure of £180 which he considered to be arbitrary had been calculated with the requirements of section 93 in mind. Mr X noted other local authorities had adopted a more modest fee. Mr X asked for the matter to be escalated to the Chief Executive.
23. The Council sent a holding reply on 16 October and 17 October to say the matter had been escalated to Stage 2 of its complaint procedure.
24. The Council provided a response to Mr X at Stage 2 of its complaint procedure on 22 November. The Council noted it had not provided a reply to Mr X’s FOI request of 31 May within 20 working days and apologised. The Council relied on government guidance which allows for planning related services to be provided by councils on a discretionary basis. The Council also relied on Section 95(1) of the Act as the legal basis for charging for certain activities on a commercial basis. The Council set out the following:

• a local authority may offer a Planning-related service to members of the public considered to be a discretionary service and highlighted relevant Government guidance that encouraged local planning authorities to take a flexible and tailored approach
• this discretion and flexibility was re-enforced by criteria in the National Planning Policy Framework and Section 95(1) of the Local Government Act 2003 (LGA 2003)
• the Local Government (Best Value Authorities) (Power to Trade) (England) Order 2009 provides that the Council is permitted to charge for certain activities on a commercial basis
• the amounts chargeable are for Local Planning Authorities to decide
• authorities spend a disproportionate amount of time liaising with applicants and agents to validate applications so they can be registered and determined
• the Council’s schedule of charges was publicly agreed at Cabinet in March 2024
• all local and regular agents, developers and applicants were written to and advised of the changes
• the new charging regime came into effect on 1 April 2024
• the validation fee of £180 inclusive of VAT, is set to reimburse various officers’ time to process planning submissions on receipt including technical support officers, case officer and, in some instances, consultees where appropriate, to assess documentation submitted as part of a planning application and advise applicants and agents accordingly and the cost of time to correspond with applicants and agents and process updated and amended documents when received
• higher fees (compared to some neighbouring authorities) deter inadequate or incomplete submissions and encourage pre-application engagement with the local authority.

25. Mr X subsequently asked the Council to confirm if it was relying on section 93 or section 95 as its response of 15 August referred only to section 93. The Council responded to Mr X on 30 November. This final response from the Council did not respond on this point or explain the relevance of Section 95. Instead, the Council referred back to Section 93 of the Act as justification for flat fees being charged to cover the work done by council officers in providing ‘invalid advice’. The Council set out the following:

• it had introduced invalid fees to help address the poor quality of applications that had historically been submitted
• these required significant officer time to correct and so slowed down the processing of other applications
• correcting invalid applications was not a service it was required to provide and the invalid service now offered was wholly optional.
• when notifying a customer their application was invalid the Council explained the reasons and it was then for the customer to decide to either use the invalid service or have their application returned via the Planning Portal (less an administration fee) for them to resubmit independently.
• when an applicant decided to enter an invalid discussion for extra support to submit a valid application it was wholly their decision to do so and they were opting to use the discretionary planning services.
• Mr X had opted not to use the invalid service on occasion and apologised that a refund took too long to process
• under Section 93 of the Local Government Act 2003, the Council could set fees for the provision of discretionary services provided that ‘taking one financial year with another, the income from charges under that subsection does not exceed the cost of provision’
• similar to pre-application services the Council was permitted to put in place a set fee for the work provided and this was commonplace in councils across the country
• it was recognised that providing invalid advice on some applications would take less time and others would take more but the discretionary flat fees charged helped recover costs to ensure we have the right resources in place to provide support to all our customers
• the provision of some invalid advice required input of multiple officers, including senior members of the team and the prices set reflect the cost of ensuring we have the necessary resources available
• it was recognised that other authorities charged lower fees but the aim through the new charges was to ensure a planning service that was sufficiently funded to process applications in a timely manner
• over £10,000 had been generated that year through the new charges based on the published planning fees but this money was reinvested in the service
• section 95 (Power to Trade), allowed councils via a wholly-owned local authority trading company to generate income which is then reinvested into the council to support wider services
• the Council’s wholly-owned local authority trading company was commissioned to deliver processing of major planning applications on behalf of the Council
• clarified Mr X’s application was processed by the Council
• the Council was confident the services provided were discretionary, customers had the opportunity to choose to withdraw their application instead and the fees charged were realistic

26. Mr X brought his complaint to the Ombudsman in January 2025.
27. In responding to our enquiries, the Council stated:

• the fee charged covered the cost of delivering in effect pre-application services to the customer to help them correct their application
• the charge covers the cost of administration, expert advice and guidance and senior officer time
• it did not generate a profit
• an assessment was carried out before the introduction of the invalid application fee to monitor the amount of time spent dealing with invalid submissions and the analysis demonstrated an unreasonably significant amount of officer time was being spent on chasing missing information and repeatedly reviewing incomplete applications, which was delaying the overall processing of valid applications and affecting service delivery
• the introduction of the fee was informed by this evidence and forms part of a broader programme of improvements to ensure the service actively operates more efficiently and that public resources are used more effectively
• the fee was intended to encourage the submission of complete applications, deter poor quality submissions, support early engagement – especially at the pre-application stage, and ultimately improve the experience for all applicants by reducing delays in the system
• councils are entitled to charge an administration fee for processing invalid applications in accordance with section 93 of the Local Government Act 2022 and provided examples of other councils that charge a 10% service charge for applications that are returned as invalid

Analysis

Administrative Charge

28. As set out above, the Administrative Charge is explained by the Council on its website in the following terms:

If your application is not valid, we will contact you to let you know why your application is not valid. At this point, you can either withdraw your planning application which will mean we will let the Planning Portal know to issue you a refund, less a 10% administration charge to cover our time for having reviewed your application.

29. It is accepted that the planning fee which is being refunded is the planning fee which is due under regulation 3 of the 2012 Regulations. Regulation 3(5) makes clear that a refund is due if an application is rejected as invalid. Once an application is considered valid, it is placed on the planning register and given an application reference number.
30. The legislative scheme which provides for the payment of planning fees does not provide for administrative charges to be made to cover administrative costs. Government guidance confirms that the planning fees system was introduced to cover the costs of considering planning applications.
31. The Council have provided no clear explanation of how the relevant provisions of the 2012 Regulations can be interpreted to allow for deductions to be made from planning fee before it is refunded. This is fault.

Invalid Advice Fees

32. Section 93 of the 2003 Act does provide the Council with the power to charge for discretionary services. It may be considered that providing advice on how to complete a valid planning application is a discretionary service.
33. Mr X disagrees with the Council’s interpretation of section 93. However, the Council has sought legal advice and explained its consideration. This would ultimately be a matter for the courts to decide.

New Charges/Fees

34. Mr X has consistently sought from the Council an explanation as to the legal basis for the introduction of the new fees/charges. The Council did not provide Mr X with a clear or consistent explanation.
35. The final response from the Council to Mr X in October 2025 refers to section 95 of the 2003 Act by way of legal justification but there is no explanation of how this section could apply and it appears inconsistent with the Council’s previous justifications as to the relevant statutory provisions in Mr X’s case. In addition, the lack of a clear explanation of the lawful basis for the New Fees/Charges is compounded by a lack of transparency and consistency in how the new system is operating.
36. In the first response to Mr X from the Council, Mr X is offered a refund for one of the £180 charges he has paid on the basis that the Council agreed the charge was ‘onerous in this case given you had provided a written description and the information requested could be turned around so quickly’. In the final response dated 30 November 2024, it is suggested that Mr X was provided with a refund because he ‘opted not to use the service’.
37. These two explanations for why a refund was provided are inconsistent and suggests there is no properly understood transparent process in place with regards to the circumstances in which Invalid Advice Fees should properly be charged.
38. There is no suggestion on the Council’s website that the fees charged are capable of being refunded in certain cases. Providing a refund only where a complaint has been pursued suggests that the system is lacking in fairness and transparency as there is no way for those using the planning system to know on what basis the fees/charges they are paying are capable of being refunded. In addition, this unclear practice of offering a refund in non-onerous cases does not assist with arguments that the Invalid Advice Fees are compliant with the Section 93(3) requirement that charges should only cover costs and that those paying should agree to the charge (as per Section 93(1)(b)).
39. The lack of transparency is not helped by the inconsistent terms used to refer to the various new charges that have led to Mr X’s complaint. For example: the Council refers to the introduction of ‘non statutory fees’ which are said (in its response to Mr X dated 15 August 2024) to ‘sit alongside statutory fees’. In the same response, the Council refers to the fees as ‘discretionary fees’ and, confusingly, further on in the response refers to ‘non-discretionary planning fees’. The Council should refer to the charges consistently in the correct terms. The use of ‘discretionary’ and ‘non-discretionary’ and ‘statutory’ and ‘non-statutory’ is not only confusing but does not assist in supporting the legal arguments being made by the Council as to the legal basis and nature of these fees.
40. I am satisfied when taken together, the lack of transparency and consistency in how the new system is operating constitutes fault.
41. There was also avoidable delay in dealing with Mr X’s correspondence and complaint. This is fault which will have caused Mr X frustration. The Council has already provided a suitable apology to Mr X and has confirmed it has taken steps to ensure complaints are promptly identified and responded to in accordance with its complaint procedure in future. In the circumstances, I do not consider a further remedy on this point is required.

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Action

42. The Council should, within one month of my final decision, take the following action:
1. apologise to Mr X for not providing a clear and consistent explanation about the introduction of the new fees/charges; and
2. refund any Administrative Charge paid by Mr X for any applications it has rejected as invalid.
43. The Council will also within three months of the date of my final decision take the following action:
1. review its policy on the Administrative Charge to ensure it is compliant with The Town and Country Planning (Fees for Applications, Deemed Applications, Requests and Site Visits)(England) Regulations 2012; and
2. review its procedure to ensure there is a transparent process in place with regard to the circumstances in which Invalid Advice Fees should properly be charged and/or refunded and that clear and consistent information is provided to applicants.
44. We publish guidance on remedies which sets out our expectations for how organisations should apologise effectively to remedy injustice. The organisation should consider this guidance in making the apology I have recommended in my findings.
45. The Council should provide us with evidence it has complied with the above actions.

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Decision

46. I find fault causing injustice. The Council has agreed actions to remedy the injustice.

Investigator’s decision on behalf of the Ombudsman

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Investigator's decision on behalf of the Ombudsman