CLA welcomes step forward in campaign for compulsory purchase fairness

Interest rates are one of a number of reforms being brought forward by Government to reform the outdated laws on compulsory purchase
Interest rates are one of a number of reforms being brought forward by Government to reform the outdated laws on compulsory purchase

Local Authorities and infrastructure companies may have to pay penal rates of interest if they fail to settle claims for advance compensation in a timely manner. In addition they will have to pay interest on outstanding claims for land that is compulsorily acquired from which they have been exempt for years.

Interest rates are one of a number of reforms being brought forward by Government to reform the outdated laws on compulsory purchase. This marks a further breakthrough in the long running campaign by the CLA, which represents landowners, farmers and rural businesses, seeking fair treatment for those facing compulsory purchase.

CLA Chief Surveyor Andrew Shirley said: “Compulsory purchase is sometimes necessary to deliver the important infrastructure. Nevertheless it causes stress, sleepless nights and business stagnation for rural land and business owners who face significant disruption and loss as a result. Today’s announcement is a further step forward in our campaign for a fair system that reduces the harm they face.

“The Government has agreed with us that on principle when an authority compulsorily buys land they must pay upfront for taking possession and today they have confirmed that they will face a penalty if they don’t.

They have also confirmed that the rate of interest for late payments will be set at 2% above base rate, which is higher than the 0.5% below base rate that is currently prescribed. This is a positive step but falls short of the 4% that we will continue to demand.

“The Chancellor has previously made clear that it is better to pay a good level of compensation up front, rather than face conflict and strong resistance from landowners that can delay the delivery of projects. We welcome the confirmation of this sentiment in today’s statement but more detail is required on how this can happen in practice.”