Development permit fees were cut by an average of 25 per cent yesterday, in a move planning parliamentary secretary Michael Farrugia said would “do justice” to developers and breathe new life into the economy.
We want the public to name obstacles with Mepa
Reductions vary from a token two per cent in fees for special buildings or uses to the 55 per cent decrease in fees for commercial development sites.
Fees related to the rehabilitation of buildings in old village centres have been cancelled completely, as part of a “Save the Village Core” project aimed at kick-starting inner village rehabilitation projects.
Maximum fee limits have also been reined in. While previously a development permit fee for large projects could cost as much as €1 million, fees will now be capped at €500,000.
The new rates will apply to any future fees concerning planning applications submitted after 2010. Applications submitted prior to 2010 will pay any necessary fees at the rates set prior to the Mepa reform.
According to Dr Farrugia, the across the board reductions will give entrepreneurs a new lease of life after years of overly high fees.
“We will also be launching a public consultation process over the coming days,” he said.
“We want members of the public to come forward and name the obstacles they come across when dealing with Mepa.”
Another proposed change will fast-track planning applications which adhere to local plans and planning policies, without the need of Environment and Planning Commission approval or case officer intervention.
Fast-tracking such applications would mean processing them in one month rather than the six it currently took, he said.
Industry embraces changes
Demolition fees have also been significantly curtailed: knocking down a small building will now cost €200 rather than the €1,000 it did before, while large developments of over 1,000 square metres would not cost any more than €2,000 to demolish, regardless of their size.
Some critics have voiced concern that the lowered fees will harm Mepa’s bottom line.
But according to Dr Farrugia, the opposite is true: lower fees will prompt people to submit more planning applications, thereby mitigating the effect.
Malta Developers’ Association president Michael Falzon welcomed the changes, which he noted had been promised in the run-up to the election.
Fees were inflated to make up for other Mepa expenses- Michael Falzon
He argued that the lower fees better reflected the true costs of providing planning services.
“Fees were inflated to make up for other Mepa expenses related to its environmental directorate,” Mr Falzon said.
“We’re not saying they should go back to what they were a decade ago, but it’s only fair that they’re realistic.”
Mr Falzon also said the decision to fast-track conventional applications simply reflected existing work practices in other European countries.
According to Chamber of Architects vice-president Tony Fenech Vella, fee reductions made sense given the financial pressure faced by the development industry.
“But the best way of bringing costs down would be to ensure we have clear planning policies which every stakeholder – Mepa, the applicant, the bank – feels comfortable with.
“Fee reductions are good, but only if they come as part of a broader package of change,” he said.
Meanwhile, biodiversity expert Alfred Baldacchino, who used to work for Mepa, questioned whether the reduction in fees would result in an increased demand for permits and unsustainable development.
He also pointed out that Mepa got its income from permit fees, which is why its environmental obligations are often given secondary importance, since they provide no opportunity for income generation.
The reduction in fees, which could result in further negligence of Mepa’s environmental responsibilities, increased the urgency for the two aspects to be separated from one another.
He said environmental protection should be given government funding on the same lines as other social services and should not be dependent on planning fees to fund its operations.