Development corporations

The designation of a development corporation now provides government and local and strategic authorities maximum flexibility in deploying development corporations to address a range of delivery scenarios across a range of sites including new towns, urban extensions and urban regeneration.

Where deployed in an appropriate way, development corporations can offer the opportunity for an infrastructure-first approach, mandatory basic design standards and the capturing of land value. However, their ability to achieve these objectives depends entirely on the powers granted to them by Parliament, or in some cases by Mayors, as well as the stage in the development process at which the development corporation is designated. Government (and Mayors in the case of MDCs) can now determine at designation whether a development corporation will have plan-making, development management (including thresholds) and highways authority powers. The only default statutory power granted to development corporations are the ability to compulsory purchase and hold land, and changes to compulsory purchase legislation apply equally to other authorities. Centrally-led New Town Development Corporations also benefit from a distinct power under Section 7 of the New Towns Act 1981 to submit ‘proposals for the development of land’ to the Secretary of State directly. Under the same powers, the Secretary of State may then make a Special Development Order granting planning permission directly.

Historically development corporations were designated by the Secretary of State with varying levels of parliamentary involvement. The Levelling Up and Regeneration Act 2023, once commenced, will enable local authorities to propose a locally led development corporations to government subject to a local interest test. A authorities such as East Devon District Council, Tewksbury Borough Council and Cumberland Council are pressing ahead with this route to delivery. Guidance published in 2018 sets out potential criteria by which Government would assess such a proposal, namely community participation, deliverability, best route, governance, placemaking, community engagement, stewardship and future growth as well as environment assessment and appropriate assessment. The key overarching legal test set out in the legislation is that the decision would be expedient in the national interest, as in previous New Towns Acts. Under recent updates, the establishment of all types of development corporations now requires consultation with persons representing businesses as well as those living in the affected area, as well as relevant local authorities. In practice, this is likely to mean a general duty to consult the public, although a degree of discretion is involved. The creation of a new tier of Mayoral Strategic Authorities across England is also leading to a new generation of Mayoral Development Corporations, so far including Greater Manchester, the West Midlands, and Tees Valley. The Secretary of State has no powers to refuse to designate under the Localism Act 2011, and only NTDCs require a public inquiry to be set up – democratic engagement which should be a prerequisite for any development at this scale. Mayoral Development Corporations also do not require parliamentary approval to be established, unlike all other types of Development Corporations, whether centrally or locally led.

While local authorities must play a strong role in the governance of all Development Corporations, it is vital that national government takes its fair share of the financial and political responsibility if the confidence of the public and other investors is to be secured. The TCPA continues to campaign for centrally led development corporations that can truly coordinate other national actors such as private utilities, executive agencies and other infrastructure providers, whilst recognising the potential of devolution to secure positive improvements in the quality of large scale developments. Ministerial responsibility for Centrally-led UDCs and NTDCs creates a strong platform to unblock cross departmental spending and advocate for the infrastructure delivery necessary for the creation of a new Garden City. Central government revenue funding such as that received by the Ebbsfleet Development Corporation is also crucial to creating a resilient organisational structure. At this stage it remains unclear what financial support locally- or Mayorally-led development corporations would receive from Central Government – particularly in terms of their ability to fund affordable housing directly rather than through Strategic Place Partnerships with Homes England. For example, a development corporation has recently been established by the Mayor of the West Midlands to drive forward regeneration of sites around HS2.

The governance requirements for development corporation boards vary depending on the model. New Town Development Corporations are governed by a board appointed by the Secretary of State. Urban Development Corporations are also appointed by the Secretary of State but, unlike NTDCs, legislation requires representation from each affected local authority through nominated board members.

Mayoral Development Corporations are appointed by the Mayor and must comprise at least six members, but the legislation does not require local authority representation, instead giving the Mayor broad discretion to appoint members with appropriate expertise. Locally Led New Town Development Corporations have the most prescriptive governance arrangements: the board is appointed by the local oversight authority (or authorities), must have an independent Chair and Deputy Chair, a majority of independent members, and include at least one elected member nominated by each oversight authority.

In February 2026, Cumberland Council agreed to request that the Secretary of State establish a Locally Led New Town Development Corporation (LLNTDC) to support long term and sustainable delivery of the new community. This followed an options assessment around the best way to deliver the 10,000 home urban extension to the south of Carlisle, jointly funded and produced with Homes England and MHCLG. The council benefited from the New Development Corporation Competition was a £10 million competitive fund launched in October 2019 to support up to 10 local places with exploring delivery models that have been less commonly used in a contemporary context, such as development corporations. Although the council would still have overarching control, the new corporation will reduce risks to the council and could potentially be funded by Government. It will speed up delivery of the development and support infrastructure planning and land assembly. A business case for this proposal is now undergoing development for the further consideration. The formal approval by the Secretary of State and a subsequent act of Parliament is expected in 2027. Like other ambitious authorities, the scheme is supported by a site specific DPD, the St Cuthberts Garden Village Local Plan, which is currently undergoing examination in public.