The government has unveiled plans to give local councils more power to put town centres first ahead of out-of-town developments.

New Planning Policy Statement 4 replaces the existing ‘needs test’ for with a new ‘impact test’ for new developments. The new test means that developments which could threaten town centres will be assessed against a range of criteria including impact on the high street, consumer choice, consumer spending, jobs and climate change before being given planning permission.

The new guidelines retain the existing ‘sequential test’ which means that available in-town sites need to be developed first before out-of-town schemes can be built. They also simplify the guidance on planning to local councils, from 137 pages to 32.

Planning minister John Healey said the move would strengthen the government’s existing ‘town centre first’ policy. “Many high streets have been hit hard by a double whammy of the downturn and out-of-town retail parks,” he said. “We are giving local councils the expert tools they need to put the viability and vitality of town centres first in difficult market conditions. The new tools go further than ever before to protect town centres from the harm large out-of-town developments can have.”

However the small shops lobby was unimpressed, describing the removal of the needs test as a mistake which will actually harm high streets. Association of Convenience Stores chief executive James Lowman said the new policy was “ambitious, contradictory and highly subjective,” and that the new impact test was too vague.