The Government has published its response on improving the implementation of biodiversity net gain (“BNG”) for minor, medium and brownfield development. The response confirms that mandatory BNG will remain a central component of the planning system in England. No fundamental restructuring of the regime is proposed. Instead, the Government intends to introduce a package of targeted exemptions and technical refinements to address practical issues arising during the early stages of implementation.

The majority of the proposed changes are to be delivered through secondary legislation and revised guidance, with implementation staged across 2026. Pending the coming into force of those amendments, the existing statutory framework remains fully operative.

Elements of the regime that remain unchanged

The clear starting point is that BNG will continue to apply as the default position. Despite pressure from the development sector (partly reflected by the fact there were over 25,000 consultation responses) the Government has rejected the suggestion that all minor development should be exempt, and the existing de minimis exemption will remain unchanged for the time being. Its longer-term future is to be considered alongside the forthcoming response to the separate consultation on BNG for residential brownfield development.

The response also acknowledges that there remains a gap in the treatment of larger schemes with very limited biodiversity impact, indicating that some form of “low impact” exemption may still be required, although no such exemption has yet been introduced.

Measures expected to come into force before 31 July 2026

The most significant change proposed in the short term is the introduction of a new area-based exemption for small sites. This will apply where the red line boundary of a development site is 0.2haor below, irrespective of the nature of the development. The exemption is conceptually distinct from the existing de minimis exemption, which is based on measured biodiversity impact. Instead, it operates purely by reference to site area. The Government has made clear that this exemption will not apply where priority habitats are present onsite.

Alongside this, the current exemption for small-scale self-build and custom build development will be removed. A previously proposed replacement exemption for single dwellings on sites of 0.1ha  or less will not be taken forward. The Government’s position is that most such development will fall within the new 0.2ha threshold, making a separate exemption unnecessary.

A further new exemption will apply to temporary development. Where planning permission is granted for a period of five years or less under section 72 of the Town and Country Planning Act 1990, and the development is wholly temporary in nature, BNG requirements will not apply. As with the small sites exemption, this carve-out will not apply where priority habitats are affected.

The Government also proposes to amend the operation of the biodiversity gain hierarchy in relation to minor development. For schemes that fall within the definition of minor development and are not otherwise exempt, off-site biodiversity gains will be placed on an equal footing with onsite habitat creation or enhancement. Statutory biodiversity credits will remain available only as a last resort. These changes do not alter the overarching mitigation hierarchy, which continues to require the sequential application of avoidance, mitigation and compensation.

Measures expected to come into force in late 2026

A second tranche of reforms is expected later in 2026. These include a new exemption for development that is wholly or primarily undertaken for the purpose of conserving or enhancing biodiversity. This is intended to capture schemes such as habitat creation projects that require planning permission, including works associated with district level licensing.

The Government has indicated that further definition and guidance will be developed by Defra to ensure that the scope of the exemption is clear and to guard against potential misuse. As part of this work, Defra will also review Rule 4 of the biodiversity metric to ensure that biodiversity-led schemes incorporating significant infrastructure elements are appropriately treated.

Additional targeted exemptions are proposed for development affecting parks, public gardens and playing fields. These are intended to address situations where improvement works such as paths, facilities or ancillary sports infrastructure can trigger BNG requirements simply due to the extent of the application boundary. The exemption will apply only where the development is not otherwise exempt, and where no priority habitats are affected. In the case of playing fields, it is limited to ancillary, community-level sports development and excludes schemes associated with wider redevelopment or stadium environments.

More technical changes are also proposed. The spatial risk multiplier will in future be assessed solely by reference to Local Nature Recovery Strategy (“LNRS”) areas, replacing the current approach which also relies on local planning authority boundaries and National Character Areas. This change is intended to simplify the metric and will apply across all development types. Existing approaches will remain in place for intertidal habitats, which will continue to be assessed by reference to Marine Plan Areas, and for the watercourse module, which will continue to operate at the level of waterbodies and catchments.

The Government has also acknowledged ongoing challenges in applying BNG to brownfield land, particularly where sites support open mosaic habitat (“OMH”). Rather than introducing an immediate solution, it has committed to further work with industry to review the operation of the biodiversity metric, habitat definitions, guidance and condition assessment methodologies. This includes consideration of how to accommodate situations where OMH units cannot realistically be delivered, with the potential introduction of proxy habitat mosaics that deliver comparable ecological outcomes.

Transitional arrangements

The Government has confirmed that further guidance will be issued on transitional arrangements, including how local planning authorities and applicants should approach schemes coming forward while legislative changes are being implemented. In the interim, the position remains unchanged. The statutory BNG regime continues to apply in full, and any planning permission granted subject to the biodiversity gain condition will require that condition to be discharged through the submission and approval of a biodiversity gain plan prior to the commencement of development.

How will this impact the market?

The HBF’s second annual BNG survey (published this week) tells a consistent story: 84% of home builders still find BNG challenging; 60% say it has influenced decisions not to pursue previously viable sites; two-thirds think the reforms don’t go far enough. LPA capacity remains an issue, with 80% of respondees reporting planning delays with 66% citing insufficient LPA expertise (down from 79%, but still significant). The industry accepts BNG in principle, the inconsistent application and cumulative regulatory burden caused by the regime are the issue.

Further, on 7 April the newly minted BNG Federation accused the Government of leaving the NSIP sector in a “regulatory vacuum” citing the lack of a response to the consultation and  absence of guidance on the BNG and NSIP interface with a planned May launch looming. Amongst others, the Government’s response clarifies one key point – the date from which NSIPs will fall within the BNG regime is 2 November 2026, not May. Next month will now see the advent of biodiversity gain statements will be published for each National Policy Statement, hopefully giving promoters the framework they need (coupled with the time provided by the six month delay) to prepare for mandatory BNG.

The BNG market itself is growing but lopsided.  There are currently 197 registered sites, providing 28,000 units across various habitat types, with the vast majority of units still available for purchase.  Just over one third of local planning authorities currently have registered habitat banks. The LNRS spatial multiplier reform that will shrink the relevant geography from 300+ LPAs to 48 LNRS zones should improve unit access materially whilst the NSIP demand surge, when it arrives, will test the market’s depth.

A system applied identically to a 150 sq m infill plot and a 500-unit urban extension was always going to struggle for legitimacy. Whether the proportionate, LNRS-led approach that is emerging still delivers meaningful BNG at scale is the real test.  It is, however, likely sensible for developers with pipeline projects coming forward in late 2026 to start factoring the 0.2ha exemption and new off-site flexibility into viability assessments now. A viability case built on the current regime applying in full could prove overly conservative once secondary legislation lands.

What is still missing?

The brownfield residential exemption consultation, running until 10 June 2026 and testing thresholds for exemption up to 2.5ha, is clearly outstanding. The range of outcomes is wide enough to affect viability assessments materially and the current regime applies in full until the responses are in and the Government’s findings reported.

The RSPB and Wildlife Trust have already generated a great number of consultation responses opposing new exemptions and calling for higher ambition. That tension between developer pressure and conservation lobby will determine how far the Government goes with BNG.

It is, however, fair to say that the consultation responses published earlier this week represent a watershed moment for BNG with the framework for TCPA and NSIP schemes now having direction. Transitional uncertainty remains unresolved as the current regime applies in full until secondary legislation lands (targeted before 31 July 2026) whilst for NSIP promoters the November 2026 launch date gives genuine preparation time. The brownfield residential consultation response, when it lands, could shift viability on a significant number of pipeline sites and it can be seen that these changes are aimed at focussing BNG where it deliver ecological value whilst reducing the burden on small/windfall sites and speeding up decision making where impacts are minimal.  From an LPA perspective, fewer applications in scope should lead to faster determination and sharper focus on larger allocations doing the real work for nature recovery.

If you would like to discuss this further, please feel free to get in touch.