Shortly before Christmas, the government published proposed amendments to the National Planning Policy Framework (NPPF) for consultation. The changes were intended to head-off a revolt from around 80 backbench Conservative MPs, led by Theresa Villiers and Bob Seeley, who were threatening to block the Levelling Up and Regeneration Bill in parliament. Their objective was clear – they wanted to see fewer new homes built in their constituencies. After days of fraught negotiations, the Secretary of State, Michael Gove, conceded to most of their demands. The new NPPF wording is the result.
Here is a summary of the most important changes relating to the delivery of new homes.
Since 2012 when the NPPF was first introduced, local authorities have been required to plan to meet all of their housing needs. Under the proposed changes, that is no longer the case. Instead, councils will only have to meet “as much of their housing need as possible.” The standard method, which previously established the minimum number of homes local authorities should plan for, will be downgraded to “an advisory starting point.”
Various reasons are given as to why authorities might choose to plan for fewer homes than the standard method indicates. One is if doing so would mean building at densities that are significantly out of character with the existing area. Another is if the housing requirement in an existing plan has been exceeded. We’re also told explicitly that “Green Belt boundaries are not required to be reviewed and altered” if that’s the only way of meeting housing need.
New wording also makes clear that the housing requirement could be higher than the standard method indicates to help neighbouring authorities meet their housing need or to reflect growth ambitions.
One of the big successes of planning for new homes over recent years has been the requirement for local authorities to maintain a supply of deliverable housing land that is sufficient to meet their needs for the next five years – known as “five-year land supply”, for short. This was meant to encourage local authorities to monitor the likely future delivery of new homes and to be proactive in managing the supply of housing land.
Planning new development is difficult to get right – things can and do wrong. And when they do, local authorities should take action to get things back on track.
To make sure that new homes continued to be delivered even if councils weren’t being proactive, when the supply of housing land fell below the five-year level, the “presumption in favour of sustainable development” applied. This was an acknowledgement that local planning policies weren’t working and should therefore be less important in deciding planning applications - with national policy being the main source of guidance instead. The result was sometimes housing development on sites which the council might not support, but which were entirely suitable and sustainable for new homes.
However, the proposed changes to the NPPF combine to reduce the importance of maintain a five-year supply.
The amendments explain that, where a Local Plan is less than five-years old, local authorities will no longer be required to maintain a five-year housing land supply. Even where a Local Plan is older than that, there will be no need for local authorities to show they have a five-year supply provided they have reviewed their Plan and decided it doesn’t need updating. The same applies to areas with Neighbourhood Plans provided they include policies to meet their identified housing need.
There are some technical changes to the way five-year supply is assessed too. There will no longer be a requirement to include a buffer in the calculation, and past “over-supply” against the housing target can also be taken into account. Even where councils do need to maintain a five-year supply, it will therefore be much easier for them to do so.
There are sometimes legitimate circumstances why local authorities cannot meet all of their housing need within their own boundary. Some towns and cities – like Leicester, for example – already spread across boundaries into neighbouring local authority areas. There may be technical reasons too, relating to flood risk or topography, for example. Until now, councils who found themselves in that situation were supposed to reach agreement with neighbouring authorities for any shortfall against their housing target to be delivered in those authorities instead. Neighbouring authorities were expected to help as long as it was “practical to do so” and that doing so would still deliver “sustainable development.”
However, that part of the NPPF is proposed to be deleted. Combined with the relaxation of the requirement to meet housing targets, this effectively leaves the decision whether to assist their neighbours entirely at the discretion of individual local authorities. If they choose not to, there’s little anyone can do about it.
Before they can come into effect, Local Plans have to go through an examination process – essentially a review by an independent planning inspector – to make sure that they are fir for purpose. In planning jargon, this is known as “soundness.” One of the tests of soundness is whether the plan is “justified” taking into account reasonable alternatives and proportionate evidence.
There will always be a number of different ways development can be distributed across a local authority. The purpose of this test was to make sure that the council had thought about the alternatives, had sensible reasons for picking their proposed approach, and that there was some evidence under-pinning those decisions. However, the proposed changes to the NPPF will see the requirement for plans to be justified removed altogether.
Without a definitive obligation to plan to meet housing need, it seems likely that many local authorities will simply not do so. Indeed, a number have already paused their plan processes to review housing targets even though these changes are still only being consulted on. The result will inevitably be a planning system that is aiming to deliver far fewer than the 190,000 homes a year it currently does (which is already far below the government’s 300,000 homes a year target).
The removal of the requirement for plans to be justified presumably means they can instead be based on gut instinct and “vibes.” Plans are far more likely to fail as a result making it crucially important that performance is monitored and action taken.
Yet even those monitoring obligations are being watered down. Regardless of the number of new homes councils choose to plan for, there is no longer a need to ensure that they are delivered. The neutering of the requirement to maintain a five-year supply of deliverable housing land means councils will no longer need to be proactive in addressing future shortfalls. Whilst the Housing Delivery Test will remain, this considers how many homes have actually been built compared to housing need meaning local authorities will be reacting to failure rather than planning to avoid it.
Planning is hard. It involves making difficult choices between competing interests in order to ensure that our long-term needs are met. These changes mean local authorities will simply be allowed to duck those difficult decisions. The inevitable consequence is that fewer new homes will be delivered - which should be no surprise because that’s precisely what their architects wanted. That might be good news for those that oppose new housing development, but it is bad news for everyone else. England’s chronic shortage of housing reduces economic growth and productivity and pushes up both house prices and rents making it far more expensive to have a safe place to call home. The only way we can remedy that is by building more new homes.
Despite the likely fall in the supply of new homes, Local Plans will still need to provide for some new development and that means there is still a chance to secure planning permission for well-located sites. In fact, these new constraints on the supply of development land will mean land with planning permission will become a more valuable commodity. As a specialist land promoter, The Strategic Land Group can help you realise your site’s development potential at our cost and risk – our fee is a share of the value of the site once it is sold, so if we don’t succeed, it doesn’t cost you anything.
We’d love to hear from you about your site – get in touch today for a free, confidential review of your sites development potential – entirely without obligation.
