Analysis: On the home front

For years the government has been browbeating local councils about the need to get their development plans up to date. Ministers have even threatened to strip 15 authorities of their planning powers because they have not made sufficient progress on their blueprints. Now the government seems to have stumbled on a way of encouraging lagging local authorities to get a move on. 

The answer lies in an apparently dry formula that councils will have to use in future to calculate housing need, according to the update of the National Planning Policy Framework (NPPF) launched by prime minister Theresa May last week. The first top-to-bottom revision of the framework in six years contains a host of changes to planning guidance for local councils (see The Two-Year Rule, and Density and Design, overleaf). But the biggest flashpoint in recent months has been the government’s moves to reform housing needs assessments, which until now authorities have been able to do by using their own formulae. 

Under the reforms all local planning authorities will have to use a standard methodology, known as the local housing needs assessment, which was road tested in a consultation paper issued in September. That document, Planning for the Right Homes in the Right Places, contained a table showing that many councils are likely to see a doubling of the official assessment of the number of new homes needed in their areas. The biggest hits will mainly be seen in southern England, hence the backlash from Conservative MPs in the shire counties, who are under pressure from their constituents to protect greenfield land from housing developments. 

“A lot of the rhetoric in the [housing secretary’s] speech wasn’t reflected in the policy”

Andrew Whitaker, Home Builders Federation

Despite the controversy, many commentators have noted that the measures included in the NPPF document appear to have been watered down since the housing white paper or are less radical than the political rhetoric preceding its launch last week led us to believe. So what exactly does the new framework say? And will it ultimately lead to more homes being built where they are needed? 

Keeping plans local

While the standardised formula is predicted to mean big increases in areas of high demand cities and the South-east of England, councils have been told by the government that they can avoid having to use the new formula this time if they submit their local plans by the end of this month. “A number of local authorities are pushing through local plans early because the government has told them that if they can get the local plan in, they won’t have to include the higher numbers,” says Martin Curtis, associate director at lobbying firm Curtin & Co.

Mark Sitch, senior partner at planning and design consultant Barton Willmore, says that while some councils are nearly ready to submit their plans, the 31 March deadline has injected added urgency. “Where they see an increase, some authorities are pushing ahead with their plans. There is certainly a focus following the consultation on the standard methodology and the realisation by local authorities about what that could mean for them.” 

A number of local authorities are taking the government up on its offer. They include Bedford borough council, where the council will use its current figure of 19,000 dwellings by 2035 as the basis for its local plan. This is a big reduction on the 25,000 dwellings that the council would have to use under the new formula, according to last September’s consultation paper. 

A paper presented to Bedford’s executive in January was explicit that the council is seeking to sidestep its new requirement. It says that submitting the plan by the end of this month will “enable the plan to progress on the basis of current housing need rather than the higher dwelling requirement likely to result from the government’s proposed standard methodology”.  

Planners in the Buckinghamshire authority of Aylesbury Vale have made a similar calculation, stating that provided their local plan is submitted before 31 March 2018 the “new calculation method will not apply”. And the process of submitting the local development plan has also been accelerated in neighbouring Central Bedfordshire, where the council voted unanimously to reject the new formula. 

Rhetoric versus policy

The local plan rush job illustrates that, however strong the political rhetoric surrounding housing, willingness to boost housing provision is often skin deep. Some say this gap between rhetoric and practical policy extends to Whitehall. The talk was tough about ramping up housing delivery in the run-up to last week’s publication of the NPPF, with Sajid Javid, secretary of state for housing, communities and local government, repeating his threat to strip councils of plan-making powers – a  sanction not mentioned in the NPPF document.

The details in the document reveal the new framework to be a “damp squib”, according Curtis, who is a former leader of Conservative-controlled Cambridgeshire county council. “The difficulty is that they have had the opportunity to intervene and they haven’t taken it.” Andrew Whitaker, planning director of the Home Builders Federation, adds: “A lot of the rhetoric in the [housing secretary’s] speech wasn’t reflected in the policy.”

And while Javid acted the hard cop when presenting the NPPF in parliament, May struck a more emollient tone in her speech launching the document earlier in the day. She talked soothingly of planning being a “powerful tool” and recalled the value of good planning when she dealt with planning as a local councillor.  

The gap in rhetoric between the prime minister and her secretary of state points to a deeper tension within the government over how far to deregulate development, believes Matt Thomson, head of planning at the Campaign to Protect Rural England. “Sajid Javid and others in his camp have been declaring war on the prime minister by labelling people as nimbys standing in the way of providing homes, particularly for young people,” he says.

Javid faced stern questioning from backbench Conservative MPs, who expressed concerns about the impact of the revised housing assessment formula during last Monday’s announcement. Reigate MP Crispin Blunt, for instance, asked Javid to confirm that “housing need does not trump issues such as areas of outstanding natural beauty, sites of special scientific interest and the green belt”. 

The government’s political weakness means that it cannot ignore these critics, says Curtis: “The government knows what it needs to do but because of the slim majority, it can’t afford to upset lots of MPs with lots of greenbelt land and green space.” Consequently it has not been as robust on changing the green belt rules as it should be, he believes.

“A number of local authorities are pushing through local plans early because the government has told them that [then] they won’t have to include the higher numbers”

Martin Curtis, Curtin & Co

The ambiguity within the government’s position can be seen in the NPPF’s stance on the green belt: it proposes amending the policy so that affordable housing can be built on brownfield sites in the green belt. This move is just tinkering, says Curtis, who believes bigger releases of land are needed to prevent scenarios like that emerging in his own county, where a doughnut of development is emerging beyond the Cambridge green belt. The result of these homes being built where planning rules are less restrictive but not where they are most needed will be long commutes, putting unsustainable pressure on local infrastructure.

The government’s limitation of its actions to mere tinkering could be an electorally short-sighted approach, cautions Curtis, given the salience of housing need among  younger people currently locked out of the housing market. “Unless the Conservative Party do something about attracting the youth vote they have a problem,” he says. 

The ball is now in Javid’s court, given that he doesn’t need to secure parliamentary approval for the revisions to the NPPF – because it is guidance rather than an act of parliament, it does not require a full vote. So even if Tory MPs come out against it, it’s in the minister’s power to push it through regardless.

For those councils that are opting for lower targets today by getting their local plans signed off early, there is a warning that they will have to play catch-up when the new assessment formula bites. Says Curtis: “When it comes to the five-year [local plan] review, numbers are going to shoot through the roof.” The new formula will apply across the board at that point.

But whatever the ins and outs of current or future housing need formulas, one crucial factor affecting housing numbers which was not addressed by the NPPF is the resourcing and efficiency of local planning departments. 

Despite recent moves to allow councils to increase planning fees levied on applicants by 20%, Friends of the Earth’s Burton says efforts to boost the throughput of planning approvals will be undermined by lack of resources within local government. “The elephant in the room is capacity,” he says. “The planning profession was being stroked by the PM and secretary of state, but that needs to be followed through by a recognition that you can’t get a good system on the cheap.”

However, the current rush to meet the 31 March deadline illustrates that – even in cash-strapped local government – it’s still true that where there’s a will, there’s a way.  

The two-year rule: getting tough with developers?

The revised NPPF states that in future councils should stipulate that developments must begin within two years of planning approval having being granted. 

Currently, applicants have three years to implement their consents, and even this can mean as little as digging a trench to show that work has begun on site. 

The NPPF wording waters down the original proposal in the housing white paper, by giving developers a get-out clause if they can prove that the two-year deadline will undermine viability.  

 “You can’t push water up the hill. If schemes aren’t ready or viable, planning applications won’t be made in the first place. It’s nowhere near enough time to do anything,” says Simon Ricketts, partner at specialist planning law practice Town Legal. 

Martin Curtis, associate director of lobbying firm Curtin & Co and a former Conservative council leader, agrees that a two-year target is “unworkable”.  He explains: “It takes two years to get on site and implement, and when you are talking about land promoters you are talking about up to four years.”

However, following reforms to limit the use of pre-commencement conditions by local authorities (the government is consulting on how to implement the new rules), the two-year implementation period should be feasible, says Claire Dutch, head of planning at solicitors Hogan Lovells. 

“They should be able to get on site in two years, and it might encourage people to shift it a bit,” she says.

But Curtis is glad that the NPPF does not take forward a proposal in the housing white paper that applicants’ past tardiness in implementing permissions should be taken into account when determining future consents. 

“You can see subsequent applications from a developer being punished by that council because of that past, rather than [judged on the] merits of the application. If the councils feel they can do that, it could be quite dangerous,” he says.

Similarly, there was little movement so far in terms of cracking down on alleged landbanking by developers, which is the subject of an investigation by former Cabinet minister Sir Oliver Letwin. 

However, in his interim findings, presented to the chancellor ahead of this week’s Spring Statement, Letwin did identify a “web of commercial and industrial constraints” affecting housebuilders’ ability to speed up the rate at which they build homes.