Planning for Housing Determining Housing Provision Andrew Pritchard Director of Strategy 7 April 2011

Introduction Emerging Government Policy Determining Housing Provision: PPS3 Some lessons from the Regional Plan Current status of Regional Plan Housing delivery in the EM Some concluding thoughts

Emerging Government Policy Localism Bill National Planning Policy Framework New Home Bonus Affordable Housing Budget 2011

Localism Bill Planning aspects of the Localism Bill have been influenced by ‘Open Source Planning’ (Conservative Party Green Paper, 2009) – but the Bill is much less radical OSP argued that the planning system was ‘broken’ – too divisive and not delivering enough development OSP proposed a planning system based on neighbourhood plans, led by local communities.

Localism Bill (or OSP-lite) RSSs replaced by a ‘duty to co-operate’ Neighbourhood Plans – but in conformity with LDF and of limited scope (Blaby and Newstead awarded ‘vanguard’ status) Neighbourhood Development Orders and ‘Community Right to Build’ Few changes to Local Development Frameworks - but an expectation that they will be ‘different’ in future (‘new style local plans’)

Localism Bill in Committee (so far) Government has conceded that the duty to co-operate needs to be strengthened - possibly based on RTPI amendment Minimum size of Neighbourhood Forums to be increased from 3 (to 20?) Further Government amendments likely House of Lords may have some views too…

National Planning Policy Framework To replace existing PPGs/PPSs/Circulars Simple, concise, consolidated framework - unlikely to be a Spatial Plan for England Will be based on a ‘presumption in favour of sustainable development’ Draft NPPF due out in the summer – to be adopted in April 2012 Relationship with NPSs and National Infrastructure Plan unclear

New Home Bonus Designed to be a simple, predictable incentive for Councils to promote house building Councils will be rewarded for net additions to the housing stock (including empty homes) for 6 years – with extra for affordable housing Cost progressively top sliced from formula grant from 2012/13 onwards (Some additional cash for empty homes)

New Homes Bonus: Impact NHB worth £17 million in to the EM – £105 million by 2016/17 Most authorities in the EM should benefit compared with the status quo (southern regions benefit at the expense of northern ones) – but some will lose out 20% to go to counties in 2 tier areas, but NHB is effectively a transfer of resources to LPAs Will NHB increase housing delivery?

Affordable Housing Reforms DCLG funding cut from £8.4 billion to £4.4 billion over the next 4 years (half of which is committed) ‘Affordable Rent’ will form the principle element of new supply – 80% of market rent DCLG estimate that 150,000 new units will be delivered in England over the CSR period Housing benefit cap and other changes to save £2 billion annually Housing Revenue Account to be abolished Re-introduction of ‘closed’ housing waiting lists

Affordable Housing: Impacts Affordable Rent likely to be more viable in more buoyant areas – in particular London and the SE EM would appear to be a loser (only 332 new homes per year based in CIH analysis) As a result, LPAs may need to revise their affordable housing requirements and viability assumptions Housing benefit changes could have a big impacts in London – and knock-on effects on surrounding areas

Budget Background 1 “We are taking on the enemies of enterprise. The town hall officials who take forever with those planning decisions that can make or break a business”

Budget Background 2 “I hear countless stories of perfectly reasonable developments being thwarted by bizarre planning rules. We want the standard answer to be ‘yes’ not ‘no’ ”

Budget Background 3 “The planning system should act as a driver for growth. But if I am being completely frank with you, it’s the drag anchor to growth.”

Budget Background 4 “People have a bizarrely crude view of green space and think anything with a blade of grass on it is worth preserving…There are lots of boring fields”

Budget Statement “…we are going to tackle what every government has identified as a chronic obstacle to economic growth in Britain, and no government has done anything about: the planning system”

Budget 2011 Planning decisions should prioritise jobs and growth (Greg Clarke Statement) Reduce burdens on developers (S106 agreements should be reviewed – Grant Shapps) Presumption in favour of sustainable development to be published in May 2011 – the default answer to development should be ‘yes’ Businesses will be able to bring forward neighbourhood plans and NDOs

Budget 2011 ‘Land Auctions’ to be piloted with public sector land National brownfield target for new housing to be removed – but Greenbelt policy remains (despite OEDC concerns) Developers will be able to convert from business to residential without permission LPAs expected to process all applications within 12 months – DCLG will give a ‘12 Month Guarantee’ for applications it deals with 21 new Enterprise Zones

Back to the 1980s? Presumption in favour of (sustainable) development (Circular 22/80) Enterprise Zones Mk 1 ‘Lifting the Burden’ (1985) Royal Weddings!

Yes, but… We still have a ‘plan led’ planning system – Section 38 (6) still applies SEA/SA/HRA plus EIA (perhaps in modified form) also still apply The localism genie is out of the bottle…

Determining Housing Provision: PPS3 Approach Evidence of need – SHMAs and other relevant market information Latest household projections (2008 based) Economic forecasts (!) Land availability (SHLAs) Affordability Sustainability Appraisal Impact on infrastructure

What’s the formula? There is no magic formula for balancing these factors - it is a matter of ‘fact and degree’ However, experience indicates that authorities will have to have good reasons not to meet the level of provision indicated in the HH Projections

Some lessons learned (1) Household growth comprises natural growth plus migration – migration is the potentially more malleable element, particularly across an HMA Economic forecasting is not very helpful: strongly influenced by population growth assumptions and external factors Job/Homes comparisons often spurious, but can be useful as a relative measure to assess options Utility providers (and regulators) difficult to pin down – but are seldom show stoppers

Some lessons learned (2) Flood risk must be properly understood – need to engage EA early Understanding transport impacts is key - strategic modelling required (e.g. Ptolemy) SPA/SAC cumulative impacts can be tricky – early engagement with NE required Try to distinguish between ‘technical’ assumptions and ‘policy’ considerations

EM Regional Plan 2009 Still part of the Statutory Development Plan Proposed revocation is a material consideration (subject to a Court of Appeal hearing in May) – but not a strong one without additional evidence ‘Stretching’ targets over a longer time frame (due to market conditions and infrastructure issues) may be a defendable alternative to the RSS – but has not been tested yet DCLG Select Committee report on RSS Revocation is an interesting read!

Housing Delivery in the EM

Conclusions De-regulation is replacing localism as the dominant driver of planning reform However, we are still in a plan-led system, and sound evidence will be required to make this work Without a plan in place, the presumption in favour of (sustainable) development will apply