Today (14th September 2017), the Secretary of State for Communities and Local Government published the above consultation. The consultation period runs until 9th November 2017. The full consultation and associated annexes can be found here
The document covers six specific subjects reflecting proposals raised through the Housing White Paper published in February 2017. These are:
Proposed approach to calculating the local housing need;
Statements of Common Ground;
Planning for a mix of housing needs;
Proposed approach to viability assessment; and
The consultation also seeks further comment on how to increase build out rates (above and beyond the proposals set out in the Housing White Paper) and states the Government’s intention to set out the circumstances when a planning application may be refused on the grounds of prematurity in the revised National Planning Policy Framework (NPPF) rather than in planning guidance (where they are currently). The new NPPF is expected to be published before 31 March 2018.
Proposed approach to calculating the local housing need
The Government’s proposed approach to a standardised methodology of calculating housing needs is to set a demographic baseline using the latest ONS household projections (published every two years in July) as the annual average household growth over a 10 year period.
However, this baseline figure should be adjusted to take account of “market signals”. The consultation suggests that a proxy for such market signals is an assessment of affordability ratios of median house price to median earnings (published annually in March). Any market area where the affordability ration is above 4.0 will need to adjust its demographic baseline upwards using a proposed standard formula. The example given in the consultation document suggests that areas with affordability ratios of 12 will need to increase their housing requirement by 50%.
The consultation suggests that there should be a cap on the level of any increase according to the current status of the local plan in each authority. For those LPAs who adopted a plan within the last five years (post NPPF) the figure could be capped at 40% above the figure in the local plan. For those with plans older than five years the proposal is to set a cap at 40% above whichever is highest of the household projections or the annual housing requirement figure in the local plan.
DCLG calculate that the use of this standard methodology across England would result in 266,000 dwellings per annum (including 72,000 dpa in London).
Jointly produced plans will be able to produce a single assessment figure for their joint area with distribution back to individual areas being a matter for local decision makers.
In order to allow plans to be produced and not constantly updated the consultation proposes that evidence used to prepare a local plan can be relied upon for a period of two years from the date on which the plan is submitted to the Secretary of State for examination.
Local authorities will be able to propose plans with housing provision in excess of the figure produced from the standard methodology. Planning inspectors will be advised that there should be an assumption that such figures should be considered sound. However, if an authority proposes a figure which is lower than the standard methodology the reasons for doing so would be rigorously tested at examination.
In order to encourage the production of up to date development plans it is proposed that, after 31 March 2018 the new methodology would apply as a baseline for calculating the five year supply of land for housing (albeit that the decision maker would still be able to take account of other policy restrictions such as green belt and ancient woodland).
Transitional arrangements for introducing the new methodology will depend on the stage at which the local planning authority has reached with its plan.
Statement of common ground
In order to support joint working and to make it clear how local authorities have met the duty to cooperate the government proposes to require a statement of common ground alongside their local plan preparation, coinciding with key stages of the plan’s progress. All local authorities will need to prepare such a statement within twelve months of the publication of the revised NPPF.
Planning for a mix of housing needs
The government proposes to amend the guidance on how local authorities should plan for different types and tenures of housing needs. The total housing need figure should, therefore, be disaggregated into different types and tenures through the local plan process. This will specifically include the need to plan for housing for older people based on the current definition of this group currently set out in the NPPF.
The consultation proposes moving forward with the Housing White Paper proposal on requiring local planning authorities to provide neighbourhood planning groups with a housing figure on which their neighbourhood plan should be based. Where there is not an up to date local plan the government’s proposal is that neighbourhood plans should use a figure that reflects their proportion of the overall calculation of housing need based on the standard methodology proposed above.
Proposed assessment to viability
Local plans will be required to more robustly assess viability at a plan level and should set out the types and thresholds of affordable housing contributions, the infrastructure needed to deliver the plan and expectations for how these will be funded and the contributions that developers will be expected to make. Such assumptions will be tested at examination to ensure that plans are deliverable and viable.
On individual decision making it is not, therefore, expected that viability will need to be retested if a proposal is policy compliant.
Government will also update planning guidance to help make viability assessments simpler, quicker and more transparent. This may include more clearly defined terms, a preferred approach to calculating costs and values and the format of reporting both contributions received and how they are spent.
The consultation also suggests that there may be a larger role for applicants to publicise the obligations secured through the planning process in order to increase transparency.
The consultation reiterates the government’s intention to introduce the necessary regulations to increase planning application fees by 20% at the earliest possible opportunity. The proposal in the Housing White Paper to allow a further increase in fees of 20% is being consulted upon in an open ended way with government seeking views on how this might be applied and the criteria used to support such an increase.
Revisiting responses to the Housing White Paper
The consultation also allows previous respondents to the proposals in the Housing White Paper on 5 year housing land supply (Questions 3b and 16) and the Housing Delivery Test (Questions 17b, 28, 29 and 30) to supplement, add to or amend their responses. This suggests that government are having second thoughts about the practicalities of these tests and proposals, specifically in the light of the proposals set out in this consultation and the rigour with which local authorities will be tested under the proposed standard methodology for calculating housing needs.
The HBF will be consulting members on the proposals set out in the consultation in the usual way and will be engaging with government officials and Ministers over the details of the proposals set out therein. Members are encouraged to respond to the consultation in their own right. Anyone who wishes to make representations to HBF are advised to contact Andrew Whitaker, HBF Planning Director on 020 7960 1600 or Andrew.firstname.lastname@example.org
AW 14 Sept 2017
Home Builders Federation
London, SE1 9PL
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