Introduced into the House of Commons on Tuesday 13th October 2015 the Housing and Planning Bill 2015 sets out the major legislative change of the new government, putting into place manifesto pledges and proposals announced in the Productivity Plan of July. Amongst many other issues, it covers:
The legislative foundation for Starter Homes and the requirement for Starter Homes on all reasonably-sized housing sites;
The Government’s powers to intervene when local authorities fail to produce a sound Local Plan for their area; and
The introduction of a new ‘permission in principle’ consent on certain sites
Our full summary of the Bill and its implications can be found below. HBF will be engaging with Government and parliamentarians throughout the passage of the Bill and during discussions about subsequent secondary legislation.
The majority of the Bill applies to England only. However, clauses 89-91, 108-110 and the whole of Part 7 regarding compulsory purchase also applies to Wales.
The timetable for the Bill’s passage through Parliament is still to be determined but the expectation is that the Bill will become law by Summer 2016 after which time supporting Regulations will need to be introduced and an implementation timetable put forward for certain aspects such as Starter Home requirements on sites. The Bill and its 145 clauses are likely to be subject to much debate and many proposed amendments and will thus require considerable parliamentary time.
The full text of the Bill can be found here and a comprehensive explanatory note here.
Part 1: New Homes in England
Chapter 1: Starter Homes
Clauses 1-7 of the Bill provide, in legislation, for starter homes. They set out a general duty to promote the supply of starter homes through local plans and a specific duty on local planning authorities to require an element of starter homes on sites of a specified size.
Clause 4 states that the planning authority may only grant permission if a centrally required proportion of Starter Homes is provided for, or unless conditions are met that allows them to do otherwise. There is also provision for commuted sums to be paid instead of on-site Starter Homes provision in certain circumstances.
The Bill allows the Secretary of State to provide for exemptions from the scheme for different types of development or for higher or lower targets for starter homes in different areas of the country, or on sites of differing sizes. The Starter Homes requirement is expected to take precedence over any local affordable housing policy.
The details of the duty, type of site and size of site are all delegated to secondary legislation.
The Bill sets out the eligibility criteria for purchasers of Starter Homes with Secretary of State powers to amend this in future. The buyer must be under 40 and a first-time buyer with the definition of a first-time buyer being the same that is used for the Help to Buy ISA, as detailed in the amendments made by the Finance Act 2010 to the Finance Act 2003 and encompasses those who have held a major interest in a property in the past either in the UK or abroad.
The Bill does include reference to the specific discounted sales prices of £450,000 in London and £250,000 elsewhere, again, with provision for these to be adjusted through Regulations.
Where Local Plan policies are incompatible with exercising the local authority’s functions in relation to Starter Homes the legislation will take priority. Local authorities must record and publish the number of starter homes delivered in their area.
Chapter 2: Self Build and Custom Housebuilding
Clauses 8-11 of the Bill introduce a new duty on local authorities to grant sufficient suitable development permissions on serviced plots of land to meet the demand for self build and custom build housing in their area. Local authorities already have a duty to maintain a register of people expressing such an interest and the Bill refines the requirements for the register.
Local authorities will be able to recover costs of making this provision in their area.
The Secretary of State may grant exemptions to local authorities based on the level of demand in their area.
Part 2: Rogue Landlords and Letting Agents in England
Clauses 12-21 of the Bill introduces the concept of “banning orders”, banning a person from either letting property in England or working for an agency letting such properties. The clauses set out the various assessments leading to a banning order, the sanctions imposed on individuals and the level of fines for breach of an order.
Chapter 3: Database of Rogue Landlords and Letting Agents
In association with the provisions of Chapter 2, clauses 22-31 require the maintenance of a database of landlords and letting agents with banning orders to be maintained by the Secretary of State.
An appeal mechanism against inclusion on the register is proposed.
Chapter 4: Rent repayment orders
Provisions are set out in clauses 32-46 of the Bill empowers the First-tier Tribunal to make rent repayment orders to deter rogue landlords from committing specified offences such as violent entry or unlawful eviction or after they receive a banning order.
Chapter 5: Interpretation of Part 2
Clauses 47 and 48 of the Bill provide definitions of various terms used in the previous 3 chapters.
Part 3: Recovering abandoned premises in England
Clauses 49-55 of the Bill deal with a technical issue regarding landlords being able to recover possession of a property where it has been abandoned and set out various procedures that a landlord must follow to recover the property.
Part 4: Social Housing in England
This part of the Bill sets out the details of the revised proposals allowing tenants of registered providers to implement their “right to buy”.
Chapter 1: Implementing the right to buy on a voluntary basis
Clauses 56-61 enable the Secretary of State (or the GLA in London) to pay for the cost of the discount offered to the tenant.
Chapter 2: Vacant high value local authority housing
Clauses 62-72 sets out the procedure for encouraging local authorities to sell their high value properties which fall vacant through allowing the Secretary of State of impose a charge on the local housing authority. Clause 69 places a specific duty on local housing authorities to consider selling high value properties (definition of such will be set out in regulations). The charge by the Secretary of State will be reduced where the local authority reinvests the receipts into the provision of new housing.
Chapter 3: Reducing regulation
Clause 73 is an administrative process allowing the Secretary of State to make regulations to amend the Housing and Regeneration Act 2008 through affirmative procedure.
Chapter 4: High Income Social Tenants: Mandatory Rents
Clauses 74-83 give the Secretary of State regulatory powers to set levels of rent that registered providers must charge high income social tenants (HISTs). HISTs are defined as those tenants with income of more than £30,000 outside London and £40,000 within London.
Powers will be given to registered providers to require evidence of income from tenants and powers to increase rents.
Part 5: Housing, Estate Agents and Rentcharges: Other Changes
Clauses 84-91 set out various other provisions with regard to housing.
Clause 84 amends the provisions in various Housing Acts to assess the accommodation need for gypsies and travellers separately from the needs of all people within their area.
Clauses 85-86 set out new tests for licences for HMO and other rented accommodation and clauses 87 and 88 introduce new safeguards regarding tenancy deposit information.
Clauses 89 – 91 are technical changes to previous Housing Acts.
Part 6: Planning in England
Many of the changes in this Part of the Bill relate to previous government announcements and those provisions set out in the Productivity Plan published in July 2015. A number of them reflect the various HBF proposals set out in our widely circulated “End-to-end” planning paper and our “Blue Skies” housing delivery paper.
Clauses 92-95: Neighbourhood Planning
Changes to the neighbourhood planning process set a statutory time limit for local authorities to designate neighbourhood areas following a request to do so, a time limit in which to hold a referendum and a time limit within which the plan must be “made” (or adopted by the local authority for decision making purposes.
Clause 94 gives the Secretary of State intervention powers to ensure that these time limits are enforced.
Clause 95 requires local planning authorities to notify neighbourhood forums of planning applications received within their area. In effect, this puts neighbourhood forums on a par with parish councils.
Clauses 96-100: Local Planning
These clauses amend the powers currently given to the Secretary of State to intervene in the local plan process. It puts in place the necessary powers to ensure that local plans are delivered as promised in the productivity plan.
Clause 96 allows the Secretary of State to intervene in the local development scheme (which sets out the development plan documents and the timetable for their production) of a local authority.
Clause 98 expands the powers that the Secretary of State has with regards to “calling in” a development plan for his own determination and allows the Secretary of State to issue a “holding direction” meaning that the document has no effect on decision making while the direction is in force. The Secretary of State can also direct a local authority to prepare or revise a development plan document, submit the document to an independent inquiry or publish the inspectors report following such an inquiry.
Clause 100 allows the Secretary of State to recover his costs of intervention from the Local authority involved.
Clause 101: Planning in Greater London
This clause gives the Mayor of London wider “call in powers” to determine planning applications in London.
Clause 102 Permission in principle
This section of the Bill introduces a new provision to grant planning permission “in principle”. Following such a permission it will then only be necessary to submit a technical details consent application to achieve the same planning status as a planning permission. This was one of the key proposals in the HBF planning paper and should be of considerable benefit to smaller developers requiring greater certainty when seeking development finance for projects.
Initially the process will be applied to residential development of fewer than 10 dwellings on land identified on the local register (see Clause 103), allocated in development plan documents or allocated in neighbourhood plans.
The new type of permission is similar to, but not the same as, outline planning permission and the technical details application is similar to, but not the same as, a reserved matters application.
It should be noted that permission in principle can only be granted or refused. It cannot be granted subject to conditions. In granting approval of the technical details a local planning authority cannot reopen the principle of development but can impose conditions on the granting of the technical details.
Clause 103: Local Planning authority to keep register of particular kinds of land
This clause will require local authorities to keep a register of land in their area which is suitable for housing development. Initially this will be used to register previously developed land or “brownfield land”.
Details of what land is to be included and, more importantly, excluded from the register will be set out in regulations.
Clauses 104-106: Planning permission etc.
Clauses 104 and 105 are technical amendments to existing legislation regarding development orders and planning applications made directly to the Secretary of State when a local authority has been designated for poor planning performance.
Clause 106 introduces a new requirement for the financial benefit of development proposals are made public when a planning authority is considering whether to grant planning permission. Such benefits must be listed whether or not they are material to the decision making process.
This clause allows the consideration of development proposals under the NSIP process where they contain an element of housing linked to the nationally significant infrastructure project. This relates not just to housing that is functionally linked to the infrastructure (such as construction workers’ housing but will also allow housing which has no functional link but there is a close geographical link between the housing and the infrastructure. This might mean, for example, developing housing close to an energy from waste plant to take advantage of the combined heat and power available from such a plant.
Clauses 108-109: Designation of Development Corporations
These clauses relate to technical issues regarding the setting up of development corporations. They change the requirements for consultation and change the parliamentary approval process from an affirmative to a negative procedure.
Part 7: Compulsory purchase etc
Clauses 111-139 make changes to the current system of compulsory purchase of land by local authorities. They are changes to existing administrative procedures such as granting rights of access to the land for survey and assessment, declarations of interest in land, possession, compensation and disputes.
Home Builders Federation
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