Memorandum by the Planning Officers' Society
(AH 41)
INTRODUCTION
1. The Planning Officers' Society represents
senior managers involved in the management of the Town and Country
Planning functions of local authorities and regional bodies in
England. A Membership of approximately 500 professional planners
has a keen interest in how the planning system operates in relation
to affordable housing.
2. The Committee has resolved to carry out
an inquiry into affordability and the supply of housing with particular
reference to 10 issues. The Society evidence focuses on the following
seven issues, number three to nine in the bullet points on the
ODPM Committee Press Notice PNO 4 of the 11 October. They are:
— The economic and social impact of
current house prices;
— The relationship between house prices
and housing supply;
— Other factors influencing affordability
of housing for sale including construction methods and physical
measures;
— The scale of the Government's plans
to boost housing supply;
— The relative importance of increasing
the supply of private housing as opposed to subsidised housing;
— How the planning system should respond
to the demand for housing for sale; and
— The scale of housing development
required to influence house prices and the impact of promoting
such a programme on the natural and historical environment and
infrastructure provision.
EVIDENCE OF
THE PLANNING
OFFICERS' SOCIETY
3. The Economic and Social Impact of Current
House Prices; the Relationship between House Prices and Housing
Supply; and Factors Influencing Affordability of Housing for Sale
Including Physical Measures
The Society shares the concerns about the inability
of many to enter the housing market. The short, medium and long
term consequences of the inability of households to enter the
housing market are manifesting themselves in various parts of
the country with economic as well as social consequences.
4. However, the Society notes that following
the Barker Review, the Treasury's response and the recent Office
of the Deputy Prime Minister July 2005 Consultation Paper on Planning
for Housing Provision, assume that increased housing supply will
be the main policy instrument to address affordability problems,
and this increase can be delivered through the planning system.
We believe that an approach based on increasing supply at any
cost is misplaced. The reformed planning system was able to produce
double the current level of housing supply 20-30 years ago. The
Committee will no doubt be aware that over the last 20-30 years
it is the decrease in publicly subsidised housing, which has led
to the reduction in supply not inherent limitations in the planning
system. Private house building has remained at approximately the
same level over this period. We believe that the importance of
financial and fiscal measures is underestimated in the Barker
Review and the Treasury and ODPM's subsequent thinking. Private
house building has not been able to increase to compensate for
the loss of public sector housing with an inevitable shortfall
in overall supply.
5. This has exacerbated the housing affordability
situation for those now seeking to be accommodated in private
housing.
6. We do not believe that the private sector
will be able to build society out of the current affordability
housing problem without interventions in the size and type of
housing being provided, as well as any increase in land supply
which may be necessary.
7. Furthermore the Government's reliance
on the planning system to deliver funding for intermediate and
social housing is not increasing the supply of affordable housing
significantly. Evidence from ODPM's research suggests that there
is a transfer of resources occurring instead. The private sector
may be finding sites for affordable housing, but is it increasing
the numbers of units provided? Evidence is far from conclusive.
8. As new house building only accounts for
1% of the annual change in the overall housing stock, it is easy
to over estimate the impact of increased housing supply on house
prices. That is not to deny a relationship, but simply to suggest
that levels well above the buffer levels of an additional 20 or
40% contemplated in the Barker Review, could be necessary to have
a significant influence on supply in many parts of England. (Barker's
analysis was at the national level.)
9. In seeking to develop its policies for
affordability the Government will need to address how resources
made available can stimulate equity share, discounted first time
purchasers' housing, and other intermediate housing to replace
the 150,000 dwellings per annum provided by the public sector
until the 1970's. It is the inability of the private sector to
increase its building programmes and compensate for the reduction
in public sector housing which is underestimated and worthy of
further consideration as a physical measure by the inquiry. While
site allocation through the planning system and planning delays
may be factors which impact on housing supply, has the industry
the capacity, initiative or appetite for significantly increasing
its output?
10. Planning gain until the Barker Review
had not been regarded as a fiscal measure. However, the growth
in the Government's expectation that the planning system will
provide the majority of affordable housing (more than half of
all affordable housing is now provided by Town & Country Planning
Section 106 Agreement in the southeast) has led to it being so
regarded. We believe that Barker's proposals for planning gain
supplement are fundamentally flawed. The Office of the Deputy
Prime Minister's previous proposals for voluntary planning charges/planning
tariffs were directly related to affordable housing problems and
other local infrastructure and community requirements. These are
now widely supported by a remarkably broad coalition. From the
British Property Federation, through to the Planning officers
Society and Local Government Association, including the RTPI and
RICPS and other important players; all are worried that Barker's
proposals will slow up the system and reduce the resources available
to address affordable housing difficulties locally with a new
system of national taxation. We would ask that the Inquiry considers
this aspect of physical measures.
THE SCALE
OF THE
GOVERNMENT'S
PLANS TO
BOOST HOUSING
SUPPLY; THE
RELATIVE IMPORTANCE
OF INCREASING
THE SUPPLY
OF PRIVATE
HOUSING AS
OPPOSED TO
SUBSIDISED HOUSING;
AND HOW
THE PLANNING
SYSTEM SHOULD
RESPOND TO
THE DEMAND
FOR HOUSING
FOR SALE
11. The Society is concerned at the lack
of clarity about the Government's plans to boost housing supply.
Regional Spatial Strategies are looking at the environmental,
economic and social implications of increasing housing supply
as suggested in the Barker Review. We support this process which
allows for consideration of the appropriate balances. However,
we have no confidence that the suggestions put forward by the
Office of the Deputy Prime Minister in the July 2005 "Planning
for Housing Provision" Consultation Paper, would lead to
the release of additional serviced land with infrastructure provided.
We believe that a full response from Government to the Barker
Review is overdue to allow the scale of the Government's proposals
to be clear. There is clearly a risk in the current ODPM thinking
that addressing supply side factors out of context could lead
to a serious risk of the market losing its focus on brown field
sites as it cherry picks longer term phases of later reserve green
field sites and responds to demand rather than need. (Our full
comments on the July 2005 Consultation is available on the Planning
Officers' Society website.)
12. If planned residential land is not coming
forward in growth areas, there is an assumption in the July consultation
that later phases of land should be brought forward. However,
this is likely to lead to an inefficient use of public resources
as duplication or diversion of infrastructure investment requirements
is likely to occur. An appropriate balance needs to be found to
allow authorities to address unforeseen constraints on the provision
of serviced planned, first phase developments. Current Government
Sustainable Communities infrastructure funding is unlikely to
resolve difficulties if they occur in many areas.
13. The planning system can provide planned
supply at different levels depending on the final decisions taken
on Barker's recommendations. However, what is critical is that
land to be developed does not undermine brown field development;
is released in a planned way ensuring adequate infrastructure;
and is focused on addressing the type of unit which would be of
greatest assistance to first time purchasers for those wishing
to enter the intermediate housing market.
14. Planning operates in a medium to long
term time scale. The influence of planning decisions on the housing
market can be over stressed. Land allocation and release mechanisms
have to be judged against trends and not just based on current
market conditions. Decisions to release any later phases of residential
development need to take account of market conditions over a minimum
of a three year period but to be based on Regional Spatial Strategy
and local development document, proposed land supply monitored
through annual monitoring statements.
15. The Inquiry is interested in the relative
importance of increasing the supply of private housing as opposed
to subsidised housing. We comment that the large reduction in
the funding of subsidised housing in recent decades has underlain
alternative options for those now suffering affordability difficulties.
It is a political choice whether new housing to address the affordability
problem is supplied from the private sector or from the public
sector. However, we do not believe that increasing the supply
of private housing alone will resolve the affordable housing crisis.
If private housing is expected to increase supply to eradicate
affordable housing difficulties, then size and type of housing
and the targeting of those dwellings to those experiencing current
difficulties will need to be achieved through policy levers and
interventions.
THE SCALE
OF HOUSING
DEVELOPMENT REQUIRED
TO INFLUENCE
HOUSE PRICES
AND THE
IMPACT TO
PROMOTING SUCH
A PROGRAMME
ON THE
NATURAL AND
HISTORIC LOCAL
ENVIRONMENT AND
INFRASTRUCTURE PROVISION
16. We have commented above on the relationship
between house prices and housing supply. The Barker Review contains
interesting analysis of the impact of different levels of housing
provision on house prices. We submitted above that, even at the
higher levels of the additional buffer proposed by Barker, the
impact on house prices on an annual basis will be relatively limited.
17. It is difficult to generalise on the
scale of housing development's impact on the natural and historical
environment and infrastructure provision. Transparent optional
planning charges/planning tariffs through the local development
framework may well be able to resolve infrastructure provision
difficulties from the increase in the value of housing land locally
if the planning supplement charge proposal is not proceeded with.
(Although in cases of particular difficulty infrastructure funding
may be required upfront to unlock developments.) Impacts on the
natural and historic environment are better judged at the Regional
and Local level. However, provided the right sites are developed
in a planned way with infrastructure provided and environmental
impacts fully considered, then the scale of development proposed
by Barker as buffers would not inherently put at risk natural
and historic environments, provided that these factors are properly
taken into consideration in the regional and local planning processes.
However, land release mechanisms should not be driven by short
term market considerations. Allocated sites proposed to minimise
their impact on the environment should be brought forward whenever
possible to achieve infrastructure provided sites. Suitable policy
levers would be needed to maximise the contribution any additional
land supply might make, to directly resolving the needs of those
currently unable to enter the housing market or find rented accommodation.
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