Abolition of Regional Spatial Strategies: a planning vacuum? - Communities and Local Government Committee Contents

Examination of Witnesses (Questions 240-258)

Q240 Chair: Good afternoon and welcome to the fourth and final session of our inquiry into the abolition of Regional Spatial Strategies. Unfortunately, Councillor Symon Fraser from the East Riding of Yorkshire Council is not able to be with us. I think he had a problem with a cancelled train and was unable to catch a later one to get here. For the sake of our records, could you say who you are and the organisation you represent?

Ken Thornber: Chairman, I am Ken Thornber, Leader of Hampshire County Council.

Jim Harker: I am Jim Harker, Leader of Northamptonshire County Council, and I represent East Midlands Councils.

Derek Antrobus: My name is Derek Antrobus and I chair the Greater Manchester Planning and Housing Commission.

Q241 Chair: You are all welcome. If at any stage comments are made by one of your colleagues with which you agree, do not feel it necessary to repeat it. If you just say you agree, that is it. We can probably make more progress that way, because we have quite a lot of interesting things to explore with you.

To begin, quite a lot of the evidence we have had so far suggests that if and when the Regional Spatial Strategies are abolished there will still be a need for some arrangement between an individual local authority and national planning guidance. Do you concur with that? If so, will we recreate Regional Spatial Strategies in some other name that in practice will be a similar thing?

Derek Antrobus: I think Regional Spatial Strategies transcend local authority boundaries, so whatever we do we need to recognise the porosity of those boundaries and to think wider than the individual local authority. That can take a variety of forms. For example, in Greater Manchester, there is a long history of the 10 authorities that constitute the conurbation working together. We also need to be alive to our connections with authorities that border Greater Manchester: Warrington, East Cheshire and so forth. There will always be a need to integrate our thinking on spatial planning.

Jim Harker: One of the challenges is that we have such a mixture of local government in England, particularly in two-tier areas, that it is essential to have a wider spatial planning provision other than district councils. I can think of an example under the structure plan process in my own county of Northamptonshire. We wanted to build a dual carriageway to link the M1 with the A14 and A45. That went through five district councils: Daventry, Northampton, South Northants, Wellingborough and East Northants. It would have been almost impossible to get that sort of road built under a system whereby strategic planning was left with the district council authorities in a two-tier structure. I think the two-tier arrangements between the counties and the districts will be particularly challenging. I would hesitate to go back to the structure plan approach. Nonetheless, I think that at sub­strategic level, there is a real role to be played by the counties in two tiers.

Ken Thornber: I would not disagree, but I can see a three-tiered structure, most of it voluntary, and for all that, gaining great commitment at district, county, sub-regional and regional level. If you take regional level in the South East, prior to RDAs we had what was called SERPLAN, a south-east region plan, which was voluntary but for all that was very effective. We now have south-east England council leaders—78 of them—who meet as 78. Obviously, they span the region, and that would be a vehicle for regional planning; or we have the south-east strategic leaders' forum formed of strategic authorities, counties and unitaries. Therefore, we have the ability to fill what I believe to be a bit of a void now between RSS and local level. We can do it in a sustainable way; we can do it voluntarily, and I think it would have greater impact.

Q242 Heidi Alexander: Councillor Thornber has just spoken about filling that void through some of the forums that already exist. The Government have proposed a duty to co­operate. How do you see that working going forward based on all your experiences? Equally, do you have any concerns about the lack of sanctions? If a local authority does not choose to co­operate what happens and how do you resolve it?

Ken Thornber: The duty to co-operate is one that we welcome. We would like to see it strengthened so it is a duty to co-operate not only at district level but with the strategic authorities. We think that in that way you can have a sub-regional co­ordinated approach to planning. The Honourable Member speaks of sanctions. In terms of housing plans, one of the greatest sanctions is the knowledge that, if you do not plan where you want your houses and the numbers you want, you will get planning by stealth, by application of developers and so on. That is one of the sanctions available. I am not one to want sanctions but I believe in the construct that there ought to be the reserve power of final intervention by the Secretary of State.

Jim Harker: I agree that it will be really difficult to enforce. I am not sure how the sanction will work unless there is guidance. Perhaps the proposed national planning framework might give some guidance about the sort of areas in which co-operation is required.

Derek Antrobus: The recent Flood and Water Management Act imposed a duty on the various agencies involved in flooding to co-operate. That appears to be working well. I do not think there would be any difference with local authorities joining together. If there is a duty to do these things, local authorities tend to obey the law.

Jim Harker: We have some evidence from Northamptonshire, which is a growth area. It has two local delivery vehicles of which you are probably aware: the West Northants Development Company and the North Northants Development Company. Both of those in two halves of the county have been working in partnership with the relevant district councils and county council to prepare core strategies. It is a mini-strategic plan. Therefore, co-operation can work.

Q243 George Hollingbery: Do the witnesses agree that if the data that backed the Regional Spatial Strategies were robust, the outcome of co-operative groups of this sort is likely to be that of the Regional Spatial Strategies? Is there any truth in that?

Jim Harker: As far as the East Midlands are concerned, the total number will probably not be that much different. The demand for housing is still there. Indeed, all the evidence is that, without the Regional Spatial Strategies, for the past 10 years the growth has shown up. There is a lot of variation between different parts of the region. For instance, South Northamptonshire does not want development. They have already told me that they will have very limited development as a result of it. Corby in Northamptonshire wants development. I think you will find that, while the total numbers are probably about the same, there will be a lot of different choices between different parts of the region.

Q244 George Hollingbery: Can the witnesses elaborate a little wider than housing, because clearly the RSSs covered a great deal more than just housing?

Jim Harker: Yes, although it was really just moving on, wasn't it? Separately, the RDAs were charged with preparing the RES, Regional Economic Strategy, for jobs, roads and industry, and the regional councils did the RSSs, Regional Spatial Strategies. The previous Government had just begun to put those two together and integrate spatial strategy—housing—and jobs, which was the sensible way forward, although on a much bigger scale. I would like to see that copied on a much more local scale. If I may say so, if I get the opportunity in Northamptonshire, I will take a combined approach that looks at economic development—jobs and inward investment—alongside housing.

Ken Thornber: The number of houses proposed by 11 district councils and two unitaries supported by Hampshire County Council is 5,600 a year. That is almost exactly where we started with our draft plan before intervention by government to increase that allocation. Looking across these districts, there is an accepted need to plan for that number of houses. We have robust discussions and they will continue, but at the end of the process we had agreement around that number of houses. Those houses are now being put forward by local district councils and, therefore, there is still a measure of agreement. It might be argued that if you are close to the RSS housing allocation, why can't we replace the RSS with something else at regional level? Indeed, I spoke of voluntary arrangements that could do that.

In my experience, it is not the case that districts in particular clamour for a lower number of houses; they accept the need. I think the big problem for us all, and certainly in Hampshire, is the infrastructure to keep pace with that level of housing. There is an infrastructure deficit. I think every district council and county would plan for these houses and it would not be that much different from the RSSs, but there is an infrastructural deficit which we need to address if we are to produce that number of houses.

Derek Antrobus: The question was specifically about areas other than housing which might create some difficulties. There are some areas about which I would have concerns. I sat on the regional planning group for the North West. One of the most contentious areas where some authorities were reluctant to allocate was to do with Gypsies and Travellers. That was very controversial. I wonder whether or not local authorities would make adequate provision for that without the sanction of Regional Spatial Strategies. I also chaired Greater Manchester waste planning committee for the production of the DPD. That was also controversial. There were some very sensitive sites. In the end, we recognised it was our duty to provide sufficient sites to meet the requirements of the RSS. I do not know what would have happened if it had not been a statutory requirement.

Ken Thornber: One request we would make is for the return of planning powers to upper-tier authorities consistent with their statutory obligations, which are certainly transportation, waste, mineral extraction and probably areas of education and social care. These are statutory responsibilities. We would look to a situation in collaboration with our district councils where Hampshire County Council planned these strategic planning concepts, if you will, in order to provide support. I focused on housing, but it is far more than just that; it is roads, infrastructure, health centres, education and social care.

Q245 Heidi Alexander: Councillor Antrobus picked up the point that I intended to raise which is that, while housing can be controversial, sometimes there are even more controversial things such as the siting of Gypsy and Traveller pitches and the building of waste disposal facilities. Councillor Antrobus, you said you would have some concern about those provisions in the region, were it not for the obligations placed upon local authorities. In the new world in which we find ourselves, possibly without the Regional Spatial Strategies, how do you deal with that problem? In your opinion how do you deal with the thorny, knotty issues that are very controversial?

Ken Thornber: If I might Chairman, this may sound like an unabashed grab for power.

Chair: The district councils might think so.

Ken Thornber: If you have these responsibilities at upper tier level, they will be exercised. If I look at the lovely county of Hampshire, it has its Gypsy problems as well as others, we could vest the strategic authority with the role of agreeing with district councils the disposition of Gypsy sites. We would have been doing that in the era of SERPLAN and before planning powers were removed. I would offer that as a way to tackle these controversial issues.

Jim Harker: Before the RDAs were invented—I know we keep talking about the two-tier system but that is really where the issues are—the old idea was that counties were responsible for the strategy and the structure plan. They planned where the roads, schools and main items of infrastructure were to be; they dealt with minerals and the bigger strategic issues of their sub-region, if that is what it is. The districts then had the responsibility to apply those strategic guidelines and had development control for housing and the industry that went along with it. It was not a bad system.

Q246 Chair: There was never any conflict in that situation, was there?

Jim Harker: Quite frankly, there was not that much conflict. We have been around a long while. I have been a member of the county council for 32 years and I chaired the old Planning Committees. There was not so much conflict because you thrashed it out. At the end of the day, it was your responsibility to get to a solution and you got it. In a way, conflict is inevitable, because if you left it to districts to make those individual decisions it would be quite difficult to get things done. You need the element of conflict and debate where everybody has the opportunity to put their point of view, but having somebody a bit more dispassionate who takes the decision is the right way to go about it.

Q247 Simon Danczuk: What do you think of the New Homes Bonus? Do you think it is a great enough incentive to get more homes built?

Jim Harker: In our experience in the East Midlands, we have plenty of extant planning permissions anyway; we have nearly 100,000.

Q248 Simon Danczuk: But I suppose we are looking to the future.

Jim Harker: There are a few issues around the New Homes Bonus. The first is that it is not yet clear exactly who will get the bonus, whether it will be the district council that gives the permission or the parish council that suffers the housing to be put upon them. We are not sure how it is to be shared out in the two-tier system. We have an indication that 80% will go to the district and 20% to the county. That is the reverse of the cost of providing the infrastructure. I understand it is not necessary to provide the infrastructure, but it will be part of that. We know that roads and schools cost 80% of the funds available. There are still quite a few issues around the New Homes Bonus. The other thing people are not sure about is that, because most of the funding for it is to be top-sliced, it means we have to pay for it to get it.

Q249 Simon Danczuk: You do not sound very enthusiastic.

Jim Harker: I can understand the principle, which is to compensate localities for putting up with development. That is a terrific principle, but it will not be that easy to apply it. I do not disagree with it; I think it is the best we have, but we need some answers to those questions.

Ken Thornber: I have done some basic arithmetic: 5,600 new homes per year in Hampshire with an average band D of around £1,500 yields an extra £10 million that will be divided among 11 or 13 authorities, so clearly it is less than £1 million each. While the bonus is welcome—there will be councils with deprived areas that want to take advantage of this— there will be affluent areas that are willing to forgo not a very great amount of money in order not to upset their vociferous populations.

I think it is mixed. There will be benefits for some councils to do this, but I am bound to say that £10 million for 13 authorities that cover 1.3 million people is not a great incentive from the point of view of infrastructure. 80% of £900,000 at district level is still not great. Given the statutory responsibilities of county councils, upper tier authorities, the 80%/20% ought to be reversed, because of all council tax bills, 80% to 85% of that bill is attributable to the upper tier. I say that in passing. Jim mentioned top-slicing. I welcome the concept. While people will not feel it in their pockets, they may see some minor improvements as a consequence.

Q250 Simon Danczuk: What you are saying is that to ignore the amount a local authority could receive from the homes bonus might be a price worth paying so they do not have the headache of having to get through all the new house building in their locality?

Ken Thornber: I think that is a real danger and in some localities that bonus will be forgone.

Derek Antrobus: I think it is fundamentally flawed and unfair, although nowadays I am not quite sure what "fairness" means. If you are an authority like Salford, where most properties are in the lower council tax band, compared with an authority where the housing market is buoyant and properties are in the higher tax band, you will be rewarded differently for exactly the same output. For every unit that is built in Salford, an identical one built in a more prosperous authority where house prices are higher will secure a greater grant. It seems to me there is a disjunction between the bonus and the effectiveness of the local authority; the level of reward you get is purely down to the market.

I think it is even more unfair when you look not at the outputs but the inputs. In order to secure development in Greater Manchester, we need to invest heavily in infrastructure and place-making to encourage development to take place. There are 69,000 extant planning applications in Greater Manchester. The main reason many of them do not go ahead, apart from the current economic climate, is the fact that we want people to invest in good places, and that requires public sector intervention.

I think our current local investment plan with the Homes and Communities Agency amounts to £375 million over the next 15 months. If you compare that with what is to be substituted for it, the £1.4 billion regional growth fund over three years for the whole country, you can see that the resource available to invest in those places and transform them is to be sharply curtailed. It is that investment we need in order to deliver these housing units.

Another issue that concerns me is the fact that the New Homes Bonus will use the net figure. To secure high-quality family housing in many northern cities requires the demolition of old sub-standard housing that has no market value. That will count against us and we will not benefit from the New Homes Bonus. By doing that we will lose out because the net figure will be reduced.

My third concern is about the reaction of the public. I have dealt with two applications in the past month. In one case, we needed to secure grant funding from the Homes and Communities Agency for some affordable housing. Obviously, that would have been beneficial in terms of the New Homes Bonus and the addition one gets for affordable housing. We got the very clear message from the local community, local councillors and the planning panel that they would not make that decision based on the financial benefits; it had to be about the quality of the environment and development. That particular application was refused by the planning panel. Therefore, it is not necessarily the case that just by waving a cheque in front of a local authority it will agree to housing; it has to be of the right quality, and people in the community must be persuaded that it is right for them. Recently, we gave planning permission for a new Tesco. Because the council sold some land, we were slated in the media for selling planning permission. That is totally untrue, but that is the public perception. If people think that you are allowing development to go ahead simply because of financial gain, my experience is that they will not go along with it.

Q251 Bob Blackman: Moving on to the impact of the New Homes Bonus, have you decided to delay decisions on any planning applications, or seen any evidence of delays, pending its introduction?

Jim Harker: Certainly, as a county council we are not a development control authority, but in my area, no. We have extant permissions, a lot of them granted only recently. The problem is not so much giving the planning permissions as selling the houses, for the reason that young people in particular cannot find the deposits. They could service the loan if they could get the deposit, but at the moment what stops them is having to find 25% to 30%, which can be £30,000 to £50,000, as a lump sum before they can even start to think about buying a house. I believe the way forward in future is to find a way to allow young people, particularly first-home buyers, to borrow the deposit as well as the main funding. That would be a great help. The recession we have been in for the past few years is very much the cause of that.

The recession is also putting major pressures on the provision of infrastructure. All the new developments and planning permissions that have been granted, which are linked to 106s, are predicated on the idea of capitalising the land values so the developer is allowed to make substantial contributions to the provision of infrastructure. That is not happening now; indeed, in no way will some of the permissions negotiated two or three years ago be able to be built because the developer and the permissions were granted when the land was worth £1 million per acre and it was easy to allocate £300,000 or £400,000 of that to infrastructure. That is no longer with us. It will hopefully come round again in due course, but until it does and until, sadly, house prices go up and provision is made for people to be able to buy those houses and borrow the money, I think we are in a bit of a stick.

Ken Thornber: Sadly, I find little evidence that the number of houses planned bears any relation to the imminence of the New Homes Bonus. Strategic authorities in particular are very aware of a national presumption of sustainable development. We know that if housing numbers are not put forward something to which I alluded earlier will happen: there will be speculative development and planning appeals. We as a county will find development where we did not really want it. That imperative will not drive housing numbers rapidly upwards but will drive strategic authorities in their planning.

Derek Antrobus: I understood from a letter we received during the summer—I think it was from Greg Clark or perhaps Grant Shapps—that the New Homes Bonus was operative from that date, so any property built after it would qualify. We have been relying on that and have kept a copy of the letter—

Chair: Very wise.

Derek Antrobus: And the number of homes we have approved since that date.

Jim Harker: I do not believe that is clear.

Q252 Bob Blackman: We may clear that up a bit later in the evidence. Given that every authority has already published the level of housing that it expects to see developed, do you think it is right that it should be given an incentive to achieve that target?

Ken Thornber: It is not really to achieve the target, is it? If it is essentially to compensate communities for taking on that development then I think that is a good idea. It is a big stumbling block.

Q253 Bob Blackman: If I may cut across you, the thrust of my argument is that they have published a target that has been accepted by the community, so should not the incentive be applied to something above the target? In other words, if your target is 5,600 or thereabouts, which was the figure to which Councillor Thornber referred, and you build 10,000, then you will be rewarded for the 4,400 extra houses that are developed. Would that not be a fairer system?

Jim Harker: It is another way of looking at it. I am not sure it is fairer; it depends on what you want it for.

Q254 Bob Blackman: The thrust from government is that they want to see more houses developed in a faster timeframe because we are at a low point in terms of house building development. Local authorities have said that that is what they plan to do anyway. Therefore, if the New Homes Bonus is to apply, surely the argument would be that there should be an incentive to build extra properties, not the ones they will build anyway.

Jim Harker: But the targets were not set by the local communities; they were set top down by the Government of the day. The local communities did not really have much choice about it. They had a consultation period and made certain variations as a result of that, but the top-down targets for the growth areas anyway were set by the central Government of the day. In that case, I think it is reasonable to say that the village or town that must take on these 5,800 houses—probably doubling or trebling the size of the community that is there at the moment—ought to have some compensation for it.

Derek Antrobus: I think the issue is not so much about targets. In Greater Manchester, the RSS indicated 200,000 extra homes over the next 15 years. Each of the local authorities in Greater Manchester through their core strategies is imbedding that aim in their planning policy. The fundamental issue is not planning policy; it is about delivery.

Q255 Bob Blackman: To take that point, should the incentive be on delivery?

Derek Antrobus: The incentive should be on delivery, but it is not the local authority that delivers these by itself; it does so in partnership with developers and local communities. It is the level of investment in places that encourages developers to build homes in those places. They have to be attractive places and we need that level of investment.

Ken Thornber: I think I would go for the honourable Member's compromise, which is actual delivery of what local government said it could deliver. My understanding of the Coalition's philosophy is that they would not be prone to target setting or directing from the top. I can speak only for Hampshire. If we do our job properly—there is a good will out there—assess us on what we say we will produce.

Q256 Bob Blackman: We have received an answer to this, but I want confirmation of it. Do you think that the financial incentives proposed are sufficient to overcome the objections most residents have? Normally, when they object to planning permission they do so on social or economic grounds or some impact on them and their properties. Do you think these financial incentives are sufficient to overcome those particular objections?

Jim Harker: I think it depends where the incentives go. I can give you an illustration. Kettering, a town with a population of 50,000, has just agreed an urban extension of 5,800 houses; it is more than a 10% population growth. It has agreed that in the parish of Cranford next door, so the people who will pay for that are those who live in the parish of Cranford. It is a brilliant idea, but I am not sure how it will work. A much more effective way to reimburse local authorities for the growth they accept is to look at the way the grant system works for local authorities. At the moment, because we use the figures from the Office for National Statistics that are two years out of date, sometimes longer, it is at least two years before we get the grant to pay for these people. If that could be tackled on a fairer basis it would compensate the areas taking the growth much more satisfactorily and to a much larger degree. Of course, there are issues around that, but I do not understand why the Government cannot work out the grant on current population statistics rather than something that is two or three years out of date. That would help a lot.

Ken Thornber: I do not think local government should ever reject the concept of earning more on the basis of what it produces. I am bound to say, however, that at the level I indicated for Hampshire it is extremely difficult to see how fundamental infrastructural deficits could be addressed by a bonus of this sort. It may be that is not in government's mind and it is concerned more with a community and small improvements to its infrastructure, but this goes for six years and there is top-slicing of the strategic authorities. There is, therefore, in terms of the 80/20 split very much reverse and imbalance. I would like to encourage government to persist with this idea and allow local government to say what it can do and then reward on that outcome, as Mr Blackman says.

Q257 Chair: I suppose the question is: what happens if in the end local government collectively does not deliver as much as is needed? The National Housing Federation gave evidence to us that 180,000 planning applications have not been granted but would have been granted prior to the abolition of the Regional Spatial Strategies. Is that not a problem? I do not think you have quite addressed that.

Ken Thornber: Chairman, if I have understood it correctly, we then do not get the £1.25 for every pound of the council tax.

Chair: That is right.

Derek Antrobus: It will vary according to different parts of the country. In Greater Manchester, there is sufficient land allocated to meet the requirements of the Regional Spatial Strategy and the requirements of the core strategies of the local authorities. We have 69,000 extant planning permissions, so it is not a question of the local authority not delivering; it is about getting the houses built on the ground, which means investment in land.

James Morris: I return to the need for strategic planning which we discussed earlier. A lot of the evidence presented to us is that there is a need for broader strategic planning. Local Enterprise Partnerships have been introduced. To what extent do you think they could act as a vehicle for strategic planning in this context?

Q258 Chair: Can you give fairly brief answers because the Secretary of State is sitting outside, waiting to give evidence?

Ken Thornber: My fundamental problem is that an unelected, unaccountable organisation is being given responsibility for some planning matters. Indeed, if the split between local government and business people is 50/50, with a business-led chairman and corporate governance having a casting vote, you could argue that unelected people are taking planning decisions or are planning strategically. I have great difficulty with that. I am not sure that business necessarily wants to conduct the process of strategic or detailed planning. Certainly, what business in Hampshire is concerned about is outcomes and getting the planning process simplified and speeded up. I do not believe LEPs are the vehicle. The vehicle for what you have said is the upper-tier authorities co-operating with LEPs, but unaccountability worries me.

Jim Harker: It does not worry me so much. It depends on the size of the LEP. If you have a great big LEP frankly you just replicate the old RDAs and you are back to the same issues. I would not go for that. If you have reasonably small-sized LEPs on one, two or three counties I think there is a good case for letting them become hands on, not just consultees, as far concerns preparation of the strategic plan. Maybe you need the local authorities to sign off, but I want them to be more involved than just consultees.

Derek Antrobus: I agree with Ken. What the LEPs need is not more planning powers but more resources to ensure the delivery of what the plans have ambitions for.

Chair: Thank you very much indeed for your evidence. You'll have a very favourably disposed Secretary of State when you go out, for getting him in on time.

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