Written evidence from Pegasus Planning
Group Ltd (ARSS 38)
SUMMARY:
The abolition of regional house building targets
will result in significantly lower and inadequate levels of development
being planned for in future through a locally determined single
tier development plan system.
The delivery of new development, particularly in
the short term, will be impeded, resulting in a reduction in the
availability of both general market and social housing, which
will, in turn, increase and compound problems of homelessness,
increase the number of concealed households, restrict labour mobility
thus stifling economic growth at a time of economic recovery and
inhibit the general ability to move home thus reducing tax revenues
received by the Government from the housing market, such as Stamp
Duty and VAT, and leading to some households remaining in unsuitable
accommodation.
Strategic, non-local issues will not be adequately
covered by a locally determined single tier Development Plan system,
based upon the current structure of Local Government in England.
The Coalition Government needs to be clear on the
nature and timing of the proposed radical reforms to the Planning
system and any transitional arrangements in light of the abolition
of the regional strategies.
INTRODUCTION
Pegasus Planning represents a number of developers
and landowners, including the majority of national volume house
builders. Pegasus has participated in the preparation of most
of the regional strategies on behalf of our clients.
IMPLICATIONS OF
THE ABOLITION
OF THE
REGIONAL SPATIAL
STRATEGIES
The Coalition Government's revocation and proposed
abolition of the regional spatial strategies, through the Decentralisation
and Localism Bill, will have significant implications for house
building in England, particularly at a time when there is a paramount
need for a continued and sustained economic recovery, if the economy
is to avoid falling into a "Double Dip" recession, and
an urgent requirement to address the current housing crisis.[21],[22]
House building in England is at a historically low level[23]
particularly since the start of the "Credit Crunch"
in 2008.[24]
Affordability for first time buyers in terms of their ability
to pay is, if anything, getting worse. Accessibility to both the
market and social sectors has dramatically contracted while house
prices generally remain high or continue to rise.[25],[26]
Pegasus have analysed housing land supply in the
South West region[27].
This research highlights that, even under the Regional Strategies,
many local authorities were calculating their housing land supplies
against the lower figures in the Draft RSS. Even then a number
of authorities had less than a five year supply of housing, despite
the advice in PPS3 para 6.[28]
The house building and development sector has a key
role to play in securing future economic growth and providing
sufficient dwellings to help ensure that the various housing needs
and demands arising from social and demographic change in England,
expected to occur over the coming years, are adequately met in
a timely manner. The declining household size and the ageing population
add further pressures on the national housing stock.[29],[30]
The latest ONS Population and Households Projections highlight
the scale of the problem facing the Coalition Government, Local
Planning Authorities, the development industry and others to ensure
that "everyone has the opportunity of living in a decent
home, which they can afford, in a community where they want to
live".[31],[32]
The importance of the private sector in resolving
the current housing crisis will increase given the reduced public
sector housing programme expected following the Comprehensive
Spending Review October 2010. Therefore, a predominantly private
sector oriented solution will be required to deliver a sufficient
scale of development required to meet projected housing needs
and demands, as evidenced locally in the Strategic Housing Market
Assessments and nationally in the ONS projections and estimates.
Pegasus note the views expressed by the NHPAU,[33]
regarding recovery from a dramatic drop in housing output and
long term assumptions about the scope for output growth. The NHPAU
predict a massive under delivery of housing which will further
amplify the structural long term under supply of housing in terms
of pent up demand and market volatility.
The work of the former NHPAU should be continued
by CLG to assist local authorities and others by providing an
authoritative source of information and research, especially on
affordability to save time and money and avoid "re-inventing
the wheel".
It remains a principal aim of the Government to secure
the necessary "Step-Change" in housing delivery, through
a new, more responsive approach to land supply at the local level,
as reaffirmed by the Coalition Government in June 2010.[34],[35]
The Minister for Housing, Grant Shapps MP is on record setting
out the Coalition Government's ambition to "build more houses
than the previous Government."[36]
It is difficult to see how this will be achieved when the major
development proposals, which formed the "back bone"
of the Regional Strategies housing delivery trajectories, are
now delayed and their futures uncertain in the short term, particularly
in the absence of any robust transitional arrangements.
The revocation of the Regional Strategies and their
eventual abolition, will seriously undermine the delivery of housing,
particularly in Southern England, and undermine developer confidence
by removing the "certainty", fundamental to smooth and
effective operation of the "Plan led" system. Maintaining
certainty is critical for developers if they are expected by the
Coalition Government to continue to commit to the often considerable
expenditure necessary to effectively engage in the planning process
and deliver large scale development proposals.
Good planning ensures that we get the right development,
in the right place and at the right time.[37]
This is to be achieved through the "Plan led" system.
The "certainty and predictability" provided by the "Plan
led" system is central to planning and plays the key role
in integrating sustainable development objectives.[38]
A spatial planning approach should be at the heart of planning
for sustainable development. It provides the policy link for Government
to various international obligations relating to climate change,
Strategic Environmental Assessment, the Habitat Regulations Directive
and other requirements.
The revocation and the "stripping out"
of the regional tier of Local Government establishes a de facto
single tier planning system in England imposing a role on
the Local Development Framework Core Strategies not previously
envisaged when the LDFs were originally established by the Planning
and Compulsory Purchase Act 2004.[39]
Paragraph 34 of PPS3 states the former Government's expectation
that the overall level of housing should be set out in Regional
Strategies. It is clear that this role was not envisaged to be
undertaken by the Local Development Frameworks. It is a debatable
point whether such documents, in their current form, are the most
appropriate policy tool to perform this task and whether the LDFs
are still "Fit for Purpose." There remains a strong
and cogent case for the retention of some form of strategic or
sub-regional planning as part of a revised planning system. The
long term continuing desirability of "binding" Inspector's
Reports and the current PPS 12 Tests of Soundness should be reconsidered
in light of the RSS revocation and the forthcoming radical reforms
of the planning system.
The planning system needs to be comprehensively changed
if a permanent single tier system is envisaged. This should be
thoroughly consulted upon before it is introduced, rather
than such a system coming about on an "ad hoc"
basis, without adequate consultation, guidance or transitional
arrangements, as to how such a new system would function and how
proposals being progressed under the previous system would be
handled. There appears to be a "reality gap" in the
Coalition Government's thinking on the nature and operation of
the revised "Plan-led" system, which embraces localism.
The revised "plan led" system should be
formulated to effectively deliver a robust housing land supply,
based on transparent, evidence based analysis of development requirements.
Informal, interim requirements, devised without wide engagement
and consultation, are unhelpful in advance of the DPD reviews.
Clearly, to ensure "certainty" and a smooth transition
to the new system the RSS figures should stand until they are
reviewed through the LDF process.
The former Government established its Development
Plan system; comprising Regional Spatial Strategies and Local
Development Frameworks. A two tier system intended to simplify
the previous system, which comprised Regional Planning Guidance,
which did not form part of the Statutory Development Plan, Structure
Plans and Local Plans.
The Structure Plans were to be abolished upon final
publication of the relevant Regional Spatial Strategy. Most Structure
Plans, other than those in the South West region, are now abolished.
The former Structure Plans, amongst other things,
set out the scale and distribution of housing and employment development
envisaged and performed many other important strategic functions,
including co-ordination of infrastructure provision and other
cross boundary matters, which do not neatly fall within individual
local planning authority boundaries.
These roles were fulfilled by the Regional Spatial
Strategies, prior to their revocation. It should be noted that,
unlike the previous Structure Plans, the Regional Strategies went
further in their level of policy prescription, not only determining
the overall scale of development appropriate for the region concerned,
they also set out the proposed distribution by Local Authority
Area, having regard to the differing Local Government Structures,
sometimes defining the level of development appropriate for particular
key settlements and included policy guidance of the broad location(s)
and scale of strategic development proposals, where the evidence
base supported such identification.
The implications of if there is to be no strategic
planning undertaken have not been adequately considered. There
will be a failure to properly plan for the future housing needs
and demands. The recent survey by consultants Roger Tym reveals
that only a minority of Councils are expected to continue with
the housing levels, previously set out in the regional strategies.[40]
The Regional Strategies were prepared by the Regional
Planning Bodies, on behalf of the Government, but the final publication
of the Regional Strategies was undertaken by the Secretary of
State. At that point the Regional Strategy document not only became
Government policy, but also part of the Statutory Development
Plan and was afforded the full weight of Section 38(6) of the
Planning and Compulsory Purchase Act 2004. Thus, the "certainty
and predictability" of the "Plan led" system was
established to enable Local Development Frameworks, in particular
the Core Strategies, to be formulated in general conformity to
the relevant finalised Regional Strategy.
Developers, local authorities and others have fully
engaged in the Regional Strategy process, committing considerable
resources, time and effort to participation in the various stages
of plan preparation, responding to consultation opportunities
and contributing to the RSS evidence base.
The revocation, with immediate effect,[41],[42]
has created tremendous uncertainty in the planning arena and significantly
undermined investor confidence, precisely at a time when the housebuilding
sector needs support during the economic recovery and dwelling
completions need to be accelerated to address the demonstrable
acute housing needs and demand.
The act of revocation, coupled with the policy shift
towards "Localism" by the Coalition Government, will
create problems for housing delivery in the medium term, as well
as the short term, as the substantial amount of time taken by
the majority of Local Planning Authorities to resolve the current
uncertainties is eventually reflected in the timing of actual
delivery of development.
The Coalition Government's Localism agenda will take
many months, if not years, to "bed down". The current
confusion, given absence of any robust transitional arrangements,
has resulted in many local authorities either withdrawing their
Local Development Framework Core Strategies or slowing down their
preparation until there is a greater clarity at the national level.[43],[44],[45],[46]
This will inevitably impede the supply of new housing and employment
development.
Development proposals formulated in accordance with
the Regional Strategies, in particular the large scale urban extension
proposals at the Strategically Significant Cities and Towns (SSCTs),
no longer have the weight of the "Plan led" system behind
them. Their implementation will inevitably be delayed and their
future is now in doubt, in some cases, where the "Localism"
agenda may result in lower development targets being set locally
by the Local Planning Authorities removing the need for urban
extensions, which are deemed "unpopular" locally, often
despite robust evidence for their allocation. The ability of the
Coalition Government to reverse now deep seated "nimbyism"
and overcome local self interests through incentives and other
measures appears limited.
The "Localism" agenda is likely to result
in the allocation of lower levels of development than set out
in the regional strategies, as anti-development lobbies apply
political pressure and the Councillors become mindful of the Local
Government Elections.
Given that the "Step Change" in housing
delivery sought by PPS3 was to be achieved, in large part at the
Broad Locations for Development identified in the Regional Strategies,
the act of revocation will now fundamentally undermine the expected
delivery of increased housing numbers at these sustainable, broad
locations, where they are needed most.
The consequences of planning for lower levels of
development are not experienced equitably across communities as
a whole. The supply of new affordable housing units will reduce
at a time when there are acute levels of housing need.[47]
Further delays in plan preparation will result from
the revocation. The delivery of development, on larger urban extensions
and regeneration areas, often is intrinsically tied to the progress
of the Development Plan. Local Planning authorities have responded
in many different ways to the emerging Localism agenda and revocation
of regional strategies. Some councils have been quick to consider
the issue and set a new lower level of housing or withdraw their
Core Strategies,[48]
whilst others have sought to take more time over determining level
of growth to be planned for.[49]
The new locally set levels of development still need
to be tested at Examination in Public by an Independent Inspector.
Core Strategies are supposed to only include strategic sites considered
central to achievement of the Strategy.[50]
Therefore, the majority of allocated sites required to deliver
the new locally determined housing figures will have to be progressed
through Site Allocations Development Plan Documents. These, in
the main, are prepared after the Core Strategies are adopted
or the Core Strategy EIP has been completed. Therefore, the delivery
of development from the expected on allocated sites included in
the Site Allocation DPDs will be delayed by several years.
Furthermore, as progress on the former Local Plans
was slow and now somewhat dated, the Core Strategies prepared
to date have not brought forward sufficient land quickly enough
to effectively supplement the housing land supply given the reliance
of Site Allocations DPD. Thus in many parts of the country there
is a dearth of genuinely available and deliverable development
sites, despite there being a demonstrable need for additional
housing to achieve the "Step Change". In a revised single
tier "Plan led" system, it will take several years to
address and rectify this problem, provided the local determined
housing figures actually recognise this point and seek an increase
in overall housing provision.
POLICY DEFICITS
Another consequence of the revocation may not be
immediately apparent to the Coalition Government policy makers.
Given the desire of the former Government to simplify the content
of Development Plans and remove duplication of policy and/or repetition
as some policy matters were covered by the Regional Strategies
there was no longer a requirement to include such duplicated policies
in the Local Development Frameworks and so such policies were
omitted from the LDFs. For those Core Strategies and other LDF
documents where this was the case, the revocation of the Regional
Strategies has created a "policy deficit" where the
regional policies no longer apply but the Core Strategies have
been adopted or the Examination in Publics have been completed
without the LDFs including adequate policies on some issues. Clearly,
there will be cost implications to the Local Authorities who need
to review their Core Strategies and/or other LDF documents to
address any "policy deficits" as a consequence of the
revocation.
INCENTIVES/NEW
HOMES BONUS
There is a fundamental tension inherent in the Coalition
Government's "Localism" agenda in respect of planning
for new development. The effectiveness of the Government's plan
to incentivise local communities to accept new housing development
is likely to be modest and patchy. Short term financial incentives
run contrary to the long standing principle that planning permissions
should not be "brought or sold". Furthermore, some more
wealthy local authorities will consider the expected incentives
insufficient to justify the inevitable political backlash from
local voters, mindful of the Local Government Elections. The current
lack of clarity regarding the precise incentives that could be
expected is also a cause for concern, prompting some councils
not agreeing to further development too hastily. Given the tight
Government Budgets as the deficit is addressed, there is a real
concern that the nature and level of incentives that are made
available will be insufficient to ensure an adequate long term
housing supply is achieved. The Grant Shapps letter[51]
did not make reference to the previous commitment to match Council
Tax revenues on every new home built for six years in grant payments.
The Minister is understood to be locked into debate with the Treasury
over affordability.
Furthermore, there is evidence that some local authorities
are reneging upon their Multi-Area Agreements in terms of their
agreed strategies for urban expansion.
ADEQUACY OF
CO -OPERATION
PROPOSALS—PROPOSED
DUTY TO
CO-OPERATE
Guidance and the reasons for joint working are set
out in PPS12 paras 4.16-4.18.[52]
In the absence of the regional strategies it is essential
that the local authorities are encouraged to work together on
strategic and cross border issues and to establish realistic and
responsible targets for waste, mineral extraction and renewable
energy generation which have regard to needs and demands arising
from a larger geographical area than their own administrative
borders.
Whilst it may be desirable for local planning authorities
to co-operate in the preparation of planning documents, previous
experience indicates that Local Planning Authorities cannot be
forced into unacceptable joint arrangements. This is particularly
evident in the Greater Bristol area. It is unclear how conflicts
in the respective "localism" camps would be resolved.
There will inevitably be differing opinions on the future scale
and direction of new development from opposing neighbourhoods,
communities or local authorities.
The implications of under provision in one local
authority are often felt by neighbouring authorities. This is
compounded if all authorities under provide, such as in the Bristol/West
of England Housing Market Area, then the impacts are felt across
a wider sub-region.
ROLE OF
LOCAL ENTERPRISE
PARTNERSHIPS
It is noted that the proposed Local Enterprise Partnership
may fulfil a planning function. Whilst this would enable housing
and planning issues to be examined over a broader area, the plan
making responsibility remains with the Local Planning Authorities
in the "Plan led" system. There does not appear an adequate
mechanism to ensure that the views of the LEPs would actually
be reflected in the Local Development Frameworks under the current
arrangements.
September 2010
21 Shelter-The Housing Crisis (2010). Back
22
National Housing Federation "Don't Mention the Housing Crisis"
Campaign 2010. Back
23
Historic Dwelling Completions data. Back
24
Housing Starts and Completions March 2002-March 2010-Building
2010. Back
25
Affordability Matters-A Fuller Picture (February 2010) NHPAU. Back
26
Housing Requirements and the Impact of Recent Economic and Demographic
Change NHPAU (May 2009). Back
27
Pegasus Planning Group Analysis of Housing Land Supply in the
South West (2010). Back
28
Planning Policy Statement 3 Housing (June 2010) Para 6. Back
29
Declining Household Size-ONS data. Back
30
Ageing Population-ONS data. Back
31
PPS3 Housing (June 2010) Para 9. Back
32
ONS Population and Household Projections. Back
33
NHPAU Housing Requirements and the Impact of Recent Economic and
Demographic Change (May 2009) Pages 6 and 7. Back
34
PPS3 Housing June 2010 Para 2. Back
35
Government Response to Barker Review of Housing Supply (2004). Back
36
Grant Shapps Quote 2010. Back
37
PPS1 Delivering Sustainable Development (2005) Para 1. Back
38
PPS1 Delivering Sustainable Development (2005) Para 8. Back
39
Planning and Compulsory Purchase Act 2004. Back
40
Planning 6 August 2010. Back
41
Secretary of State's letter dated 27 May 2010. Back
42
Letter to Chief Planning Officers dated 6 July 2010. Back
43
South Oxfordshire Council withdrew its Core Strategy and is working
on revised proposals. Back
44
Wiltshire Council revised its timetable to produce the Wiltshire
Core Strategy. Back
45
Joint Core Strategy for Gloucester, Cheltenham & Tewkesbury
delayed to take account of Pickles letter. Back
46
Taunton Deane Core Strategy being revised to plan for lower levels
of development. Back
47
Chartered Institute for Housing in the South West (CIHSW) Planning
20 August 2010. Back
48
South Oxfordshire Core Strategy. Back
49
Wiltshire and South Wiltshire Core Strategies. Back
50
PPS12 Local Spatial Planning Para 46. Back
51
Grant Shapps New Homes Bonus Scheme Letter 9 August 2010. Back
52
PSS12 Local Spatial Planning (2008) Paras 4.16-4.18. Back
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