Written evidence from Hallam Land Management
Limited (ARSS 57)
SUMMARY
The majority of Local Planning Authorities are resistant
to new housing development.
Over a period of more than 25 years housing land
in the UK has been consistently and seriously underprovided leading
to excessive rises in the cost of housing.
Such underprovision can only be made good through
the allocation of significant numbers of new sites right across
the country.
Many elected representatives at Local level are acutely
aware that new housing is unpopular with their constituents.
Local Planning Authorities have consistently over
a period of 25 years resisted new development by seeking to reduce
housing numbers through RSSs and Structure Plans before that.
Housebuilders require a continuity of supply of new
housing land.
They are content to engage in the consultation process
but require certainty that at the conclusion of such a process
there will be sufficient land in the right places and at the right
time. The considerable costs of engaging in the planning process
for developers and housebuilders can only be justified if there
are tangible results in the form of new planning permissions of
sufficient number and quality in the appropriate locations.
Incentivising Local Planning Authorities with enhanced
grant fundong is very unlikely to override their general hostility
to new residential development
Whilst the funds will be gladly accepted by the Local
Planning Authorities where development is proposed it is unlikely
to in itself persuade the Authorities that such development is
acceptable on a scale sufficient to make an impression on the
shortage of housing land.
Local Planning Authorities do not have a good track
record of working together to secure additional allocations of
housing land and there is nothing to suggest that this will change
simply because the Government are asking them to work together
in the future.
Hallam Land Management Limited is one of this country's
leading strategic land development companies. It currently manages
about 8,200 acres of land on 120 sites across the whole of the
UK.
The company has been active for over 20 years and
during that time has brought forward many sites mainly for housing
and but also for other forms of development, such as retailing,
employment and renewables.
We are currently involved in the promotion of around
20 sites of more than 1000 dwellings; some on our own account
others in collaboration with other developers including most of
the major national housebuilders.
Many of our sites are long term and we frequently
are promoting sites over a 10 year or more period. We are not
housebuilders but having obtained planning permission for our
sites we then sell our land onto the housebuilders, sometimes
having installed infrastructure.
We have been involved in most of the RSS and have
participated in many of the RSS EIPs. We have also participated
in many LDFs and are involved directly in many of these EIPs also.
We have also participated in many Structure Plan and Local Plan
Inquiries in the earlier planning system.
Most of our employees are town planners and all are
very familiar with the planning system. I am a chartered town
planner with over 35 years experience and have served on the National
Council of the Royal Town Planning and on the National Planning
Committee of the House Builders Federation.
This consultation is concerned with four main issues
and I will take each of these in turn.
1. The implications of the abolition of regional
house building targets for levels of housing development
Most Local Planning Authorities are generally resistant
to new housing development. New housing development is normally
disliked intensely by existing communities. Those communities
put their elected representatives under a great deal of pressure
to resist such new development and new members are often elected
from an anti-development platform. New residential development
is possibly the most contentious matter affecting local politics
in many areas of the country.
Over a period of time dating back to 1974 with the
introduction of the Structure and Local Plan system, Local Planning
Authorities have by and large had the allocation of housing numbers
imposed on them by a more strategic higher authority, which has
ensured with relative degrees of success that at least a proportion
of the land required for new housing has been allocated. Passing
over that entire responsibility to the local planning authority
is likely to lead to an overall reduction in the provision of
new land.
In most of the RSS EIPs, in which we have been involved,
many local authorities have argued vehemently for a reduction
in housing allocation numbers. This is no coincidence and simply
reflects the political will of those LPAs to reduce the amount
of development. Virtually, all responsible representatives of
the development industry have long argued that the initial figures
put forward in the RSSs were too low let alone the reduced figures
argued for by the majority of LPAs
It is, to our mind, inconceivable that these same
LPAs will now take a more responsible view with regard to the
allocation of land for housing.
When the Local Government Act 2003 was introduced
creating the current RSS/LDF system the Government said that it
intended all LDFs to be confirmed before 2007. The reality is
that by the time of the election in May 2010, there were hardly
any fully effective LDFs in place. The reason for this is that
there was simply no strong will on behalf of the LPAs concerned
to actually get on with the process. For many authorities, stalling
the production of the LDFs has been an effective way of stalling
new housing developments.
The RSSs provided at least some form of target, which
the LPAs were required to meet. Left to their own devices we fear
that housebuilding targets will be drastically reduced from a
total that was in the first place critically low.
The development business is a very complex and time-consuming
process. The volume of work, which is required to be produced
in support of even quite modest planning applications can take
between six months and a year to prepare and involving amongst
other things exhibitions and public consultations exercise. All
of this work can cost significant sums of money, which together
with the now substantial planning application fees can equate
to a substantial investment of time and money. Such an investment
decision is not taken lightly, by housebuilders or developers
and it is reasonable to expect a degree of consistency in decision-making.
Regrettably a more localist approach to decision making is more
likely to lead to more uncertainty and hence risk for developers.
Frequently planning applications can take unto 12 months to determine
and may easily span a change of political control within any particular
council. A localist approach may legitimise a different planning
opinion from the planning authority at the conclusion of a planning
application to that that would have been available at the start
of the process. Whilst this could be the case under the previous
and indeed any regime, under the presently proposed regime it
is a far more likely outcome and is in itself likely to put off
developers from making applications on anything other than those
sites which have an almost certain outcome. All of which is likely
to lead to fewer developments coming forward. We accept that planning
is at the heart of a democratic process and that there is always
an element of risk but that risk, in a structured RSS LDF system,
can be managed and understood, but there is a danger that a locally
accountable decision based system will be open to frequent and
unsubstantiated change.
The housebuilding industry requires a minimum amount
of land in the appropriate locations to be able to provide the
appropriate number of houses for the population of the country.
It requires a reasonable amount of certainty that the sites that
it needs to bring forward are actually going to be approved at
the end of the process. Over a period of 25 years that situation
has become progressively less certain and the volume of available
land has become much reduced. It is unfortunate but in our view
the new localism approach to planning is almost certainly likely
to increase delay uncertainty and cost of bring forward even fewer
sites than previously and this ultimately will be at the expense
of the house buying public, or more properly at the expense of
those fortunate enough to be able to buy a house because for the
great majority of those people wanting to buy a house the planning
system will actually prevent sufficient houses being made available.
It should be noted that there is a possibility that
just the reverse of what the Government intends with its policies
will actually happen. That is to say that instead of Local Planning
Authorities taking more responsibility for decision making on
planning matters, they will actually make less decisions or give
more refusals which will lead to appeals against refusals or non
determination which will inevitably lead to individual Planning
Inspectors or indeed the Secretary of State himself actually having
to make more of the decisions. So, instead of decisions being
taken at a local level many will in fact be taken by external
agencies or even by the Government itself.
2. The likely effectiveness of the Governments
plan to incentivise local communities to accept new housing development
and the nature and level of the incentives, which will need to
be put in place to ensure an adequate long-term supply of housing
Regrettably, for the reasons I outline in para one,
above, incentives are not likely to work. If politicians are elected
from a "no development" platform, then financial inducements
are unlikely to have much material effect. If those politicians
feel that they are likely to be voted out of office if they are
seen to be encouraging development then no amount of financial
inducement is likely to make them change their mind. Nor indeed
is it likely to change the mind of the electorate who, generally,
do not want the development. Until the electorate decide that
new development is necessary and desirable, their elected representatives
will take the same view. Clearly, in the past, Local Authorities
have been keen to take advantage of Section 106 and other contributions
but only where they have concluded that development is, in any
event, unavoidable and they have taken the unsurprising view that
they should take whatever financial contributions they can from
the development, but it is not these contributions which have
led the authorities to accept the development in the first place.
The development has come because of the imposition of targets
from RSS or elsewhere and not from the cash that comes with the
development. In other words the local communities see the cash
as compensation for the development rather than a justification
of it. Furthermore what can be the logic of giving more cash to
local authorities simply to grant planning permissions when there
may not be any actual specific requirement for that cash? Can
it be a good use of public money to proffer cash to those councils
for giving planning permissions when they should in any event
be granting the permissions without the need for incentives?
We are seeing a reverse incentivisation at the present
time whereby Local Authorities are presently looking to hold back
planning permissions because there is an awareness of the incentives
which they think are to be made available shortly but the details
are unclear and so there is a temptation to wait to ensure that
councils are not missing out on windfall benefits. This is quite
understandable from their point of view, but in the short term
at least, is actually having the reverse effect from what is intended
by the introduction of the incentives and so it is important to
finalise these matters as soon as practicable.
3. The Committee understands that the government
intends to announce further details of its plans for incentives
shortly and would welcome comments on the adequacy and appropriateness
of those incentives when the details are available
It is difficult to comment on the adequacy and appropriateness
of the incentives without knowing the details of those incentives.
However, as noted above the scale of the incentives is unlikely
ever to be sufficient to bring about the responsible decision
making that the government seeks.
Historically, the majority of Local Planning Authorities
have always sought to restrict the amount of growth in its own
administrative area. There have been notable exceptions but normally
development has occurred only where the Local Authority concerned
believes there to be a real threat of losing appeals.
The last Government had spent much of its time, especially
in its early years, restricting development particularly on Greenfield
sites (because of the unpopularity of such development). More
latterly, the Government did seem to have accepted the argument
that more land was required for housing and many appeals have
been allowed over the last two years on the basis of the lack
of a five year land supply. Crucially, however, the five year
land supply has been measured against the RSS targets. Without
the RSS targets there is a real danger that Local Planning Authorities
will simply distort the five year land supply argument in their
favour.
Put simply, the carrot (contributions and incentives)
as opposed to the stick (RSS targets and lost appeals) approach
does not work with housing land because there is no carrot sufficient
for local politicians to support housing growth when to do so
is likely to result in a lost seat at the next election. Already
we are seeing examples of up to 40% reductions in targets from
RSS figures in authorities such as for example Rotherham and Leeds
and this is being repeated in Local Authorities across the country.
4. The arrangements which should be put in
place to ensure appropriate cooperation between local planning
authorities on matters formerly covered by regional spatial strategies
History shows that Local Planning Authorities rarely
work well or cooperate together effectively. These arrangements
are often at their worst when one authority is to accommodate
what it sees as the growth requirements of a neighbouring authority
although this is precisely where such cooperation is most needed.
At best such arrangements can lead to significant delay and at
worst they can be totally counterproductive insofar as policy
making is concerned. Without some higher authority bringing together
the respective parties it is likely that in many if not the majority
of cases the LPAs, whilst possibly seeming to acquiesce to the
notion of working together collaboratively are actually simply
not able to come to a consensus view. These types of arrangements
will almost inevitably be difficult and particularly so if different
Local Authorities are under different political control. This
difficulty will be exacerbated if councils change political control
during the process, as will almost certainly be the case with
a different and shorter political cycle to National Government.
In the RSS arrangements, Local Planning Authorities
had to become involved to have influence and the process would
simply leave them behind if they were not constructively involved.
Collaborative working between authorities under the presently
proposed arrangements could become mired in disagreement and delay
enabling LPAs to avoid making painful political decisions on housing
allocations.
It is essential therefore that any mechanism, which
is put in place to enable cooperative working between authorities,
incorporates some form of punitive action against LPAs who do
not cooperate.
CONCLUSION
Most LPAs, and particularly those in the parts of
the country where there is most pressure for development, are
driven by the desire to resist that development pressure. This
desire stems from the general will of the local electorate to
minimise any new development in what is often perceived by the
general public as an over developed country. Frequently that public
antipathy to new development hides under the banner of inadequate
infrastructure and indeed this is in part the reason for the dislike
of the new development but the reality is more fundamental opposition
to the development in the first place. Therefore the government's
aim to sweeten the pill through financial incentives will in fact
be no more than sweetening the pill and will not of itself persuade
many LPAs to take the medicine, in the first place. Certainly
if they have to have the new development the LPAs will be pleased
to receive money for new infrastructure, but then this would be
no different from the planning arrangements which are already
in place with the S106 mechanisms. But under a regime whereby
the LPAs decide for themselves whether they need the new development,
the answer in the majority of cases is likely to be a resounding
"No thanks" and no amount of financial inducements is
likely to change that.
The country has suffered from an under provision
of land for new housing for 25 years. There has been little to
prevent LPAs from allocating such land other than their own inclinations,
but even when they have been under an obligation through housing
number allocations being imposed from above they have more often
than not chosen to under allocate. We would be very pleased if
the Governments new arrangements lead to a significant increase
in housing allocations but we regret to say that we believe that
the reverse is likely to happen as over the next few years there
will be even less allocations than has been the case recently
and the Government will be obliged to review the position and
bring in the sort of targets that the last Government themselves
ultimately had to introduce.
September 2010
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