Memorandum from Turley Associates (ARSS
93)
EXECUTIVE SUMMARY
Even before the effects of the recent recession,
the planning system has not been able to deliver the amount or
type of housing which our communities, our economy and our society
needs. By the end of this year, some commentators have predicted
that the shortfall against the levels of housing we need will
be one million homes. This has led to severe problems of affordability,
where a growing number of households are excluded from home-ownership;
and accessibility, where labour mobility and economic growth are
stifled.
The recent credit crunch and economic recession have
exacerbated this problem. Reduced availability of credit and economic
uncertainty have constrained the demand for new housing and reduced
the housebuilding industry's ability to supply even the amount
for which there is demand.
With more stable economic conditions and a positive
and certain policy framework, the housebuilding industry has the
potential to deliver the housing we need and in doing so create
jobs and stimulate economic activity. As the economy emerges from
recession, housing demand increases and the Coalition Government
commences its "reboot" of the planning system, it is
essential that steps are taken to enable the industry to increase
the rate of new housebuilding and to boost the supply of housing
land.
The Government is aware of this and it is reflected
in its own analysis; Open Source Planning notes that "the
country needs a major upswing in development and construction
as soon as possible".
Having abolished the RSSs, the challenge facing Government
is how best to deliver the "upswing" in construction
and development over the short, medium and longer term. The Government
inherits a "backlog" of one million homes compared to
current housing requirements and a supply of housing that, in
many cases, does not match the type of housing for which there
is demand. All recognised projections of housing need suggest
requirements will rise but the planning system is not, at present,
well equipped to respond quickly to this need. Urgent action is
needed that will improve the supply of housing in England that
takes account of the significant local variations that exist in
the need and demand for housing.
The proposed presumption in favour of sustainable
development which conforms to national environmental, architectural,
economic and social standards would be an important measure in
the delivery of housing. "Open Source Planning" also
proposes a very different approach to the creation of "new
local plans" which are to comply with a new national planning
framework and to be completed within "a reasonable timescale".
It is the Government's intention that a presumption
in favour of sustainable development will only apply after these
documents are in place. However, it will take time for these plans
to be prepared and adopted. Observation, research and past experience
indicate that it will take between 24 to 36 months for a new system
to become embedded and working in practice. If housing delivery
is not increased in the meantime, this will add to the current
shortfall, compound problems of affordability and accessibility
and frustrate the Government's aim of delivering an upswing in
construction and development activity.
As such the Government should prioritise the introduction
of a presumption in favour of sustainable residential development
as an immediate step. If such a presumption was to be introduced
now, it is considered that the early positive results would include
the following:
Maximum delivery of good quality housing in areas
where it is needed at a time when the country is emerging from
recession and controls on public sector investment will be strict.
A powerful incentive for local authorities to prepare
new local plans in the minimum possible time scale.
Local members and engaged communities would quickly
adopt a positive approach to providing the development their areas
need.
Timescales for developments to come forward would
be radically reduced.
The resulting increase in housebuilding activity
would stimulate investment, boost local economies and create jobs.
New homes would help to address the significant national
shortfall and meet needs for affordable housing.
This submission also requests that measures are put
in place to ensure that data and research collated by the now
abolished Regional Local Authority Leaders' Boards are retained
and updated for use all stakeholders. Responsibility for this
could rest with LEPs under a properly constituted framework taking
account of the possibility of a duty to co-operate and being granted
a limited planning function. The efficiency of such a strategy
is demonstrated by the success of "Joint Data Units"
following the abolition of a number of metropolitan county councils
in the mid 1980s.
1. INTRODUCTION
1.1 This submission has been prepared by Greg
Mitchell BA(Hons), DipTP, MRTPI of Turley Associates, an independent
planning and development service to a wide variety of organisations
including financial institutions, developers, house builders,
retailers and land owning estates. Greg Mitchell has over 30 years
of experience in town planning principally within consultancy
and the development industry. He is the national head of the company's
Housing and New Communities sector. Turley Associates has a national
team across ten regional offices in the UK.
1.2 The revocation of RSSs is a significant change
to the English planning system and the consequences of the change
are yet to fully enfold. The advice issued to LPAs goes some way
to addressing the uncertainty which followed the initial announcements
by the Secretary of State and confirms a national commitment to
certain key planning policy objectives such as those relating
to economic development, design, climate change, flood risk and
transport.
1.3 Housing development remains the most controversial
topic and, outside London, the revocation of the RSSs may give
rise to some LPAs using the change to simply resist new development
in the housing and economic development sectors. In the absence
of detailed information on the promised financial incentives for
growth, the current situation is one where local objection will
have significant weight in the planning process. Evidence is that
LPAs are exercising extreme caution when it comes to controversial
schemes. In the longer term, it remains unclear whether the incentives
will be enough to provide a fair and balanced planning process
for the industry.
1.4 Plans for Local Enterprise Partnerships are
positive but it is unclear what the actual level of uptake will
be from LPAs and what planning powers, if any, such partnerships
will have.
1.5 The revocation of RSSs sweeps away regional
housebuilding targets, which were the basis of the UK's growth
agenda. In the short term the replacement for these is not clear.
Whilst LPAs are advised to continue with preparation of their
LDFs they will be able to review development requirements. It
is open to them to adopt "Option 1" housing requirements
or to formulate alternative requirements provided their approach
passes the tests of soundness set out in PPS12.
1.6 In view of the fragility of the housing market,
the backlog in housing delivery and the potential contribution
of increased housebuilding to economic recovery, we consider that
it would be preferable for Government to require LPAs to deliver
housing at least in accordance with Option 1 requirements pending
the testing and adoption of robust alternative figures.
1.7 Whilst much effort across the development
industry has been focussed on the implications for housebuilding,
it is also of note that employment, retail and other necessary
development also have growth agendas rooted in RSS. Uncertainty
on how to fill the strategic void extends across most sectors.
1.8 The planned reintroduction of a presumption
in favour of sustainable development is welcome. Its consistent
application during the transition between the revocation of RSSs
and the introduction of any new local development planning system,
would go some way to restoring industry confidence and ensuring
that development can contribute towards economic recovery.
1.9 The need and demand for additional housing
continues to grow while delivery of new housing is currently at
its lowest level since the 1920s.[128]
The effects of the recession on the delivery of new housing have
been severe with a 46% reduction in annual housing completions
in the first quarter of 2010 compared to the same period in 2007.[129]
1.10 This under-supply has led to problems of
affordability, which have prevented many households from
having the opportunity to own their own home, and availability,
which has reduced the mobility of labour and constrained economic
development and growth. The Government is aware of this and it
is reflected in its own analysis; Open Source Planning notes
that "the country needs a major upswing in development
and construction as soon as possible".[130]
1.11 It is essential that positive action is
taken quickly by the Coalition Government to address these problems
and deliver the new housing that is so needed by so many communities
and that will lead the economy out of recession.
1.12 Recent market conditions, and to some extent
planning policies, have constrained developers' ability to bring
forward plans for housing delivery. This submission highlights
the scale of the challenge and suggests measures including early
action which if taken by the Coalition Government will help to
create the conditions which the housebuilding and development
industries require to deliver the Government's aspirations for
communities.
2. THE CHALLENGE
AHEAD
The Need for New Housing
2.1 It is widely accepted that we are not building
enough housing to meet the Country's needs and that the supply
of new housing must be increased. It is acknowledged that the
lack of supply is a significant contributor to social and economic
problems. Kate Barker's stark analysis in her Review of Housing
Supply in 2004[131]
was that "I do not believe that continuing at the current
rate of housebuilding is a realistic option, unless we are prepared
to accept problems of homelessness, affordability and social division,
decline in standards of public service delivery and increasing
the costs of doing business in the UK".
2.2 As an illustration of the challenge ahead,
in 2007, it was calculated that housing completions[132]
in England would need to reach 240,000[133]
per year if the objective of providing enough housing was to be
met. Even before the credit crunch, annual completions fell well
short of this requirement. The highest recent rate of completions
was in 2007-08 and totalled 167,000. Completions fell slightly
in 2008-09 and then sharply in 2009-10 when less than 134,000
new dwellings were completed. "Mind the Gap" estimated
that the shortfall of housing completions against identified need
could amount to one million homes by the end of 2010.
2.3 Clearly the potential supply of new housing
varies across England in response to market and physical conditions—for
example opportunities for major brownfield development are less
obvious in the south west of England than elsewhere.
Future Housing Need
2.4 Projections of medium and longer term housing
requirements confirm that need and demand for new housing are
likely to continue to rise for the foreseeable future. For example,
the ONS population and household projections[134]
project rising requirements for new housing. While the effects
of the recession and credit crunch have had some impact, for example
on levels of migration, it is clear that they have not affected
the major underlying drivers of recent increases in housing requirements—rates
of household formation, falling household sizes and people living
longer.
Summary
2.5 In summary therefore, the challenge facing
the new Government is how best to deliver the "upswing"
in construction and development over the short, medium and longer
term. The Government inherits a "backlog" of one million
homes and a supply of housing that does not match the type of
housing for which there is demand. Future housing projections
suggest requirements will rise but the planning system is not,
at present, well equipped to respond quickly to this need.
2.6 All this has happened at a time when the
housebuilding industry has undergone a major restructuring and
downsizing which leaves it with much reduced capacity to respond
to housing needs. It is, therefore, vital that action is taken
immediately to stimulate housebuilding and make the planning and
delivery of new housing simpler and more responsive to current
demand. In particular, action is needed to avoid the very real
risk that a transition to any new system of planning for housing
arising from the revocation of RSS will compound problems of under-supply.
The focus needs to be on increasing the supply of new housing
across all tenures.
3. THE COALITION
GOVERNMENT'S
PROPOSALS
3.1 In addressing the challenge of increasing
housebuilding activity, the Government proposes the "radical
reboot" of the planning system which The Conservative Party's
Green Paper: Open Source Planning called for.
Reforms of the Planning System
3.2 The analysis in Open Source Planning (and
earlier studies such as the Barker and Killian Pretty Reviews)
concludes that the planning system does not do enough to facilitate
development where it is needed and often adds disproportionately
to the timescales and costs of bringing forward development. Any
reform of the system should make it more efficient and help to
bring forward good quality and sustainable development more quickly.
3.3 It is clear that any new system will require
not just legislative time to become active but time to regain
the confidence of local communities and councils. Open Source
acknowledges that "tragically, the very idea that development
can benefit a community has also become a casualty" (of
mistrust in the planning system). Further reforms of the planning
system should provide clarity and certainty which can help to
restore confidence in the system—for communities and for
housing investors and home builders.
3.4 With the revocation of RSS it will be essential
that local councils, communities and the development industry
remain clear about what level of housing is expected to be delivered
in a particular area. In deciding how to proceed, the Government
should have regard to the longer term projections of population
and housing need which confirm the urgency of an increase in housebuilding
if the country is to avoid the significant social and economic
consequences highlighted by the Barker Review.
Delivering New Housing
3.5 Meeting Option 1 figures for delivery of
new housing will require a significant increase in current rates
of delivery. This, at a time when need remains high and demand
is increasing, but the main delivery agent—the housebuilding
industry—faces a dual problem of difficult market conditions
and significantly reduced capacity.
3.6 The Government's planned financial incentives
for the delivery of new housing could act as a powerful incentive
for councils to plan for more housing. In the longer term, the
proposed new system does have the potential to deliver housing
through a combination of a simpler local plan system and direct
local incentivisation of development. However, there is concern
that in the transition to this new system, particularly now that
the strategic housing requirements in RSSs have been revoked,
opportunities for good quality housing may be delayed and the
impacts of the economic downturn prolonged. Hence the reason why
we advocate the use of Option 1 levels as a minimum.
Local Development Plan Timescales
3.7 In previous systems, the absence of binding
timescales for adoption of development plans has added to uncertainty
and delays and frustrated development activity. The Government's
proposals for local authorities to complete local plans within
prescribed timescales will help, but experience in this area has
not been good.
Data and Research
3.8 In many cases, a considerable body of evidence
that would be relevant to a new local plan has already been gathered
and widely consulted upon. In order to avoid yet further delays
and costly gathering of new evidence, the existing evidence base
should form an essential component of whatever revised local development
plan system the Government proposes. There is no need to duplicate
work that has already been completed incurring unnecessary costs
for the public and private sector. In this context it is important
that measures are put in place to ensure that data and research
collated by the now abolished Regional Local Authority Leaders'
Boards is retained and updated for use all stakeholders. Responsibility
for this could rest with LEPs under a properly constituted framework
taking account of the possibility of a duty to co-operate and
being granted a limited planning function. The efficiency of such
a strategy is demonstrated by the success of "Joint Data
Units" following the abolition of a number of metropolitan
county councils in the mid 1980s.
Presumption in Favour of Sustainable Development
3.9 Open Source proposes that there should be
a presumption in favour of sustainable development after a Local
Development Plan is adopted. The introduction of such a presumption
in favour of sustainable housing would act to address both the
need to maintain and increase housing delivery as the country
emerges from recession and to provide an added incentive for communities
and councils to prepare local plans quickly. It is through this
mechanism that the issues set out above could be addressed.
3.10 Could a mechanism be put in place to enable
the presumption to be introduced ahead of the adoption of a Local
Plan? We believe it could. The presumption in favour could indicate
that local planning authorities should consider favourably proposals
which would help to meet local housing requirements and which
can be demonstrated to comprise sustainable development.
3.11 Sustainability Appraisals could be used
as a means of ensuring consistent assessment of the sustainability
of proposals for new housing. Sustainability Appraisal is a transparent
and objective tool for considering the overall sustainability
of a development which can be applied to individual planning applications.
The information contained in such an appraisal can be proportionate
to the scale and likely impacts of the development and could comprise
part of the information required to accompany a planning application.
Assessment of local housing requirements could draw on a range
of evidence including population and household projections, Strategic
Housing Market Assessments, economic growth plans and recent levels
of housebuilding in the area.
3.12 It is suggested that a Sustainability Appraisal
could be submitted alongside the Design and Access statement with
a planning application. It is already a requirement for most major
schemes. If it was viewed as robust by the Local Authority then
the presumption in favour of development would apply in respect
of the consideration of that application. If the Local Authority
did not consider it robust they would determine the application
as if the presumption did not apply but the applicant could appeal
and the Planning Inspector could come to his or her own view on
the Sustainability Appraisal and then apply the presumption or
not in coming to a decision. This provides a straightforward procedure
which enables the sustainability of a scheme to be tested.
3.13 This mechanism mirrors the sustainability
testing of the Local Development Plan but can be introduced immediately.
If the presumption in favour of sustainable housing development
is only introduced once councils have adopted new local plans
this risks further delay. Our observation, research and past experience
indicate that it will take between 24 to 36 months for a new system
to become embedded and working in practice. Meanwhile, on current
evidence, there is a clear prospect that councils will resist
or defer much needed housing development with the consequent serious
impacts on jobs, economic activity, labour mobility and the cost
and availability of housing. This would frustrate the Government's
aim of delivering an upswing in construction and development activity.
4. REQUEST FOR
ACTION
4.1 In conclusion, even before the effects of
the recent recession, the planning system has not been able to
deliver the amount or type of housing which our communities, our
economy and our society needs. By the end of this year, some commentators
have predicted that the shortfall against the levels of housing
we need will be one million homes. This has led to severe problems
of affordability, where a growing number of households are excluded
from home-ownership; and accessibility, where labour mobility
and economic growth are stifled.
4.2 The recent credit crunch and economic recession
have accelerated this problem. Reduced availability of credit
and economic uncertainty have constrained the demand for new housing
and reduced the housebuilding industry's ability to supply even
the amount for which there is demand.
4.3 With more stable economic conditions and
a positive and certain policy framework, the housebuilding industry
has the potential to deliver the housing we need and in doing
so create jobs and stimulate economic activity. As the economy
emerges from recession, housing demand increases and the Coalition
Government commences its "reboot" of the planning system,
it is essential that steps are taken to enable the industry to
increase the rate of new housebuilding and to boost the supply
of housing land. The Government's aim of delivering an "upswing"
in development and construction activity depends on this. An increased
supply of housing is essential if the Government is to achieve
its stated aims of delivering economic growth.
4.4 A new, simpler local plan system combined
with incentives for communities to deliver new housing could help
to boost housing supply. The proposed presumption in favour of
sustainable development which conforms to national environmental,
architectural, economic and social standards is also an important
measure in the delivery of housing. It would, however, be a concern
that if the introduction of such a presumption in favour is left
until after the introduction and adoption of new local plans and
a revised development tariff system, opportunities for sustainable
and much needed housing will be delayed at this critical time.
Preparation of a local plan is likely to take a minimum of two
years. If housing delivery is not increased in the meantime, this
will add to the current shortfall and compound problems of affordability
and accessibility rather than addressing them.
4.5 Such a presumption would make clear that
to be considered sustainable, a development would need to:
Comply with national policy contained in Planning
Policy Statements and Planning Policy Guidance notes;
Have been shown to sustainable through application
of an objective Sustainability Appraisal process;
Be subject to payment of any tariff in accordance
with prevailing local requirements; and
Have been subject to appropriate public engagement.
4.6 As such the Government should prioritise
the introduction of a presumption in favour of sustainable residential
development as an immediate step. If such a presumption was to
be introduced now, it is considered that the early positive results
would include the following:
Maximum delivery of good quality housing in areas
where it is needed at a time when the country is emerging from
recession and controls on public sector investment will be strict;
A powerful incentive for local authorities to prepare
new local plans in the minimum possible time scale;
Local members and engaged communities would quickly
adopt a positive approach to providing the development their areas
need;
Timescales for developments to come forward would
be radically reduced;
The resulting increase in housebuilding activity
would stimulate investment, boost local economies and create jobs;
and
New homes would help to address the significant national
shortfall and meet needs for affordable housing.
September 2010
128 Mind the Gap: Housing Supply in a Cold Climate.
A Discussion Paper by David Pretty CBE and Paul Hackett for The
Smith Institute, Town & Country Planning Association and PriceWaterhouseCoopers.
September 2009. Back
129
Housebuilding: March Quarter 2010, England. Communities and Local
Government May 2010. Table 1b. Back
130
Open Source Planning Green Paper. Policy Green Paper 14. The Conservative
Party. 2009. Page 11 Back
131
The Barker Review of Housing Supply: Delivering Stability: Securing
our Future Housing Needs. Final Report Recommendations. HMSO.
March 2004. Page 1 Back
132
Taking account of expected demolitions and changes of use Back
133
Homes for the Future : More affordable, more sustainable. Presented
to Parliament by the Secretary of State for Communities and Local
Government. July 2007. Back
134
Household Projections to 2031, England. Communities and Local
Government. March 2009 Back
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