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

Written evidence from Denton Wilde Sapte LLP (ARSS 100)


1.  The RSS system responded to a need for strategic spatial planning and was broadly fit for purpose. Its wholesale abolition discards significant evidence-based policy and investment by public, private and third sectors and undermines private sector investment in house-building.

2.  The transitional and replacement measures in relation to the role of the planning system in mediating housing supply are unclear and the proposed incentive system is unlikely to achieve its stated objective.

3.  Although the planning system is likely to become more contentious as a result of the mismatch between demand for housing and local desire to approve it, the policies that will guide decisions made on appeal are in doubt. As a result, there is a real risk that investment in new solutions to housing stress will not occur.

4.  We suggest that reforms to the development plan system should (paragraph 2.8, below):

(a)  require local policies to assess and address housing stress;

(b)  ensure there is a strategic framework for local decision-making; and

(c)  operate with the benefit of clear, detailed national guidance on the:

(i)  presumption in favour of sustainable development where the local development plan is out of date; and

(ii)  approach to be applied by decision-makers where there is either no or inadequate evidence of adequate housing land supply.


1.  Implications of the Abolition of Regional House-Building Targets for Levels of Housing Development

Purpose of Targets

1.1  The Regional Spatial Strategies were intended to provide a framework for private investment and public sector planning. RSS policies provided an evidence-driven, strategic focus for spatial planning decisions. The need for a regional tier of policy arose as a result of the difficulties experienced by local planning authorities in both dealing with strategic applications and putting in place a coherent planning framework to deliver major urban extensions. The RSS system was welcomed, initially, by both the development industry and third sector agencies with interests in conservation, sustainability and social justice.

1.2  Annualised house-building targets were intended to:

reflect evidenced housing need in defined Housing Market Areas;

address significant historic shortfalls in housing delivery holding back economic growth and affordability;

meet projected demand for new households in Housing Market Areas;

effectively compel planning authorities to identify and allocate appropriate levels of land for managed growth in line with strategic spatial planning objectives; and

assist local planning authorities and cross-boundary agencies in planning for growth and supporting investment in a "joined-up" way.

1.3  The Coalition Government recognises that growth in projected households has consistently exceeded housing supply over previous decades and has resulted in an unmet need for housing. The Minister for Housing suggested, in his answers to the Committee on 13 September 2010, that the RSS system had failed to address that problem.

Fitness for Purpose

1.4  The RSS evidence-gathering and testing process included public examination by appointed experts and public consultation. The "examination in public" provided an effective and fair opportunity for public involvement in the process. Aside from objections to the principle of development per se, annual targets proved controversial because they were very often increased at a late stage in the adoption process by central government. These changes were often driven by a policy-based desire to meet the demographic and econometric requirements identified in the CLG evidence base.

1.5  The way in which the RSS system was operated therefore exacerbated public perceptions that targets were either arbitrary or set without proper regard to environmental and other constraints. In many cases, the Secretary of State's "Proposed Changes" to the levels of annualised housing delivery recommended by the appointed Panels was in fact still substantially less than needed to meet the evidenced need. Research suggests that even if the RSS targets had been delivered, housing affordability would have deteriorated markedly by 2026 in all regions apart from the North East.[136]

1.6  The principal peaks in volume house-building of the last 100 years were driven by the Wheatley Subsidy and the large-scale public sector programmes of the 1960s. The RSS framework, backed by the house-building target, provided an equivalent stimulus to achieve a market-led step change in delivery during a period where public funds will become increasingly scarce.

1.7  Substantial public and private sector investment and third sector participation has already been committed to:

representations to the Panels appointed to consider the evidenced need for strategic growth, and to the Secretary of State;

engagement in the Local Development Framework process geared to meeting RSS objectives; and

land acquisition, scheme design and negotiation to meet RSS objectives.

1.8  The RSS system offered the potential to convert substantial public and private sector preparation over the past decade into:

a strategic approach to planning for, and distributing, development to meet social needs; and

a more certain environment for both public and private sector investment.

1.9  Although the RSS system posed questions about the timing of, and responsibility for, accompanying infrastructure delivery, it nonetheless provided a framework for the principle of, and broad locations for, growth. As such, it represented stimulus to investment that would have been broadly cost-neutral to the public sector over the next development cycle.

1.10  In our view, the RSS system was broadly fit for purpose and met a need for a coherent spatial strategic planning framework capable of providing greater certainty and efficacy of delivery for those requiring housing, those delivering it and those affected by decisions on its location and form. The RSS system was in fact coming into effect at the point it was abolished, as adopted or emerging policies for growth came to be applied to appeal decisions submitted in the 12 months before abolition (relating to schemes designed to respond to the need identified, and the framework set, by the RSS). Since abolishing this tier of the development plan system, the Secretary of State has overruled planning Inspectors advice to dismiss proposals for around 3,500 homes.

Consequences of Abolition

1.11  The Minister for Housing described the abolition of the RSS to the Committee on 13 September as the most significant governmental intervention in support of house-building since the Second World War. He suggested that house-building quantum will be the 'gold-standard' against which the success of the new system should be judged.

1.12  Conversely, the abolition of the RSS system is, in our view, a surprisingly wholesale and retrograde step which negates the value of significant professional input and expenditure from the public, private and third sectors. It has already had the effect of undermining the willingness and ability of the development sector to apply its creative and financial resources to deliver housing at a time when it is at a record low.

1.13  We believe that the post-RSS environment is a significantly more difficult one in which to deliver housing, due primarily to uncertainties about:

what scale of housing need is recognised in planning policy and what weight it should be given by decision-makers (particularly on appeal);

how strategic infrastructure will be funded and delivered; and

the role of, and guidance to, the Planning Inspectorate for determining housing appeals in the context of out of date development plans, housing stress indicators, inadequate delivery and local opposition to development.

1.14  We consider it likely that house-building quantum will suffer significantly as a direct result of the abolition of the RSS, the lack of a transition regime and the inadequacy of the proposed public sector stimulus package. Third sector organisations, such as Friends of the Earth, have also raised wider concerns about the risks of piecemeal development and outdated environmental policies.

1.15  The ability of the post-RSS system to deliver homes for future populations as well as the "local homes for local people" referred to by the Minister for Housing as the objective of the new arrangements will be its crucial test. It is difficult to see how a radical increase in delivery can be achieved without a clear framework that enables investors to commit resources to opportunities and engaging local people in the design process. Without the certainty provided by the RSS system, the development process is likely to become more contentious. The Minister of State for Decentralisation acknowledged in addressing the Committee on 13 September that there is entrenched resistance to development in many areas. That reflects the need for a genuine debate about the quality of many schemes, but also, in many cases, a resistance to the principle of development by existing residents. There is a real risk that parochial approaches will not only be unable to deliver the step change in provision necessary to address current and anticipated deficiencies in supply, but that they will actively prevent it. As such, we believe that investors are turning away from both projects and areas that now represent unquantifiable or highly uncertain risks, with wider implications for the delivery of housing and its associated economic benefits.

1.16  The Localism Bill will address some of these issues, but will inevitably raise as many questions. As such, the level of uncertainty is likely to increase. We believe the following are of particular relevance to the Committee's Inquiry:

the environmental, social and economic consequences of a strategic planning "gap" over the next two to five years;

the likely effect on investment and housing stress in localities, districts and counties that are unwilling or unable to create a clear alternative framework for appropriate growth;

the economic and social consequences of piecemeal delivery or no delivery at all;

the implications for development plan documents already adopted on the basis of RSS adopted or emerging levels of provision; and

the economic cost to the development sector of land acquisition based on adopted Government policy withdrawn without sector consultation (and the knock on effect on both investor confidence and housing delivery).

2.  Likely Effectiveness of the Government's Proposed Incentives

"New Homes Bonus"

2.1  The extent to which the Government proposals remain in draft represents a key barrier to investment in strategic land for housing. Currently, the only clear proposal for incentives is that announced by the Minister for Housing on 12 August 2010. We understand that the "tax-matching" scheme will be limited to six years and introduced through the forthcoming Comprehensive Spending Review. The Minister for Housing confirmed before the Committee on 13 September that:

(a)  no assessment of the number of homes likely to be delivered as a result of the tax matching scheme has been carried out

(b)  the only "Plan B" for the tax matching scheme, should local resistance to meeting housing need outweigh the (in our view, limited) financial incentive to approve applications, is to increase the level of matching.

2.2  An authority approving a development of 100 band D homes would, on the basis of current figures, be able to recover an additional £8,400 per house over six years. In our view, far from being a "powerful incentive", this is unlikely to incentivise local decision-makers to approve proposals that conflict with strongly-held local views on the principle of development. It will almost certainly not persuade those already living in locations that would be affected by growth to accept it. The bonus also raises the question of whether the demonstrable financial benefits of development should be given greater weight than local opposition to it.

2.3  There is a real risk that new arrangements displace the democracy of decision making by elected representatives using the expert advice with a system that may prioritise sentiment over sense.

Policy vacuum

2.4  The majority of development plans are out of date. The presumption in favour of appropriate forms of development in Planning Policy Statement 3 has assisted with the determination of strategic housing proposals during the past few years in which an unnecessarily complex and time-consuming local development framework process has made it difficult to operate a plan-led system.

2.5  Given the inevitable delay in legislating for and implementing a new system, clarity is needed on the proposed presumption in favour of sustainable development in the absence of up to date development plans should be clarified at the earliest opportunity, including the publication of clear guidance to local authorities and the Planning Inspectorate for applying the criteria.

2.6  The Minister of State for CLG suggested, in his answers to the Committee on 13 September, that the significance of the five-year housing land supply set out in Planning Policy Statement 3 will continue. He suggested that rigorously prepared housing land supply calculations would "trump" local opposition. Given the chilling effect that the abolition of the RSS (and the anticipated cancellation of other planning guidance) has already had on housing delivery, this should be confirmed in the Localism Bill and interim guidance.

Key Issues

2.7  We believe the Committee's Inquiry should consider the following:

the likely consequences of successful local opposition to all forms of major house-building over the next five to 10 years, in particular the cost and timing implications of the majority of strategic housing decisions being determined at appeal;

the experience gained from the implementation and cancellation of the Housing And Planning Delivery Grant in attempting to incentivise delivery;

the affordability of tax matching proposals and the effect of switching housing revenue account funding between different areas;

whether reliance on public funding to deliver housing in the current climate is likely to be successful and represents a cost-effective use of public resources compared to the system of regional targets; and

the extent to which the lack of a transitional arrangement within which investors can operate is likely to affect housing stress.

2.8  If the statutory development plan is to be a more concise and less prescriptive document, we believe it should still have the following characteristics:

a duty to:

assess requirements for housing in consultation with local people and providers (including identifying the appropriate housing market area); and

publish an annual housing stress report.

a requirement to:

reflect housing stress indicators;

reflect strategic housing market and housing land availability assessments which have been separately reviewed by an independent examiner and following public consultation;

make provision for at least 10 years' housing supply through (part of which is clearly deliverable in the short term and part of which is realistically developable in the medium term); and

where housing stress is sufficiently bad, to ensure a five year supply of available and deliverable sites.

include clear "sustainable development" criteria that protect the local interest in the quality of design and masterplanning.

2.9  The Government should clarify the following as a matter of urgency:

what housing need and supply data local authorities should use until they put new development plans in place;

how housing needs assessments will be tested to ensure they are "robust"' and what criteria should be applied in developing them;

how the Planning Inspectorate should consider housing land supply issues where the development plan is out of date;

the criteria for approving sustainable development which will be applied in the absence of an up to date development plan;

the role of Empty Dwellings Management Orders in bringing empty private sector properties into effective use as social housing to increase supply without increasing the existing development footprint; and

how strategic infrastructure will de delivered to match growth proposed by local administrations and when.

September 2010

136   More Homes for More People: Advice to Ministers on housing levels to be considered in regional plans (National Housing and Planning Advice Unit, September 2009). Back

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