Written evidence
from Arup (ARSS 110)
EXECUTIVE SUMMARY
(i) The design of a new system of planning for
housing will need to include a means of ensuring that:
locally generated housing levels meet national needs
in aggregate;
local politicians are given a good understanding
of the sub-regional context within which they operate, including
economic drivers, demographic needs, travel patterns, and housing
quality issues;
any incentives regime works within a broader spatial
policy framework to ensure that houses are built where they are
most needed;
effective cross-boundary working takes place, particularly
in Functional Urban Regions where high levels of population growth
are projected (see Figure 2 for the priority areas that we suggest);
there is a constructive interface with Local Enterprise
Partnerships, without giving them a primary planning function;
and
regional evidence bases of relevance to LDF preparation
are made available on dedicated websites for each region.
(ii) Local authorities should be required to
set up formal cross-boundary arrangements to ensure access to
technical expertise and credible interaction with private operators
on resource planning and management. The most appropriate spatial
scales are:
regions for minerals and renewable energy;
sub-regions for waste and flood risk management;
and
local authorities for green infrastructure.
INTRODUCTION
1. Arup is an international planning, design
and engineering consultancy. Its planners and economists have
regularly undertaken research commissions on behalf of DCLG, other
government departments and government agencies, regional and sub
regional bodies and local authorities over the last 20 years.
A former Arup Director had hands-on experience of the rigorous
independent testing stage in the preparation of Regional Spatial
Strategies (RSS) as a former Examination in Public Panel Chair.
2. Arup has in-depth expertise in the technical
aspects of energy, water, minerals and waste, ecology and landscape
and their relationship to public policy issues. It also has its
own horizon scanning capability and was involved in the Government
Office for Science's recent Land Use Futures Foresight study.
The implications of the abolition of regional
house building targets for levels of housing development
3. Although by no means perfect, regional house
building targets set through RSS provided a means of stepping
down national household projections to the sub-national level
while taking account of factors such as the needs of the regional
economy, affordability levels, housing market pressures and weaknesses,
availability of suitable land and adequacy of infrastructure (PPS3,
para 33). Within this framework regional bodies arbitrated between
bottom up local interests and national needs, and the results
of the independent testing process ensured that the pieces of
the jigsaw largely added back up to the national picture. The
fact that there was a shortfall rather than an exact match against
national household projections in published regional plans, particularly
in the southern regions, was a reflection of the discretion in
the system to take account of local circumstances. The challenge
under a new system will be how to ensure an equivalent measure
of coordination.
4. In constructing a new system it must be very
clear what the boundaries of local discretion are, otherwise there
will be false starts and delays in the process of adopting LDF
core strategies. One of the reasons why RSS turned sour in the
minds of many local councillors particularly in southern England
was that regional bodies, led by local authorities with inputs
from business and environmental interests were given the responsibility
from producing RSS—it was their plan.i It was
therefore considered unjust by many to have major modifications
(particularly in the area of housing numbers) imposed by the Government
in the final stages, in contrast to the previous system whereby
regions, largely through a voluntary collaborative process, had
produced "advice" and Government, taking account of
a wider range of national issues, had produced the final "guidance".
5. Without some form of externally mediated housing
target, it is vital that local politicians are given an understanding
of the bigger picture. Our work looking at the implications of
long term demographic and economic trends across England and the
scope for planning to "bend" these trendsii
is something that could usefully be updated as context for the
new system.
6. Some local authorities in high demand areas
with high levels of unaffordability (house price: income ratio)
will find that their local evidence base suggests higher housing
levels than they previously had under the RSS system. This is
because National Growth Areas and to a lesser extent National
Growth Points previously acted as "safety valves" in
accommodating national household projections. Ways will therefore
be needed to manage local expectations.
7. Local authorities may therefore need help
to understand the sub-regional context within which they operate.
These specialist skills will more readily be available in the
big city regions (in some instances such capability has been retained
eg the Tees Valley joint strategic unit). But many of the biggest
challenges will arise around freestanding cities where for example
new science-based economies are growing strongly eg Oxford, Cambridge
and York. Such cities are often under-bounded and are dependent
on their neighbours for the provision of sufficient housing opportunities.
The issues are exacerbated by demographic trends of counter-urbanisation,
which are placing greater housing market pressure in the rural
hinterlands of cities and city regions. Understanding the demographic
profile sub-regionally and identifying the most robust population
and household projections on which to base joint planning may
require new skills, as we are finding in our current advice to
York City Council and surrounding boroughs.
8. In addition to the issue of housing numbers,
it is also important there is a strategic cross-boundary understanding
of housing markets to inform wider housing policies and investment
strategies. Our work for the Northern Wayiii identified
the need for a city region wide perspective in relation to policies
on the type, quality, density and tenure mix of new housing, as
well as interventions to improve the quality of existing neighbourhoods
and housing stock. This is important to ensure that areas have
the right mix of housing in the right places in order to attract
and retain a skilled and creative workforce needed to drive a
knowledge economy.
Recommendation
Rec 1 Government guidance
should be provided, possibly through an update of PPS3, on the
broader parameters within which local authorities should set housing
levels within LDFs, the demographic basis that they should use,
and the supporting evidence required.
The likely effectiveness of the Government's 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
9. Current proposals are designed to incentivise
local authorities to allocate more housing land through LDFs and
to grant permission for more applications. This immediately raises
the issue of how the additional element over and above
what might ordinarily have been allocated or permitted could be
identified.
10. There are high risks that an incentive system
could lead to unrealistic expectations in the areas with fewest
economic prospects in the quest for housing-led regeneration.
In such areas incentives may encourage new housing in greenfield
areas with new occupants leaving empty properties in less desirable
areas (such as former industrial or mining towns), which could
then cause housing market weakness, dereliction and a downward
spiral. Alternatively the prospect of revenue income from incentives
could lead to additional housing provision on paper, ie in LDFs,
which does not get built because it is perceived to be too risky
a proposition by housebuilders.
11. To avoid this, incentives could be focused
on authorities most in need of additional housing, eg with the
worst affordability ratios. However this implies skewing of local
government finance towards more prosperous areas, particularly
in the South, which may be politically unacceptable.
12. It also begs the question as to whether such
incentives would have a large enough monetary value to overcome
perceived amenity disbenefits eg from congested infrastructure.
At the level of Council Tax receipts implied in the Conservative
Party Green Paper, we estimate that about 10-20% could be added
to Council Tax receipts for an average District in areas accommodating
about 350 units pa. However at a national total of some £1.5
billion pa this may be unaffordable to the Exchequer, and in any
case the majority of Council Tax receipt goes to County Councils
in two tier areas, whereas the planning incentive is needed at
district level.
13. There is also a need to consider how the
incentives in terms of retention of Council Tax receipts will
relate to other mechanisms that have previously been used. In
many areas, local authority support for housing growth has been
based on an assumption that substantial Government funding will
be provided for supporting infrastructure—this implicit
"deal" was a main feature of the Growth Areas and Growth
Points programmes. It remains to be seen whether the previous
consensus on the need to plan for growth in such areas is now
broken if programmes for infrastructure investment are scaled
back.
14. The prospect of levering substantial investment
from developers through Section 106 contributions has also acted
as an incentive to local authorities to plan for housing growth.
In more challenging market conditions local authorities are having
to reconsider what they can realistically demand from Section
106 agreements. This, alongside uncertainty around the future
introduction of the Community Infrastructure Levy will also act
to reduce financial incentives to plan for housing growth.
Recommendation
Rec 2 Any incentives regime
would need to work within a broader spatial policy framework to
ensure that houses are built where they are most needed. In order
to reduce public opposition, attention will also be needed on
issues such as raising design standards, locally generated funding
mechanisms for associated infrastructure improvements, and ways
of giving greater voice to supporters of new housing in the planning
decision process.
The arrangements which should be put in place
to ensure appropriate cooperation between local planning authorities
on matters formerly covered by regional spatial strategies (eg
waste, minerals, flooding, the natural environment, renewable
energy, &c.);
15. The numerical guidance previously provided
in RSS on several of these technical issues was an important means
of delivering against international and national targets. It is
therefore in the Government's own interests to ensure meaningful
coordination at the most appropriate spatial scale for each issue.
16. For minerals and renewable energy there could
be merit in retaining a regional framework, whereas a sub-regional
basis may be appropriate for waste and Flood risk management.
We envisage green infrastructure for the most part being dealt
with by individual local authorities. It is also vital in our
opinion to acknowledge that major infrastructure needs, eg adequacy
of power supplies, grid connections and water supply, must be
understood at a strategic scale, such that utility companies can
build up a picture across their operating areas of where major
development is likely to take place.
17. Minerals: a mechanism is needed to
ensure that extraction particularly of construction materials
is achieved at sufficient rates to meet demands often occurring
in different parts of the country. The extent to which recycled
materials can substitute for primary crushed rock and aggregates
is also needed. This first process involves involves a national
top-down perspective and the second a bottom-up perspective. Hence
the regional level with Regional Aggregate Working Parties as
the mediating body has been found to be a useful working level.
There is no reason why these bodies should not continue their
work.
18. Waste: a mechanism is needed to negotiate
sufficient disposal capacity in the hinterlands of the major conurbations
and under-bounded cities while alternative waste management processes
to enable greater degrees of city self-sufficiency are brought
on stream (as driven in part by European legislation). Whilst
the landfill tax provides a powerful financial incentive for local
authorities to work together to plan proactively for provision
of municipal waste facilities, no similar incentives exist on
planning for commercial or hazardous waste facilities. An inter-regional
area may be the most logical spatial unit to plan for requirements
in Greater London and the Home Counties, whereas a sub-regional
arrangement may be appropriate around the main conurbations in
the North and West Midlands.
19. Renewable Energy: a mechanism is needed
to step down from national targets set out in international agreements
to a sub-national level such that groupings of local authorities
know what level of renewable energy they would be expected to
provide, as context for determining planning applications. Useful
lessons can be drawn from experience in Wales whereby national
guidance is provided on the scale of need together with clear
spatial expression where appropriate, such as the strategic search
areas for on-shore wind.iv Arup has advised the Welsh
Assembly Government on this topic for many years.
20. Flood Risk and Coastal Protection:
this is adequately built into LDF preparation via Strategic Flood
Risk Assessments. However there is a need for a cross-boundary
perspective because water catchments and coastal systems cut across
local authority boundaries. In some areas (eg Hull) the solution
to flood risk may be upstream catchment management measures in
another local authority. The Environment Agency would be in a
good position to commission cross-boundary evidence collection
in areas where more widespread flood risk issues need to be tackled,
working with the Flood and Coastal Risk Management partnerships
that have been created as a result of the Pitt Review and the
Water Management Act.
21. Green Infrastructure: policies for
protecting and enhancing the natural environment are well embedded
into the local planning system. However understanding the value
of land in providing ecosystems services is continuing to progress,
as elaborated in the recent Land Use Future's report.v
Natural England is in the best position to input this thinking
into plan making and to lead cross-boundary work on projects of
wider than local significance.
Recommendation
Rec 3 The Government should
require local authorities to set up formal cross-boundary arrangements
at a broad enough spatial scale to allow technical expertise to
be brought to bear on resource planning and management and to
allow credible interaction with private operators.
The adequacy of proposals already put forward
by the Government, including a proposed duty to co-operate and
the suggestion that Local Enterprise Partnerships may fulfil a
planning function; and
Proposed duty to cooperate
22. Our previous research for DCLG on optimum
geographies at the sub-national scalevi suggested that
the sub-regional level was critical to understanding functional
economic relationships and hence should inform planning for housing.
It is also the level at which authorities are encouraged to collaborate
through setting up Integrated Transport Authorities.
23. There are already good examples of local
authorities cooperating voluntarily eg the Greater Norwich Development
Partnership where local authorities are cooperating on a joint
LDF core strategy. In and around Cambridge the local authorities
have successfully set up a joint think tank and delivery vehicle:
Cambridge Horizons.
24. The issue is whether the proposed duty to
cooperate, together with self-interest in seeking efficiencies
in planning and possibly other local government management areas,
will be strong enough or whether additional proactivity from the
Government will be necessary. We have some reservations about
whether voluntary sub-regional partnerships will have the capacity
or political will to tackle controversial planning issues around
housing growth, eg involving a selective release of Green Belt
in an authority area adjoining the main driver of demand.
25. Additional guidance may be needed from national
Government on the planning imperatives for joint working in particular
parts of the country, in that the Government Offices for the Regions
will no longer be there to provide that positive steer. We put
forward our suggestions on priority areas for collaborative working
in Figures 1 and 2. These are based on identifying local authorities
where population growth is projected to be highest following past
trends, together with those locations with journey to work areas
that extend over several local authorities (termed Functional
Urban Regions). The greatest need for joint working on housing
growth is where both these patterns overlap (see the names in
bold type on Figure 2). Where lower levels of population growth
are projected within these Functional Urban Regions there would
still be strong case for collaborative working on other topics,
particularly transport.
26. If the decision on whether to cooperate is
left entirely to local authorities there is a risk that important
relationships are missed, such that the Inspector examining a
particular draft LDF core strategy may find the locally agreed
housing provision unsound, hence perpetuating a policy vacuum
for housebuilders and leading to decision-making "by appeal".
Recommendations
Rec 4 Guidance could usefully
be provided by Government on the types of circumstances in which
it is crucial to cooperate in order to take account of the interrelationships
between housing, economy and transport.
Rec 5 Government guidance
would also be useful on the merits of different vehicles for cooperation
ranging from joint statutory committees (as the London Planning
Advisory Committee was constituted after the abolition of the
GLC), to looser strategic planning partnership approaches eg through
the Leeds City Region Partnership.
Local Enterprise Partnerships
27. LEPs are intended to be slimline business
orientated organisation to give confidence to the private sector
to invest in projects that are strategically important to the
economy. Extending RDA responsibilities into the spatial planning
arena was not generally successful, since delivery and plan making
are different skills. In our opinion the function of LEPs should
not be complicated by giving them a primary planning function.
28. Constructive roles in which LEPs could interface
with the planning system would be:
articulating barriers to economic growth which can
be dealt with through planning, eg emerging shortages of employment
land, or labour supply issues that are related to the housing
stock or quality of place;
informing the economic evidence base for LDFs; and
identifying infrastructure bottlenecks with economic
consequences, and where necessary acting as a conduit in joint
investigations with utility companies.
Recommendation
Rec 6 Local authority
planners and LEPs should work together to ensure that policy is
coordinated in order to provide a framework to guide public investment
programmes such as on regeneration and affordable housing by the
Homes and Communities Agency.
How the data and research collated by the now-abolished
Regional Local Authority Leaders' Boards should be made available
to local authorities, and what arrangements should be put in place
to ensure effective updating of that research and collection of
further research on matters crossing local authority boundaries
29. Valuable data sets have been assembled largely
through Regional Observatories. Extensive research has also been
commissioned by Regional Leaders Boards and their predecessors
and the RDAs. These must continue to be available as context for
LDF preparation. Some aspects will become part of the evidence
base for LDFs, but evidence needs careful interpretation.
30. Many smaller local authorities will not have
access to specialists in critical areas like demographics, economic
forecasting, renewable energy. They may need help in understanding
data sources and engaging in scenario building exercises to examine
uncertain economic futures. Our guidance on strengthening the
economic evidence for regional plans prepared for ODPM could usefully
be reinterpreted for use by groupings of local authorities in
LDF preparation.vii
31. Joint funding solutions probably based on
local authority contributions will be needed for the storage and
updating of regional data and research resources, possibly brokered
through the regional branch of the LGA. Greater understanding
of the value of existing data should build momentum for the case
to maintain it.
Recommendations
Rec 7 Awareness raising
exercises could usefully be organised by the regional branches
of the LGA on the resources available from previously assembled
regional evidence bases, how to access them, and how to interpret
them for a particular locality.
Rec 8 The databases and
research studies should be available on an easily distinguished
dedicated website for each region, rather than be subsumed in
the National Archives website with its inadequate search facilities.
REFERENCES
i Evaluation
of the Role and Impact of Regional Assemblies,
see section 4.4, Arup for DCLG, 2007. Available at:
http://www.communities.gov.uk/publications/localgovernment/evaluationrole
ii Regional
Futures: England's Regions in 2030, Arup
and Oxford Economic Forecasting for the English Regions Network,
RDA Planning Leads Group, ODPM and DfT, January 2005. Available
at:
http://southwest-ra.gov.uk/media/SWRA/RSS%20Documents/Technical%20Documents/Regional_Futures_Report.pdf
iii The North's
Residential Offer: Policy and Investment Review,
Arup for Northern Way, 2006. Available at:
http://www.thenorthernway.co.uk/document.asp?id=471
iv Planning
Policy Wales Technical Advice Note (TAN) 8: Planning for Renewable
Energy, see Annex D for a potential methodology
for local authorities within Strategic Search Areas based on Arup
research. Available at
http://wales.gov.uk/desh/publications/planning/technicaladvicenotes/tan8/tan8main2e.pdf?lang=en
v Land Use
Futures: making the most of land in the 21st century,
Government Office for Science, January 2010. Available at:
http://www.foresight.gov.uk/Land%20Use/luf_report/8507-BIS-Land_Use_Futures-WEB.pdf
vi Planning
and Optimum Geographic Decisions for Economic Decision Making:
The Sub Regional Role, Arup for DCLG,
2008. Available at:
http://www.communities.gov.uk/publications/planningandbuilding/planningoptimal
vii Guide to
improving the economic evidence base supporting regional economic
and spatial strategies, Arup for ODPM,
September 2005. Available at:
www.communities.gov.uk/documents/planningandbuilding/pdf/325633.pdf
September 2010
| 
