Abolition of Regional Spatial Strategies
Memorandum from Catesby Property Group (ARSS 105)
Summary
Revocation of Regional Strategies; Planning is essential is every geographical level. The removal of regional planning has created a gap which will need to be filled, either from the top down or the bottom up. Without some form of strategic planning it will need to be re-invented.
Lack of transitional arrangements: The loss of regional planning, although damaging in its own right has been exaggerated through the lack of any proper planning for the change. The absence of transitional arrangements has led to a dangerous vacuum whereby confidence in the system has been lost and vital investment is being undermined.
Lack of co-ordination: Planning is important to bind policies together. Without co-ordination there is a strong likelihood that there will be a waste of resources, overlapping roles, gaps in provision and chaos in implementation. In housing, the sum total of housing provision has to fit together to form a jigsaw, otherwise peoples needs will remain unmet and younger people and those in need will be priced out of the market.
A stimulus for investment: The private sector also needs a clear framework within which to operate. The public sector needs to work to a plan to deliver infrastructure. Without proper planning there will be insufficient confidence for business to invest. Recent changes have created chaos and confusion which has totally undermined business confidence and lost vital income for businesses and the Exchequer.
Incentives for development: The ‘jury is out’ over whether the New Homes Bonus will be a stimulus or a restraint on growth. Essentially, the impact will only be felt when the effect of the cutbacks from the Comprehensive Spending Review are realised. However, there is no guarantee that homes will be provided where they are needed under the proposed regime. There must therefore be a twin track approach based on a needs based as well as an incentive based method for determining housing targets.
1. Background.
The Government originally signalled its intention to abolish Regional Spatial Strategies in the Conservative Party ‘Open Source Planning’ Green Paper No 14, issued early in 2010. This ambition was carried through to the Conservative Party Manifesto in April 2010 which then formed part of the Coalition Agreement reached between the Conservative and Liberal Democrat Parties after the General Election in May 2010. The Green Paper justified the change on the grounds that the previous planning system was ‘broken’ and undemocratic. I believe that the changes were based on a false premise and that the planning system – although complex, bureaucratic and long-winded - was not fundamentally flawed and could have been streamlined through evolution rather than revolution.
The abolition of the ‘regional tier’ was intended to be consistent with a ‘localist’ approach where decisions are made from the ‘bottom up’ (based on the decisions of local communities) rather than from the ‘top down’ by what were perceived to be unelected and unaccountable regional bodies. This change underlies the new Government’s philosophy of community-led planning. This is a laudable aim, but not an original one. Local participation has been a basic element of the planning process for at least 40 years. In truth, planning must be a combination of ‘top down’ advice and ‘bottom up’ aspiration if the system is to work efficiently and effectively.
Following the formation of the Coalition Government in early May, the Secretary of State announced on 6th July 2010 that all RSS’s had been revoked. The statement was backed by advice from the DCLG posing (and then answering) various questions about the implications of the revocation of RSS’s. The Planning Inspectorate also issued advice to Inspectors indicating how cases should be handled in the light of the Government’s new approach. However, this left a huge vacuum caused by the absence of any transitional arrangements and hence created confusion and chaos. Contrary to normal practice, there was no prior consultation or discussion about the merits or the implications of abandoning Regional Strategies, nor has there been any advice to deal properly with existing planning applications, appeal cases currently in the pipeline or emerging Local Development Plans.
The Government has made it clear that in the absence of ‘top down targets’, local authorities are free to make their own decisions about the appropriate level of housing provision, subject to future testing of LDF’s for soundness, and hence they are not bound by previous targets either within emerging (or even adopted) Regional Plans. Essentially, this represents a retrospective change to planning policy and hence many local authorities are now taking a step backwards to review their plans, or holding fire until central guidance is more clear. The base requirements for calculating 5 year housing land supply is no longer clear, so that both developers and local authorities are in a state of confusion.
Government Ministers have argued that the previous ‘hierarchical’ system based on consistent housing targets which ‘cascade’ downwards from national, to regional, to local level was over-complex and created tensions between local communities and regional bodies. They have now indicated that this process will be replaced by a voluntary system of development incentives, whereby local authorities are encouraged to welcome housing through Government subsidies, equivalent to multiples of Council tax – for building more housing – but the details of this scheme have yet to emerge and will not become clear until after the Comprehensive Spending Review in October – and maybe not until the ‘Localism Bill’ is enacted.
Consequently, having taken 30 years to build up the strategic planning system, and perhaps 3 years to prepare each Regional Plan, it has taken literally 3 months to abandon the whole process and create a situation of complete paralysis in the planning system.
2. Key concerns.
A hiatus in planning: The immediate impact of the decision to revoke Regional Spatial Strategies has been to throw the planning system into total chaos. Local authorities are no longer clear what advice, if any, they should follow and developers are now being unfairly prejudiced by the decisions of some local authorities to review their housing targets, to reduce their ambitions and to renege on previous commitments. Above all however, the undue haste in revoking RSS’s has created a complete vacuum causing inevitable delay and uncertainty for both developers and local communities. Without firm advice, with no Transitional Arrangements and with details of the New Homes Bonus still yet to be announced, most local authorities have simply deferred making any decisions until the implications are more clear. So for the time being, the planning system is at a standstill.
The impact on meeting needs for homes and jobs: The decision to revoke RSS’s has had a predictable response by those authorities who, for local political reasons, would prefer to reduce their scale of housing development. Studies by consultants in the south west of England have shown that some 60,000 new homes have been wiped from local authority plans in that region at a stroke. This trend is being replicated throughout the country. The HBF has indicated that at least 100,000 homes will be lost as a consequence of the decision. Already some appeals have been over-turned purely on the strength of the abolition of RSS’s, (including a key decision promoted by our own company where a mixed use development proposal including 400 homes, recommended for approval by an independent Inspector has been dismissed by the Secretary of State). This will have a tangible impact on future housing delivery as well as undermining local economic investment. The evidence of history (and psychology) is that, given the choice, Council’s rarely welcome development where this will create local political tensions, so a huge reduction in delivery of new housing, including affordable housing is inevitable.
The loss to the wider economy: The Coalition Government’s over-riding objective in the first few months of its Parliamentary term has been to limit public spending and reduce the financial deficit. At the same time, the Prime Minister has clearly indicated that he wishes to see a new stimulus to revitalising the private sector. Yet the immediate effect of the decision to revoke RSS’s (and abandon strategic housing targets) had been to stifle development, both in the short, medium and longer term and to dissuade developers from undertaking future investment. At a time when Government wishes to encourage and incentivise private investment, this seems completely inconsistent and counter-productive. The direct consequences, for example, of dismissing our appeal (against the advice of the Inspector) will be to lose a substantial number of jobs (and thereby tax income), lose investment in jobs (and hence corporation tax income), lose Capital Gains tax from the land sale, lose Stamp Duty income from the land purchase and the individual home sales and to lose all the benefits from the S106 package – including 120 units of affordable housing and contributions to the local health, education and leisure services. This represents a major loss to both the national and the local economy.
The need for certainty and clarity: House-builders, developers and investors necessarily have to make decisions over the long term (both with landowners and in the promotion of land) and cannot risk sacrificing effort and investment on schemes which will not materialise. Communities also require some certainty is knowing how much, when and where development is likely to occur, whether as future occupiers, investors or neighbours. Projects require funding which must be based on a calculated degree of certainty and clarity of future policy. The development industry, which has already been extremely hard hit by the economic recession, (and is still suffering as a result of the credit crunch and the inability of many potential buyers to obtain mortgages), relies on a proper and professionally run planning system which offers clarity and certainty. The recent changes have prejudiced both developers who may now have to abandon schemes in the pipeline and communities who will lose badly needed homes and jobs.
The need for consistency and co-ordination: The absence of any proper transitional arrangements and the decisions by authorities to reduce their housing output are creating a yawning gap between what should be provided (as measured by objective indications of need – such as household projections) and what may be provided, if and when local authorities ultimately produce their Local Development Frameworks. It is also creating an arbitrary distribution of development without any strategic overview and therefore no co-ordination between authorities to determine whether wider needs are being met – or whether the sum total of provision adds up to the whole – either at sub-regional, regional or national level. The previous system of hierarchical planning had the advantage of ‘controlling’ housing totals to regional aggregates to ensure that delivery conformed to a wider ‘vision’. In future, the delivery of housing will be parochial, sporadic and largely unplanned – so that any co-ordination will be accidental rather than appropriately planned. Put simply, the jigsaw will not fit together.
The uncertainties of the New Homes Bonus: In future local authorities will be encouraged to build more homes through attracting a cumulative financial incentive – based on multiples of Council Tax. This may persuade some authorities to promote more building, but there is no guarantee that those authorities tempted to encourage housing will be those where homes are needed. Financial incentives do not always produce the desired effects in terms of planning outcomes. Those high demand areas where homes are urgently required and where house prices are already high, may tend to ignore the incentives resulting in a mismatch between need and supply, thereby exaggerating price differentials. In general, local people tend to welcome housing, in theory, since they are aware homes are needed, but resist housing in practice. The new system will not overcome that pattern. Furthermore, it seems likely that local people will be sceptical about the ‘bait’ of additional Council funding, unless they are sufficiently public spirited and ‘socially aware’ to appreciate the merits of additional infrastructure. Arguably, it creates the illusion that ‘development is bad’ and that incentives are necessary to encourage people to accept it – rather than viewing development as an essential tool in delivering prosperity and meeting peoples legitimate needs.
The creation of Local Enterprise Partnerships: Whilst the creation or more local initiatives may have some powerful merits. We are not altogether convinced that the loss of established links and business support functions will help to boost investment – which is not necessarily locally focused but could (depending on the size of the operation) be locally, regional or nationally significant. Current emphasis appears to be focused on simply dismantling what previously existed to remove any vestiges of regional influence – this is wasteful and counter productive. In practice, investment and enterprise may be stimulated at all geographical levels and therefore there is no magic advantage in removing regional Development agencies and replacing them with Local Enterprise Partnerships.
The loss of monitoring, coordination and data collection: One of the first actions of the Coalition Government was to abolish the Regional Planning Bodies, the RDA’s and the National Housing & Planning Advice Unit. The Government Offices will be closed very shortly. Whilst there is little purpose in maintaining staff without a regional planning role, it is important to continue to collect statistics, monitor progress and measure achievements against pre-determined objectives. Without monitoring there is little purpose in planning. There is therefore a deep concern that vital evidence which will be necessary to judge the merits of proposals, record progress and measure achievement (for example housing land supply) is in danger of being lost. Unless consistent time series are maintained, statistics will become meaningless. Unless projections and forecasts are made, planning will simply operate within a vacuum. Past information is important in projecting future needs. The data sources within the Regional Offices must therefore be kept.
3. The way ahead.
Clear guidance: It is essential that planning guidance is established or re-affirmed to provide a clear basis for decision making. A national planning strategy is long overdue, but this will need to have a regional – and possibly also a sub-regional dimension to fill the gap lost by Regional Spatial Strategies.
Confirming broad policies and objectives for the delivery of housing is essential, including ensuring that local authorities maintain a suitable ‘portfolio’ of housing sites, through establishing, at the very least a 5 year supply of housing land. This in turn will require clear advice on formulating housing numbers, since the 5 year target requires suitable benchmark against which supply is measured. This is turn necessitates ensuring that there is an appropriate evidence based approach to housing.
Determining housing targets: Whether housing numbers are reached from the bottom up or the top down, they must be derived from reliable and up to date evidence sources and be logical and consistent with those Districts around them. ‘Localism’ should not mean ‘parochialism’. Leaving local authorities (who have not previously taken responsibility for determining housing numbers) without some guidance is tantamount to putting the inmates in charge of the institution! In practice, established sources such as Housing Market Assessments and Housing Land Availability Assessments – unwieldy and unreliable as they may be – will continue to have a role. But the house-building industry, with its experience and interest will need to have an input too. It would be irresponsible to simply leave decision making to the whim of local politicians without the help of evidence and advice.
Planning ahead: The present system of Local Development Frameworks is complex and unwieldy. It needs to be simplified and streamlined to ensure that local authorities can establish a clear vision and blueprint for their areas – albeit with adequate flexibility to allow for unexpected changes, initiatives and ideas. The past progress with LDF’s has been abysmal. The loss of RSS’s removes one of the important keystones of the planning system meaning the local plans are all the more important. There must be a clear and up to date baseline for calculating 5 year land supply figures with scope for authorities to allow additional homes if needs allow. The concept of ‘localism’ must not be allowed to frustrate the preparation of forward plans – without proper planning we face chaos, confusion and ultimately anarchy.
Involving the local community: Public consultation and participation have been at the heart of planning for nearly half a century. The public expect their local politicians to deliver homes, jobs and services efficiently, effectively and equitably – without fear or favour. It is not the role of politicians to stifle development purely to pander to specific interest groups or to support local resistance based on a ‘not in my backyard philosophy. To do so, simply allows planning to return to the law of the jungle! The concept of localism must therefore be interpreted as a positive approach whereby local people are encouraged to engage in planning, both in determining the scale, form and direction of growth and in contributing to the pattern of change. But it is not sensible, fair or equitable to allow the public a veto over plans and schemes which have been promoted, tested and adopted – simply to stop unwelcome development or court political favour. The concept of ‘localism’ therefore needs to be clearly defined.
Promoting investment: Clarity and certainty is a vital ingredient of investment. Incentives may also help, but businesses can only plan ahead if they are convinced that there is a profit to be made and a market to exploit. The recent changes have been hugely counter-productive. The emphasis on Local Enterprise Partnerships must therefore be supported by national (if not regional) backing to ensure that businesses thrive and investors (especially in the development industry) have the confidence to invest.
Monitoring and information: There must be a reliable library and/or data source which can underpin decisions, otherwise debate will be unstructured and uninformed, with opinions, taking over from empirical evidence. This means protecting existing data sources and encouraging the continuation of organisations who can provide objective sources of statistics, projections and evidence which is supported and trusted by all sides.
September 2010
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