Abolition of Regional Spatial Strategies

2 . 3 The TCPA believes that on the whole the regional planning approach established in 2004 ha d substantial benefits to the delivery of sustainable development in England . However, the boundaries of these regional plans , particularly in southern England , were sometimes unhelpful and their connection to the community and business sectors , as well their democratic accountability , needed urgent reform.

2.4 The overall TCPA conclusion is that while change was necessary the outright revocation of RS was not in the public interest. This conclusion is based both on the process of how RS were removed without adequate transitional arrangements and on the substantive impact that the removal of the regional tier will have on addressing important issues such as housing and climate change. Our evidence seeks to explore both of these issues.

3 .0 The Process of revoking Regional Strategies (RS)

3 .1 The Secretary of State for Communities and Local Government (CLG) effectively revoked RS in a letter dated 27 th May 2010. The letter stated that local authorities were no longer required to have regard to regional housing figures. It was made clear that RS would be abolished in the forthcoming Decentralisation and Localism Bill, but that in the interim RS have ceased to be an effective part of the English planning framework outside London. The regional planning bodies responsible for RS have been quickly disbanded.

3 .2 Since the letter on 27 th May 2010 was issued there is not yet an effective transition plan in place to deal with the uncertainty inevitably caused by the removal of the RS. Under the 2004 Planning Act , RS and the Local Development Framework (LDF) are two parts of the same development plan (see section 38 (3) of the 2004 Planning and Compulsory Purchase Act). The RS sets much of strategic context for the LDF and LDF s should not, according to Government guidance in PPS 12, repeat RS content. In reality much of this strategic context comprised research, data sets and strategic allocations on housing and energy which formed both the evidence base and shaped the direction of LDF policy. The revocation of RS, therefore, not only removed one half of the legally defined development plan , but it compromised the basis for much of the remaining LDF policy. Adopted LDFs are now subject to potential challenge and those in preparation will require urgent review. It is unsurprising, therefore, that both legally and pragmatically the letter of 27 th May 2010 created uncertainty for those preparing and implementing LDFs. We are aware that the preparation of some LDF frameworks has been halted until there is greater clarity on the detail of the reform package. The scale of this delay is illustrated in the TCPA and Cushman and Wakefield ’s recent sample of local a uthority opinion, where approximately 46 per cent of respondents said they expected the revocation to result in delays adopting their core strategy. [5]

3 .3 We believe the uncertainty created for communities and for business after the letter of 27 th May 2010 has been damaging to the achievement of plan coverage and to process es of systematic evidence gathering.

3 .4 There is a secondary legal concern to the revocation of RS around the need for a n adequate equalities impact assessment ( required under the 2010 Equalities Act ) , of the consequences of implementing the ‘ Open Source Planning ’ policy document , which may lead to legal challenge. Legal challenges are already under way by private sector interests seeking to defend RS development allocations [6] .

3 .5 Regional planning bodies held immensely important data sets which need to be kept to inform the LDF process. While CLG has since made clear the need to make this data available in a letter from the Government’s Chief Planner to all Local Authority Chief Planning Officers on the 6 th July 2010 [7] it would have been helpful to agree common approaches before the 27 th May 2010 letter. As a result , different regions are taking differing approaches (For example the East Midlands RS evidence base will be held by Nottingham Trent University , t he South West data will be held by the British Lib r ary ). While existing data may be saved through these ad hoc agreements there is no compulsion for any local authority to have regard to it in formulating new plans. Neither is the existing data always available in a form which is disaggregated and therefore useful to a local authority . Most importantly , there are no arrangements for this information to be periodically refreshed and therefore its usefulness to local planning is limited.

3 .6 The loss of planning expertise is also a significant issue. The TCPA does not argue for planning jobs for their own sake , but it is important to note that some of most able strategic planners with key expertise on issues such as climate change were working at the regional level.

3 . 7 There does not appear to have been i nter-department cooperation and understanding of the consequences of the revocation of RS and regional planning bodies. For example, the Department for Energy and Climate Change (DECC) are continuing to fund regional energy capacity studies despite the fact that there are no regional planning bodies to implement them. While it is true that local authorities have access to this data it is not clear that DECC were fully aware of likely negative impacts of revoking RS on the delivery of renewable energy.

3 . 8 It is important to highlight that historically the normal approach to planning reform (for example in relation to the 2004 Planning Act) is to leave current arrangements in place while a transition is made to new system. In the interim clear timescales are set for the changes in order that a measure of certainty is created for all parties.

4 .0 The Substantive impacts of the Revocation of RS

4 .1 Housing

4 .1.1 The removal of RS and the associated abolition of the National Housing Planning Advice Unit (NHPAU) will have a substantial impact on the way housing needs are forecast and provided for through the planning system. In short, a nationally organi s ed and regionally and locally expressed housing regime based on targets has been replaced by exclusively local consideration of housing needs. ‘ The Future of Planning Report’ concluded that the consequences of these measures would be a significant ‘under provision’ of housing because local housing needs assessments may not adequately consider international, national and regional housing pressures.

FIGURE 1. Existing and future processes for planning for housing in England

+ Latest 2008-based population projections for England on 27 May 2010

* Latest housing projections for England to 2031 on 11 March 2009

4 .1.2 The impact of the removal of the regional tier contained in the Secretary of States letter of 27th May 2010 and the subsequent abolition of the NHPAU means there will be the following uncertainties until further detail is given on how local housing need will be assessed :

1. There is uncertainty about the linkage between nationally collated demographic data sets and local authority housing needs assessments.

2. There is no national derived target mechanism to deal with overall housing needs or particular social housing needs

3. There is no mechanism for dealing with needs of particular ethnic groups who have distinctive housing needs such as travellers

4. There is no mechanism for apportionment of international, national or inter regional demographic change

5. There is no mechanism for the relocation of housing pressures from areas of high demand and limited capacity to areas of greater opportunity.

4 .1.3 The Government has suggested a range of solutions based around financial incentives to deliver more housing which are discussed in section 6. However there is clear evidence not only that the system will not meet future housing needs but that existing planned provision is being taken out of the system. Research carried out by Tetlow King Planning, found that the revocation of RS had a "very significant impact" on reducing local authority house building targets. The research commissioned by the National Housing Federation (NHF) found that the Government’s decision to allow councils to no longer consider the regional targets has resulted directly or indirectly in plans to build 84,150 homes being dropped [8] .

4.1.4 While only a short time has elapsed since the revocation of RS there is now little doubt that the measure has had a significant short term impact on our ability to understand, plan for and deliver the housing vital to the well being of our communities.

4 .2 Climate change

4 .2.1 Spatial planning has a major role to play in dealing with climate change. The regional tier set carbon dioxide reduction targets, renewable energy generation targets and climate change adaptation objectives. It allowed for a strategic approach to flood risk which inevitably has cross border impacts. In some regions such as the East Midlands and East of England it was the key forum for data collection and a strategic response to sea level rise.

4 .2.2 Planning for renewable energy also illustrates the potential challenges with the revocation of RS , particularly in terms of linking our EU obligations which flow out of the Renewable Energy Directive [9] with the detailed implementation at the local level. Local authorities and the town and county planning regime have responsibility for all energy projects under 50 megawatts. Regardless of market incentives to invest in renewable energy no project can take place until final development consent has been provided through the planning process. The planning system is therefore the final gateway and as a result the key enabler in achieving a low carbon energy future.

4 .2.3 The diagram below provides a comparison of the old RS process and the ‘Open Source Planning’ regime. At present, there is a gap between EU and national aspirations and local delivery which raises some important issues :

· What will be the mechanism to ensure local authorities meet the Renewable Directive target regime?

· How will local authorities respond to the obligations of the Directive if they have significant environmental constraints?

· Local authorities will have different constraints and capacity for approaching renewable energy and will need to cooperate with each other in order to overcome their different positions.

4 .2.4 While the potential of the ‘duty to cooperate’ to solve these issues is dealt with below it is important to note that onshore wind is both vital to our achievement of a low carbon economy and locally very controversial. It is unlikely that many d istrict councils would, unsupported, have the planning skills base or political will to respond to the pressing need for the expansion of renewable energy.

FIGURE 2. Existing and future processes for planning for renewable energy in England

5 .0 Solutions

5 .1 The Coalition Government has put forward two principle solutions to the problems created by the abolition of RS. The first is a new ‘duty to cooperate’ which will be contained in the forthcoming Decentralisation and Localism Bill due to be published in November 2010. The second is the proposed incentives regime.

5.2 Duty to cooperate

5 .2.1 There is as yet little detail on what the ‘duty to cooperate’ will contain but ‘Open Source Planning’ argued that it would ensure effective working relations between neighbo u ring authorities who share cross border issues. There was also the suggestion that such c o op e ration may lead to joint infrastructure plans. Joint infrastructure plans would, however, be voluntary and their legal status in the planning system has not yet been made clear.

The legal status of the Development Plan and why it matters

Section 38 (6) of the 2004 Planning and Compulsory Purchase Act continued the plan led regime established in 1991. The 2004 Act defined the development plan as consisting of RS and the Development Plan component of LDF. Decisions must be made ‘in accordance with the plan unless material considerations indicate otherwise.’ This gives the development clear primacy over other strategies in planning decisions. The vital issue is that while voluntary infrastructure plans or REP strategies might be desirable we have to be very clear about what relationship they have to legally defined development plan for an area if there policy is to be effectively translated into real outcomes. The RS regime was clear on this point but much greater clarity is needed on the Open Source planning proposals.

5 .2.2 More clarity is required on how the ‘duty to cooperate’ would work in detail. A broad brush duty would allow very wide interpretation as to what cooperation might mean and would need to overcome the likely tensions which already exist between authorities in areas of high development pressure. The duty would have to deal with the very tough decisions currently made through RS as to the allocation of profoundly unpopular development such as waste recycling, minerals development and onshore wind farms.

5 .2.3 The ‘duty to cooperate’ would need therefore to be accompanied with detailed guidance to issues which it would deal with, for example to ensure climate change and flood risk were not ignored. It would also need to be prescriptive as to what cooperation means in terms of the production of a joint strategy with defined review periods and a clear commitment to resource the process. It would need to ensure that cooperation meant taking responsibility for deciding on unpopular forms of development.

5 .2.4 The Government has also stressed that the preparation of Local Enterprise Partnerships (LEP) provides an opportunity for enhanced cross border cooperation. On the 29 th June 2010 the Secretaries of State for Department for Business, Innovation & Skills (BIS) and CLG wrote to Local Authority Leaders, Business Leaders and Local Authority Chief Executives inviting them to submit proposals for LEPs which would replace Regional Development Agencies [10] . LEPs will have responsibility for economic development , but it is not yet clear whether they will have precise planning powers. The Rt Hon Vince Cable MP, Secretary of State (BIS), suggested at a select committee appearance on 21 st July 2010 that the Government was open to suggestion s, but did not wish to be prescripti ve . Some proposals for LEPs do assume planning powers will be part of the package. If the LEPs were to assume planning powers then a whole series of further questions need to be dealt with. For example LEP s have an economic growth focus rather than a susta inab le d e velopm e nt remit. Careful co nsideration would nee d to be given to the ma tc h between th e 56 area bids for LEPs received by G overnment and the reality of the economic and envi r onme n tal geography of these loc ali ties.

5 .2.5 Overall the measures proposed to compensate for the loss of RS are currently hard to evaluate without the details of how they might fit with the statutory planning system. To be effective the ‘duty to cooperate’ would have to be defined in detail as to what cooperation might mean. If the LEPs are to assume strategic planning powers then what status would any plan or strategy they prepare have in law?

5 .3 The Incentives regime

5 .3.1 The Coalition Government has placed considerable emphasis on the power of financial incentives to replace top down target setting. The TCPA welcomes the initial proposals that local authorities gain directly from bonuses for housing approvals based on council tax values. However, we remain concerned as to the effectiveness of this regime in meeting the current housing crisis. We are surprised that a more detail ed feasibility of such incentives was not carried out to evaluate the degree to which they may meet overall needs or how such revenue is to be split in two tier authorities. It is also unclear that such incentives paid to local authorities will be sufficient to overcome local opposition .

5. 3.2 The stated level of incentive ( f or example 125% of the value of council tax for 6 years for affordable housing ) now also seems to be under review. The Housing Minister, the Rt Hon Grant Shapps MP, wrote to councils on 9th of August reiterating the Government's commitment to a new homes bonus scheme. However, his letter made no reference to the intended level of subsidy. CLG has previously made clear that the first year of the tax matching scheme would be funded from the scrapped £200 million housing and planning delivery grant. However, if output remained level the Chartered Institute of Housing estimates the proposed housing subsidy would cost much more, reaching £1.2 billion a year from year six. If, as seems probable, the level of incentive is further reduced then the need for a robust plan-led target driven regime should be re-examined. In fact both effective planning and new financial models are necessary to meet social housing needs.

5 .3. 3 In taking new models forward at a time of economic constraints and uncertainty, the TCPA believes that the incentive regime should be considered within the wider context of the Coalition Government’s review of how local government is financed, including reforms to Housing Revenue Accounts.

6 .0 Conclusion: the need for a long term s olution

6 .1 The removal of forums and mechanisms for dealing with controversial cross border issues such as housing growth or energy production does not remove the underlying pressures which drive these challenges. The proposed new measures to replace the function of RS require careful examination and require more detail to understand how they will meet housing and climate change challenges. As a society we need , both in the medium to long term , to put in place flexible and democratic strategic planning.

6 .2 The TCPA believes that a revised planning system must offer a strong system which can deal with strategic issues which are too big in scale or timeframe to be resolved within one local planning authority area. Some might be whole city-regions, some might be parts of conurbations, and others might be among clusters of towns.

6.3 Democratic strategic planning is not top-down imposition, but about integrating local plans into coherent frameworks. Effective strategic planning can reduce costs to both public and private sectors, secures efficiency savings, and protects the environment. It can:

· provide certainty and generate confidence for private investors;

· set clear priorities for public expenditure;

· make best use of resources and specialist skills in plan-making; and

· align public and private investment, and national and local spending plans.

6.4 The new system must address the issue of the evidence and expertise required to inform strategic planning decisions. As regional planning structures are abolished, it is vital that respected, independent technical advice bodies provide information and support on issues such as housing, waste and climate change. The abolition of bodies such as the NHPAU, the Sustainable Development Commission and the Royal Commission on Environmental Pollution could hinder local authorities and communities’ ability to achievement sustainable development; to ensure they are able to deliver on the dual challenges of housing and climate change they must have access to transparent data and advice.

September 2010