Reforming the National Planning Policy Framework Notes from a parallel universe
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Reforming the National Planning Policy Framework Notes from a parallel universe
There is a parallel universe to the one in which we (and our clients) live and work. In this parallel universe, you can take a piece of planning policy guidance, re-draft it so that it says largely the same thing (but make it a bit longer), bring it into force and suddenly the supply of new housing increases dramatically. In this parallel universe Garden Cities will spring up all over the country, residents turn out in their thousands to support new housing projects, infrastructure to enable the development to be built appears as if by magic, and landowners fall over themselves to sell land as quickly as possible at the lowest possible price to enable the housing to be delivered. Who inhabits this parallel universe? It is almost entirely populated by government policy advisers. It is in their interest to try and persuade us that tinkering with policy solves all problems, especially if that tinkering avoids addressing the real problems facing housing supply in Britain at the moment – public antipathy towards development near our homes, limited resources of local planning authorities, the real cost of providing the necessary social, economic and communications infrastructure to serve new development and the Treasury’s unwillingness to provide it, which stems from the public’s unwillingness to pay the taxes needed to fund it.
Neil Bucknell Partner neil.bucknell@laytons.com +44 (0)1483 407 016
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Reforming the NPPF | Notes from a parallel universe
Unfortunately, the inhabitants of this parallel universe appear currently to be in charge of planning policy. To be fair, they have been in charge of planning policy for most of the last generation. There have been only brief moments when common sense and reality has broken through, and one of the few bright spots in the last 30 years was when the Coalition government pulled together a group of leading figures from the world of development, local government, the planning profession and environmental NGOs to produce the National Planning Policy Framework in 2012.
The significance of the NPPF was as much the fact that it put together in one place all of central government’s planning policies, giving local planning authorities (and more importantly planning inspectors dealing with appeals) a single set of rules to apply in decision making. It is not perfect, but some of those imperfections stem from the fact that voters in England and Wales are wedded to concepts such as the Green Belt which (in this author’s view) add to the problems of housing delivery in an environmentally sustainable manner. The NPPF has been a major factor in the increase in housing supply that has occurred by giving planning officers a clear set of rules to wave under the noses of recalcitrant planning committee members when considering schemes for which there is no reasonable objection, by giving the Planning Inspectorate a clear set of rules to make decisions by (rather than entertaining arguments for and against a scheme based on selective quotations from different planning policy guidance notes) and by giving applicants and their advisers a clear set of rules to quote when promoting sites through the local plan process, pursuing planning applications (whether against the background of an adopted local plan or not) and fighting appeals. However, the inhabitants of the parallel, policy making universe have decided that because the NPPF has not transformed the delivery of housing in the UK to the extent that they might have hoped, they must tinker with it to show they are doing something. Unfortunately, it cannot be said that the proposals address the shortcomings. Even if they did, those of us who live in the real world know that an amended NPPF drafted in the most developer friendly terms would still have to operate against the politics of the real world and “the system”. Looking at the proposal from this standpoint, there are a few points worthy of note or comment:-
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Reforming the NPPF | Notes from a parallel universe
1. Viability, Stealth Taxes and Decision Making From our experience here, we would urge that the NPPF
obtaining planning permission easier for both applicants and
discourages (not encourages) viability reviews once planning
local planning authorities. The Treasury (who we suspect are
permission has been granted. There is an underlying
driving this) should bear in mind that if as a result profits rise,
assumption that profitability on a site can only go up during
they will indirectly benefit through increased tax take on those
its life, and not go down. We doubt that any local authority
who benefit from the development process, to say nothing
would support review mechanisms, if they gave the developer,
of the considerable income that must now be derived from
or beneficiary of the planning permission a general right
Stamp Duty Land Tax charged on sales of development land
to reduce planning contributions or affordable housing
and new homes.
provision. While there may be exceptions (such as the adverse market conditions following the economic crises of
Draft paragraph 34 emphasises the problem. Encouraging
2008 and 2009) that may justify this, for most of the time, long
local authorities to set contribution levels and affordable
term decisions have to be taken by those promoting large
housing provision which “should not make development
sites which are in part based upon the planning gain package
unviable” makes the naive and unrealistic assumption that
and affordable housing provisions in the initial outline
it is possible to effect these levels across the local planning
planning permission. A general regime of viability review only
authorities’ areas taking no account of the considerable range
undermines the commercial decision making process, which in
of factors affecting individual sites which can affect viability,
turn is likely to disincentivise developers and landowners from
including the values achievable in the location where the
bringing forward larger areas of land for development (for
development is situated, ground conditions, the need to carry
example “garden city” developments).
out decontamination, the adequacy of existing infrastructure and any special requirements that were imposed at the time
A further problem that we are particularly encountering
the site was acquired (for example by a seller retaining land
with London authorities is that local authorities and their
or where the development is in part enabling development
advisors seem to have very little idea as to the commercial
to enable the seller to provide new facilities on its retained
practicalities of the development process. At present, we
land). It is also inconsistent with paragraph 57, and the test
are currently dealing with two sites which are locked in
set out in the CIL Regulations 2010 as amended. We would
the planning process with London Boroughs, where the
strongly urge that paragraph 34 be replaced with a paragraph
Boroughs are insisting on a mechanism for review which
pointing out the requirements of paragraph 57 and the
would effectively put a halt to the sale of dwellings on the
CIL Regulations, suggesting that if meeting local authority
development while a further viability reappraisal is carried out.
requirements for affordable housing, the rates of any CIL imposed by the local authority and any other obligations
Our experience over the years is that viability issues are
properly justified under paragraph 57 together adversely
handled poorly in the planning process and that this is a
affect the viability of the scheme, then these should be the
problem that all concerned with the planning system have
circumstances and trigger the viability discussions between
brought upon themselves. We need to move away from a
the applicant and local planning authority (or authorities
system that seeks to squeeze out every element of value in
where there is two tier local government). We do though
the development process through the planning system. If
welcome the suggestion that viability appraisals are not
we did so, it would make the process of applying for and
required in all cases.
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Reforming the NPPF | Notes from a parallel universe
2. Local Employment and Procurement Policies
3. Electronic Infrastructure – Planners do not deliver electronic infrastructure
There is one matter which we think ought to be dealt with in
We are concerned with the ambit of Chapter 10. As with our
Chapter 6 of the revised NPPF.
comments above, one of the problems with the planning system is that it is being stretched to try and deal with matters
There is a growing practice amongst London Boroughs
that are not primarily problems of space or planning. We
whereby obligations are imposed obliging developers to
can understand the planning policy which discourages local
seek to achieve quotas of local procurement of labour and
authorities from failing to make adequate provision for
materials for any scheme, and to provide training schemes
telecommunication masts and other telecommunications
within projects.
infrastructure that requires planning permission. However, the bulk of the problem with providing cable and broadband in
We are strongly of the view that this ought to be discouraged,
the UK lies entirely outside the planning system. Government
as it is anti-competitive, and in many cases overlooks the
policy would be very much directed that ensuring that the
commercial realities of developments, and the geographic
Department of Transport and local highway authorities ensure
realities of Greater London. London Boroughs do not
that whenever a road is built or rebuilt, ducting is provided
generally represent travel to work areas, or economic zones.
so that cabling can be provided quickly and cheaply with the
They are largely the result of an amalgamation of old pre-
minimum of disruption to local communities.
1965 local authorities under the Greater London Council Act in the 1960s. We consider that such obligations ought to be
There is no way that the average local planning authority
discouraged.
is going to be equipped to promulgate effective and practical policies that would encourage the provision of
We can see a role for training obligations on large scale
communications infrastructure as part of the general planning
development, where the need for any particular trade is
process. We suggest that Chapter 10 be redrafted (or at least
likely to be sufficiently long for an apprenticeship could be
paragraph 112 redrawn) to make it clear that its ambit should
supported on site. However, we are encountering problems
be limited to those elements of communication systems that
with Boroughs insisting on provisions relating to the offering
currently require planning permission.
of apprenticeships on small scale sites, where it is simply impractical, because none of the trades will be on site for long enough to support an apprenticeship. We suggest that Chapter 6 be enlarged to make specific recommendations on these issues.
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Reforming the NPPF | Notes from a parallel universe
4. Conservation of Natural Environment An unintended step backwards for nature conservation?
5. More (badly thought out) Categories of Affordable Housing
We are particularly concerned at the proposed changes to the definition of Affordable Housing, in particular in relation The amendments proposed in Chapter 15 to the provisions
to starter homes and other forms of tenure. The availability of
relating to wildlife replacing the current paragraphs 113
homes suitable for those wanting to buy for the first time can
and 116 have caused consternation amongst organisations
partly be addressed through the general planning system, by
concerned with wildlife conservation. This Chapter as
the local authorities ensuring that there is a sufficient mix of
amended seems to remove the protection currently
size and type of units to ensure an adequate forward supply
afforded to Local Wildlife Sites. Specifically, we consider that
of smaller cheaper units for first time buyers.The problem with
paragraphs 172 and 173 need be amended to make it clear
new novel types of tenure is twofold:
that Local Wildlife Sites are designated for their biodiversity value, and that any development impact that directly or
a. Homes that are specifically designated as only being
indirectly affect them should be regarded as development
available for first time buyers will inevitably be less
proposals that might cause significant harm to biodiversity for
marketable when a first-time buyer wants to sell to
the purposes of interpreting paragraph 173.
move up the housing ladder. We are very disappointed that the consultation responses to the initial starter homes proposals have not been listened to. There is no point in having a class of housing with limited saleability, which will inevitably be a poorer investment for first time buyers, leading to a potential poverty trap for first time buyers in small units who cannot find another first time buyer to acquire their unit, or who can only achieve a sale at a lower price, preventing them moving up the housing ladder if (for example) they want to start a family and buy a larger unit. b. The proposals regarding discounted housing do not address the issue – who owns the discount? If homes being sold permanently at less than 20% of the market value, it implies that the retained 20% discount has to be held by somebody. In particular, the novel forms of tenure (other than the old fashioned shared ownership leases, which are known and understood by registered housing providers, mortgage lenders and others) are unattractive to mortgage lenders. They face the same
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Reforming the NPPF | Notes from a parallel universe
difficulty in evaluating their security as a first time buyer
While we welcome the fact the government is prepared
does in looking at a house that has limited marketability
to review policy from time to time, updating the NPPF as
on resale.
proposed makes minimal impact on the problems facing the planning system at present. Unfortunately, our view is that
We would urge the government to drop these proposals.
the most effective steps (putting more resources into local
Instead, there is a perfectly adequate mechanism in traditional
and national planning, removing some of the financial burden
shared ownership housing, with the housing disposed of on a
from developers and providing infrastructure that will benefit
leasehold basis, with the buyer having the ability to staircase
not just any proposed development but also the community
out and acquire the remainder of the equity, and the lender
at large) would all require the government to open its purse
having recourse to the remainder of the equity if they have to
a little wider – something that it is clearly adverse to do,
enforce in circumstances where a shortfall is likely.
especially as that purse may shrink after Brexit and the Health Service is clearly ahead of the queue politically. Whether
Once again this is something that should be taken out of
or not the observations we have made above (which are
the planning system. Beyond planning obligations which
incorporated in our response to the Consultation Team) are
set quotas for the provision of affordable rental dwellings
taken on board, we do not see any likelihood of any material
and shared ownership dwellings, if the government really as
amelioration of the current difficulties in housing supply from
serious about getting more people onto the housing ladder,
the proposed amendments.
they should look at funding for registered providers (and other bodies, including local authorities) to provide traditional shared ownership housing which can be sold in the market, and proceeds of the sale of the retained equity is released back to the registered provider, local authority or other body can then be recycled for future use in supporting home ownership or affordable housing.
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Reforming the NPPF | Notes from a parallel universe
Real Estate | Planning & Environment We provide planning services for a variety of clients – developers, landowners and other parties involved in the planning process. We also provide advice and services for ancillary matters, including highways issues and the registration of commons and village greens.
Our Team Neil Bucknell
Sara Hampson
Partner neil.bucknell@laytons.com +44 (0)1483 407 016
Partner sara.hampson@laytons.com +44 (0)1483 407 014
Paula Ghosh
Sara McKay
Solicitor paula.ghosh@laytons.com +44 (0)1483 407 046
Solicitor sara.mckay@laytons.com +44 (0)1483 407 000
Sue Irons Consultant sue.irons@laytons.com +44 (0)1483 407 011
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