Govt launches draft revised National Planning Policy Framework

By Paul Norman - Monday, March 05, 2018 11:26

The government said maximising the use of land, strengthening protections for the Green Belt and a greater emphasis on converting planning permissions into homes were at the heart of its new planning reforms, launched by the Prime Minister today. CoStar News takes a look at the key areas and catches up with the UK property industry to test initial responses to the legislation.

The government said: "We must do more to deliver 300,000 homes a year by the mid-2020s. More planning permissions need to be fast tracked into homes for a generation of first time buyers locked out of the housing market and our increasing older generation need the right homes designed to their needs."

Click here to see the draft policy framework.

What it termed a major overhaul to the National Planning Policy Framework, the first in six years, has been launched today providing a "comprehensive approach for planners, developers and councils to build more homes, more quickly, in the places people want to live".

Councils and developers will now be required to work with community groups to ensure those affected by new developments will have a say on how they look and feel.

The government said the framework will focus on the following areas:

Greater responsibility

Local authorities will have a new housing delivery test focused on driving up the numbers of homes delivered in their area, rather than numbers planned for. Developers will also be held to account for delivering the commitments, including affordable housing and the infrastructure needed to support communities.

Maximising the use of land

More freedom will be given to local authorities to make the most of existing brownfield land to build homes that maximise density. Redundant land will be encouraged such as under utilised retail or industrial space for homes, with more flexibilities given to extend upwards on existing blocks of flats and houses as well as shops and offices. 

Maintaining strong protections for the environment

Ensuring developments result in a net gain to the environment where possible and increases the protection given to ancient woodland so they are not lost for future generations.

Ensuring the right homes are built

Delivering more affordable homes that meet the housing needs of everyone wherever they are in their life, including sites dedicated for first time buyers, build to rent homes with family friendly tenancies, guaranteed affordable homes for key workers and adapted homes for older people.

Higher quality and design

Introducing new quality standards so well designed new homes are built in places people are proud to live in and live next door to.

More transparent planning process

Local authorities will be encouraged to work together and continue to close the gap between planning permissions granted and homes built. A new standardised approach to assessing housing need will be introduced with new measures to make the system of developer contributions clearer, simpler and more robust, so developers understand what’s expected of them and will be in no doubt that councils will hold them to their commitments.

Housing Secretary, Sajid Javid, said: "An entire generation is being locked out of a broken housing market as prices and rents race ahead of supply. Reforming the planning system is the crucial next step to building the homes the country needs.

"This government is determined to fix the broken housing market and restore the dream of home ownership for a new generation. There is no silver bullet to this problem but we’re re-writing the rules on planning so we can take action on all fronts.

"In moving to a more integrated society, the focus for everyone, whether a developer or a neighbourhood group, must be to come together to build the homes our communities deserve."

John Acres, MRTPI, President, The Royal Town Planning Institute, said: "We are delighted to be co-launching the consultation on the new National Planning Policy Framework today and we encourage the planning profession and others who care about planning and what it can do, to feed back to government.

"The RTPI will be holding a series of round table sessions for our members around the country to discuss its contents. Planners are critical to and passionate about building vibrant and connected neighbourhoods, towns, cities and wider areas; at the heart of which we need to ensure we build enough good quality homes that fit the needs of all.

"A clear, concise and consistent policy context can help to deliver this. We applaud the government’s focus on homes and planning and in revising the framework."

In a move to ensure that swift and fair planning decisions are made at appeal an end to end review of planning inquiries is also planned.

The planning reform package is part of a wider package of housing reforms; building on the recent £5bn Housing Infrastructure Fund announced to help unlock new homes in areas with the greatest housing need.

The government has already allocated £866m to 133 council led projects to fund key local infrastructure including new roads, cycle paths, flood defences and land remediation work, all essential ahead of building the homes.

The consultation has launched today to feed in views on proposals for the future of planning and will run until Thursday 10 May.

Melanie Leech, Chief Executive, British Property Federation, said: “The UK needs more homes, and it is good to see Government being bold and putting the steps in place to speed this up. 2018 must be a year of housing delivery if Government has any chance of reaching its target of 1.5 million new homes by 2022.

“Government has rightly strengthened its position on the need for multi-tenure housing delivery, faster delivery of homes and higher density of homes in the right places. Those building homes-for-sale won’t be able to achieve this alone. We need a housing sector firing on all cylinders. Investors and developers in Build-to-Rent – new, professionally-managed homes built for renters – can offer both faster delivery and higher density. The Build-to-Rent sector is in turn fully committed to revolutionising the UK’s rental market with longer-term, family-friendly tenancies for customers who require additional security.

“Currently, methods employed to calculate housing need vary significantly across the country and result in significant time and cost burdens, fundamental flaws that will impede an ambitious housebuilding programme if not resolved. We strongly support the standardised approach to assessing housing need without exception. That is the way that the Government will deliver on its housing promises, and as importantly, cater for a generation that wants to have a home to call their own.

“The five new towns are an important measure to support continued housing supply in the UK, but their delivery is probably beyond 2022 and therefore not applicable to the target of 1.5 million homes by 2022. It is good that Government is thinking long-term, however, beyond a Parliament, and we would like to see such new towns getting all-party support.

“Today’s measures cannot be seen in isolation and must be matched by ambitious capital spending on infrastructure. The Housing Infrastructure Fund is a great start, but local councils must also deliver the social infrastructure – school places, health care facilities, employment land – that all make a community possible.

“While we agree today’s measures will support a more effective planning system, local planning authorities have suffered for too long from a lack of resource and it is vital that Government pays this more attention and ensures that it takes steps to attract young people to planning as an attractive career option.”

RICS said that urging developers to ‘do their duty’ shows a fundamental misunderstanding of what’s needed to deliver more homes

Lewis Johnston, Parliamentary Affairs Manager, RICS, said: “The planning changes announced today, under consultation, effectively mark the end of the localism experiment for housebuilding. In threatening to remove planning powers from councils who fail to deliver their target of new homes, the Prime Minister is suggesting local authorities bear at least some responsibility for the housing crisis. A variation of this charge has also been squarely levelled at private developers, who are accused of dragging their feet on developing land with planning permission, and are being urged to ‘do their duty to Britain’ or risk losing permissions in the future.

"Whilst we support measures to increase build out rates and push councils to deliver ambitious local plans, we believe the government is still missing the fundamental point about addressing the housing shortage.

"The real reason we no longer build enough homes to meet need is that councils no longer play any significant role in building new homes. Four decades ago local councils built 40% of all new homes, whereas now they contribute only a negligible amount. As RICS have previously proposed, this can only be rectified by giving councils more borrowing powers to build. The government needs to go much further than the tentative steps in the 2017 Budget and really lift the borrowing cap so councils can be a genuine player in housing again.

"Empowering councils in this way would be a better approach to delivering affordable homes than lambasting private developers. Urging them to ‘do their duty’ misses the point, and the task of delivering the affordable housing we need is not a role that fits them very well.

"Ensuring the right homes are built, and delivering the affordable homes that meet the needs of everyone, is vitally important for a functioning housing market. We need action that doesn’t just tinker around the edges, but actually delivers all tenures the market needs.

"Ultimately, although this is another step in the right direction to address the supply and affordability issues within the housing market, we are still moving at an extremely slow pace.”

Ian Anderson, Partner in Cushman & Wakefield’s Planning and Development team, comments: “Today’s draft National Planning Policy Framework (NPPF) sets out how the Government plans to step in and ‘turn up the heat’ on both local authorities and developers to account for the number of homes being delivered.

“The Housing Delivery Test is the most significant change – it will put councils under pressure to deliver more homes or face the prospect of developers getting the right to ‘build anytime anywhere’. But local councils will also be under added pressure too as the government takes local house prices into account for the first time when setting local housebuilding targets. This will put very significant pressure on fast-growing but expensive cities like Oxford and Cambridge.

“The government’s focus on good design and the importance of town planning is very positive, but there was no mention today of more money for local planning departments to deliver the very significant numbers of homes required in many areas across the country. One of the big delays housebuilders face is the capacity of the planning system to deliver new local plans and assess applications, and without more resources many local authorities will struggle to meet the challenges the Government has set for them.

“Although an ambitious and streamlined approach is to be welcomed, there is certainly a great deal of ‘stick’ and perhaps not enough ‘carrot’ for councils to get more planning permissions delivered. The big opportunity for planning reform is to increase housing density, particularly around train stations, and to make it as easy as possible for brownfield sites in town and city centres to be converted to residential.”

Ed Cooke, CEO at Revio commented: “Revo wholeheartedly supports the Government and wider industry in its efforts to meet the clear housing requirement across the UK; but as we've said before these efforts should not be rushed at the expense of taking a holistic, long term approach that ensures we are delivering sustainable, well-equipped developments that nurture community and meet the everyday needs of residents, as well as businesses supporting the local economy. Jobs, retail, leisure and neighbourhood facilities, underpinned by strong infrastructure, are all part of this debate and we can’t make the mistake of overlooking these elements for short term gain.”

John McLarty, Head of Planning at Strutt & Parker, said: “It is great to see the government is acknowledging the need for local authorities to step up with renewed focus on housing delivery. This is a shared problem that requires shared solutions."

Robert Grigg, Managing Director of Property Finance at Hampshire Trust Bank, responds to today’s National Planning Policy Framework consultation papers: “Britain’s housing crisis is undoubtedly one of this Government’s greatest challenges and while we welcome the continued focus on the UK housing market through consultations like this, we believe more action needs to be taken if we are to reach the target of increasing housing supply to 300,000 a year by the mid-2020s.

"In order to try and meet these targets, we need housebuilders of all sizes to be building. While support for local house building almost doubled between 2010 and 2016 (29% to 57%), the Government needs to do more to support small and medium sized (SME) housebuilders. SME housebuilders don’t hoard land but often miss out on opportunities due to the endless red tape that binds them, mainly due to the costly and lengthy planning process, and this is having a significant impact on their business development plans. We urgently need the Government to deliver on its pledges made in today’s papers to reduce red tape and streamline the planning process for SME housebuilders, enabling them to build more much-needed homes.”

Tom Barton, Associate in planning at Trowers & Hamlins, said: "The draft NPPF released by the Government today continues with a number of themes set out in last year's housing white paper. As expected Westminster is turning up the pressure on local authorities to deliver units within their area and there new rules as to how the number of new units needed should be determined.

"Action plans will be required by those authorities failing to meet their housing requirements with those falling significantly below seeing decision making being passed to Planning Inspector's with a strong presumption in favour of sustainable development being in place.

"There is mixed news for housebuilders, the large ones will benefit from a track record of delivering units in scale when this becomes a material consideration in determining applications. Those involved in the planning system will question the proposal to allow shorter periods for implementation of consents given how the system continues to groan under substantial underinvestment and the issues around, amongst other things, discharging pre-commencement conditions."

Adam Jaffe at Investec Structured Property Finance, said: “While Mrs May speaks positively about tackling planning delays and reducing land-banking to try to increase housebuilding, these issues have been prevalent for many years and require direct action to make a difference. The government can legislate to help these processes but real change has to come from within the industry itself. Working together with government is the only way to create the housing supply that is so needed.”

Jan Crosby, UK Head of Housing at KPMG, said: “Finally the Government is shifting the emphasis from inflationary demand-side policies to supply. As ever though, the devil will be in the detail. The last time a new planning framework was produced new housing slowed as developers and councillors digested what the guidance meant. To avoid this as much clarity will be needed as soon as possible on the proposals to avoid a short term stalling of supply.

“Shifting emphasis on public land towards key worker accommodation makes sense and we believe that there are innovative funding solutions to deliver discounted rental housing alongside housing for sale. In an open market competition, the buyer of the land will focus on the houses likely to sell at the highest profit in order to support paying the required land price. If public land is to deliver key worker housing it must de-couple from the traditional land market - perhaps through selling it with restrictions or indeed employer nomination guarantees.

“Facilitating density and apartments is understandable for city locations but for those of us who remember the density driven planning guidance in PPG3, there will be caution that it does not encourage developers to build product that is not sustainable - particularly to the extent a down cycle occurs. It was secondary city centre apartments that caused a lot of the difficulties for banks during the last downturn.”

Richard Brown, Research Director at Centre for London said: "Housebuilding in London has missed mayoral targets for more than 15 years, so changes that will help more homes get built are welcome. But today’s announcements risk missing the vital role that local authority planning departments play in unlocking development and ensuring high standards.

"London boroughs' spending on planning and development has fallen faster than any other service area in recent years. Per capita expenditure on planning in 2017/18 budgets was 59 per cent lower than the amount spent by councils in 2010/11.

"The reality is that budget cuts have made it hard for boroughs to invest in active master planning and community engagement.

"The draft London Plan sets out ambitious targets for building in the suburbs, yet this is where opposition to development is often greatest. If these boroughs are to deliver on their targets they will need extra capacity, as well as smarter working, to bring local residents on side and create great places."

CoStar News will be updating industry reponses to the framework today.

Get in Touch
+44 203 205 4600