Gove to consult on changes to calculation of local housing need, end obligation to maintain five-year housing land supply where plans up to date

The Secretary of State for Levelling Up, Housing and Communities has unveiled plans for a consultation on changes to the method for calculating local housing need figures, a ‘rebalancing’ of the relationship between planning authorities and the Planning Inspectorate, and an end to the obligation on local authorities to maintain a five-year housing land supply where their plans are up to date.

In a letter sent to local planning authorities (LPAs) on Monday (5 December), Michael Gove said the new approach would be set out in an upcoming National Planning Policy Framework prospectus, which will be put out for consultation by Christmas.

On the consultation on changes to the method for calculating local housing need figures, Gove said: “I recognise that there is no truly ‘objective’ way of calculating how many homes are needed in an area, but I do believe that the plan-making process for housing has to start with a number. This number should, however, be an advisory starting point, a guide that is not mandatory.” [Secretary of State's emphasis]

The Secretary of State said it would be up to local authorities, working with their communities, to determine how many homes can actually be built, taking into account what should be protected in each area. “It will also be up to them to increase the proportion of affordable housing if they wish."

As part of this, the minister will instruct the Planning Inspectorate that they should no longer override "sensible local decision making, which is sensitive to and reflects local constraints and concerns”.

Gove suggested this would amount to a rebalancing of the relationship between local councils and the Planning Inspectorate, and would give local communities a greater say in what is built in their neighbourhood.

Under the changes, when assessing a local plan, the following would have to be taken into account:

• Genuine constraints: "local planning authorities will be able to plan for fewer houses if building is constrained by important factors such as national parks, heritage restrictions, and areas of high flood risk."
• Green Belt: "further clarifying our approach to date in the National Planning Policy Framework and the Localism Act, we will be clear that local planning authorities are not expected to review the Green Belt to deliver housing."
• Character: "local authorities will not be expected to build developments at densities that would be wholly out of character with existing areas or which would lead to a significant change of character, for example, new blocks of high-rise flats which are entirely inappropriate in a low-rise neighbourhood. While more homes are needed in many existing urban areas, we must pursue 'gentle densities' as championed by the Building Better, Building Beautiful Commission. The [Levelling Up and Regeneration] Bill's provisions for mandatory design codes, which will have the same legal force as the local plan, will give authorities a powerful tool to guide the forms of development that communities wish to see."

The Secretary of State also confirmed he would review how the ‘soundness’ test for reviewing plans at examination is operated by the Planning Inspectorate. “I will ensure that plans no longer have to be ‘justified’, meaning that there will be a lower bar for assessment, and authorities will no longer have to provide disproportionate amounts of evidence to argue their case.”

Gove said: “The effect of these changes will be to make absolutely clear that Local Housing Need should always be a starting point – but no more than that – and importantly, that areas will not be expected to meet this need where they are subject to genuine constraints.”

Inspectors will therefore be required to take a more reasonable approach to authorities that have come forward with plans that take account of the concerns of the local community, by taking a more pragmatic approach at examination which fully reflects this updated policy, the letter added.

The Secretary of State said that for those areas that would like to bring forward their own method for assessing housing needs, he would be clear on the exceptional circumstances under which they may do so, for example where a case can be made for unusual demographic and geographic factors. This will be made clear in an updated National Planning Policy Framework and guidance to the Planning Inspector.

In relation to ending the obligation to maintain a rolling five-year housing land supply obligation, Gove said this would mean for authorities with a local plan, or where authorities are benefitting from transitional arrangements, the presumption in favour of sustainable development and the 'tilted balance' will "typically not apply" to councils with a local plan in relation to issues affecting land supply.

He also said he wanted to:

• consult on dropping the requirement for a 20% buffer to be added for both plan making and decision making – “which otherwise effectively means that local authorities need to identify six years of supply rather than five”;
• recognise that some areas have historically overdelivered on housing - but they are not rewarded for this. “My plan will therefore allow local planning authorities to take this into account when preparing a new local plan, lowering the number of houses they need to plan for.”

Councils in the advanced stages of preparing a local plan will not benefit from removing the five-year housing land supply obligation. In light of this, the Secretary of State said he would also put in place transitional arrangements.

"Where authorities are well-advanced in producing a new plan, but the constraints which I have outlined mean that the amount of land to be released needs to be reassessed, I will give those places a two-year period to revise their plan against the changes we propose and to get it adopted," he noted.

“And while they are doing this, we will also make sure that these places are less at risk from speculative development, by reducing the amount of land which they need to show is available on a rolling basis (from the current five years to four).”

The Secretary of State claimed that communities would as a result have a much more powerful incentive to get involved in drawing up local plans.

He also said he would increase community protections afforded by a neighbourhood plan against developer appeals – increasing those protections from two years to five years.

In the letter Gove announced a series of consultations on:

• What areas the Government proposes to be in scope of the new National Development Management Policies, and consultation on each new policy before it is brought forward by the Government. “National Development Management Policies will also not constrain the ability of local areas to set policies on specific local issues.”
• Detailed proposals for increases to planning fees.
• A new planning performance framework that will monitor local performance across a broader set of measures of planning service delivery, including planning enforcement.
• Further measures on allowing LPAs to refuse planning applications from developers who have built slowly in the past, and on making sure that local authorities are not punished under the housing delivery test when it is developers who are not building.
• A new approach to accelerating the speed at which permissions are built out, “specifically on a new financial penalty”.
• How to tackle "irresponsible developers and landowners who persistently ignore planning rules and fail to deliver their legal commitments to the community.”
• What more can be done in national policy to support development on small sites particularly with respect to affordable housing. The minister will also launch a review into identifying further measures that would prioritise the use of brownfield land.

Gove's reforms also involve plans for a registration scheme for short-term lets in England, which would be discretionary for local authorities.

The details of how the scheme would be administered will be consulted on before summer recess, "with a view to the scheme being up and running as soon as possible thereafter," Gove said.

"I will also consult on going further still and reviewing the Use Classes Order so that it enables places such as Devon, Cornwall, and the Lake District to better control changes of use to short term lets if they wish."

Alongside this, Gove has asked the Competition and Markets Authority to consider undertaking a market study.

Adam Carey