Gove consults on reforms to five-year housing land supply, “new flexibilities” to meeting housing needs as part of planning overhaul

The Government has launched a consultation on reforms to the five-year housing land supply rules and the introduction of “new flexibilities” to meeting housing needs.

The proposals, contained in a 58-question consultation paper launched by Secretary of State Michael Gove just before Christmas (22 December), include removal of the requirement for local authorities with an up-to-date plan to demonstrate continually a deliverable five-year housing land supply.

The Government said the change should take effect when it publishes a revised National Planning Policy Framework (NPPF), expected in Spring 2023.

“Our intention is to provide local authorities with another strong incentive to agree a local plan, giving communities more of a say on development and allowing more homes to be built,” the consultation paper adds.

The consultation paper also says that the Government recognises that current guidance on using any oversupply of housing in five-year housing land supply calculations has left room for different interpretations.

“We have a system that has the potential to penalise those local planning authorities that overdeliver their housing requirements early in the plan period. In particular, where a local planning authority cannot justify using historic oversupply in its 5-year housing land supply calculations, it can result in a shortfall in a 5-year housing land supply later in the plan period. Consequently, the presumption in favour of sustainable development can result in additional development on land which is not allocated for development in the local plan or in line with local policies.”

The Government therefore proposes bringing its position on oversupply in line with that on undersupply, when calculating a five-year housing land supply. “This will enable a local planning authority to include historic oversupply in its five-year housing land supply calculations and to demonstrate it is meeting its community’s overall housing requirements.”

This would be implemented by amending the Framework and planning practice guidance.

The Government has meanwhile also promised “new flexibilities” in meeting housing needs. Local authorities will still be expected to continue to use local housing need, assessed through the standard method, to inform the preparation of their plans; although the ability to use an alternative approach where there are exceptional circumstances that can be justified will be retained.

The Government, however, will consult on making it clearer in the NPPF that the outcome of the standard method for assessing local housing need is “an advisory starting-point to inform plan-making – a guide that is not mandatory”.

The consultation paper also proposes to give more explicit indications in planning guidance of the types of local characteristics which may justify the use of an alternative method, “such as islands with a high percentage of elderly residents, or university towns with an above-average proportion of students”.

The consultation paper ­sets out, amongst other reforms, three proposed changes to the NPPF relating to “matters that may need to be considered when assessing whether a plan can meet all of the housing need which has been identified locally”.

They are, first, to make clear that if housing need can be met only by building at densities which would be significantly out-of-character with the existing area [...], this may be an adverse impact which could outweigh the benefits of meeting need in full".

The consultation paper says: “This change recognises the importance of being able to plan for growth in a way which recognises places’ distinctive characters and delivers attractive environments which have local support; imperatives which are reflected in the Framework’s chapter on achieving well-designed places.”

Second, the consultation proposes, through a change to the NPPF's chapter on protecting Green Belt land, "to make clear that local planning authorities are not required to review and alter Green Belt boundaries if this would be the only way of meeting need in full (although authorities would still have the ability to review and alter Green Belt boundaries if they wish, if they can demonstrate that exceptional circumstances exist)”.

The paper argues that this change would “remove any ambiguity about whether authorities are expected to review the Green Belt, which is something which has caused confusion and often protracted debate during the preparation of some plans”.

The third proposal is that a revised NPPF will make clear that authorities may also take past ‘over-delivery’ into account, such that if permissions that have been granted exceed the provision made in the existing plan, that surplus may be deducted from what needs to be provided in the new plan.

This is separate to the proposals which would allow oversupply to be taken into consideration for the purposes of calculating a five-year housing land supply.

The consultation paper says: “The purpose of these changes is to provide more certainty that authorities can propose a plan with a housing requirement that is below their local housing need figure, so long as proposals are evidenced, the plan makes appropriate and effective use of land, and where all other reasonable options to meet housing need have been considered.

“We will also make clearer in policy that authorities who wish to plan for more homes than the standard method (or an alternative approach) provides for may do so, where they judge that is right for their areas, for example to capitalise on economic development opportunities.”

The Government also says it wants to make sure that plans are subject to proportionate assessment when they are examined, “in particular to avoid local planning authorities and other parties having to produce very large amounts of evidence to show that the approach taken to meeting housing need is a reasonable one”.

It therefore proposes to simplify and amend the tests of ‘soundness’ through which plans are examined, so that they are no longer required to be ‘justified’.

“Instead, the examination would assess whether the local planning authority’s proposed target meets need so far as possible, takes into account other policies in the Framework, and will be effective and deliverable. Although authorities would still need to produce evidence to inform and explain their plan, and to satisfy requirements for environmental assessment, removing the explicit test that plans are ‘justified’ is intended to allow a proportionate approach to their examination, in light of these other evidential requirements.”

The Government intends to update national policy in Spring 2023 to reflect this.

However, for the purposes of the changes to the test of soundness, the Government proposes that these will not apply to plans that have reached pre-submission consultation stage, plans that reach that stage within 3 months of the introduction of this policy change, or plans that have been submitted for independent examination.

The consultation also proposes ways of improving developer accountability and taking into account past irresponsible behaviour in decision-making, such as deliberately ignoring planning rules.

The paper says: “We recognise that it is a long-standing principle that planning decisions should be based on the planning merits of the proposed development – and not the applicant. This principle is critical to ensuring the planning system is fair, open and focused on land use considerations.

“Nonetheless, there are instances where personal circumstances can be taken into account, and we consider it would be legitimate to consider widening this scope to include an applicant’s past irresponsible behaviour.”

The paper outlines two potential ways to take account of this past behaviour. The first is to make such behaviour a material consideration when local planning authorities determine planning applications so that any previous irresponsible behaviour can be taken into account alongside other planning considerations.

The second option is to allow local planning authorities to decline to determine applications submitted by applicants who have a demonstrated track record of past irresponsible behaviour prior to the application being considered on its planning merits. This is similar to the amendment which the Government has already made to the Levelling Up and Regeneration Bill allowing local planning authorities to decline to determine new applications on sites where the build out of development has been too slow.

The consultation also suggests new mechanisms to tackle developers who have failed to build out following planning permission, including the publication of data on developers in cases where they fail to build out according to their commitments.

Alongside this, the Government has suggested making delivery a material consideration in planning applications, meaning that applications with trajectories that propose a slow delivery rate may be refused in certain circumstances.

Other proposals include a greater emphasis on the "role of beauty and placemaking in strategic policies".

On this point, the consultation document says: "We also propose to make a stronger link between good design and beauty by making additions to Chapters 6, 8 and 12 of the Framework to further reflect the importance of beautiful development in our everyday lives as recognised by the Building Better, Building Beautiful Commission report so it becomes a natural result of working within the planning system."

Under a subheading of "refuse ugliness", the consultation document details plans to amend the framework to encourage local planning authorities to consider how they can ensure that planning conditions associated with applications reference "clear and accurate plans and drawings which provide visual clarity about the design of development, as well as clear conditions about the use of materials where appropriate, so they can be referred to as part of the enforcement process".

The policy changes to the NPPF are expected to take effect from Spring 2023, ahead of the implementation of the Levelling Up and Regeneration Bill, which is currently intended to be introduced in late 2024.

The Government is proposing to set a deadline of 30 June 2025 for plan makers to submit their local plans, neighbourhood plans, minerals and waste plans, and spatial development strategies for independent examination under the existing legal framework.

Authorities that have a local plan that is more than five years old will have to begin preparing a new-style local plan immediately once the new system is introduced.

The proposals relate to England only. The consultation closes on 2 March 2023.

Adam Carey