Category Archives: urban planning
In some recent renewable decisions especially one relating to a Solar Farm, Pickles has hinted he is turning all established principles for judging the impact on any proposal on its head. I read the recent Copland decision with some interest. No problem with the decision, it would be clearly be harmful, the policy context was up to date, the inspector recommended refusal. However the SoS letter hinted that Pickles is leaving open the issue of whether a view from a private property is a material planning issue – dangerous.
The Inspectors letter correctly sets out the law.
it has not been claimed by the Council that the turbines would be so close to any dwellings as to be unacceptably dominant or overbearing in the outlook from those dwellings or to make them unpleasant places to live (the ‘Lavender test’)….
Whilst there would clearly be a change in the views available from numerous dwellings and from other private places, it is a well established planning principle that there is no right to maintain unchanged such views from private property. To do otherwise would severely constrain all types of development, whatever their public benefits, which would be contrary to the public interest. Nevertheless the general public perception of valued landscape character should not exclude how that character may be perceived in views from private dwellings….
This is an application of the Stringer Test. Planning is about public interest not private interest though sometimes a private interest may also be a public one, so for example views from homes of a lake district landscape my contribute to they character of that landscape.
However Pickles does not quite make that distinction in his letter.
The Secretary of State agrees with the Inspector that the views available from many private dwellings, buildings and land in the settlements are relevant to considerations of the effect on landscape character but that they do not here result in other unacceptable visual amenity impacts on occupants of individual dwellings that are separate from his considerations of landscape character.
This part of the letter is likely to be seized on, but without the context of the Inspectors recommendations it makes no sense.
Page 164 of the Autumn statement
The government will also launch a review into the role local authorities can play in supporting overall housing supply.
If ever there was an open ended review it is this. This includes the whole of the planning system and well as its role in direct construction. Could this be another of Gideon’s trangulations i.e. supporting council house buildings in the run up to the next election?
The NIP hides away on page 15
The government will continue to work to ensure that the planning system does not act as a barrier to vital infrastructure investment. It will:
• continue to refine the Nationally Significant Infrastructure Projects (NSIP) regime as lessons are learned from projects going through it, including:
• launching an overarching review of the NSIP regime, while freezing planning application fees for the NSIP regime for the remainder of this parliament
• having regard to the designation of a ‘Top 40’ priority investment when considering applications for the NSIP regime
• providing policy certainty and confidence for the transport sector through the publication of a National Networks National Policy Statement (NPS)
• reform the judicial review (JR) system to tackle delays to infrastructure delivery and reduce the impact of meritless claims; it will establish a specialist planning court with set deadlines to accelerate the handling of cases, introduce legislation to ensure that minor procedural claims are dealt with proportionally and allow appeals to ‘leapfrog’ directly to the Supreme Court in a wider range of circumstances
• take further steps to address delays at every stage of the planning process and incentivise improved planning performance, by:
• consulting on mechanisms to speed up Local Plan production, including a statutory requirement to put local plans in place
• addressing delays associated with the discharge of planning conditions
• consulting on proposals to reduce the number of applications where unnecessary statutory consultations occur
• ensuring that households benefit from developments in their local area; building on the measures it has already put in place (including the neighbourhood funding element of the Community Infrastructure Levy), the government will work with industry, local authorities and other interested parties to develop a pilot passing a share of the benefits of development directly to individual households
Further details are given on page 100
Town and Country Planning System
7.41 The Government is taking steps to address delays at every stage of the planning process and incentivise improved planning performance.
7.42 Local Plans provide certainty for developers, while supporting locally-led sustainable development. Three quarters of planning authorities now have a published Local Plan, but further progress can be made. The government will consult on measures to improve plan making, including introducing a statutory requirement to put a Local Plan in place.
7.43 Delays associated with the discharge of planning conditions can hinder the effective delivery of development. The government will legislate so that where a planning authority has failed to discharge a condition on time, it will be treated as approved, and will consult on using legislative measures to strengthen the requirement for planning authorities to justify conditions that must be discharged before any work can start.
7.44 To prevent delays for applicants, the government will consult on proposals to reduce the number of applications where unnecessary statutory consultations occur, and key statutory consultees will commit to a common service agreement. The government will also pilot a new scheme to provide a single point of contact for cases where a point of conflict in advice cannot be resolved locally.
7.45 The government wants to ensure that households benefit from developments in their local area. Building on the measures it has already put in place at the local authority and community level (including the neighbourhood funding element of the Community Infrastructure Levy, ‘Community Benefits’ in the energy sector and the New Homes Bonus), the government will work with industry, local authorities and other interested parties to develop a pilot passing a share of the benefits of development directly to individual households.
This will be the third round of reforms, The NPPF round one, the use class order changes round two. The HBF have been lobbying for the deemed conditions reform. All conditions must have reasons and every DM planner knows the common law tests used to determine whether grampian/negative conditions are appropriate (or they should) so it is difficult to see what use this would be.
The statory duty to have a plan is interesting, Scotland has it and noone should fear it but it makes no difference as it isn’t enforced. It would only bite if others could claim funds and an EIP place to submit their own plan if an LPA was very late. The Government quoting stats on published plans is meaningless when most published plans now fail the DTC or are found unsound at first bite.
Any monies passed to individual households would need to come off either profits or CIL/Infrastructure funding. It is a daft idea designed to enrich already well off people living on the edge of towns and villages at the cost of society as a whole and will do little to dissipate opposition. There is no system of compensation/betterment for changes to land values, their is no right to a nice view, and if there is to be any such system it should solely come from a levy on betterment.
With the Hastings/Rother decision and the Mid Sussex DTC decision it seems clear that one area where the Duty to Cooperate is having most impact is Dads Army Land – the Sussex Coast. And as it should be because the new South Downs National Park and the High Weald AONB mean that the tightly packed towns here have little room to expand without becoming the kind of sprawl you find around Seaford and Peacehaven. So now Rother finds it has to consider a tripling of its housing targets to accommodate overspill from Hastings. That is without even considering overspill from Weladen District (Which the inspector said needed to undershoot because of european sites – even on the basis of the now revoked SEP). There is one big problem . Rother is 80% AONB, and what is left is Romney Marsh (flood risk area and European sites, let alone areas protected because of proximity to Dungerness), or urban areas, ancient woodland or areas already allocated for major expansion of Bexhill. So where is it to go? Similarly the Sussex Coastal Towns SHMA requires an overspill of over 7,000 dwellings in the rest of West Sussex.
Compared to the SEP (South East Plan) Rother now has to consider an additional 9,000 dwellings. Those dwellings were allocated away from the District in the first place because of its constraints. There is now likely to be around 15k extra dwellings needed to be allocated arising from trend based need from Lewes, Wealden and Chichester considered together. You can add to that the 7,000 extra dwellings arising from the West Sussex SHMA overspill and a figure of overspill from Crawley, before you even consider the impact of any extra runway at Gatwick. Given that Rother patently wont be able to handle this extra growth where will it go? The obvious answers are further growth at Ashford (which was exactly the South East Plan Plan) and expanding Paddock Wood to New Town Scale. Similarly in West Sussex you could deal with the spillover with a new settlement, I don’t particularly like the idea of a road based one around the A23 (the New Country Town Proposal) and think the bolder and better approach is to ‘do a Milton Keynes’ and have a rail based corridor with a new station between Burgess Hill and Hassocks even if it means convergence of the towns, and/or between Burgess Hill and Haywards Heath. After all no-one these days bemoans the convergence of Wolverton and Bletchly do they? The best here would be the enemy of the good, and a proper masterplan led approach can ensure proper woods, green wedges and country parks at the most visually sensitive locations in those gaps.
So where next for these authorities? They have no choice but to cooperate now if they want haphazard appeal led growth in juicy villages (from the developers point of view). They will have to consider alternatives and SEA them. How if this any different from the process undertaken for the South East Plan? Not all all really, LPAs are having to reinvent the wheel after an interregnum of three-five years (as worked basically stopped two years prior to the election due to Spelman’s letter). The South East Plan process was reactive, the government set bigger targets LPAS called foul and it was all fought out at the EIP. What is desperately needed here is vision, a proper plan-led design led study on where in Sussex and South East Kent to take an overspill of around 35,000 swellings over 15 years and likely 70,000 over 30 years.
Liz Kendall MP has siad the DTC isnt working. Clearly these decisions show that it is but boy it is watching strategic planning in extreme slow motion, if it wasnt slow enough already. Labours ‘right to grow’ will do little as here it is not an issues of adjoining areas because of landscape designations but anywhere within sustainable commuting distance. How would the ‘right to grow’ work? If the same examination driven way as the DTC it would still be strategic planning in extreme slow motion.
For Private Bowls and Captain Pickles though all they seem willing to do is hold back the invading hordes of electors, whom they have pissed off everywhere now not just in growth areas, with the policy equivalent of broom handles and pitchforks.
In a statement, Mid Sussex District Council said that Councillors are “frustrated” by the inspector’s verdict. The statement said that the council will carefully consider the inspector’s comments and will do whatever is required to secure a successful local plan as soon as possible…
“Many residents left the last hearing feeling the odds were stacked against the district council in its attempt to agree a local plan in the face of opposition from those with vested interests, such as developers.”
Gary Marsh, Mid Sussex District Council’s cabinet member for planning, said: “I feel we have been unfairly treated and it would seem that the expectations about what is required by councils under the duty to cooperate have changed in recent months and we will be making that point to the inspector.”
Anyone who has read of the many DTC fails on this site will know that they have not changed. Rather some authorities like Mid Sussex have pursued a political agenda, I presume in the face of officers advice, that they are likely to fail. Indeed the writing has been on the wall for Mid Sussex since Brighton sent them a formal DTC notice to take overspill need Exactly One Year Ago.
How ridiculous now to blame ‘vested interests’ aren’t those living in Brighton, Crawley, Worthing, Littlehampton etc. living in overcrowded accommodation every bit as much as legitimate a local interest as someone living in Haywards Heath or Hassoks?
But we have seen many times ridiculous bad tempered statements by council leaders on this website, sitting Canute like hoping against hope that the planning system and housing need will somehow one day go away before their plan gets found out.
Mid Sussex Fails Duty to Cooperate for Failing to Cooperate with Crawley and Sussex Coastal Districts
Just yesterday I was discussing how little sense it made to plan for the West Sussex coastal district separate from the north of the county, and today I was sent through the Mid Sussex decision on just that. The most important so far I think as it deals with no just cooperation within one MHA but between two overlapping and closely related HMA, that is Gatwick and Sussex Coastal. The underlying issue of course is whether Mid Sussex should have to plan for a new town to take Sussex Coastal overspill. Brighton have formally requested Mid Sussex to meet some of their need and Crawley. Adur and Lewes may do so in the future. Now it seems inevitable they will.
The response from the four coastal local planning authorities (submitted by Adur and Worthing Councils) concludes by suggesting that I should take a flexible approach and proceed with the examination ‘as this would enable the housing issues to be considered in detail’. Similarly one participant at the hearing session suggested I could adopt some form of sliding scale that would enable me to conclude that, although in his view the Council had not fully met the requirements of the duty, it had made sufficient progress to be deemed acceptable. There is no room for such flexibility in the legislation – either the requirement has been met or it has not and it is on that basis I have considered the evidence.
At the EM it was suggested that if the submitted District Plan (DP) (which covers the period up to 2031) were to be found sound, then it should be subject to an early review, which would be based on a thorough assessment of cross-boundary issues. However, the legislation on the duty does not provide for such an approach to be followed….
.The Council did not establish a robust framework within which ‘co-operation’ could be monitored – for example in terms of frequency, issues to be addressed, outcomes to be anticipated and bodies to be involved.
…the Council appears to have taken a rather ad hoc approach and relied on existing established meetings to give consideration to the duty. The Council argued that there is no specific requirement in the legislation to take a structured approach, and that is correct. However, the Council needs to demonstrate co-operation, co-ordination and continuous engagement and one way this may be achieved is through a more transparent process that can be appropriately managed and monitored….
In a Report to the Scrutiny Sub Committee for Planning and Economic Development (5th March 2013) entitled ‘Housing Numbers for the District Plan’ (EP31), paragraph 28 confirms that ‘discussions with neighbouring authorities need to continue over the next few months to clarify their
positions and agree mechanisms for addressing cross-boundary issues where practical and consistent with the strategy and objectives of the District Plan’.
Firstly there is no record of any significant ‘mechanisms’ having been agreed prior to the submission of the DP and secondly the officer appears to be precluding any discussions if they relate to issues that might conflict with the Council’s strategy and objectives of self-containment. Neither of
these factors add weight to the Council’s contention that it has met the duty…
Meetings have been held and doubtless appropriate issues have been discussed but it needs to be demonstrated
that appropriate conclusions have been drawn at those meetings and that the Councils have acted on those conclusions. It is inevitable that there will be difficult issues to address. An example is the situation regarding
the proposed Memorandum of Understanding between Mid Sussex and Lewes Councils, which was drafted over 18 months ago but which has not been signed. This does not indicate that a constructive approach has been adopted.
The evidence indicates that a number of local planning authorities in the area will be unable to meet their objectively assessed housing needs in a
sustainable way. Whilst I understand it is not always easy to take an active approach in terms of considering the needs of other local planning authorities and also that localism has a role to play in any deliberations, those factors should not be seen as a reason to take a back seat and rely on others to seek solutions to cross-boundary problems.
there is no indication in the submitted plan that
serious consideration has been given to the concerns that were voiced. The opportunity was there for the Council to conclusively demonstrate, one way or the other, that it had considered the concerns of nearby local planning authorities and drawn appropriate conclusions. However, there are no significant references in the DP to any cross-boundary issues. The meetings that have been held could not accurately be described as frequent and the evidence does not demonstrate that consideration of cross-boundary issues has been taking place from ‘initial thinking’.
No in-depth analysis of the issues facing the local planning authorities in the area has been undertaken and no robust assessment of how those
issues should be addressed has been prepared. The lack of commitment to seeking a way forward is demonstrated by the lack of progress on the Memorandum of Understanding between Mid Sussex and Lewes Councils.
Therefore in terms of fulfilling the duty I would describe the foundations upon which the approach of the District Council is based, as at best, shaky.
The Coastal West Sussex Strategic Planning Board (which represents Brighton and Hove, Adur, Arun, Chichester, Lewes, Worthing and the South Downs National Park) published, in May 2013, a Housing Study(Duty to Co-operate)12. I am unable to give full weight to the conclusions included within this Study because I have not tested the evidence on which it is based. However, I have no reason to doubt that it provides a reasonably justified indication of the situation because it pulls together
evidence from a range of other studies. This Study suggests that housing delivery over the period to 2031, across the Coastal Housing Market Area, is likely to be at least 20% below objectively assessed needs – equivalent
to at least 495 dwellings a year.
The Council argued that it hasn’t been clearly demonstrated by Brighton and Hove, for example, that it could not accommodate a higher level of housing development than is currently being proposed. I cannot draw a conclusion one way or the other because I have not seen all the evidence
but similarly the District Council does not appear to have made a robust assessment of the situation which it could have undertaken if it had collaborated with Brighton and Hove to seek an outcome of mutual benefit to all parties.
The evidence does not enable me to conclude that prior to the submission of the DP, Mid Sussex District Council gave satisfactory consideration to
meeting the unmet development needs (in particular in terms of housing) of nearby local planning authorities. The requirements of paragraphs 178 to 181 of the National Planning Policy Framework have not been met.
Therefore it is with regret that I must conclude that the Duty to Cooperate has not been met. As the Plan has not been based on effective joint working on strategic priorities and because currently there is insufficient evidence to demonstrate that the DP has been positively
prepared, there is also the risk that the Plan could be found to be not sound….
It must be emphasised that this does not mean that Mid Sussex should be expected to accommodate additional growth – that is not necessarily the case. What it does mean is that the Council should give detailed and rigorous consideration to the development needs of nearby authorities and draw robust conclusions with regards to whether or not any of those needs could be met in a sustainable way within the District, bearing in mind the environmental and other constraints that exist.
I understand that this is not the conclusion that the Council would have wanted and that there may be consequences in terms of the Council being unable to meet its 5 year housing land supply requirement. Nevertheless this cannot outweigh the need for effective joint working. I must advise the Council to withdraw the Plan, undertake a more rigorous assessment of cross-boundary issues and in so-doing ensure that it meets the requirements of the Duty to Co-operate, carry out the necessary consultation and re-submit the Plan as soon as possible.
Mevagissey Parish Council Successfully Challenges AONB Housing Permission for Failure to Consider Alternative Sites
Long awaited case and a predicatible victory
- The planning application of course required the Council to weigh all material considerations; but, in particular, it required the Council to consider, in the light of the relevant policies, the tension between the local need for affordable housing and the impact of the proposal on this location within the AONB. One primary ground of challenge is that the Council’s approach to this task was not in accordance with the relevant policies and was therefore unlawful…
This debate did not apparently include any consideration of alternative sites: none is recorded in the minutes….
the Council accepted that the grant of permission “failed to adequately specify what exceptional circumstances weighed in favour of granting permission such as to outweigh the impact of the development of the AONB”. …
The Developer’s stance, briefly put, has been to deny that the Council erred in its approach to the relevant AONB policies (Ground 1), and to aver that the reasons given for the grant were adequate (Ground 2)….
- Where an application is made for a development in an AONB, the relevant committee or other planning decision-makers are required to take into account and weigh all material considerations. However…the NPPF places the conservation of the landscape and scenic beauty of an AONB into a special category of material consideration: as a matter of policy paragraph 115 requires it to be given “great weight”, and paragraph 116 of the NPPF requires permission for a major development such as this in an AONB to be refused save in exceptional circumstances and where it can be demonstrated the proposed development is in the public interest. In coming to a determination of such a planning application under this policy, the committee are therefore required, not simply to weigh all material considerations in a balance, but to refuse an application unless they are satisfied that (i) there are exceptional circumstances, and (ii) it is demonstrated that, despite giving great weight to conserving the landscape and scenic beauty in the AONB, the development is in the public interest. The committee may of course depart from the guidance (see paragraph 41(iv) above), but (i) the Planning Committee certainly gave no reasons for doing so, and (ii) as I have indicated above (paragraph 49(i)), Mrs Townsend did not seek to argue that they did, in this case, deliberately and informedly depart from the guidance
- It was the Planning Committee’s duty to exercise their own judgment on the application. In doing so, they were of course entitled to come to a different conclusion from that of the officer. However, they could not do so without, in their summary reasons, (i) indicating that they had correctly identified, understood and applied the relevant policies, notably paragraphs 115-116 of the NPPF; and (ii) explaining, if but briefly, why they had come to the conclusion they had, and thus why they considered the officer’s conclusion wrong.
[The minuted reasons] suggests that the Committee found that the need for affordable housing outweighed the harm to the AONB that the development would cause, on the basis of a simple balancing exercise. However, they were not performing a simple balancing exercise. They could only approach the application on the basis of the paragraphs 115-116 of the NPPF: they had to find exceptional circumstances, and then, giving the conservancy of the AONB great weight, determine whether other factors (including of course the need for affordable housing) meant that the public interest was nevertheless in granting permission for the development. … the words in the summary grounds…suggested – and, in my view, very strongly suggested – that they had ignored the requirements of paragraphs 115-116 of the NPPF, and adopted a wrong approach.
one can properly assume from that experience alone ….that they had in mind, and understood and applied, the requirements of paragraph 115-116 in this particular case; and properly addressed their minds to the scope for alternative ways on which the accepted need for affordable housing could be met in Mevagissey by developments on alternative deliverable sites that would do less harm to the landscape and scenic beauty of the AONB.
The Hastings Examination on DTC and When You can Undershoot Objectively Assessed Need – and Why it’s Different from Arun
Apologies for not reporting the Hasting Inspectors decision before. It has become political because Nick Herbert MP in Arun has quoted it to Arun District council there who rejected his advice to set a target well below their objectively assessed need’.
‘I would like to draw to your attention to Hastings Borough Council’s plan. This proposed a housing number that was HALF their objectively assessed housing need. Significantly, the Planning Inspector has just passed the plan, specifically endorsing the lowered housing number, on the basis that protected landscapes and “exceedingly pleasant … open land … providing an integral part of an attractive rural setting” present “constraints [which] are valuable assets which give the Borough its unique charm, character and appeal” (Report, 21 October 2013, paras 55 and 56 – see here)’… the key point is not to compare Hastings and Arun directly: it is that the principle that lower housing numbers CAN be set has been established and endorsed by the Inspectorate. This case was drawn to my attention by the Planning Minister when I raised these issues with him.
The Hasting Decision turns on the fact that Hastings has a very tight boundary which on its land side is all AONB. Arun on the other hand has major areas outside AONB. Also Arun went through the DTC process in asking its landside authority Rother to take the overspill, and their own inspector as a result is looking at raising tripling its target. In that report
(2010 based) household projections and the County Council’s estimates for dwelling requirements that relate to them suggest a trend based dwelling requirement of 7,493 dwellings during the plan period, an annual average of 441 and more than twice the amount proposed in the Planning Strategy. Following the requirements of the Framework, particularly its paragraph 178, and in line with the good working arrangements between the 2 Councils, the Borough Council in its letter of 7 March 2013 formally requested Rother District Council to consider the extent to which it might assist in meeting the Borough’s housing requirement of 7,493 dwellings. In this way, the Council explored the implications of this trend-based projection to its logical conclusion and the possibility of meeting the Borough’s full, objectively assessed housing needs.
The Chief Executive of Rother District Council replied to the Borough Council’s request in his letter of 9 April 2013. He refers to a similar request from the Inspector examining the District Council’s Local Plan Core Strategy in which she refers to a figure of 9,979 dwellings as the trend-based projection for Rother District during the plan period which is more than twice that contained for it in the South East Plan. This is described as a dramatic change in approach to housing requirements. The letter states that the stark proposition is that Rother increases its housing provision from the South East Plan’s figure of some 4,800 dwellings 2011-2028 to some 13,765 dwellings, this being the sum of the 9,979 dwellings above plus the balance of 3,786 dwellings that cannot be met in Hastings …
I am not aware of all the planning circumstances in Rother District, but the crucial point here is that I am satisfied that the Borough Council has done everything asked of it to explore the possibility of meeting its needs beyond its boundary. The level of housing growth set out in Planning Strategy should be supported as explained later in this Report. It would be unreasonable to fail the plan and deem it unsound on matters outside its control and upon which it has vigorously sought to resolve.
The inspector at Rother has yet to conclude. However it now finds its objectively assessed need has risen by 3,786 dwellings. It remained an option for Arun to say that it could not meet its own need however para 14 of the NPPF requires that objectively assessed need be met in full unless (para 14.)
any adverse impacts of doing so would significantly and demonstrably outweigh the benefits, when assessed against the policies in this Framework taken as a whole; or
–– specific policies in this Framework indicate development should be restricted
Remember the NPPF does not protect green field sites per-se so the only possible breach would be with Para. 152
Local planning authorities should seek opportunities to achieve each of the economic, social and environmental dimensions of sustainable development, and net gains across all three. Significant adverse impacts on any of these dimensions should be avoided and, wherever possible, alternative options which reduce or eliminate such impacts should be pursued.
And the ‘positively prepared’ and justified tests from para 184.
Positively prepared – the plan should be prepared based on a strategy which seeks to meet objectively assessed development and infrastructure requirements, including unmet requirements from neighbouring authorities where it is reasonable to do so and consistent with achieving sustainable development;
Justified – the plan should be the most appropriate strategy, when considered against the reasonable alternatives, based on proportionate evidence;
Both of which are slightly oblique references to the EU SEA directive (2001/42/EC) which requires strategies (remembers strategies not plans) to consider reasonable alternatives, and a strategy can look beyond a plan area.
Now it would be reasonable for a strategy to consider alternatives to developing what little land remains between the South Downs National Park and Sussex Coast Towns, such as developing a new settlement north of the South Downs near Haywards Heath as has been proposed. Nick Herbert MP could have raised this and suggested this as an alternative that should be considered in the SEA. Because he has not done so, he has not suggested an alternative location to meet the NPPF, his statements don’t comply with national policy and should be ignored. It is very unclear as far as I can see if Nick Herbert is campaigning against the houses in his constituency as breaching national policy, or campaigning against national policy so housing can and will be blocked anywhere and everywhere, we should know.
I need to stress that Nick Herbert MP was quite wrong in stating that Arun was in the report setting a housing target. That was wrong all it was doing was setting its objectively assessed need based on a SHMA update (a waste of £21k if ever there was one)though the wording of the officers recommendation was needlessly woolly ‘the council needs to plan for’ (rather it is the SHMA figures as a whole which coastal west susses and its neighbours need to plan for)). This any authority needs to do before choosing sites, strategy and SEAing them. Establishing need is not the same as setting a target. What is the MP suggesting they do, the supreme idiocy of Tandridge District Cllrs in rejecting a SHMA report, which would only lead to a flood of no hope appeals in the very fields Nick Herbert wants to protect?
Incidentally I think the new strategic planning area of ‘coastal West Sussex’ – launched this week, is bonkers. The proper strategic planning area should be the Greater Brighton Conurbation – including Worthing and Arun, and the road/rail corridor to London via Gatwick.
Regular readers of this blog will know that past statements by EN about the Lodge Hill site have made it clear, contrary to recent DEFRA statements, they they view biodiversity offsetting not as a means of offsetting residual impact but as a means of smoothing consents where the primary impact is negative. The statement below confirms it. It took the bravery of the inspector Laura Graham here to show that the test of whether there was an alternative site with less habitat loss impact had not been met.
In a letter to the Planning Inspectorate (PINS), Medway Council said that the decision to withdraw the document from examination was made on 21 November. The council said it will now start work on a new local plan.
In a statement issued this week, Medway Council said that the decision to withdraw the core strategy followed a decision from conservation adviser Natural England to confirm an SSSI covering a site earmarked for a new settlement.
The Lodge Hill site, a former Ministry of Defence facility on the Hoo Peninsula, had been allocated as a 5,000 home community in Medway Council’s draft core strategy.
But on 19 November, Natural England confirmed the site as an SSSI. Speaking after the decision, Poul Christensen, Natural England’s chairman, said: “The evidence clearly points to this site being one of the most important strongholds for nightingales in the country. Confirming this land as an SSSI gives the clearest possible recognition of this.”
Natural England said in a statement that the SSSI status “does not determine whether or not development can go ahead; this is a matter for the planning system”.
The adviser added that, “in order to contribute to sustainable development, we will consider carefully any proposals for a habitat creation scheme to offset the impacts on the special wildlife of the site, should development proceed”.
Natural England had said in March that it was minded to designate the location as an SSSI because of the presence of nightingales.
In June, the council was told by inspector Laura Graham that because of this, and the lack of alternative sites, the document should be withdrawn and a new plan drawn up.
Given that EN now have a political placeman in charge we will see what difference this makes.
This week has seen an almighty blog ding dong between prominent New Keynesians.
Williamson kicked it off here on the 27th Nov. Arguing is highly mathematical language that QE has been deflationary.
the effect of QE is to lower the liquidity premium (collateral constraints are relaxed) which…will lower inflation and increase the real interest rate.
An idea that has been floating around in post-keynsian circles for some time. See Cullen Roache and Francis Coppola for example., with particular stress on the role of QE in providing safe collateral. Narayana Kocherlakota had briefly made such a claim in 20011 before withdrawing it.
Horror erupted with arguably the leading new Keynesian monetary theorist being threatened with ejection from the club, as summed up by Noah Smith
In a testy response, Nick Rowe called Williamson’s post “horribly wrong,” lamenting: “What the hell has gone wrong with some of the best and brightest in economics?” Brad DeLong then jumped in, accusing Williamson of mistaking an unstable equilibrium for a stable one. Paul Krugman echoed that accusation.
There were further follow ups by Williamson here, calling it a ‘teachable moment’ for his opponents to learn of their errors, and here and Krugman here, saying Williamson had not explained a story of how the effect he describes derives from individual actions.
I don’t much care for Willaimson’s NK modelling style and scary plumbing. DGSE doesn’t properly account for state, accumulation and stocks – only flows, and the Lucas ‘cash balance constraint’ is just a hack to avoid having to account for stocks. None the less Williamson seems to be moving in the right direction. His latest model has a decidedly ‘non-neutral’ role for money. Lets focus on the key mechanism in his model the changes in liquidity from QE leading to a lessening in the ‘liquidity premium’.
I have never much myself like the term and the treatment of liquidity in for example IS/LM models. If liquidity has a premium it has a price and what therefore determines that price? Quantitative stories alone don’t tell you about the demand side or the dynamics of the liquidity premium in disequilibrium. For example the price of an asset at a term will be determined by the next most beneficial asset at that term. The ‘liquidity premium’ is the difference in price with a comparable asset which is fully liquid. But we cant solely determine that price on the basis of a liquidity transformation of that asset only, the price is set by the price of the next most beneficial asset with that liquidity. Why do we want a more liquid asset? Aside from the transactional demand for money it is likely that what looked a good investment is now suboptimal, and in really bad times with negative returns money is the best asset of a bad lot. Seen in these terms we can tease out the differential components of ‘liquidity premiums which are easily confused, rate of returns on assets, the effects of inflation and the effects of risk.
This is how I see the basic macro, in terms from the godfather of QE Richard Werner.
Financial Assets Real Assets(GDP)
Nominal Rate of Return X inflation premium X risk premium <> Nominal Rate of Return (after depreciation) X inflation premium X risk premium
This sets the bounds within agents react and the context for micro, the pages on which the story is written. The inflation premium is the same on both sides of the equation. However the effect is not inflationary neutral, the adjusted rate of return on the RHS is what monetary theorists long ago (after Henry Thornton) used to term the ‘mercantile rate of return’ and on the LHS the ‘monetary rate of profit’. If the rate of change on the RHS is greater than the left hand side then the circulation of goods will parri passu not be backed by the creation of money, i.e. inflation. If the converse happens we have deflation. Where we have a differential rate of return then we see a shift in investment between the two sectors (as in the Petty/Ricardo/Malthus Silver-Corn model I discussed here) leading to an increase/decrease in the real wage which restores equality in the long term providing there is no change in the stock of money in circulation. Changes in the monetary stock, such as paying off debt or increasing the stock of money in circulation, can set off a ‘cumulative process’.
I have previously argues, for example in my paper on a stock-flow consistent alternative to IS/LM that the concept of liquidity could be fully replaced by conceptions of risk and leverage. That is correct and can explain why the ‘demand for loans’ curve (leverage) slopes down with the interest rate. But there is a role still for ‘liquidity premiums’ considered as an addition to the gradient of this curve caused by increasing risk (and not other effects) through time. Consider the following from Anderson’s Economics and the Public Welfare
“Selling on the stock exchanges at the outbreak of the war was an illustration of a fundamental principle in economic life. When there is general confidence in the uninterrupted goings on of economic life, confidence in the legal framework under which economic life operates and in the essential integrity and fairness of governments, men with capital prefer to have their capital employed. They want income from it. They want capital to work with, as giving additional scope to their personal efforts and their personal abilities. They are quite content to have their capital embodied in physical goods destined for future sale, in shares in industrial undertakings, in real estate which brings in rentals, or in loans to active men engaged in industry and commerce. But when grave uncertainties arise, and, above all, when unexpected war comes, men prefer gold to real estate. The man who has his wealth tied up in lands can make no shift. He must sit and take what comes. With the apprehension of war. however, the effort is made to convert illiquid wealth into liquid form as rapidly as possible, even though heavy sacrifices are involved.”
Jerry Bower calls this the Szlazard principle after the physicist who always kept packed suitcases at the door. At times of greatest uncertainty there will be a marked increase in the ‘liquidity’ premium.
Consider again our equation. If the risk premium on financial assets is reduced, through for example a central bank buying bonds on the secondary market, then this will underwrite the risk free return and lower the liquidity premium. This means the LHS value will increase compared to the RHS which is deflationary. We have a simple mechanism, will this satisfy the critics?
A potential objection is this a revival of the ‘natural rate’ argument which Sraffa has supposed to have disproved. He did not only that under barter there is no unique natural rate. See this paper here, Own rates, in any inter-temporal equilibrium, cannot deviate from each other by more than expected price appreciation or depreciation (including the effect of the change in the purchasing power of money) plus the cost of storage and the service flow provided by the commodity, multiplied by the liquidity premium must be equal, so that the net anticipated yield from holding assets are all are equal.
Putting this in broader context of whether the state of ‘mainstream’ economics is in good shape, as Krugman and Williamson have argued. Noah Smith
what Steve and I usually argue about is the general state of macro – he says macro is in fine shape, I say it hasn’t discovered much. I think this reversal supports my thesis. If a top-flight macroeconomist, who knows the whole literature backwards and forwards, can so easily change his workhorse model in one year, and reverse all of his main predictions and policy prescriptions, then good for him, but it means that macroeconomics isn’t producing a lot of reliable results.
But there is nothing wrong with changing your mind, as Keynes did, if a short term crisis leads to dismantling of a misguided ‘mainstream’.