What Realistic Planning Reforms Could be Made After the Election?

I want to set down here some realistic changes that should be made after the election.  Who knows who will win? There is not a lot of difference between the two biggest parties on the Green Belt, Neighbourhood Planning, meeting housing need and the NPPF.  Both seem equally guilty in our national failure to build enough homes. Both the Coalition and Labour have toyed with the idea of using state land development as a macroprudential measure to avoid housing boom and bust.  The big difference is the social purposes of planning, especially affordable housing, how it is defined and who and how is prioritised.  This is basically a queuing rule when we arn’t delivering enough housing, and the basic fact remains that we arn’t.

Therefore it is important to consider an agenda that is realistically deliverable by either party and a range of coalition groupings.  This creates a dilemma because although there is no appetite to rip the current system after the disjunctions of the NPPF we arguably have gone, over the last 15 years, from a system that is failing to one that is broken,  whilst local plan adoption has not been as slow since the first post 2004 Act plans came forward.  So an agenda must ensure stability whilst also ensuring deliver ability – a hard cocktail.

So ill set down a number of broad principles – within which their could be a suite of policy options.

1) Ministerial Self Restraint

Ministers should constrain themselves from constant changes in planning policy and guidance and confusion as to the difference between them.  This is now very confused with major changes to policy being announced in ‘guidance’.    The idea of being able to take with you all national planning policy in one short document, not a bulging lever arch file or files has been lost.  Following a targetted and forensic review of the NPPF – say six months after the election – Ministers might consider setting out a rule not to change policy (unless in an emergency such as following court decisions or discovery of a loophole which can be exploited) other than in a 2 year review cycle.  The model here is the ‘forward guidance’ of the bank of England, where success of policy is ensured by ‘anchored expectations’  the success of policy is not due simply to its comprehension but to expectations that it wont change in the medium term.  Admittedly in recent months there has been some improvements with some major changes subject to consultation and parliamentary announcement, this doesn’t seem to apply to Green Belt changes however.

2) Simplifying Planning Law

Once ministers restrain themselves from weekly amendments to planning policy they will need other occupations.  Our planning acts have not been consolidated since 1990, this is an age and planning law has become ever more complicated.  The opportunity should be taken in the same act to set down a clear compulsory purchase code (as recommended by the law commission) and to have a chapter which is essntially an updated New Towns Act.  The law re the GLA is also out of date and the relationship between Neighbourhood plans and Local Plans needs clarification and a single consistent terminology. Their also needs to be some enabling clauses to allow use of innovative single stage consents (of which more below). The Act I think should have a clear clause stating it is not the purpose of the Act or secondary legislation to set planning policy, rather the NPPF would be required to be presented to Parliament for an extended debate and resolution every two years.  Otherwise  debate on the act could get bogged down with the kind of silly amendments proposed by Bill Cash MP.

3) Providing Planning With a Viable Revenue Stream

Planning will simply collapse unless it gains a new revenue stream or streams, this could come from several sources, bravely allowing LPAs to set their own fees, which would require some kind of OFFPLAN regulator, giving statutory authority to charging S106 admin fees, allowing charging of A4D applications.  A bolder course of funding is needed however as this wont be enough.  I suggest a system below that might also fix another problem the broken infrastructure funding regime.

4) Enabling Land Valuer Uplift Capture and a Proper Infrastructure Funding Stream

Capturing land value to pay for infrastructure and affordable housing is critical to the success of planning.  We no longer have a major local infrastructure and affordable housing public funding stream.  Initiatives like the local infrastructure fund are welcome but marginal. CIL. outside London, is running into trouble – it requires a complex infrastructure to run and a needless costing of infrastructure needs which is not necessary as in every case needs outstrip CIL potential.  The only longer term solution, learning a lesson from the post world war II New Towns – is to directly capture land value uplift.  The complex caselaw on CPO makes this very difficult.  The New Towns act was essentially a workaround by granting allocations and consent at the same time, and today is unviable because of the plan led system of the 2004 Act. a new mechanism is needed. Rather than the present Jim Bowen ‘look what you could have won’ principle of valuation with its complex CAADs etc. we should have a simple rule, the value of land with consent being, say, twice the existing land use value, five times for agricultural land.  Once land is allocated for development the owner would have two years to pay a fee to the LPA equivalent to market value of land minus statutory price to unlock the allocation or they could offer tio sell the land to a local housing corporation at the fixed statutory price.  If they applied for planning permission was applied for without allocation they pay fee to collect the approval notice.  If development is not substantially commenced within two years the LPA or Garden City/Urban Development Corporation would have the option of buying the land at the statutory price and developing it themselves, or the owner could pay a fee, priced to act as an incentive, to extend the option for two years more.  This would fully replace S106 payments, CIL etc. once in force.  I think its simplicity would be welcomed on all sides of the industry.  It could be applied in phases, first applying to large new Garden City type sites.   A guaranteed neighbourhood  cut would also apply.  The LPA would also have the right to buy certain plots of the development (after masterplan approval) for affordable housing and plots to sell for custom build.  This would be a powerful incentive to LPAs to get on and allocate land, indeed I think the charge should be reduced where an adopted plan is more than 5 years out of date as an incentive.

5) Finally Recognise that We Cant Get Enough Local Plans Out Quickly Enough

Since 1988 the whole thrust of national planning policy has been to get local plans out more quickly so as not to lag in meeting housing need. It hasn’t worked.  It looked like finally it was going to work for a few brief years between around 2007 and 2012 as plans came forward in much increased numbers, but after the NPPF plan adoption has slowed to a near dead stop nationally. Yet still the DCLG Select Committee thinks that everything will be alright with the NPPF if we get more local plans out.  Plan adoption rates would have to increase by many fold to meet the backlog over a parliament, it isn’t going to happen.  You would think after 17 years of a policy failure ministers would finally wake up to this.

This need not mean we abandon local plans, a disastrous course.  Nor does it mean that the main solution is simpler examination  – this helps but sound plans have no problems with examination and they are then over quickly, the main problem is getting a sound plan to submission.

What it does mean is:

a) The fundamental principle of the NPPF, that is drive local plan adoption of avoid BWYLWYL, needs some amendment.  We will need to rely on the NPPF more and more, so it needs to be clearer.  In particular how the NPPF applies to multiple applications around villages, many of which are out of scale, it needs additional principles, as does when an application comes forward which is one of several large strategic options for an area (and not necessarily the best).  All that is needed is a couple of paragraphs adding some good practice principles and allowing some exercise of local choice if their are better sites.  Indeed I would require in secondary legislation that where an LPA considered there is a better site and there is no 5 year supply they cannot refuse under normal (not footnote) para.14 grounds unless they attach a map outling an alternative site to the pink slip – this would then be  material consideration.  This would force LPAs to consult on and agree in principle housing sites even in advance of adoption.

b) We need a mechanism for Delivering large Strategic Sites in advance of Plan Adoption.  The Ecotowns project foundered because of David Lock’s insistence that you needed some form of more central mechanism for quickly agreeing large sites – including Garden City Masterplans and large brownfield site masterplams – and the local backlash this produced.  But he was right, especially if we cant rely on local plans.  There has been much discussion about adapting the large scale infrastructure projects regime, but the problem with that is it needs a national planning statement.  There is not and will not be one for housing and the lack of one for large scale employment sites is deeply unsatisfactory, indeed rather useless as it hasn’t been used once.  There is an elegant solution, which ill cover in a moment when I come to distribution of strategic sites.

There is a lot we can do to make the EIP and Soundness Testing issue much less trying and prolonged than it is now.  The principal of ‘frontloading’ seems to have gone with the final stages of plan production and examination becoming a paper chase.  A brief NP like examination wont wash with the current legal tests however.  It would also simply displace prolonged examinations with prolonged legal reviews, as we see in democratic countries that dont have the examination system.  I would suggest two reforms.

a) Apply the New Zealand Adopt First Examine Later System – this seems to work very well. Plans are published, come into force straight away and are independently examined after as resources allow. I proposed such a system to Mike Ash before the 2004 Act was finalised but the Dept didn’t bite.   There are two major risks with this which are resolvable.  First that a plan might be submitted which does not meet the legal tests. Secondly that a plan might be submitted that proposes unrealistically low housing numbers. Both of these issues are resolvable and I set out mechanisms following.

b) Apply a Pre-screening for the Legal Local Plan Tests  There is no point even starting an examination if the legal tests arn’t met.  Already we have in effect an informal pre-examination period.  This could be brought forward and run by PINS. The key tests regard the duty to cooperate and the requirements of the SEA directive.  Both are interlocked as the most problems are caused by not consulting on options required to meet overspill housing need.  If my next recommendation were adopted then the number of houses and workspaces to be allocated would be clear to all parties in a housing market area. Then its members would specify how how much they expected to accommodate themselves and how much should be taken by neighbours. This would automatically tick the legal test – though not necessarily the soundness test – on the Duty to Cooperate.  PINs & PAS would also screen much earlier whether the draft plan consultation contains a full set on reasonable alternatives (with a rolling online feedback from the private sector) providing a plan is them submitted within 18 months it should not be open then to propose new options. This is an ‘unreasonable’ alterative because late and not frontloaded.

c)  Take the most divisive and technically difficult area – the housing & jobs numbers game – out of the examination system Much discussion about this in recent months.  Even planning consultant paid by the hour to submit 300 page documents questioning line by line OAN are fedup and question if this is supposed to be objective why can’t it be done by a verified third party.  If this finding was them binding it would take much of the heat out of the plan making process.  The post NPPF system by giving local plans two degrees of freedom, how much and where, rather than one, where, became bogged down largely because there was always a temptation to massage numbers down  if this implied politically difficult sites.  A model could be the highly successful and much missed NHPAU.  It would be a brave minister to reinstate something similar and make it binding however no single reform would do more to unjam the system and reduce unnecessary waste of planning resources in both the public and private sectors.

 7) Improve Larger than Local Planning

There has been a gradual resurgence in strategic planning as the inevitable results of following the Duty to Cooperate work through.  So the duty works but is too slow. In many areas strategic studies and joint planning is taking place, most notably in Greater Brum.  A problem is lack of structure and enforcability.  South Staffordshire for example wont play ball with the Greater Brum process, Anber Valley with the Greater Derby Process, Central Beds with Greater Luton.  Whilst there is limited appetite for reestablishment of a full strategic tier, and in some places like Cornwall is unnecessary, their is a need to provide statutory support to the kind of processes that are emerging anyway, the principle of subsidiarity, then city regions and sub regions should determine their own boundaries for larger than local arrangements is key.   The recent RTPI report makes the right nooises but is lacking in practical detail, carrots alone are not enough. The problem is that there is no means of testing the LPA by LPA allocations that emerge from larger than local planning, nor even a formalised way of testing them.  In Greater Brum for example the numbers will potentially be tested 13 times.  A simple change would be to provide an enabling power for strategic plans, and a clause that once adopted these set the housing and jobs targets for individual authorities – the general conformity rule.  LPAs could petition the SoS if some holdout LPAs dont take part and the SoS would have reserve powers, after taking advice from PINS and PAS, to require them to join.  Then it would be unlikely that this reserve power would ever have to be used.  The membership of boards should be set by statute to ensure firstly a majority of democratically elected members, secondly an odd number of board members (to avoid the Greater Luton standoff).  Strategic planning done by LEPS or even combined authorities is not always a god fit.  LEPS often cover off areas and dont typically cover Housing market Areas, wittiness Brum.  Secondly combined authorities can be even more curious in form in more than one case of a proposed combined authority covering parts of two HMAs.

Once the principal of a very large strategic site (2,000 or more dwellings) has been made in a strategic plan it should then be possible to move directly to delivery.  All a local plan is doing in these cases is playing catch up.  This I think is the answer to the major infrastructure route question.  The strategic plan would then perform the function of the NPS and establish the principal of development.  Then there could be a limited time (Say six months) to form a local delivery company in partnership and without an LPA majority, and then another 12 months to draw up a masterplan approval, which would be locally determined.  If the deadline is missed the private sector could apply directly to PINS under the major sites regime.

 8) Clarify National Policy on Green Belt Reviews

Green Belt has always been a curious hybrid, a national policy locally implemented, with no disincentive to declare it.  Structure plans were for 20-25 years and so local plans had to have sufficient ‘strategic reserve’ sites. With the abolition of regional plans and structure plans the reserve of sites is being depleted logically requiring Green Belt reviews.  Their seems no appetite for this to be a centrally driven process.   Under the principle of subsidiarity if Green Belt Reviews are required as part of larger than local planning, and this is necessary to meet the DTC then it should and will happen.  The problem is the uncertainty created by the revised and unhelpful guidance that treats GB as a ‘constraint’ without specifying if this is a permanent environmental one or a contingent policy one, that can be challenged and changed.  All that is needed are a few lines added to the NPPF, no need to be centralist.  The principle of considering the sustainability impacts ‘when declaring Green Belts’ could simply be replaced with ‘when declaring and reviewing Green Belts’ and adding a sentence that ‘local plans should ensure that Green Belt boundaries and Strategic Reserve sites remain fixed over a period of 25 years.  To meet this requirement Green Belt boundaries may have to be reviewed, where necessary as part of a larger than local strategic process.   Realistic options of sites within the inner boundary, outside the outer boundary and current Green Belt sites should be explored and their impacts assessed.’  Finally the fundamental principle that GB is a policy constraint not an environmental constraint should be made clear.

9) Provide a Single Stage Process for Approving the Principle of Development

Currently you work vigorously to get a site allocated than have to apply, as if from square one, for planning consent.  This is a needless duplication and leads to the ridiculous possibility you had recently of a site in Northampton, in a newly adopted plan, being refused.

We have very gradually moving along the path towards a zoning and subdivision system in the UK. We are almost the only jurisdiction in the world apart from crown dependencies and colonies to have the alternative development consent system.  The development consent system is very good at fine details and keeping things as they are but doesn’t scale and is hopeless at delivering new development at a quarter and city scale.

Many of the coalitions changes have been nudging us in this directions, but often crudely applied as amendments to the GPDO and UCO with complex policy tests, such as loss of industry, agricultural buildings and shops.  This goes roughshod over local issues, such as in Greater London and National Parks.

I would suggest the following system, three fold, redline consent, masterplan approval and detailed consent.

Redline consent would replace outline planing permission and would as a minimum indicate the site and level of acceptable development.  Allocated sites in local plans would automatically receive redline consent and applicants could apply for it on non allocated sites.  It would be optional to include other reserved maters in the application.  This is similar to the sucessful Special Development Zone process in the Republic of Ireland.

Masterplan Approvals – we are almost the only country without this process and it is a major hindrance.  What the treasury doesn’t get is that once the principle is established you cant just start building or wave an LDO around on a large complex site casting away ‘redtape’ and then start building.  It doesn’t work like that.  Before any development can start other than a favella you have to masterplan and subdivide the site.  The current outline procedure is poorly suited to this as masterplans often contain information that is suppl,menry to the reserved matters process, and which regulate detailed site development and bulk (development control regulations as they are called).  I’m much of the world you subnit your masterplan its stamped and thats that.  We need a similar simple process.  This should also enable LPAs and Neighbourhoods to draw up masterplans as part of development plans.  Masterplans should also become a third kind of plan alongside neighbourhood plans and local plans.

10) Shift the Focus from Allocation to Delivery

Again an issue of all party consensus.  If permissions are stacking up but not starts then the economic benefits of more housing is lost.  The Lyons review idea of a duty to deliver is a good one and one I think the Coalition could accept.  More and more local housing companies are being formed.  As profit making enterprises they can lever private finance and ensure infrastructure is built alongside new housing.  There are many forms this could take, through the HCA, city development agencies, development corporations and local housing companies.  All that is needed is some enabling pwers and ability to capture land value uplift.