Planning matters blog

Keeping up the pace: What does the new Standard Method mean for the South West?

Cardiff office 25 Aug 2020

Update 16 December 2020:

The launch of the proposed new standard method for local housing need on 6th August 2020 unleashed a media and political storm. An unfortunate cross-over with the problems of A-levels and GCSEs led to it being dubbed the ‘mutant algorithm’.

On 16th December, the Government sought to resolve matters, making a series of announcements across four publications:

A written Ministerial Statement
Response to the Consultation on Proposed Changes to the Current Planning System
Updates to the Planning Practice Guidance on Local Housing Need to set the new standard method approach
A spreadsheet with the indicative figures from the updated method

What are the headlines and what does it mean?

View blog

The Government’s White Paper “Planning for the Future” was released last week, which outlined the planning reform proposals for England, aimed at delivering a "significantly simpler, faster and more predictable system”.

Alongside this is a consultation on “Changes to the current Planning System” which aims to continue the simplification of local housing need calculations through revisions to the Standard Method. The new methodology is out for consultation until 1 October 2020.

Doffing the cap to change

The revisions to the standard method very much ‘doffs the cap’ to the current approach to increase housing supply but seeks to better achieve a ‘fair share’ approach by boosting housing numbers in areas with low projections and putting greater emphasis on the uplift for affordability. An approach which is welcomed.

The new standard method now proposes to yield 337,000 homes a year nationally which is higher than the current figure of 270,000 and a step change towards the Government’s 300,000 homes a year ambition. It follows a similar approach to the current method, but with some important changes:

The baseline was previously centred solely on household projections. It now uses the higher of the household projections or 5% of stock growth. This helps to “level up” authorities where projections are unduly low and implies a balanced approach where each authority does its bit;
The affordability uplift is now designed to “deliver greater overall emphasis on affordability than in the current standard method”. Instead of uplifting solely based on how unaffordable an area currently is, the method now also uplifts based on the change in the ratio over the last 10 years.

What are the implications for the South West?

The total South West housing requirement has increased from 27,379 houses to 36,804, an increase of 34% on the previous Standard Method target. This is just below the national average change of 35% and sits well below the rate of growth for London, which would see a 67% increase. Furthermore, some of the South West’s LPAs would see significant falls in their requirements under the proposed revised Standard Method. Bournemouth, Christchurch and Poole will see a significant fall (-32%) compared to the current methodology; as well as falls in West Devon (-13%), Gloucester (-12%), South Somerset (-11%), Torridge (-1%) and Cheltenham (-1%). Indeed, Bournemouth, Christchurch and Poole would see the second largest absolute reduction of any local authority in the country with a reduction of 852 dwellings per annum (dpa) from the current Standard Method.

Figure 1: Change in housing requirements from current standard method to new standard method

However there are significant increases with Cotswold seeing a 148% increase (722 dpa), South Hams at 117% (414 dpa), Teignbridge at 102% (774 dpa) and Cornwall with a smaller percentage increase at 44% but a larger absolute increase at 1235 dpa. Clearly, the proposed standard method would have major implications across the South West, with a number of authorities facing the prospect of significant changes in their minimum requirements. Under the current method, 53.2% of the national requirement is located in London, the South East and the South West. Under the proposed method this rises to 67.4% and there will therefore be significant pressure for the South West to delivery its share.

Table 1: South West LPA breakdown

The new standard method will have implications for those authorities where Local Plans are still in the relatively early stages of production, or where Plan Reviews are due in the coming 2 or 3 years. This is particularly the case for Mendip, Wiltshire, the West of England authorities and Greater Exeter. The transitional arrangements set out by the Government in its consultation document propose that from the publication date of the revised guidance, authorities which are already at the second stage of the strategic plan consultation process (Regulation 19) are given 6 months to submit their plan to the Planning Inspectorate for examination. Authorities close to publishing their second stage consultation (Regulation 19), are proposed to be given 3 months from the publication date of the revised guidance to publish their Regulation 19 plan and a further 6 months to submit their plan to the Planning Inspectorate.

Table 2 below shows the date at which adopted plans (including housing requirements) become more than 5 years old for each LPA in the region, and the status of any emerging Local Plans.

Table 2: Local Plan Status

Some authorities will no doubt press on with their plans at pace including Swindon who will be keen to get their plan to Examination given the 42% increase under the proposed new standard method. Whilst Cotswold with its 148% increase, the largest in the South West, has a recently adopted plan which is likely to allow them to bypass the interim standard method, with the next plan likely to be completed under the new planning reforms.

In the West of England, whilst North Somerset is expected to press ahead of the other four authorities, the joint evidence base on housing numbers currently in preparation will inevitably be impacted by the proposed changes and the new Spatial Development Strategy will need to grapple with these issues. There are large potential increases for South Gloucestershire (+80%) and BANES (+88%) which will be a step change for those authorities, especially the latter given the additional development constraints.

The confusion over the Greater Exeter Strategic Plan with East Devon recently withdrawing from the process and Mid Devon not withdrawing but proposing a new form of GESP instead casts major uncertainty about the timescale for their respective new plans and the progress of Exeter’s and Teignbridge’s reviews. The new changes will have a direct impact on three of those authorities with an increase under the proposed new standard method by 74% in East Devon; 74% in Mid Devon; and 102% in Teignbridge.

The revised standard method could prove useful for any developers pursuing 5 year housing land supply cases where the adopted requirement is more than 5 years old. The reduced requirement in South Somerset will result in the opposite effect for 5 year supply analysis and could indicate benefits to pursuing a 5 year supply case quickly in that LPA, before the revised method is enshrined in formal guidance.

As always, there is a wide variety of situations across the region but this also provides plenty of opportunities for further site promotion.

For implications of what the New Standard Method means for other regions, see below perspectives:

London | North West | Thames Valley | West Midlands | Yorkshire and The Humber

What the health? The planning system and healthcare service funding

Myles Wild-Smith 20 Aug 2020

As the ongoing COVID-19 pandemic continues to reshape our daily lives, one thing has also become clear: we need to think more seriously about the links between the built environment and our physical and mental health. To date, this discussion has generally been weighted more towards access to open space and suitably-sized homes with windows, but the issues are more broadly based. Even though the Government’s Planning for the Future White Paper has charted some radical reforms to planning obligations, the current planning obligation framework will continue to be in force for a few more years, and there are some critical issues which will continue to need to be addressed over this interim period.

Planning for health

Pre-pandemic, the revised National Planning Policy Framework (2019) [NPPF] sought to include a stronger emphasis on health and well-being; it states that the planning system should support “strong, vibrant and healthy communities” (Para 8b) and should take account of “local strategies to improve health… for all sections of the community” (Para 92b). But, it also introduced the notion of addressing inadequate ‘services’ (Para 81b). The development industry in large part accepts the need to contribute to providing capital funding for education and health infrastructure, but despite the NPPF’s subtle shift to include services, little consideration had been given to what role, if any, the development industry should play in helping to address healthcare services revenue funding challenges (beyond its contribution via general taxation).

By contrast, the NHS has proverbially left the running blocks. Faced with budget cuts, resource constraints, and need to keep up with an ageing population, one NHS Trust has been seeking s106 funding for acute healthcare services from via planning obligations since 2014.

These initial requests were successively rejected at planning appeals, as the Inspectors considered that such funding requests were not in accordance with Regulation 122 of the Community Infrastructure Levy (CIL) Regulations (2012) and did not relate to the development. However, two appeals, recovered by the Secretary of State [SoS] in 2016, concluded that such requests were material to the consideration of the applications, were acceptable in principle, and were necessary to make the development acceptable in planning terms.[1] The ‘Securing Section 106 and community infrastructure levy funds’ (September 2018) guidance followed this, in which NHS Improvement and Trusts highlighted the capital and revenue opportunities for NHS trusts impacted by local development.[2]

An un-funded funding gap

So how are Trusts impacted by development beyond infrastructure requirements? The key issue for Trusts is the Government’s current funding mechanism. Trusts are commissioned by Clinical Commissioning Groups [CCGs] to provide planned and emergency acute healthcare to the population of areas under the terms of the NHS Standard Contract. However, this contract is an outturn activity volume-based contract which is agreed annually with CCGs and is based on the previous year’s activity. The contract, therefore, does not account for in-year population increases until the next year, and any additional healthcare activities resultant from an increase in the population of an area – which Trusts are legally obliged to undertake – remain unfunded. Simply put, there’s a potential hole in Trust’s budgets arising from population growth in an area, and a greater number of NHS Trusts are now turning their attention to the development industry to plug these ‘funding gaps’ through S106 contributions.

Having dealt with a number of these requests, we can see there are practical concerns about how some NHS Trust’s are seeking s106 contributions. The Regulation 122 Tests requires s106 requests to be “fairly and reasonably related in scale and kind to the development”. In this regard, it is important that Trusts only make requests for the un-costed ‘new persons’ that would likely and reasonably present themselves for treatment because of a proposed development. This is because some of the population of the development will have moved from within the area, and will have already been considered within the service provider’s funding model. At present, there are legitimate questions regarding whether the Trusts’ calculations address this.

In addition, these requests are typically made well into the determination period of planning applications. Indeed, one Trust submitted four s106 requests to developments which had already been determined by a planning committee in Worcester – requests which were subsequently rejected.[3] Consequently, there is little room left for the negotiation of additional s106 monies beyond which has already been agreed or found viable.

A return to marginal viability debates?

Turning to the latter point, and setting aside broader concerns about the Trusts’ calculations, the manner in which Trusts are currently engaging in the planning system is somewhat at odds with the spirit of the NPPF, and more importantly, likely to hinder the Government’s ambition to ‘build, build, build’.

The revised NPPF shifted the consideration of the ‘viability’ of sites from the decision-making stage to the forefront of the planning process – plan-making – and is clear that Local Plans “should set out the contributions expected from development… [and] such policies should not undermine the deliverability of the plan.” (Para 34). In the context of education contributions, the Planning Practice Guidance [PPG] states that obligations should be set out in the local plan, so that they are subject to examination [4]. The aim of this is to ensure that these obligations are sufficiently certain and “can be accurately accounted for in the price paid for land”.4 This is particularly important, as paragraph 57 of the NPPF serves to limit the scope for re-testing the viability of developments post-Local Plan examination. As such, developers are likely to find it more difficult to justify diverging from planning obligations on viability grounds.

However, currently, few authorities have grappled with the revised NPPF through local plan reviews, and few, if any, local plans contain an explicit reference to the need for developments to fund healthcare services, let alone including a standardised approach. It is therefore difficult for the development industry to factor these ‘unknown’ costs into the viability of the development.

Whilst the economic implications of COVID-19 are still crystalising, the viability of sites will invariably be at the forefront of many plan-making and decision-making discussions. This is likely to limit Trusts further, as the viability assumptions of sites will have already been ‘baked-in’, and the economic uncertainty of COVID-19 will invariably impact the viability of some schemes. Moreover, LPAs may have to make tough decisions in the balancing exercise, to ensure that planning obligations align with their area’s particular priorities: fund the NHS? deliver affordable housing in an area where there is already an acute shortfall? Or ensure this brownfield site is brought back in to use?

The Government has been clear that a critical part of our economic recovery plan is to ‘build, build, build’ the homes and infrastructure this country needs. But there is still uncertainty from Councils and the Government as to whether such requests are acceptable. Fareham Borough Council rejected a c.£6m S106 request for the Welborne Garden Village in October 2019[5], and the SoS recently rejected a £1m request in Teignbridge in June 2020. Coupled with eleventh-hour requests, discussions and negotiations between LPAs, applicants and Trusts, there is a risk that such requests will delay the decision-making process for applications which are proposing to deliver housing to meet needs, which also deliver wider economic benefits.

What the above highlights is that, increasingly, LPA officers will have to weigh up the importantance of further S106 requests in the planning balance, and make difficult decisions as to which best align with the LPA’s priorities, and importantly, which can be viably be delivered. Despite opening up planning obligations to the provision of public ‘services’, the Government is seemingly silent on whether planning should cooperate and integrate with service providers. Historically, whilst both NHS Trusts and CCG’s have been consulted in the preparation of local plans, this has largely in respect of the infrastructure-related impacts of planned housing growth. If planning is to play a role in mitigating the impacts of development on service funding – and evidence from the West Midlands indicates that Trusts believe it should – there is a cogent need for them to engage more proactively in the planning system form an earlier stage, or more specifically, the plan-making process.

In the interim, we would urge our developer and housebuilders clients to have a more keen regard to these potential planning obligations when acquiring land and considering site viability, and to discuss this with us.

[1] Appeal References: APP/T3725/A/14/2221613 and APP/T3725/A/14/2229398[2] https://www.hsj.co.uk/south-warwickshire-nhs-foundation-trust/massive-pool-of-untapped-cash-for-nhs-from-property-developers/7020202.article[3] https://www.worcesternews.co.uk/news/17918031.city-council-agrees-reject-hospital-39-s-plea-millions-massive-housing-developments/[4] PPG ID: 23b-004-20190901[5] Application Reference: P/17/0266/OA

New homes: extending into the sky!

Hannah Whitney 18 Aug 2020

There have been a number of recent changes to the General Permitted Development Order ‘GPDO’ which come into force during August 2020. This blog focuses on changes introduced through amendments to Part 20 (Classes AA-AD) of the Town and Country Planning (General Permitted Development) (England) (Amendment) (No. 2) Order 2020 ‘GPDO July amendments’ which come into force on 31 August 2020 and will permit the addition of storeys to various buildings to create new dwellings.

The GPDO July amendments also introduced amendments to Part 1 of Schedule 2 to create Class AA – ‘enlargement of a dwellinghouse by construction of additional storeys’. Subject to limitations and the requirement for prior approval, the amendments create Permitted Development Rights (PDR) for up to two additional storeys, where the existing dwellinghouse consists of two or more storeys; or one additional storey, where the existing dwellinghouse consists of one storey. I have focused on the Part 20 changes in this blog, but please do get in touch if you have any queries on the new Part 1 Class AA PDR.

The new PDR for Part 20 ‘AA-AD’ aims to boost housing supply within existing developments and give more flexibility for provision of new homes without the need to obtain planning permission. Although, notably, the new PDR requires prior approval in respect of a long list of matters which arguably covers the majority of elements that a local planning authority would consider when assessing a planning application (except of course the development plan which is not relevant when considering prior approval applications). Is the Government effectively replacing planning applications these types of upward extension with a PDR prior apporval process? In this instance yes, as the process for consideration and assessment will remain similar to that of a planning application for development of this scale. In this respect, the buildings that can benefit from this PDR have effectively be zoned for upwards extensions, subject to addressing the prior approval matters.

Consequently, this new PDR is also likely to be used to create a fallback position, when negotiating development with local planning authorities, in a similar way that office to residential PDR has been used by some developers to establish a fallback when negotiating development proposals.

The measures set out within the GPDO will control the height of new extensions, but individually permitted extensions will have the potential to significantly alter the appearance of the existing building being extended. At a local level this PDR is likely to be controversial. It will be interesting to see how widely it is used moving forward - and the reaction from neighbours and leaseholders.

What will these new PDRs provide?

The new Class AA and Class AB allow the construction of up to 2 additional storeys on free standing detached blocks (Class AA) and on buildings in a terrace that are in specific commercial or mixed uses (Class AB) to create new self-contained flats.

The new Class AC and Class AD allow the construction of up to 2 additional storeys to be constructed on existing houses which are detached or in a terrace to create a new self-contained flats.

As you would expect, the new PDRs do not apply to all land. There are a number of exclusions including: listed buildings or buildings within Conservation areas, AONB’s, National Park’s, The Broads and World Heritage Sites.

What types of building will benefit?

The new PDR for Classes AA and AB applies to buildings used for any purpose within Class A1 (shops), Class A2 (financial and professional services), Class A3 (restaurants and cafes) or Class B1(a) (offices) of the Schedule to the Use Classes Order, or as a betting office, pay day loan shop or launderette.

Or in the case of buildings in mixed use this applies to two or more uses in the above uses or residential (class C3) together with one or more of the above uses.

The new PDR for Classes AC and AD applies to existing dwellinghouses in C3 residential use.

To benefit from the new Permitted Development the buildings must have been constructed after 1st July 1948 and before 5th March 2018.

For Classes AB, AC and AD the buildings should not have previously been enlarged by the addition of one or more storeys above the original building.

Can these types of residential building be of any height to benefit from the PDR and what are the height restrictions?

No; there are maximum and minimum heights.

Detached buildings in commercial or mixed use

In the case of detached buildings in commercial or mixed use (Part 20 Class AA) the buildings must be 3 storeys or more, measured from ground level, and the finished extended building must not be more than 7 metres higher (not including plant) than the existing building. Further, there is also an overall height restriction of the extended building which should not exceed 30 (not including plant).

Terraced buildings and detached dwellings

The height limits are understandably different for terraced buildings in commercial or mixed use (Class AB) and for terraces or detached properties in use as a dwellings (Class AC and Class AD). The PDR allows up to two additional storeys where the existing terrace or detached dwelling is two or more storeys and only one additional storey where the existing terrace or detached dwelling is one storey. Where the existing terrace or detached residential dwelling is one storey the finished extended building must not be more than 3.5 metres higher than the existing building (not including plant) or 7 metres where the existing building is more than one storey. The overall height restriction of the extended building is no more than 18 metres (not including plant).

In addition for Classes AB and AC there is a requirement that the height of the highest part of the roof of the extended building should not exceed by more than 3.5 metres the height of the highest part of the roof of every other building in the row of terrace buildings of which it forms part (not including plant, in each case).

Floor to ceiling height limitations

For all four classes (AA to AD_ new storeys should have a floor to ceiling height measured internally, that does not exceed the lower of 3 metres, or the floor to ceiling height, measured internally, of any storey of the principal part of the existing building. The reference to the principal part of the building refers to the main building, meaning that any lower front, side or rear extensions of a lower height are excluded (whether these lower parts of the building are original or later additions is not relevant). The extension must also not extend beyond the curtilage of the existing building, or be forward of a wall forming the principal of the existing building or be forward of a wall fronting a highway and forming a side wall.

What are the associated works for which prior approval may be granted?

The associated works that may be granted planning permission by the PDR if forming part of the prior approval application for classes AA and AB include:

a. engineering operations reasonably necessary to construct the additional storeys and new dwellinghouses;

b. works for the replacement of existing plant or installation of additional plant on the roof of the extended building reasonably necessary to service the new dwellinghouses;

c. works for the construction of appropriate and safe access to and egress from the new dwellinghouses and existing premises/dwellinghouse in the building, including means of escape from fire, via additional external doors or external staircases;

d. works for the construction of storage, waste or other ancillary facilities reasonably necessary to support the new dwellinghouses

For classes AC and AD, which relate upwards extensions to dwellinghouses, the associated approved works include items a, c and d above, but item d is not included, so planning permission would be required.

Is prior approval required?

The following ten prior approval matters are applicable to classes AA and AB:

a. transport and highways impacts of the development;

b. air traffic and defence asset impacts of the development;

c. contamination risks in relation to the building;

d. flooding risks in relation to the building;

e. the external appearance of the building;

f. the provision of adequate natural light in all habitable rooms of the new dwellinghouses;

g. impact on the amenity of the existing building and neighbouring premises including overlooking, privacy and the loss of light;

h. impacts of noise from any commercial premises on the intended occupiers of the new dwellinghouses;

i. impacts of the introduction of, or an increase in, a residential use of premises in the area on the carrying on of any trade, business or other use of land in the area; and

j. whether because of the siting of the building, the development will impact on a protected view.

For Classes AC and AD the prior approval matters listed above at a to g and j are applicable, but when considering overlooking, privacy and the loss of light (prior approval matter g) the ‘existing property’ is not referenced. Prior approval items h and i are not applicable to Classes AC or AD.

When local authorities are considering the impact on protected views, they must consult Historic England, the Mayor of London and any local planning authorities identified in the Directions Relating to Protected Vistas.

Is the decision maker limited to consideration of the above matters?

Yes, although paragraph 14 of the prior approval procedure identifies that a local planning authority may require the developer to submit such information as the authority may reasonably require in order to determine the application, which may include assessments of impacts or risks, and how they may be mitigated, having regard to the National Planning Policy Framework or details of proposed building or other operations.

Paragraph 14 does create some uncertainty for developers as it opens up the opportunity for local authorities to request that additional matters are considered though the prior approval process. This is however not a new uncertainty and has been present for other prior approval routes that have been under consideration over the last few years.

There is no requirement to refer to the development plan when considering a prior approval application.

Chapter 12 of the NPPF, ‘Achieving well-designed places’ (paras 124 to 132) is dedicated to design and creating high quality developments and places. It is likely to be an important tool allowing local planning authorities to resist prior approval applications which propose poor quality designed additions that are out of keeping with surroundings. In my view in the case of this PDR local planning authorities will rely more heavily on the design related content of chapter 12 of the NPPF when considering prior approval matter ‘e’, ‘consideration of the external appearance of the building’.

Local planning authorities should of course also have regard to representations received during consideration of the prior approval application which provide opportunities for other parties to raise concerns about design.

The LPA may refuse the prior approval application if it considers that the development does not benefit from the PDR or meet its conditions, or insufficient information has been submitted with the application to determine whether or not this is the case. In this circumstance the application may be appealed.

Is there an application fee?

Draft amendments to the Fee Regulations 2012 propose a fee of £334 per new dwelling where the number of dwellings proposed is less than 50. Where more than 50 dwellings are proposed, the fee will be £16,525 plus £100 for each dwelling above 50 dwellings, up to a maximum fee of £300,000. For comparison, the prior approval fee for a change of use from office to residential is £96, whilst a full planning application fee for development up of up to 50 homes is £462 per dwelling. The Prior Approval fee is therefore closer aligned to the full planning application fee for a residential property that other prior approval fees. This is logical given Part 20 relates to new floorspace and not just a change of use.

The fee for the Part 20 Permitted Development Prior Approval will come into force by the end of August.

Must the LPA consult with certain other bodies?

The GPDO identifies that local planning authorities must consult with the relevant bodies where there are potential transport and highways impacts, impacts on aviation, or where there are potential flooding risks. Where protected views are a prior approval matter, consultees will include the Mayor of London and Historic England. Consultees have 21 days to respond.

Is public consultation required?

The proposed prior approval application must be advertised by the LPA by site notice, and by serving notice on all owners and occupiers of any flats and any other premises within the existing building and any adjoining owners or occupiers (my emphasis).

The local planning authority must take into account any representations made to them when determining an application.

Does the GPDO specify conditions to be attached to the prior approval?

Yes, the developer must provide the local planning authority with a report relating to construction management which must include mitigation measures to protect adjoining occupiers. The developer must also notify the local planning authority of the completion of the development.

The new dwellings must be self-contained flat(s) and the new flat(s) must remain in C3 use, although ancillary uses are permitted.

In addition to the above which are applicable to Classes AA- AD the following conditions are only applicable to the individual classes as stated:

i. Class AB: the development must not include a window in any wall or roof slope forming a side elevation of the building.

ii. Classes AC and AD:

the materials used in any exterior work must be of a similar appearance to those used in the construction of the exterior of the existing dwellinghouse;
following the development, the roof pitch of the principal part of the building must be the same as the roof pitch of the principal part of the existing dwellinghouse; and
the development must not include a window in any wall or roof slope forming a side elevation of the dwellinghouse.

How long does the prior approval last?

The prior approval is issued subject to the condition that the works must be completed within a period of 3 years starting with the date prior approval is granted. As soon as reasonably practicable, the developer must advise the LPA that the development has been completed.

Might the proposed development be liable for the Community Infrastructure Levy?

Yes, given that new floorspace will be created, but this would be dependent on the CIL charging schedule in the relevant local planning authority and whether there would be any deductions, exemptions or reliefs.

Might the proposed development be liable for s106 contributions?

Given the guidance in the current Planning Practice Guidance s106 obligations are unlikely:

“By its nature permitted development should already be generally acceptable in planning terms and therefore planning obligations would ordinarily not be necessary. Any planning obligations entered into should be limited only to matters requiring prior approval and should not, for instance, seek contributions for affordable housing.”

There is of course the potential that the Planning Practice Guidance could be amended to take into account the new PDRs.

Any request by a local planning authority for planning obligations would need to be necessary to make the development acceptable in planning terms, directly related to the development, and fairly and reasonably related in scale and kind to the development.

If the existing building has a planning condition limiting it to a certain number of units or another control related to extending the building can I benefit from the PDR?

Please contact us to discuss this. While the GPDO cannot override a condition, the condition may not have been adequately drafted and/or may not apply in the context of a fresh planning permission to extend the building.

Haven’t there been other changes to PDR?

Yes. Please see the below helpful Lichfields Planning Matters blogs:

New Part 20 Class A which grants planning permission for self-contained flats to be constructed on top of certain existing, purpose-built blocks of flats – see “Right to rise: extending purpose-built residential blocks upwards”; and

New Part 20 Class ZA which grants planning permission for demolition of certain detached purpose-built blocks of flats or detached Class B1 office, research and development or light industrial buildings and the construction detached purpose-built blocks of flats or a single detached dwellinghouse, see “Tubthumping: knock down and rebuild permitted development rights”

Levelling up: What does the new Standard Method mean for Yorkshire and The Humber?

Adam Jackson 17 Aug 2020

Update 16 December 2020:

On 16th December, the Government sought to resolve matters, making a series of announcements across four publications:

A written Ministerial Statement
Response to the Consultation on Proposed Changes to the Current Planning System
Updates to the Planning Practice Guidance on Local Housing Need to set the new standard method approach
A spreadsheet with the indicative figures from the updated method

What are the headlines and what does it mean?

View blog

On the 6^th August the Government announced a revision to the standard method for calculating local housing need. The new methodology is out for consultation until 1^stOctober.

Further to our blog which discusses the implications of the revised method at the national level, this blog focusses on what the changes will mean for housing requirements in Yorkshire & The Humber.

What has changed?

The Government’s new method, announced in the document on Changes to the Current System, incorporates stock into the baseline (as well as household projections) to help achieve a ‘fair share’ approach; this approach helps to boost housing numbers in areas with low projections. It also puts a greater emphasis on the uplift for affordability and removes the cap which exists under the current approach, stating it is ‘not compatible’with the aim of boosting housing supply quickly. When aggregated, the proposed changes would result in a need being established for 337,000 homes a year – far higher than the 270,000 under the current approach but no doubt intended to help plans ‘stretch’ for the 300,000 homes a year ambition, in light of some areas not being able to deliver.

Levelling up

The current standard method has been bad news for boosting housing delivery in the north and has resulted in some almost laughably low housing requirement figures for local authorities in the Yorkshire and Humber (“Y&H”) region, including a paltry 12 homes per annum in Richmondshire.

A key aim of the new method is to make it more compatible with the objective of ‘levelling up’ the midlands and north. As discussed in greater detail below, the new method does offer a slight improvement on the current method, however it still results in housing requirements below levels of recent delivery. The new method also continues to concentrate growth in London and the South East, although this will always be the case for a method with such a significant emphasis on affordability (see Figure 1).

Figure 1: Current local plan requirements, recent housing delivery, current standard method and new standard method by region

Source: Lichfields analysis based on MHCLG/ONS

Short-term fix

Proposal 4 of the Government’s White Paper proposes to replace the Standard Method for Local Housing Need with a further new standard method which distributes the national target of 300,000 homes, taking into account both need and constraints, removing the need for authorities to debate whether they can meet their need at all. In effect, it will do the balancing exercise to apply the ‘policy off’ estimate of need and review of constraints to arrive at the ‘policy on’ requirement. So, whilst the current proposals will be of significant importance for emerging local plans coming forward over the next 2-3 years – and in five year land supply matters over that time horizon – they may ultimately have a short shelf-life once the third ‘new’ standard method is introduced.

What are the implications for Yorkshire and The Humber?

Although the new method results in an increase in housing requirements across the country, as can be seen in Figure 1, rather than ‘levelling up’, the overall effect is to turn up the heat on London and the south of England with northern regions flatlining or falling below levels of recent delivery.

Y&TH receives the smallest proportionate increase in England, with an increase of just 9% on the current standard method requirement for the region, meanwhile adjoining regions in the North West and North East see increases of 20% and 16% respectively. The 17,870 dwelling annual requirement for the region is also 1,465 dwellings less than the annual requirement set by Local Plans, and 1,214 less than the average annual delivery for the region. Furthermore, the Local Plan annual requirement of 19,335 does not take account of York or Calderdale, which do not have Local Plans in place.

Figure 2: Change in housing requirements from current standard method to new method

Source: Lichfields analysis based on MHCLG/ONS

At the local planning authority (“LPA”) level in Y&TH the picture is more varied, with some LPAs seeing a potential increase in requirements and others seeing a decrease (see Figure 2 and Table 1).

Table 1: Yorkshire and The Humber LPA breakdown

Source: Lichfields analysis based on MHCLG/ONS

The new standard method will have implications for those authorities where Local Plans are still in relatively early stages of production, or where Plan Reviews are due in the coming 2 or 3 years. The transitional arrangements set out by the Government in its consultation document[1] propose that from the publication date of the revised guidance, authorities which are already at the second stage of the strategic plan consultation process (Regulation 19) are given 6 months to submit their plan to the Planning Inspectorate for examination. Authorities close to publishing their second stage consultation (Regulation 19), are proposed to be given 3 months from the publication date of the revised guidance to publish their Regulation 19 plan and a further 6 months to submit their plan to the Planning Inspectorate.

Table 2 below shows the date at which adopted housing requirements become more than 5 years old for each LPA in the region, and the status of any emerging Local Plans.

Table 2: Local Plan Status

No emerging Local Plans are currently at Regulation 19 stage in the Y&TH region, although a number of LPAs are close to that point and could be at that stage (or close to it) when the revised standard method is published as formal planning guidance by the Government. These LPAs will therefore need to fast track their Local Plan submissions in accordance with the transitional arrangements.

Wakefield in particular could be an authority which presses ahead quickly with its Local Plan submission based on the current standard method, as any delays could see its housing requirement more than double (970 per annum based on the current method versus 1,982 based on the revised method). Conversely, Sheffield could stand to ‘benefit’ (depending on your perspective) from its long delays on its Local Plan production, as it will almost certainly be able to take advantage of the lower figure derived by the revised standard method by prolonging the consultation process.

Figure 3: New standard method compared to current plan requirement

Source: Lichfields analysis based on MHCLG/ONS

In addition to those LPAs which are currently consulting on emerging Local Plans, the effects of the revised standard method could be felt at any future Local Plan reviews undertaken prior to the wider reforms in the White Paper coming into force. Leeds, for example, is committed to undertaking an early review of its Site Allocations Plan before the end of 2021, and the 14% reduction in the revised standard method requirement could prevent the release of some sites which could have overwise been brought forward.

Furthermore, the revised standard method could prove useful for any developers pursuing 5 year housing land supply cases where the adopted requirement is more than 5 years old, such as Richmondshire, Rotherham and Selby. The reduced requirement in Sheffield will result in the opposite effect for 5 year supply analysis and could indicate benefits to pursuing a 5 year supply case quickly in that LPA, before the revised method is enshrined in formal guidance.

As always, a varied picture across the region but plenty of opportunities for further site promotion.

For implications of what the New Standard Method means for other regions, see below perspectives:

London | North West | South West | Thames Valley | West Midlands

[1] Changes to the current planning system: Consultation on changes to planning policy and regulations

Planning matters

Update 16 December 2020:

Doffing the cap to change

What are the implications for the South West?

Planning for health

An un-funded funding gap

A return to marginal viability debates?

What will these new PDRs provide?

What types of building will benefit?

Can these types of residential building be of any height to benefit from the PDR and what are the height restrictions?

What are the associated works for which prior approval may be granted?

Is prior approval required?

Is the decision maker limited to consideration of the above matters?

Is there an application fee?

Must the LPA consult with certain other bodies?

Is public consultation required?

Does the GPDO specify conditions to be attached to the prior approval?

How long does the prior approval last?

Might the proposed development be liable for the Community Infrastructure Levy?

Might the proposed development be liable for s106 contributions?

If the existing building has a planning condition limiting it to a certain number of units or another control related to extending the building can I benefit from the PDR?

Haven’t there been other changes to PDR?

Update 16 December 2020:

What has changed?

Levelling up

Short-term fix

What are the implications for Yorkshire and The Humber?

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