Planning matters

On 20 July, the Government updated the National Planning Policy Framework (NPPF) to much fanfare, alongside the publication of the National Model Design Code (NMDC) and launch of an Office for Place.

These are more changes to the existing system, so more of a policy filler before the main planning reform event.

The key changes in policy are those given most property press coverage - requirements related to design and changes to the national policy considerations to be taken into account when seeking to remove permitted development rights for change of use to residential. The new national policy requirement for local plans to look 30 years ahead where large scale development forms part of the strategy is an important change too.

Apart from transitional arrangements relating to this new requirement for 30 year vision, the new and revised policies came into force immediately.

The background is that in January, a year on from the publication of the ‘Building Better, Building Beautiful’ Commission’s report, ‘Living with Beauty’, the Government issued its response, setting out where it will take forward the Commission’s recommendations. Accompanying the report was a consultation on the proposed amendments to the NPPF and the content of the newly published (then draft) National Model Design Code and accompanying guidance note.

Tom Davies covered the key changes in his February blog “Design-led - but a variety of NPPF changes are proposed”.

As Tom noted, while the press release and headlines focus on design quality and ‘Beauty’, the revisions to the NPPF cover a broader range of issues, with the Government also consulting on amendments to policies on sustainability, flood risk, and biodiversity; Article 4 Directions; protection of the historic environment; and minor changes which remove now out-of-date references within the Framework.

Almost all of the changes proposed have been taken forward.  And where there are changes to the text consulted on, it is not a wholesale change in approach.

The key changes are explained below.

Improving design quality and placemaking

The Government has given centre stage to its proposals to raise the standards of design and quality of new development.

The Communities Secretary’s 20 July Written Ministerial Statement gives a summary of what the changes to the NPPF are intended to achieve in terms of design:

In May 2021, 14 local planning authorities from each English region (remember them?) were selected to take part in a six month programme to test the NMDC, with a £50,000 budget each. Notwithstanding, the policy requirement to devise codes is already national policy.

According to the Government, the 14 local authorities are “generating valuable insight to help in the wider application of design coding nationally” and a further 10 pilot authorities are now sought.

The “Delivering a sufficient supply of homes” chapter now expressly refers to “places to be created” rather than to “development” and requires strategic policy-making authorities to:

It is these future design guides and codes that were the focal point of the Communities Secretary’s announcements on 20 July, particularly the policy that guides and codes should be based on local aspirations as established through effective community consultation. Speaking at Policy Exchange event, Robert Jenrick said:

The National Model Design Code has been published in two parts: NMDC Part 1 – The Coding Process and NMDC Part 2 – Guidance Notes.

According to the NMDC itself, its purpose is:

The NMDC provides a comprehensive list of principles that councils should consider when formulating their own codes, with more detailed definitions and proposed parameters included within Part 2. The principles within the National Design Guide are to be taken into account too.

 

New paragraph 129 in the NPPF confirms that design codes can be prepared for entire areas or neighbourhoods, or for individual sites. It also makes clear that landowners and developers may take part in the preparation of design codes prepared by local planning authorities or neighbourhood planning groups and may also prepare codes for sites which they propose to develop. To carry weight in decision making no matter who prepares them,design codes must be developed in conversation with local communities, in order to reflect local aspirations. Where local codes are absent, the NMDC can be a material consideration.

As one might expect, Chapter 12 “Achieving well-designed places”, has been amended or augmented in several paragraphs.

As proposed at consultation stage, it states that all local authorities should prepare design guides or codes consistent with the National Design Guide or National Model Design Code – the consistency with these documents being the key element of change to revised paragraph 128 (previously paragraph 122). Previously the NPPF said “plans or supplementary planning documents should use visual tools such as design guides and codes”.

But the reference to supplementary planning documents has not disappeared, due to consultation responses which noted that the link between design guides and local planning policy was not clear enough. The NPPF confirms design codes and guides need to be produced either as part of a plan or as supplementary planning documents to carry weight in decision-making.

The emphasis on visual tools was removed after the January consultation draft stage, notwithstanding references to use of visual engagement tools in the NMDC. As before, the detail and degree of prescription within codes or guides should be tailored to the circumstances, with the NPPF now noting geographic coverage and scale of change should also be considered when devising guides and codes.

As to the degree of detail that codes should include, the NPPF continues to state that codes should “allow a suitable degree of variety”. The previous and consultation versions tagged on “where this would be justified” after “variety”, but this has been deleted and is not in the final version. This is a welcome change, particularly where guides would otherwise seek homogeneity, potentially stifling innovation and density changes.

The NPPF now gives significant weight to development that reflects guidance and policies and outstanding or innovative designs that “fit in with the overall form and layout of their surroundings”.

The latest amendments also call for development proposals that are not well-designed to be refused. This is slightly stronger wording than before, with the Framework previously stating that permission should be refused for development of “poor design” that does not reflect local design standards or codes.

 

While ‘beauty’ or ‘beautiful’ has been inserted into the revised Framework and accompanying guidance, what this means locally will be informed by baseline studies and based on the ten characteristics of well designed and beautiful places as set out in the National Design Guide. These are based on the objectives for design set out in Chapter 12 of the NPPF and expanded upon within the NMDC. These bring together a range of established urban design principles such as built form (density, height and layout), movement, identity and public space which are to guide the development of local design criteria.

The Government has responded to criticisms and questions about the term beautiful:

The Government proposes to take forward the Building Better, Build Beautiful Commission’s recommendations for planning policies and decisions to ensure tree-lined streets; “unless, in specific cases, there are clear, justifiable and compelling reasons why this would be inappropriate” (footnote to new paragraph 131). Furthermore, opportunities should be taken to retain trees and/or incorporate trees elsewhere in developments. There should also be measures to ensure that trees are maintained post completion; it seems that this would likely be through conditions.    

The policy which requires strategic policies to look at least 15 years ahead has been extended to require:

This policy is subject to a transitional arrangement and applies only to plans that had not reached Regulation 19 (pre-submission) stage at on 20 July (or equivalent stage for Spatial Development Strategies).

The Government decided against defining ‘larger-scale development’, concluding that this will depend on context, scale and setting, decided locally and tested at examination. Examples are provided within the policy. The Government is considering providing guidance on the evidence base required to support a 30 year vision.

 

Amendments have been made to paragraph 11 (a), regarding the ‘presumption in favour of sustainable development’; plan-makers will be required to “align growth and infrastructure; improve the environment; mitigate climate change (including by making effective use of land in urban areas) and adapt to its effects”. This provides a new (overdue?) reference to climate change within the presumption and perhaps aims to address to concerns raised by Tory backbenchers regarding the delivery of infrastructure provision for new housing and focusing development on brownfield sites.

The NPPF now also makes reference to the United Nation’s 17 Global Goals for Sustainable Development under paragraph 7; part of the Government’s strategy to ensure that the objectives (which the Government signed up to in 2015) are embedded in the planned activities of each Government department.

The Government’s response to the consultation hints at what might follow in terms of climate change mitigation and adaption:

There have been some tweaks to the policies on biodiversity, with paragraph 180 (previously 175) saying that opportunities to improve biodiversity should be integrated into a design (rather than encouraged) particularly where it can secure measurable net gains (as before) or “enhance public access to nature where this is appropriate” (which is new).

On flood risk, draft paragraph 160 (currently paragraph 156) has been amended to clarify the sequential test should take into account all potential sources of flood risk. Further to this, the Flood Risk Vulnerability Classification is now included within the NPPF under Annex 3, moving from guidance to policy.

The 20 July Written Ministerial Statement explains:
“We have also made a number of environment-related changes, including on flood risk and climate change. These changes are an initial response to the emergent findings of our joint review with the Department for Environment, Food and Rural Affairs (DEFRA) of policy for building in areas of flood risk. For instance, highlighting the opportunities from improvements in green infrastructure and natural flood management techniques. We are also amending guidance on flood risk to emphasise that checks done by local authorities should steer new development to areas with the lowest risk of flooding from any source”.

In light of the Glover Review of protected landscapes, paragraph 176 (formerly 172) seeks to ensure that the scale and extent of development within the ‘settings’ of National Parks and Areas of Outstanding Natural Beauty (not only within, as previously) should be sensitively located and designed so as to avoid adverse impacts on the designated landscapes.

The Government sought to tighten national policy on the introduction of Article 4 Directions (i.e. areas where certain permitted development rights do not apply) where they would prevent the change of use to residential via permitted development rights [1].

Nearly three quarters of respondents to the consultation did not agree with these proposed changes to national policy.

The Government amended the policy differently to the wording originally proposed; confirming on 1 July that the first part of paragraph 53 now says:

As proposed, the policy now says that all Article 4 Directions should be limited to “the smallest geographical area possible and, as before, to situations where an Article 4 direction is necessary to protect local amenity or the well-being of the area.

This pre-empts proposals for authority-wide removal of the new permitted development right for converting the new Use Class E (commercial, business and services) to C3 residential, which was proposed in December. 

Unperturbed, on 21 July 2021 the Royal Borough of Kensington and Chelsea began consultation on a consultation on a borough-wide Article 4 Direction seeking to prevent change of use from Class E to residential.

The Government intends to explore widening the extent nature of permitted development further, and the proposed amendments regarding Article 4 Direction are a nod to this future intention too.

 

Chapter 16 of the Framework, Conserving and enhancing the historicenvironment, has a new paragraph relating to the preservation of historic statues and related, following concerns from the Government that these were being removed “without proper debate, consultation with the public and due process”.

New paragraph 198 states:

The policy has been tweaked from the draft version, which referred to retention, but not specifically in situ.

This policy seems intended to accompany changes to the law which were announced by the SoS in a press release on 17 January 2021. These proposed that where a council intended to grant planning permission for works involving the removal of any statues or statutory listed objects, the Communities Secretary would be notified and would take the final decision.

More broadly, the preservation and enhancement of the historic built environment underpins much of the Government’s ‘building beautiful’ agenda; with the National Model Design Code supporting the use of character appraisals and heritage assessments to form the baseline for the development of design codes.

 

These changes to national policy are as anticipated for some time, largely reflecting the Government’s somewhat conflicting twin focuses on both design beauty and permitted development rights, in delivering more well-designed homes.

As the Government emphasised in the consultation and the consultation outcome, this is only the beginning.

It has, without question, been a challenging year for our town and city centres. As the global pandemic continues and lockdowns come and go, a raft of the nation’s most famous retailers have disappeared from high streets across the country. As in the rest of the developed world, the Covid-19 pandemic has been a ‘game changer’ for the sector. With the growth in online shopping over the last decade or so, most centres had already devised strategies based on re-focusing their offer away from retailing and toward a leisure and food and beverage-based offer.

In the North of England, our town and city centres have suffered more than most in recent years. While Covid-19 has sped up the process of change, even prior to the pandemic many centres were already experiencing major challenges due to both changes in shopping behaviour and weak underlying economic conditions.

The Government’s Levelling Up Fund Prospectus, published in March 2021, identifies a total of £4.8 billion to be invested over the coming years to support town centre and high street regeneration, local transport projects, and cultural and heritage assets across the country.

In addition to the Levelling Up Fund, as part of the Government’s wider package of interventions, there are three key funding streams, which have already seen a great deal of uptake across the North:

• Future High Streets Fund – This fund seeks to allocate £830 million to help deliver transformative changes to struggling high streets;
  
  
• Towns Fund – 100 cities, towns and areas have been invited to bid for part of this £3.6 billion fund designed for proposals which drive economic growth. In many places, town centres are integral to these schemes; and
  
  
• High Street Heritage Action Zones – Seeking to transform High Street buildings which can help to fuel economic, social and cultural recovery.

Town centre stakeholders are responding with a range of radical and ambitious projects. These include strategic interventions by local authorities, including through the acquisition of shopping centres and use of Compulsory Purchase Order powers.

With innovative and ambitious strategies now in place in many towns – and Government funding available to support delivery - there are grounds for optimism over the future of our town centres.

Lichfields’ Insight, ‘Moving on up? Levelling up Town Centres across Northern England’, reviews the various different funding bids currently under consideration. Using this research, we have identified six key themes which underpin the different plans and strategies currently under consideration. These are:

• Health and Wellbeing - With the demise of retail, we need to find a reason to draw visitors into town centres. As well as more pleasant and healthy outdoor spaces and experiences, this could also involve locating other essential services close to transport hubs where they can help to maintain footfall.
  
  
• Education - Universities and colleges have long been key parts of daily life in our city centres. Opportunities exist to locate student populations in the heart of these centres, where they can contribute to vitality and viability.
  
  
• Tourism - Many of the North’s town and cities have fascinating visitor attractions and dramatic physical and geographical environs. An ambitious and coherent tourism strategy should seek to make the most of these unique assets to drive trips to their town centres.
  
  
• Heritage - The North has a rich and varied history, the remnants of which live on in many of our town and city centres. They can make a real contribution to the environment and attractiveness of these towns as visitor destinations.
  
  
• Digital and creative - Whilst retail may never return to its previous levels, flexibility is required to re-purpose the floorspace left behind by these vacancies. Utilising new funding streams and planning reforms, space should be made to accommodate innovative small businesses which will contribute to the vibrancy and culture of town centres.
  
  
• Town centre living - As retail space recedes, we need to ensure our town centres remain attractive places to live. As well as making an invaluable contribution to housing supply in our urban areas, maintaining a meaningful 24-hour population in town centres will in turn drive demand for services and facilities which contribute to the vitality and viability of the centres.

With these themes in mind, our Insight provides evidence across the North of innovation, optimism and ambition in the town centre sector, which means the future may not be as bleak as many sceptics would have you believe.

The issue of development viability is becoming an increasingly important battleground in planning and plan-making. There are several reasons for this, not least the issue of rising costs. The Covid-19 surge in house prices notwithstanding, there remains the potentially longer-term problem for the sector to accommodate the rising cost of labour and materials as well as the need for adaptable and flexible housing to meet the requirements of an ageing population and of achieving ‘net zero’ targets.

2019 changes to the NPPF and related PPG further underlined the importance of viability. The changes point towards the ‘frontloading’ of viability assessment to the plan-making (rather than the decision-taking) stage and the greater requirements for the standardisation of inputs that have evolved as a result. Perhaps one of the most important takeaways from the amended guidance is the following quotation:

“The price paid for land is not a relevant justification for failing to accord with relevant policies in the plan. Landowners and site purchasers should consider this when agreeing land transactions.” [Paragraph: 002 Reference ID: 10-002-20190509]

Developers are now required to engage early on viability issues – the option of negotiating at application stage is now no longer a realistic option unless ‘particular circumstances’ justify the need to. At Lichfields, we have questioned whether the practical implications of this approach could actually disadvantage the smaller players in the market who will not necessarily have the same resource as volume builders at their disposal to absorb the costs associated with earlier engagement.

Two years on from the publication of changes to the NPPF and related PPG, there are still quite significant misunderstandings in the industry about the implications of the changes. Whilst relevant case law helps to provide further clarity on the interpretation of particular aspects of the guidance, we are still not much further on in terms of how to deal with issues of standardisation in viability assessment.

To this end, our forthcoming Insight (subscribe to Insights to get it sent to your email) aims to fill a gap by bringing together a comprehensive analysis of evidence submitted to local plan and Community Infrastructure Levy (CIL) examinations. It covers a total of 93 local authorities across England and in Wales, reflecting a broad coalescence of policy approach between the two.

Our findings therefore reflect the distillation of a large body of evidence on the assumptions and approaches used in undertaking viability assessments for housing development in a local plan context and for local plans (and CIL charging schedules) that were found sound at examination. In this way, we hope that the findings will be useful to a wide range of users and will assist in providing a broad framework for the standardisation on inputs/approaches.

Further detail can be found by reading the Insight, but overall, we distilled our findings down to three main areas:

1. Factors with a common methodology;
2. Factors with a narrow range of values/figures; and,
3. Factors with a broader range of values/figures.

 

It is important to note that the above findings are intended to guide practitioners to ready-reckoners and ranges for which there has been broad coalescence based on a review of the evidence. They should not be used dogmatically, and it should be emphasised that such an approach cannot account for all eventualities – there will inevitably be specific circumstances that justify the application of alternative inputs.

Whilst the issue may have traditionally been viewed as the exclusive realm of agents/valuers, changes to the NPPF/PPG mean that viability is now central to the plan making process and site deliverability. Viability is therefore now critical to planning policy and practice. In particular, the shift towards the standardisation of inputs allows a greater role for planners who can focus less on the assessment of individual input assumptions and concentrate more on how the issue dovetails with other planning considerations. This is perhaps also reflected in the recent update to the RICS guidance note on viability which directly responds to the changed planning context.

As a leading planning consultancy, we have a unique and deep understanding of the interface between viability and planning which others may not be able to offer. We have extensive experience of supporting clients at plan examinations on planning and more recently on viability issues. 

Please get in touch if you would like to discuss how we might be able to assist.

 

The Communities Secretary, Rt Hon Robert Jenrick MP, has issued a Written Ministerial Statement (WMS) confirming changes to the policy on Article 4 Directions in paragraph 53 of the National Planning Policy Framework (NPPF), following a consultation held at the start of 2020. The consultation also covered a number of other proposals the Government has yet to respond to (see our previous blog for more detail on these).

The changes will be included in a revised NPPF expected later this year, but have been announced now “so that local authorities and communities can take it into account from today when they consider bringing in any new Article 4 directions”.

Article 4 directions allow a local planning authority to withdraw a specified permitted development right within a defined area. With the Government having introduced a number of new permitted development rights over the past year, primarily intended to deliver new homes and make more efficient use of existing sites in and around town centres and high streets, the changes to national policy seek to limit the use of Article 4 Directions that withdraw permit development rights that permit new homes.

The Minister’s Statement confirms the new wording of the NPPF will be as follows.

• where they relate to change from non-residential use to residential use, be limited to situations where an Article 4 direction is necessary to avoid wholly unacceptable adverse impacts (this could include the loss of the essential core of a primary shopping area which would seriously undermine its vitality and viability, but would be very unlikely to extend to the whole of a town centre)
  
  
• in other cases, be limited to situations where an Article 4 direction is necessary to protect local amenity or the well-being of the area (this could include the use of Article 4 directions to require planning permission for the demolition of local facilities)
  
  
• in all cases, be based on robust evidence, and apply to the smallest geographical area possible.”

The text for paragraph 53 of the framework previously read:

“The use of Article 4 directions to remove national permitted development rights should be limited to situations where this is necessary to protect local amenity or the well-being of the area (this could include the use of Article 4 directions to require planning permission for the demolition of local facilities). Similarly, planning conditions should not be used to restrict national permitted development rights unless there is clear justification to do so. .”

The WMS from the Minister says that the new wording will enable the measures to be used in a highly targeted way to protect the thriving core of historic high street areas, while ensuring they do not “unnecessarily restrict the ability to deliver much needed housing through national permitted development rights”. While there is nothing within the policy which limits the application of Article 4 Directions to ‘historic areas’ only, it seems likely that the presence of a conservation area or listed buildings may help justify a council’s decision where it intends to designate one, given that the WMS itself is also national policy.             

The changes will likely make it more difficult for councils to implement Article 4 directions for larger areas of land within town centres, for example. This may support the Government with its aims of making more effective use of land in urban and rural areas. The new policy also applies to Class M (take-away, betting shop, pay day loan shop or launderette to residential), Class P (storage to residential) and Class Q (agricultural to residential).

The WMS is clear that the policy on limiting Article 4 directions relating to change of use to residential does not apply to change of use between houses of multiple occupation and dwelling houses.

In either instance, the area to be protected will need to be tightly defined and justified by “robust evidence”.

Within the Statement, the Minister also said:

“Councils should recognise the value to housing supply and increasing resident town centre footfall from supporting ‘flats above shops’; for example, councils can consider applying different policies to residential conversions above ground floor level.”

This seems to imply that where councils seek to restrict changes of use to residential by way of Article 4, they should consider limiting this to just residential development permitted by Class MA, while allowing for new homes created in the upper floors above existing commercial uses (under the existing Class G of the GPDO which allows for certain high street uses to become mixed-use).

Currently, Class G of the GPDO allows for a change of use for the spaces above shops, financial and professional services, betting shops and pay day loan shops to change to mixed use with up to two flats. In a separate technical consultation on the consequential changes to the GPDO (discussed in detail here), it was proposed that this PD right would be continued and extended to encompass all of the new Class E categories.

This recent consultation confirms that Class G (or equivalent) would continue to allow for up to two new flats to be created. Changes of use that would result in the creation of more than two flats may instead benefit from PDRs under Class MA, therefore allowing the authority greater powers to consider and mitigate any impact via the prior approval process.

The Minister’s statement also says that he intends to make the other changes to the NPPF proposed in the consultation - presumably those relating to design, plan-making and environmental protections - later this year.

The changes to the permitted development rights required as a consequence of the introduction of use Class E are expected to be laid before Parliament very soon.