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Draft London Plan EiP: A change is gonna come
Lichfields is currently monitoring the draft London Plan Examination in Public (EiP), which is scheduled to last until May 2019, and will report on relevant updates as part of a blog series. The seventh blog of the series focuses on some key further suggested changes proposed by the Mayor. After months of hectic hearing sessions, lengthy written statements, endless words, minor suggested changes, followed by further suggested changes, we are now officially in the break-month of the London Plan Examination in Public (EiP), which will duly resume at the end of April. In this context, you might well be forgiven for having lost the plot over where we are at with the draft London Plan, and the latest GLA position on some of the more contentious proposed policies. Whilst, we are still far from knowing any official recommendation from the Planning Inspectors (with the Inspectors’ report currently expected sometime in Summer 2019), the break creates an opportunity to look back at some of the changes the GLA has officially endorsed via published further suggested changes. Below, I have listed six key policy changes (plus a little bonus) which are likely to significantly affect the development sector in London, if endorsed and confirmed by the Inspectors. All the references below to draft London Plan policies/paragraphs are taken from the latest version of the whole Plan (published August 2018, available here). 1. Housing targets and monitoring: a steep stepped approach? One of the main concerns for London Boroughs has surely been the high annualised housing targets (set out in table 4.1 in the draft Plan) and their immediate application from April 2019. The GLA seems to have accepted that it is unrealistic (and procedurally questionable, given that the Plan is not yet adopted) for London Boroughs to step-up their housing delivery at the levels the GLA envisages from year one. Accordingly, it proposes to allow Boroughs to increase their housing targets gradually, allowing them ‘to set out a realistic, and where appropriate, stepped housing delivery target over a ten-year period’ (Paragraph 4.1.3[1]). This might provide a short-term solution to address under-delivery in the first years, but the cynics among us might say that it will simply allow Boroughs to kick the can down the road. Interestingly, the proposed change also touches on another very contentious point, this being the interplay between proposed housing targets, the Government’s standard method for assessing housing need, and the Housing Delivery Test. Boroughs wishing to opt for a stepped housing delivery target are to clearly articulate ‘how these homes will be delivered and any actions the boroughs will take in the event of under-delivery’; the draft Plan now notes that a ‘clear articulation […] would also fulfil the requirement of a ‘Housing Delivery Test action plan’’. Notwithstanding the questions raised by London Boroughs on the potential impacts of this ad-hoc regime (with the new London Plan based on the 2012 NPPF, while Local Plans will be based on the 2019 NPPF), MHCLG concerns about London’s deviation from the standard method for assessing local housing need, and the draft Plan’s reference to the Housing Delivery Test, the Mayor seems firm in his view that housing delivery in London should be assessed against his targets, rather than the standard method-derived housing requirements. This makes for a policy area of the draft London Plan worth following, particularly to understand what the Inspectors will recommend in light of these differing views between the Government and the GLA, as well as for the potential practical implications it may carry.  2. Small sites: yet, not too small to contribute Another contentious policy, due to the draft Plan’s over-reliance on its potential achievements and the modelling assumptions behind it, is Policy H2 ‘Small sites and small housing developments’. Further suggested changes proposed to this policy provide clarifications that any affordable housing requirement that Boroughs wish to apply to small housing developments of nine units or less should only be ‘a tariff approach rather than seeking on-site contributions’ (Policy H2 H[2]). Additional changes to supporting text further stress that ‘affordable housing requirements from development of nine or fewer units should be asked for as a cash in lieu contribution’. Moreover, the presumption in favour of small housing developments[3] would also apply to change of use of non-residential buildings to residential use, which has now been deleted from the list of small housing developments exempted from the presumption; this was added to the list via August 2018 minor suggested changes (Policy H2 F, and related supporting text at paragraph 4.2.3A [4]). The deletion of the above and other exemptions to the presumption in favour of small housing developments (including the exemption for designated Green Belt and MOL sites) suggests that the original assumptions behind small sites-related housing delivery might have been too optimistic. 3. Affordable Housing or employment land, that is the question There is no doubt that the provision of affordable housing in London is the number one priority of the draft London Plan. A suggested affordable housing change that is already worrying some in the Built to Rent sector relates to Boroughs being able to ‘require a proportion of affordable housing as low cost rent (social rent or London Affordable Rent) on Build to Rent schemes’. Furthermore, these potential low cost rent homes ‘must be managed by a registered provider’ (Supporting text 4.13.9A[5]). This could represent quite a conundrum for those Build to Rent developers who are not registered providers (the large majority), and could create issues around different managements within the same building. The draft London Plan also includes affordable housing policies relating to residential development on London’s industrial land. In order to achieve some form of planning benefit from future losses (beyond provision of new homes) and ‘given the difference in values between industrial and residential development’ the draft London Plan policy H6 proposes a threshold of 50 per cent affordable housing for development in certain industrial locations where there would be a net loss of industrial capacity.  The supporting text of Policy H6, as amended, refers to ‘industrial floorspace capacity’ and says ‘residential development proposals that would result in a net loss of industrial floorspace capacity on Strategic Industrial Locations, Locally Significant Industrial Sites or Non-Designated Industrial Sites are expected to provide at least 50 per cent affordable housing to follow the Fast Track Route’ (Supporting text 4.6.6[6]). However, the concept of ‘industrial floorspace capacity’ comes with some caveats, in the form of recently proposed footnote 46E. This recognises that the floorspace capacity approach also applies to ‘sites used for utilities infrastructure or land for transport functions that are no longer required’ for the purposes of Policy H6; furthermore, the footnote acknowledges that ‘some surplus utilities sites are subject to substantial decontamination, enabling and remediation costs’. In these instances, and if ‘it is robustly demonstrated that extraordinary decontamination, enabling or remediation costs must be incurred to bring a surplus utilities site forward for development, then a 35 percent affordable housing threshold could be applied, subject to detailed evidence, including viability evidence, being made available’ (Footnote 46E[7]). The above is a sensible change given that development on industrial land often incurs in greater costs in terms of site preparation. One might assume that such decontamination costs should be accounted for in the price paid for land, but it is also true that many sites might have been bought well before the fast-track route approach to affordable housing was introduced. 4. Industrial land: exempting from the plot (ratio) Still on industrial land policies, significant debate emerged at the related hearing session on the introduction of a minimum floorspace plot ratio of 65% (industrial floorspace/total land) as benchmark against which the principle of ‘no net loss’ of industrial floorspace capacity should be measured. In the draft London Plan industrial floorspace capacity is defined ‘as either the existing industrial and warehousing floorspace on site or the potential industrial and warehousing floorspace that could be accommodated on site at a 65 per cent plot ratio (whichever is the greater)’[8].   However, the GLA recognises that not all industrial uses might be able to operate or being commercially viable if a strict 65% floorspace plot ratio were to apply. Accordingly, a further suggested change provides for exceptional circumstances, where ‘it should be demonstrated that it is not feasible to achieve no net loss of industrial floorspace capacity through alternative configurations, multi-storey industrial development, a wider mix of industrial uses, or other appropriate measures’ (Supporting text 6.4.5AB[9]). However, this exceptional approach will not apply to industrial developments proposed as part of SIL/LSIS consolidation processes, and for industrial/residential/non-industrial co-location schemes. 5. Green Belt and Metropolitan Open Land: national policy and no land-swap Green Belt and Metropolitan Open Land (MOL) policies are always a contentious topic, and the draft London Plan is surely no exception. However, and quite surprisingly, the GLA does not propose to amend Policy G2 B (i.e. Green Belt ‘de-designation will not be supported’), which many consider inconsistent with national policy. The Mayor of London written statement clarifies the reason for this, as the ‘policy wording has a different emphasis to the NPPF, with the NPPF requiring the demonstration of exceptional circumstances to justify boundary changes. The emphasis in the draft London Plan is considered justified as Green Belt release is not considered necessary, with the vast majority of London’s development needs being able to be met within London, without developing on the Green Belt’ (Paragraph 65.8[10]). The capacity to meet the vast majority of London’s development needs within its own boundaries has been challenged by many stakeholders, particularly in light of the very high housing targets, industrial land policies, and over-reliance on small sites potential housing delivery. It will be interesting to learn the Inspectors’ view on this point. In terms of further suggested changes, the GLA clarifies that MOL ‘is afforded the same status and level of protection as Green Belt’ and that this should be ‘protected from inappropriate development in accordance with national planning policy tests that apply to the Green Belt’. Interestingly, the supporting text reference to the principle of land swaps being potentially applicable to MOL had been removed (Supporting text 8.3.2[11]). 6. Affordable workspace with an expiry date Low-cost and affordable workspace policies are an interesting innovation of the draft London Plan, although initially many of the details were to be left to the Boroughs for their decision. More details have been provided in relation to affordable workspace, where spaces are provided at below market rate due to the ‘specific social, cultural, or economic development purpose’. Affordable workspaces can be provided ‘and/or managed directly by a dedicated workspace provider, a public, private, charitable or other supporting body; through grant and management arrangements; and/or secured in perpetuity or for a period of at least 15 years by planning or other agreements’ (Supporting text 6.3.1[12]). The removal of the expectation that affordable workspace should only be secured permanently will probably be a great relief to the development sector, given the uncertainty that surrounds this new policy. Further suggested changes proposed to remove the reference to ‘reasonable proximity’ for the re-provision of lower-cost business spaces, possibly due to the difficulties in defining what ‘reasonable proximity’ might have meant in practice. Bonus track: live hub of planning data Not strictly policy related, but of interest to the development sector in the Capital is the recent update on the development of a live hub of planning data by the GLA. As explained in a useful article[13], the London Development Database will be used to ‘monitor implementation of the London Plan’. To support the monitoring phase, the GLA has published Non-Technical Planning Data Standard which sets out the key information that will be collected up-front on planning applications ‘in machine readable fields, so that planning application information can travel automatically through systems and out to the public’. As stated on the GLA website ‘[a] Technical Planning Data Standard will follow with further information on schemes, fields, and other relevant details’. Importantly, the goal is for this automation process to be ready ‘in conjunction with publishing the new London Plan. […] Based on the outcome of the London Plan EiP, [the GLA] will amend any fields in the Data Standard that do not align with the final London Plan before the automation project goes live’. Having robust systems in place to collect information and directly feed-back to the GLA is crucial to ensure that the practical implications of new policy approaches are closely monitored, and potential unintended consequences addressed as soon as practicable. The draft London Plan: a marathon, not a sprint The London Plan EiP is still moving forward, with four additional weeks of hearing sessions scheduled until the end of May, and which will cover some crucial areas such as town centres, social infrastructures and viability. We know that the Inspectors aim to write their final report on the draft London Plan between May-July 2019, and we could reasonably expect this to be published towards the end of Summer 2019. The current target is for the final version of the new London Plan to be published early in 2020, just before the next Mayoral Election takes place (May 2020). As the Mayor has repeatedly said over the last three years, solving the housing crisis ‘is going to be a marathon, not a sprint’, and we can surely state the same for the new London Plan publication process. However, as someone with a far better voice than mine used to sing:‘It’s been a long, a long time coming But I know a change is gonna come, oh yes it will’ [1] Appendix 1: M19 Further Suggested Changes[2] Appendix 2: M20 Further Suggested Changes[3] ’For the purposes of part D, the presumption in favour of small housing developments means approving proposals for small housing developments which are consistent with the policies of the London Plan while recognising that local character should evolve over time to provide new homes’ (Policy H2 E, Matter 20 Further Minor Suggested Changes to Policy H2)[4] Matter 20 Further Minor Suggested Changes to Policy H2[5] Appendix 1: M29 Further Suggested Changes[6] Appendix 1: M24 Further Suggested Changes[7] Appendix 1: M24 Further Suggested Changes[8] Supporting text at paragraph 6.4.5 (The draft London Plan showing minor suggested changes, August 2018)[9] Matter 62: Land for Industry, Logistics and Services, Further Suggested Changes[10] Mayor of London Written Statement on M65 Green Belt and Metropolitan Open Land[11] Matter 65 Further suggested changes to be made to Policy G3 Metropolitan Open Land[12] Matter 60: Low Cost and Affordable Business Space Further Suggested Changes[13] A live hub of planning data for London – update (Medium) See our other blogs in this series: Draft London Plan EiP: A new hope for industrial land? Draft London Plan EiP: Heritage and culture are now dusted Draft London Plan EiP, Affordable Housing: 3D snakes and ladders Stand and deliver… Draft London Plan EiP: ‘Willing Partners’ or not? Draft London Plan EiP: Design – fit for purpose? Lichfields will publish further analysis on the draft London Plan Examination in Public in due course. Click here to subscribe for updates. This blog has been written in general terms and cannot be relied on to cover specific situations. We recommend that you obtain professional advice before acting or refrain from acting on any of the contents of this blog. Lichfields accepts no duty of care or liability for any loss occasioned to any person acting or refraining from acting as a result of any material in this blog. © Nathaniel Lichfield & Partners Ltd 2019, trading as Lichfields. All Rights Reserved. Registered in England, no 2778116. 14 Regent’s Wharf, All Saints Street, London N1 9RL. Designed by Lichfields 2019.

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Revised NPPF: a new beginning at the end of a long and winding road?
The final version of the revised National Planning Policy Framework (NPPF) was published on 24 July 2018, on the very last day before summer Recess and avoiding Parliamentary debate. In contrast, the draft version (published in March for consultation) had been announced by the Prime Minister Theresa May at a dedicated launch event. Much has changed in the make-up of Government in the four months since the consultation started (not least, the Housing Secretary and Housing Minister); however, and notwithstanding the huge amount of responses received (almost 30,000), changes made to the final version of the revised NPPF focus on clarifications and re-wording, with very few more significant amendments. Naturally, wider implications and potential impacts of the new policies will become clearer over time; for now, we have identified eleven points where changes have been made following the draft NPPF’s consultation and which are worth bearing in mind. 1. Using design policies as a key to boosting house building The revised NPPF gives a new centrality to design policies, as they are considered instrumental in delivering new homes. In his Written Ministerial Statement announcing the launch of the revised Framework, Housing Secretary James Brokenshire said: ‘[…] Critically, progress must not be at the expense of quality or design. Houses must be right for communities. So the planning reforms in the new Framework should result in homes that are locally led, well-designed, and of a consistent and high quality standard.’ Chapter 12 ‘Achieving well-designed places’ is where this renewed rhetoric is translated into policy. Paragraph 124 specifies that ‘being clear about design expectations, and how these will be tested, is essential’ for achieving sustainable development. Effective engagement e.g. with local communities (including through workshops), the use of ‘local design standards or style guides’, and the refusal of permissions for developments of poor design are some of the ways the revised NPPF aims to achieve this objective. Crucially, para 130 requires local planning authorities (LPAs) to make sure that the quality of approved developments does not materially diminish ‘between permission and completion, as a result of changes being made to the permitted schemes’. 2. Planning application viability assessments as exception to be justified The front-loading of viability assessment at plan-making stage (rather than when determining applications) was already anticipated by the draft revised NPPF, as the expectation was to be for plans to set out the levels and types of affordable housing and other infrastructure that would be required from proposed developments. However, changes included in the final version are quite significant when compared to both the original NPPF and the draft revision, particularly around paragraphs 34 and 57. The revised NPPF’s paragraph 34 on development contributions removes the possibility for plans to set out circumstances when further viability assessment may be required in determining individual planning applications. The reasoning is in para 57: the revised NPPF puts the burden on applicants ‘to demonstrate whether particular circumstances justify the need for a viability assessment at the application stage’. Furthermore, para 57 goes on to state that it will be for the decision maker to decide about the weight to be given to the viability assessment ‘having regard to all the circumstances in the case’ (including whether the plan/evidence is up to date, and potential changes to site circumstances). 3. Standardised methodology and Housing Delivery Test confirmed (for now) The new standardised methodology to assess housing needs and the Housing Delivery Test are two of the most anticipated changes to housing policy that the Government is bringing forward, and they are reflected in the revised NPPF (and accompany documents). Unsurprisingly, neither has been significantly amended when compared to previous consultation versions, probably reflecting the inherent complexities behind their ‘construction’. However, of interest in relation to the standardised methodology is the Government response to the draft revised NPPF consultation which highlights: ‘[…] it is noted that the revised projections are likely to result in the minimum need numbers generated by the method being subject to a significant reduction, once the relevant household projection figures are released in September 2018. In the housing White Paper the Government was clear that reforms set out (which included the introduction of a standard method for assessing housing need) should lead to more homes being built. In order to ensure that the outputs associated with the method are consistent with this, we will consider adjusting the method after the household projections are released in September 2018. We will consult on the specific details of any change at that time.’ In short, the methodology is confirmed for now, but everything may change, following the release of household projections in September 2018 (see this Lichfields blog for further details). 4. Lower requirement for small (and medium) sized sites The draft revised NPPF’s requirement for at least 20% of the sites identified by LPAs in their plans to be half a hectare or less has been changed and potentially made more achievable. The final version of the revised NPPF now expects LPAs to accommodate at least 10% of their housing requirement on ‘small and medium sized sites’ (up to one hectare) through their development plans and brownfield land registers. Furthermore, it is recognised that the 10% target may not be achievable in all circumstances; in such cases, the preparation of the relevant plan policies should detail the ‘strong reasons’ that make the target unachievable. 5. More clarity on strategic and non-strategic policies The draft NPPF’s reference to ‘strategic’ and ‘local’ policies - which caused confusion in relation to spatial development strategies, and appeared to undermine the need for local plans - has been clarified. The final revised NPPF now distinguishes between strategic policies (which should look over a minimum of a 15-year period) and non-strategic policies (included in local plans, when these are not considered strategic policies, and in neighbourhood plans). Both ‘strategic’ and ‘non-strategic’ policies are defined in more detail in Annex 2: Glossary. 6. Town centre diversification promoted The rapid changes that are affecting the retail sector and, as a consequence, England’s town centres are acknowledged and reflected in the final version of the revised NPPF. It recognises that diversification is key to the long-term vitality and viability of town centres, to ‘respond to rapid changes in the retail and leisure industries’. Accordingly, planning policies should clarify ‘the range of uses permitted in such locations, as part of a positive strategy for the future of each centre’. The draft revised NPPF’s reference to town centres in decline has been removed, possibly because of its unclear wording and most probably in wider recognition of the effects that changed shopping habits are already having on town centres.    7. Land assembly and compulsory purchase Reflecting wider debates about the role of LPAs in bringing forward enough land for housing developments to meet their identified needs (and the Government’s 300,000 homes/year target), paragraph 119 now details some of the powers that proactive LPAs should use. These include specific reference to facilitating land assembly, where possible, and using compulsory powers where this is considered beneficial to ‘meeting development needs and/or secure better development outcomes’. 8. Green Belt: of course it’s here to stay Unsurprisingly, Green Belt policies have not changed significantly from the draft version published for consultation; however, two minor changes in wording are of interest. Paragraph 136 on exceptional circumstances to amend Green Belt boundaries now refers to these being ‘fully evidenced and justified’, an addition since the draft revised version. While this might appear to be a more stringent requirement, new para 137 specifies that, to justify the existence of exceptional circumstances, an LPA ‘should be able to demonstrate that it has examined [it was ‘should have examined’] fully all other reasonable options for meeting its identified need for development’; this might seem like a minor change, but it could give more flexibility and a clearer path for LPAs considering releasing Green Belt in exceptional circumstances. 9. Heritage policies retained and restored Heritage and historic environment policies are generally in line with those proposed in the draft revised NPPF. Importantly, LPAs are now expected to maintain ‘or have access to’ a historic environment record (paragraph 187). One of its purposes is to be used to ‘predict the likelihood that currently unidentified heritage assets […] will be discovered in the future’. Changes to the way the impact of proposed development on the significance of designated heritage asset is assessed, which were already anticipated in the draft revised NPPF, are now confirmed and further clarified; paragraph 193 states that ‘great weight should be given to the asset’s conservation […] irrespective of whether any potential harm amounts to substantial harm, total loss or less than substantial harm to its significance’. Finally, where a development proposal will lead to less than substantial harm to the significance of a designated heritage asset, ‘this harm should be weighed against the public benefits of the proposal including, where appropriate, securing its optimum viable use’. The term ‘optimum viable use’ was included in the original NPPF but not in the draft revised NPPF. 10. A change to transition The policies in the revised NPPF are material considerations to be taken into account in determining planning applications ‘from the day of its publication’ (i.e. from 24 July 2018). Importantly, the policies in the 2012 NPPF still apply to examining plans submitted on or before 24 January 2019. Interestingly, footnote 69 is amended to clarify that for spatial development strategies, ‘submission […] means the point at which the Mayor sends to the Panel copies of all representation made’; this is an amendment specifically made to reflect the stage reached by the draft London Plan, particularly when compared to the draft revised NPPF wording (which referred to ‘submission’ being a later stage, specifically the point in which copies of the strategies intended for publication are sent to the Secretary of State). Accordingly, the new draft London Plan will be examined against the original NPPF policies – a relief to the Mayor no doubt. 11. ‘Social rent’ back in and starter homes loosen up The revised version of the glossary at Annex 2 includes reference to social rent again, as an ‘affordable housing for rent’ product rather than in its own right; any reference to social rent housing was previously deleted from the draft revised NPPF’s definition of affordable housing. Further amendments have been made to the definition of ‘affordable housing’, particularly in relation to starter homes. Interestingly, previous reference to the maximum annual household income of eligible buyers (£80,000, or £90,000 in London) has now been removed and left as a matter for secondary legislation; this is to reflect the fact that the Housing and Planning Act 2016 does not explicitly refer to those income thresholds. Might this signal the ‘resurgence’ of starter homes? Unlikely. Overall, the impression is that the process of updating and reviewing the 2012 NPPF has been more complicated than many expected it to be, and the continuous changes in the Department and then Ministry surely have not helped (five Housing Ministers and three Secretaries of State since the NPPF review was first announced). Perhaps as a result of it having taken a good while, the revised NPPF seems to better reflect the new approach taken by the Ministry, the renewed centrality that housing policies have within the Government’s agenda and all of the case law that has come about from testing the 2012 Framework in the courts. The new NPPF even reflects Sir Oliver Letwin’s emerging findings on housing delivery, by effectively recognising that the quality and design of housing development is crucial to ensuring greater community support. Some reforms do seem ambitious, particularly around viability assessments and given the English plan-led system, and the practical impacts of these reforms ought to be tested and monitored over a longer period of time to understand whether Government has struck the right balance. As acknowledged in James Brokenshire’s Written Ministerial Statement, the revised NPPF alone will not be enough solve the housing crisis; other reforms, the support of central Government, cooperation with/between stakeholders, local authorities and communities are all crucial elements in addressing the housing challenges the country is facing. As usual in these cases, whether the revised NPPF represents a new beginning or rather a false start is too soon to be said, as its final judgement will be solely based on its achievements and/or failures. See the ‘Revised National Planning Policy Framework’ suite of documents here Lichfields will publish further analysis of the consultation on the draft revised NPPF and its implications. Click here to subscribe for updates.

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