The pressing need to build more new homes has gained significant traction in recent years and it is identified now as a national crisis. After featuring prominently in the 2017 political manifestos, Prime Minister Theresa May has identified that the number one domestic priority is to increase the rate of house building to 300,000 homes a year by the mid-2020’s.
Delays in house building are often blamed on the planning system and, more recently, accusations of land banking have surfaced frequently in the media. In response, an independent review – led by Sir Oliver Letwin – was commissioned “to tackle barriers to building”. Much of the attention has concentrated on trying to understand the reasons for delays after development proposals have been approved, however there has been little said about the trials and tribulations of reaching this position. It is very rarely straightforward and the determination process can be frustrating when there do not appear to be any outstanding concerns, yet an application is refused by members against an officer recommendation for approval.
At the Planning for Housing Conference on 4 October 2017, a local council leader told a conference seminar that planning committee members rely on the advice of officers “nine times out of ten times” and that members are “rarely party political and tend to make decisions more on the basis of geographical or local knowledge”. In our experience, these statements perhaps underestimate just how often this occurs - particularly with applications for major developments.
The examples of two planning appeals in recent years for sites in the North East can be cited, which followed applications that had been refused by members contrary to officer recommendations. As both appeals were subsequently allowed, the obvious questions were (a) whether the appeals could have been avoided and (b) how much time and cost (for both sides) having to go to appeal had added to the process. Time and money are particularly relevant, when there is a clear need to speed up the rate of building new homes.
At the time of submitting a planning application for a major development proposal, applicants can (in theory!) expect to receive a decision within the statutory 13 weeks. Where a planning application takes longer than the statutory period to decide, the Government’s ‘planning guarantee’ states that a decision should be made within 26 weeks and that “no application should spend more than a year with decision makers, including any appeal”. To put this into the context of these two appeals, one complied with the ‘planning guarantee’ however the time from submission of the planning application to receiving the appeal decision for the second case extended well beyond the Government’s policy at 23 months.
These timings do not actually tell the full story as for each scheme an earlier planning application had been refused; new applications had been submitted and the development proposals considered at appeal represented revised proposals. Following the refusal of the earlier applications, in each case the applicant had sought to address the issues raised locally and used the appeal process only as a last resort.
Therefore in these examples, the true length of time it has taken to achieve planning permission for each site, from submission of the earlier planning applications to receiving the appeal decisions for the revised schemes, is 34 months and 42 months respectively.
Lichfields’ Refusal for Good Reason, published last week, looks into the subject of members’ decisions against officer recommendations, to understand whether this is a common occurrence and to assess whether there is any issue with the quality of decision making.
The research considered all appeals in 2017 for proposals of 50 homes or more. 78 out of the total 309 appeals (25%), as shown above, related to applications that had been refused against an officer recommendation for approval. 65% of these 78 appeals were allowed and, as a result, around 6,000 new homes could be delivered. In comparison, 40% of appeals were allowed in instances of officer-recommended refusal of planning permission.
The research findings indicate that the percentage of allowed appeals (for applications refused against officer recommendation) is generally higher when the reasons for refusal relate to technical matters compared to appeals where the main issues are more subjective.
Lichfields’ research also considered the time that an appeal can add on to the end-to-end housing development process. Of the 78 appeals considered, the average time from receiving a decision notice to the determination of an appeal was 11 months; however, this time period varies between 4 and 19 months. As shown below, the time period increases with the number of new dwellings proposed. For developments of less than 150 new homes, the average time from decision notice to appeal decision was 10 months; however, this increases to 13 months for developments of 150 houses or more. Generally, it is therefore reasonable to assume that an appeal is likely to add a year on to development timescales.
So, in answering the questions posed above:
Could the appeals have been avoided? It is important to remember that an officer recommendation is just that – planning committee members are fully within their rights to decide otherwise. Members should however ensure that their reasons for refusal are substantiated and within the legal and policy framework. Lichfields’ research found that the prospects of success at appeal are greater if an application has planning officer support and particularly if the member-disputed factors relate to technical matters. In contrast, the appeal outcome is more varied when the main issues are subjective ones, indicating that members can be justified in disagreeing with their officers’ recommendations in some instances.
What time and cost do appeals add onto the process? It is clear that an appeal is costly for both sides and can add around a year to the development process. Many decisions going against officer recommendations will however go unchallenged therefore ensuring high quality decision making by councillors is a vital component in tackling the housing crisis.
Lichfields’ research concludes with a series of recommendations to improve the quality of decision making which include:
Requiring councils to seek independent advice where there is disagreement between the planning officer and members on a technical issue
Allowing a ‘cooling off’ period for planning committee members to seek impartial advice about the prospects of defending their decision at appeal, when they are inclined to go against an officer’s recommendation.
Requiring local planning authorities to publish statistics on decision making, to allow applicants to understand the likely need for an appeal.
Reviewing the training given to planning committee members, which is not currently mandatory.
 Autumn Budget 2017 – Building the homes the country needs: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/661430/Building_the_homes_the_country_needs.pdf Planning Resource article: Planning committees in line with officers 'nine out of ten times (4 October 2017): http://www.planningresource.co.uk/article/1446496/planning-housing-planning-committees-line-officers-nine-ten-times Planning Practice Guidance (Determining a planning application) Paragraph: 001 Reference ID: 21b-001-20140306 and paragraph: 002 Reference ID: 21b-002-20140306: https://www.gov.uk/guidance/determining-a-planning-application
The Government has set out its stall for tackling the housing crisis, as emphasised most recently by the new revised National Planning Policy Framework (NPPF), which whilst covering all land use planning matters, was nevertheless firmly focused on boosting housing supply.
But new housing doesn’t just address the housing crisis. It has an economic benefit too. Lichfields was commissioned to undertake research on behalf of the Home Builders Federation (HBF) to quantify the economic contribution of house building, and in particular, quantify the ‘economic dividend’ that could be realised by delivering the Government’s broad ambition for c.300,000 new homes per annum. Our analysis updated a similar report we prepared for the HBF in 2015.
Our 2018 report - The Economic Footprint of House Building in England and Wales – was launched on the 24th July, the same day Government finally released the new NPPF.
Our report details the key economic implications and benefits of new house building activity within England and Wales. It highlights how the delivery of 224,000 new homes last year in England and Wales resulted in significant contributions:
The investment and expenditure spent on new land for housing development amounted to nearly £12 billion (£11.4 billion in England and £500 million in Wales).
In 2017/18 house building generated £38 billion of economic output to the Great Britain economy.
The number of people directly employed in the construction of domestic buildings in England and Wales equated to 239,000 in 2016. The majority of these jobs (224,500 or 94%) are based in England, with the remaining 14,500 (6%) based in Wales.
The industry contributes to the Exchequer through a range of taxes such as Stamp Duty Land Tax, Corporation Tax and Value Added Tax (VAT). The house building industry also provides significant contributions towards infrastructure development and the provision of affordable housing.
Across England, over £804 million of S.106 contributions are made each year towards funding these facilities and services, with a further £37 million of contributions made in Wales. Financial contributions are also invested in providing education facilities, sport and leisure facilities, community facilities and open space.
New housing development also offers an opportunity to increase local expenditure as residents spend their money on goods and services in the local area.
But these already will significant benefits will increase further if annual house building was to increase to just over 300,000 to broadly match the Government’s ambitions for England and projections for Wales. This would result in the following benefits:
Our analysis shows that boosting house building will be good for our economy as well as helping to address the housing crisis.
Our footprint report for the HBF builds on Lichfields’ track record of economic impact assessment and support to our clients in helping them to maximise and clearly evidence their contribution to economic growth. Both on individual projects and across their corporate footprint, we work with some of the largest and most successful companies in the property sector including commercial developers, housebuilders, retailers and industry bodies, to help them assess their economic contribution.
To find out more, have a read of our new report and get in touch with Sarah Fabes.