14 Apr 23
The picture for planning approvals is even sorrier, with fewer than 73% of applications being approved – again, the lowest rate in more than a decade.
And with fewer planning applications submitted in the last quarter than at any time since 2012 (apart from the first three months of the Covid lockdown), the story looks set to get even worse. Homes can’t be built without planning permission, so the supply of new homes will begin to fall too.
It is tempting blame the country’s current economic malaise – and many who don’t really like new homes in the first place have been quick to do so – but that view doesn’t bear even the lightest scrutiny.
The number of planning applications for new homes decided in each of the last seven years has been lower than the one before – well before Truss-onomics and rising interest rates. Like so many of our housing market issues, its root cause lies with the planning system.
The plan-making system has seized up. It is almost three years since the government’s planning white paper first raised the prospect of major systemic changes – reforms which were delayed by changes of Prime Minister, changes of Secretary of State, by-election defeats and back-bench rebellions from Conservative MPs.
The resulting uncertainty saw some local authorities decide to delay the preparation of new local plans. With the expectation that any new plan could quickly become out-of-date, this was a rational response. Last year, just 13 new local plans were submitted for examination – the lowest number in a decade and just over a quarter of the peak in 2018.
“Without new sites being allocated for development in local plans, the number of potentially available development sites inevitably diminishes – which in time feeds through into a fall in the number of planning applications.”
The number of new plans adopted was also at a record low. Both figures have been trending downwards for several years.
Without new sites being allocated for development in local plans, the number of potentially available development sites inevitably diminishes – which in time feeds through into a fall in the number of planning applications.
Although we can expect the Levelling Up and Regeneration Bill to finally become law this year – and to change the plan-making process will change dramatically – we are still light on detail. Much uncertainty remains – and many local authorities are understandably holding their local plan processes in abeyance.
Potential changes to the framework have compounded the problem. Key amendments propose making it easier for councils to plan to deliver fewer homes than the government’s standard method indicates, while increasing protections for the green belt. Since Michael Gove made the government’s intentions clear in December, about 25 local authorities – almost 10% of the total – have announced delays to their local plans. Many more have delayed plans but without doing so publicly.
The government is also proposing to significantly dilute the consequences for local authorities who are unable to demonstrate a five-year housing land supply – neutering one of the key checks and balances in the planning system and further reducing another potential source of new housing supply.
For some local authorities, local plan delays are squarely political. Despite the obvious dearth of housing supply and the clamour for new development from some – especially the young – new homes have become politically toxic in some quarters. Where authorities face constraints like green belt, which allow them to resist development on sites which aren’t specifically designated in local plans, there is no jeopardy to them in simply not bothering with a local plan. Instead, they can take the plaudits from those local residents who are opposed to new homes in principle. One council leader recently complained of having “too many new houses” “forced upon us.”
“With uncompleted reforms, countless delayed local plans, more restrictive national policy and inadequate budgets, the planning system has been on its knees for some time. The problems go far beyond the economy. But that means it is in our control to fix it.”
The problems go beyond plan-making. Nutrient neutrality, for example, is another significant barrier to new homes being built. As many as 120,000 new homes are being held up by Natural England’s requirement that new development shouldn’t increase the levels of nutrient pollution in a number of protected rivers across 74 local authorities in England. That’s despite the government acknowledging that house building is a marginal contributor to the issue – well behind sewage works in desperate need of improvement and farming.
Research also suggests that the impact of new homes on river pollution is dramatically over-stated. Natural England have been slow to put the necessary mitigation measures in place, extending the delays.
Lack of resources is another crucial factor. The Royal Town Planning Institute claims that spending on planninghas almost halved in the last decade. With budgets squeezed, it is entirely understandable that some local authorities will choose to delay funding work on a local plan work that might quickly be superseded. It also restricts their ability to provide considered pre-application advice and to work creatively to find solutions once applications are submitted. That increases the risks associated with a planning application and, when the costs of an application are so high in the first place, many perfectly reasonable proposals won’t be submitted in the first place.
With uncompleted planning reforms, countless delayed local plans, more restrictive national planning policy and inadequate budgets, the planning system has been on its knees for some time. The problems go far beyond the economy. But that means it is in our control to fix it.
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