In July of this year, new Local Government Secretary Eric Pickles announced the Coalition Government’s decision to scrap Regional Spatial Strategies and bring an end to the strategic housing target regime. We look at what this could mean for the future of house building in the UK.

Housing targets scrapped

This year’s Queen’s Speech laid out the proposals for the Decentralisation and Localism Bill, to be introduced into Parliament in the Autumn. The Bill sets the scene for a radical shake up of the planning system. Building on the “localist” agenda of the Open Source Planning Green Paper published by the Conservative Party before the election, one such proposed measure is a “community right to build”, which would exempt certain community groups from the need for planning consent where there is “overwhelming community support for the development”.

The Bill also proposes to give “neighbourhoods” (whatever these comprise) increased rights to consultation with developers. Although two of the most controversial proposals in Open Source Planning – the introduction of a right for objectors to appeal against the grant of planning permission, and placing limits on developers’ grounds of appeal against the refusal of permission – have not made it into the Coalition’s planning programme.

One of the most far-reaching measures of the Bill is the plan to abolish Regional Spatial Strategies and “return decision making powers on housing and planning to local councils”. In a letter to council leaders in May, Eric Pickles stated that “decisions on housing supply…will rest with local planning authorities without the framework of regional numbers and plans”. With this letter, sent on behalf of the Government, the housing targets regime came to an end.

Then, on 6 July 2010, Regional Spatial Strategies were formally revoked with immediate effect. Mr Pickles also announced that all current national planning Policy Statements – which would be reviewed and amended to become a single national planning framework – should now be read as no longer containing any reference to regional planning. At the same a short guidance note was published in the form of ‘Q&A’ advice for local authorities to deal with immediate issues that may crop up.

How did this all come about?

From as far back as the last economic downturn in the early 1990s, previous Governments tried to use the planning system to encourage house building – by setting housing targets in regional planning policy and effectively compelling local authorities to set aside land for housing. But a number of factors impeded housing growth: with some local authorities resisting their targets, especially in areas of high demand such as the South East, and a slow moving planning application process, and more recently the economic downturn, UK house building remains below targets.

So the Government has proposed a radically different approach, abolishing housing targets and all regional planning. This message had already been clear in the Open Source Green Paper – the existing planning system is “broken”, and the aim was to scrap the “top-down” regime of national and regional house building targets and replace it with a more “localist” and neighbourhood-based approach that “transfers power to local communities” and thus encourage more development at a local-led level.

The new approach promoted by the Coalition is that house building would instead be stimulated by allowing local authorities to retain council tax revenue from new properties for six years. However, the speed of the announcements and new measures, accompanied by a notable absence of consultation and guidance on the detail, has been surprising and is causing widespread concern.

What now?

The frustration with the lack of detail, and the questions raised on what happens during the new policy vacuum that has resulted from the announcements, have been widely reported.

  • One such question is how practitioners will now be applying National Planning Policy Statements, when these policies had been formulated within a framework that was fi rmly rooted in regional strategic planning for housing.  
  • The Government’s statement tells us that local authorities “may wish” to review their plans following the revocation. But this begs the question as to how undetermined planning applications for allocated sites will be affected. Which framework will now apply if an authority chooses not to carry out a review for a major application? Alternatively, if the authority does carry out the review but – under pressure from its local residents for instance - decides to make a U-turn from its former “thumbs up” for a scheme and is no longer willing to grant consent – then it is not clear what framework a developer can now fall back on.  
  • Further, the Bill provides no penalties for local authorities who are free to adopt an anti-development approach to the whole of their area. Oxfordshire councils have already made moves to abandon their core strategies, leading to the up-rooting of the future for major housing applications in the region. Wealden District Council, for example, has recently decided to defer consideration of its emerging core strategy, creating an uncertain future for housing developments in its part of Hampshire.
  • The Coalition’s proposal to encourage local authorities to grant planning consent for housing is to introduce fi nancial incentives that will effectively result in councils getting an automatic, sixyear, 100% increase in the amount of revenue derived from each new house built in the area. But this measure has not yet been brought into operation and there is no clear guidance on whether planning applications which are submitted during the current transitional period will qualify.

The Coalition’s rebuff on these criticisms was the statement that “the new guidance is crystal clear - councils are in charge. They can now deliver plans and make decisions.” But behind the scenes the Government might not be feeling so bullish about its decision to abolish regional strategies without primary legislation. Following a Commons debate, the Government has suggested that instead of waiting for the Localism Bill to be passed, it may use secondary legislation to make its planning reforms: Bob Neill, the Minister at that debate, said: “Ultimately, there will be a need for primary legislation to sweep such matters away, which will be dealt with in a localism Bill ….However….we will also explore the possibility of using secondary legislation to remove the most diffi cult part of the regional strategies in advance of that. We are actively discussing with offi cials the means by which this may be done”.

Scottish housebuilder Cala Homes has already mounted a legal challenge to the Government’s decision to abolish regional strategies in order to re-instate the South East Plan. It claims the Minister acted outside his powers by removing a fundamental part of the plan-led system and breached European law by failing to assess the environmental effects of revoking regional strategies. We may not yet have heard the end of strategic planning for housing.