UK: Building The Future

Last Updated: 9 March 2016
Article by Roy Pinnock

Housing has become a key priority for the electorate for the first time in decades, with planning and housing appearing in the manifestos of all the major parties in the run-up to the 2015 general election. It has become a political imperative for the government to take action on the housing crisis.

The Housing and Planning Bill, which has now passed its third reading in the House of Commons and proceeds to the House of Lords, is seeking to make statutory the government's manifesto commitments to extend the right to buy, build 200,000 new starter homes, ensure local people have more control over planning and protect the green belt. The Bill is controversial, being described as the 'end of the road for affordable housing' (The Guardian, 6 January 2016) and viewed by some as the product of a process (including 2am debates in the House of Commons) that has moved it from being, in the words of Shadow Housing and Planning Minister John Healey, 'a bad bill [to] a very bad bill'.

The Bill introduces measures to both supply a greater number of homes and to make changes to the affordable housing system. Provisions are included to try to speed up the planning process, including giving the Secretary of State new powers to intervene where local authorities are seen to perform poorly. This article focuses on the planning elements of the Bill. This review does not cover sections on regulating landlords, rent repayment orders, recovery of abandoned premises, estate agents, rent charges, compulsory purchase orders and others.

Starter homes

Providing discounted 'starter' homes for first-time buyers was a much publicised election promise, albeit one that has proved politically divisive.

The Bill will require local planning authorities (LPAs) to carry out their planning function with a view to promoting the supply of starter homes, and to prepare reports monitoring their compliance with this duty. Under clause 6, the Secretary of State may make a 'compliance direction' requiring a development plan policy to be ignored if an LPA has failed to carry out its function in accordance with this duty, or has an incompatible policy. That is a novel step which cuts across the localism agenda.

The Bill will allow the Secretary of State to make regulations specifying a 'starter homes requirement' which must be provided for planning permission to be granted, which is likely to be either a proportion of dwellings or a financial contribution. It has also been left to regulations to determine whether the same rules as for starter homes exception sites will apply, including an ability to sell at market price after five years. No draft of these regulations has yet been published, and it is anticipated that consultation will be carried out first. Once made, these regulations will have a significant impact, shaping the composition of housing schemes coming forward, and will be eagerly awaited by both developers and LPAs to assess their impact.

Current planning policy on starter homes on exception sites (issued in the March 2015 ministerial statement) encourages LPAs not to seek section 106 affordable housing contributions. Controversially, starter homes seem likely to be classed as affordable homes in the context of planning obligations under the current review of the National Planning Policy Framework (NPPF), and for the replacement of high-value, council-owned homes in London, as set out below. This is likely to have a knock-on effect on the provision of other types of affordable housing. Developers may well prefer to provide starter homes rather than other forms of affordable housing, making it difficult for LPAs to meet the housing needs of the wider community, and potentially requiring existing section 106 agreements, which provide for affordable housing, to be renegotiated.

Social housing

The Bill waters down the original proposals, which would have extended the right to buy to all housing association tenants. This provision is voluntary in the sense that housing associations have agreed to comply with the right to buy, rather than being obliged to do so via legislation. There will be a presumption that housing association tenants can exercise the right to buy, but the deal envisages that there will be exceptions, for example for rural homes. Right-to-buy discounts will be provided by grants from the Secretary of State, the Homes and Communities Agency and the Greater London Authority, and also from the sale of high-value local authority homes.

The government intends that dwellings sold under the extended right to buy will be replaced on a one-for-one basis, and housing associations have agreed to this as part of the voluntary deal. The voluntary deal allows replacement homes to be built within three years, anywhere within the country, and does not require that the same type or tenure of dwelling is reprovided.

In addition to grants, the government seeks to fund the voluntary right to buy by requiring LPAs to sell high-value homes that become vacant. The mechanism will require councils to make a payment to the government which is equivalent to the value of high-value homes likely to become vacant in that year, less the council's expenses. There is a lack of clarity about how valuations will be carried out, how regional variations will be dealt with, and how shortfalls between receipts and grants will be met. There is particular concern about the ability of LPAs in areas with high land values to continue to provide social housing, and in particular larger homes, when subject to this duty; a report by Shelter in September 2015 ('Report: the forced council home sell-off') estimated that 97.1% of Kensington and Chelsea's existing stock would be considered high value and therefore subject to a requirement to sell. In April 2015, the Conservative party published figures showing the values over which homes could be sold (Briefing Paper, Number 07331, 22 October 2015, see reference box above), although at the committee stage Brandon Lewis, the Housing and Planning Minister, stated that thresholds would be set following research currently being undertaken (Briefing Paper, Number 07398, 29 December 2015, see reference box above). At the report stage, an amendment was accepted which would require London boroughs to provide two new affordable homes for each high-value home sold, which will include starter homes.

Provisions are also included for high-income social tenants to 'pay to stay'. Following a voluntary scheme which allowed social landlords to charge tenants with a household income of more than £60,000 higher rents, the Bill will make 'pay to stay' mandatory. The Bill will give the Secretary of State the power to make regulations, which are expected to require households earning more than £30,000, or £40,000 in London, to pay market or near market rents, with the uplift paid to the government. Taken as a whole, these changes to social housing provisions suggest that renegotiation of section 106 agreements may be desirable or necessary, and that more flexible mechanisms to deal with affordable housing will be required in the future. These changes are also likely to impact on viability assessments, having further consequential impacts on affordable housing provision.

Local plans

There is currently no duty on LPAs to prepare local plans. In some areas, this has led to 'planning by appeal', where, without a current local plan showing a five-year housing land supply, schemes are refused planning permission by the LPA, only to be granted permission on appeal. The Bill includes a range of measures to incentivise local plan making, by giving the Secretary of State greater control over the plan-making process (see box below). This reflects the government's target of ensuring that all LPAs have 'prepared' a local plan by early 2017.

These changes largely amend existing powers, but provide greater flexibility and a clear political marker that the Secretary of State may be willing to make an example of some LPAs by stepping in. The changes may provide an incentive for other authorities who have not yet made local plans or who have defective plans. They may incentivise further dragging of heels as under-resourced authorities and local politicians accept that government will intervene. There are missing links that will mean the process is still constrained, though, as there is no power for the Secretary of State to undertake evidence-base work, to determine objectively assessed housing needs.

Without the ability to control the evidence base, the power to direct may be frustrating in practice. The Bill was amended during the House of Commons committee stage to allow the Secretary of State to invite the Mayor of London (or a combined authority) to prepare or revise a development plan document where the LPA is failing or omitting to take the necessary steps to prepare it. The Mayor or combined authority will be reimbursed for their expenses by the LPA. The Secretary of State will also have powers to intervene in the preparation of these plans.

Neighbourhood plans

As well as increasing pressure from the Secretary of State on local plans, the Bill also introduces measures to speed up LPA involvement in neighbourhood planning. The Bill introduces provisions to designate neighbourhood areas if the LPA does not decide an application for designation in time, and will impose a timetable for the consideration of neighbourhood plans and neighbourhood development orders.

Strengthening the Secretary of State's supervision over the planning function of LPAs, neighbourhood forums or parish councils will be able to ask the Secretary of State to intervene in neighbourhood plan making where the LPA does not make a decision on holding a referendum within the specified time, does not follow an inspector's recommendation, or makes modifications other than those specified. The Secretary of State will then be able to exercise the functions of the LPA in relation to the neighbourhood plan and direct that certain actions are taken. The Bill also provides for neighbourhood forums to ask to be kept informed of planning applications made within their area.

These provisions highlight the importance of neighbourhood planning to the government. These measures seek to increase the pressure on LPAs to progress neighbourhood plans where proposals are put forward. Developers should consider engaging with emerging neighbourhood plans at an early stage, both to seek to get their sites allocated and to avoid objections when making subsequent planning applications in designated neighbourhood areas.

Planning permission

A recent controversial amendment to the Bill introduced a pilot scheme for the processing (rather than the determination) of planning applications to be outsourced by LPAs. The Bill will enable the Secretary of State to make regulations, allowing applicants to elect for their application to be processed by a 'designated person' rather than the LPA. The clause states that designated persons could be authorised to take any step in processing a planning application apart from determining it, while the detail of how this would work, including the fees and sharing of information, is left for the regulations.

The Bill would also extend the Secretary of State's ability to decide any application for a poorly performing LPA, rather than only those for major development, as is the current situation. Wider powers for the Secretary of State to decide applications and the potential involvement of third parties in processing planning applications demonstrate the government's objective to speed up the planning process.

However, the impact of the provisions that centralise control depends on the willingness of the Secretary of State to take action, and consequently the extent to which this acts as a deterrent to improve LPA performance. It may be that some overstretched LPAs accept the Secretary of State deciding some of their applications as a way of lightening their administrative burden, and similarly may welcome the ability to outsource the processing of applications. Equally, some LPAs may prefer for the Secretary of State, rather than their officers and members, to make controversial decisions.

The Bill also introduces the concept of 'permission in principle' for land allocated in a qualifying document, such as a brownfield land register, local plan or neighbourhood plan for small-scale development. Brandon Lewis said at the committee stage that the intention was for 'permission in principle' to be limited to housing-led development (Briefing Paper, Number 07398, 29 December 2015). However, the legislation is not limited to this, and it could be used for zoning and wider permitted development. It is not clear which technical details will be required, and whether 'permission in principle' can be made subject to conditions. It also remains to be seen how 'permission in principle' will satisfy assessment requirements under the Town and Country Planning (Environmental Impact Assessment) Regulations 2011. The government has stated in the same briefing paper that they do not intend for 'permission in principle' to exist in perpetuity, and will consult on a suitable duration.

Under provisions included within the Bill, the Secretary of State will be able to require LPAs to keep registers of land, which in the first instance is likely to be brownfield land. However, this could be expanded to include public-sector land, or land with unimplemented planning permission. Land entered on these registers could then be subject to 'permission in principle'. It is not yet known how environmental assessments and deliverability will be considered for developments of this type, and the government intends to consult on the criteria, to be included in regulations, against which land will be assessed before it is entered on these registers (see 29 December briefing paper for further details).

Clause 115 of the Bill introduces a new requirement for LPAs to provide information about the 'financial benefits' of any planning application when reporting it, and to state whether the financial benefit is material or not. This will require more planning officer time, and materiality in particular is likely to be tricky to decide, as LPAs consider the relationship between the contribution and the scheme. There are concerns that this may lead to an increased risk of judicial review. This may provide the opposition with extra material to assess for evidence of illegal, irrational or immaterial issues, ignored material issues, or procedural unfairness.


The Bill will amend the existing legislation to allow development consent for nationally significant infrastructure projects (NSIPs) to cover 'related housing development'. This will not allow housing-only development, but will allow an element of housing in any NSIP in England, where the housing is either in proximity to the site or is required by the NSIP development.

Guidance in a briefing note issued in October 2015 (DCLG, 'Housing and Planning Bill: Nationally Significant Infrastructure Projects and Housing – Briefing Note') suggests that housing in the proximity of the NSIP development should be located within one mile, and there is an expectation that developments should include affordable housing, including starter homes. For both nearby housing and housing required due to the development, it is unlikely that consent for more than 500 homes will be granted.

These provisions would allow specific housing to be consented under an infrastructure-based regime. It may provide an interesting precedent for the provision of housing consents under non-housing planning regimes. For example, could the NSIP process be adapted to provide consents for garden cities where the government may prefer central control of the process?

Dentons is the world's first polycentric global law firm. A top 20 firm on the Acritas 2015 Global Elite Brand Index, the Firm is committed to challenging the status quo in delivering consistent and uncompromising quality and value in new and inventive ways. Driven to provide clients a competitive edge, and connected to the communities where its clients want to do business, Dentons knows that understanding local cultures is crucial to successfully completing a deal, resolving a dispute or solving a business challenge. Now the world's largest law firm, Dentons' global team builds agile, tailored solutions to meet the local, national and global needs of private and public clients of any size in more than 125 locations serving 50-plus countries.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Events from this Firm
28 Sep 2017, Seminar, London, UK

On 26 July the FCA published its long-expected consultation paper on the extension of the SMCR to all FCA-authorised firms. The so-called "core regime" introduces the key concepts of regulator-approved senior managers, firm-approved certification staff and conduct rules applicable to virtually all staff.

3 Oct 2017, Conference, Zurich, Switzerland

As the founding Partner of the Europe-Iran Forum, Dentons Europe will once again support this year’s event. This compelling event which explores all Iran-related topics will take place in Zürich on 3rd and 4th October.

4 Oct 2017, Conference, Munich, Germany

Dentons Global Real Estate Group is delighted to be exhibiting once again at EXPO REAL, the International Trade Fair for Property and Investment which takes place on 4-6 October, 2017 in Munich, Germany.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.