Part 1 of this blog considered the expectations and challenges around build out and some of the reforms proposed to address it. This part considers the implications of slow build out for local authorities and what they, and the planning system more broadly, can do to speed up delivery.
Accountability for delivery
Local authorities are at the sharp end of the slow build out problem. They have limited control over development once development is fully permitted but are increasingly going to be become accountable under the NPPF for delivery against their local housing requirements.
According to the last Housing Delivery Test (HDT) results, 33% of LPAs have become subject to at least one of the NPPF 'penalties' arising from under-delivery. 19 further local authorities are likely to face another 20% buffer to their 5-year housing land supply in 2020 (Planning Magazine). If local authorities lack enough 'deliverable' sites to make up that level of supply, the 'tilted balance' may kick in. Those authorities then, in theory, become more vulnerable to planning by appeal.
So what can LPAs do?
- Restrict: Authorities can, in principle, impose conditions setting a timeframe for implementation that is shorter than the default statutory 3 years. Where an LPA considers that an implemented development is unlikely to be completed within a "reasonable period", it can serve a 'completion notice' (s.94(2), TCPA 1990). This does not require completion; it is a notice that the permission will (subject to Secretary of State sign-off) expire. At the end of the period specified, the permission becomes invalid and the development can no longer proceed.
These are negative tools, however. They are more likely to frustrate development than encourage it. It is not surprising that they are seldom used.
- Contract: Local authorities are likely to consider using contractual mechanisms. These would include an agreed trajectory for build out, including deadlines by which certain build out 'milestones' must be completed – e.g. numbers of storeys or residential units, a development phase. Absolute delivery commitments may generate legal interest in whether they are enforceable or, more fundamentally, necessary (see Wavendon Properties, for example). Where agreed milestones are not achieved by the relevant deadlines, there could be:
- changes to housing types and tenures – e.g. increased proportion of rented housing or affordable housing, a shift in the affordable tenure split towards social rent, etc.;
- acceleration of triggers for the delivery of infrastructure items (schools, libraries, etc.);
- a viability review;
- theoretically, an option for the Council to acquire the land becoming exercisable.
The effectiveness and desirability of these mechanisms depend on factors such as the extent of any contractual get-outs for the developer, provisions for control over the quality of the development and monitoring, and the LPA's monitoring capacity.
- Deliver: More ambitiously, local authorities can themselves engage in delivery, either individually or with private sector partners, through 'local housing companies'. Indeed the use of these vehicles has increased significantly in recent years.
- Supply: politicians can chose to allocate more land than necessary to meet the NPPF's minimum requirement for a 5YHLS + 5%, to better compensate for consent lapses, which local plan housing trajectories sometimes underestimate. Flipped the other way around, less exuberant delivery trajectories can be used (which more closely reflect the build out patterns covered in Part 1 of this blog) – more deliverable sites would need to be identified to compensate for the more realistic approach.
There is no single solution for speeding up delivery, and mere tinkering with the current system will not do. More work is needed to understand whether positive incentives can be devised to specifically target the rateof delivery, rather than delivery per se.
In any event, any package of measures should include Government incentives that reward authorities, and perhaps investors, for planning for growth and delivering it in a timely manner. Putting in place a more meaningful alternative to the New Homes Bonus would be a start in creating incentives to facilitate speedy delivery once outline permissions have been granted without the burden on further planning regulation.
In the meantime, the tools identified above are likely to come more to the fore in debates about delivery.
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