“The Future of the Planning System” v “Planning for the Future” – two important consultations closing this week

“Planning for the future”, the government’s Planning White Paper published on 6 August 2020 and on which the consultation closes this week (29 October 2020), has been widely publicised and analysed in depth by the development community. As we said in our blog earlier this month, given the impact of the White Paper’s proposals on development in the short and the long term, developers should respond to this consultation. However, another consultation on the planning system in England, which closes the following day, on 30 October 2020, hasn’t been so widely publicised. This latter consultation is a Call for Evidence by the Housing, Communities and Local Government Committee (HCLGC) for an inquiry into the government’s proposals for reforming the planning system. Although the Call for Evidence was only issued on 8 October 2020, developers should find it easy to respond to, because it asks questions that are prompted by the Planning White Paper consultation but not expressly dealt with by it.

What does the HCLGC consultation ask that the White Paper doesn’t?

The future of the planning system in England” inquiry is gathering evidence which, whether intentionally or otherwise, will test the Prime Minister’s statement in his Foreword to the White Paper that the planning system in England is “outdated and ineffective”, that it is “artificially constraining” England’s potential and, in particular, that it is the planning system’s fault that “we have nowhere near enough homes in the right places”. The inquiry also tackles the issue of the future of the green belt, on which the Planning White Paper is surprisingly silent. In my view, if the aims of the White Paper are to be achieved, particularly the urgent increase in supply of new homes, these are important questions, the answers to which should guide which proposals the government should take forward and how. From initial responses to the White Paper seen in the many discussions that have taken place on it, it seems as though others in the development industry agree. Perhaps the questions being put by the HCLGC inquiry should have been asked by the government before the White Paper was published. Ideally, MHCLG will wait to take account of the answers received before pressing on with their fundamental reforms.

Questions asked by the HCLGC Call for Evidence:

  • Is the current planning system working as it should do? What changes might need to be made? Are the Government’s proposals the right approach?
  • In seeking to build 300,000 homes a year, is the greatest obstacle the planning system or the subsequent build-out of properties with permission?
  • How can the planning system ensure that buildings are beautiful and fit for purpose?
  • What approach should be used to determine the housing need and requirement of a local authority?
  • What is the best approach to ensure public engagement in the planning system? What role should modern technology and data play in this?
  • How can the planning system ensure adequate and reasonable protection for areas and buildings of environmental, historical, and architectural importance?
  • What changes, if any, are needed to the green belt?
  • What progress has been made since the Committee’s 2018 report on capturing land value and how might the proposals improve outcomes? What further steps might also be needed?

For more information please contact:

Fiona Sawyer
Fiona Sawyer
Professional support lawyer, planning, London
+44 20 7466 2674

“Planning for the future” consultation closes shortly

Two months ago the government published “Planning for the future“, a Planning White Paper proposing the most radical changes to the English planning system since the Second World War. The proposals have been the subject of much debate across the development industry. With the consultation closing in just over three weeks, developers still have time to consider whether, and how, to respond to the consultation.

Should developers respond?

Developers often decide to leave it to industry bodies to respond to consultations on their behalf and many may choose this route for this consultation as well. However, for these proposals, developers may want to consider whether they should submit an independent response. This is not only because of the enormity of the proposals and the impact that they will have on development in the short as well as the long term, but also because, depending on how the proposals are ultimately implemented, there may be limited opportunity for further public consultation or scrutiny – this may be the one chance that developers have to voice their opinions or concerns about certain elements before they are put into effect. One only has to consider the recent example of how permitted development rights for upwards extensions and demolition of commercial properties for residential development were implemented to see how major change can be introduced through secondary legislation without prior Parliamentary scrutiny.

How should developers respond?

When deciding what to say in response to the consultation questions, many in the industry are sharing their opinions to help ensure that consultation responses are considered and instructive. We have taken our time to review the provisions in detail and have produced a briefing paper to provide an in-depth analysis of the practical implications for clients to inform any response they may have to the consultation. If you are interested in receiving a copy of this briefing, please contact us. We are also running a series of user-friendly and practical round table sessions on the White Paper for our clients.  If this would be of interest, please let us know.

For further information please contact:

Matthew White

Matthew White
Partner and head of UK planning practice, London
+44 20 7466 2461

Catherine Howard

Catherine Howard
Partner, planning, London
+44 20 7466 2858

Changes to the current planning system – Permissions in Principle

On 6 August 2020, alongside the Planning White Paper, the government launched a consultation called Changes to the current planning system. In our blog of 11 September 2020, we reported on one of the four proposals in the consultation, the new affordable housing product called First Homes. Here we focus on the proposal to extend the current Permission in Principle (PiP) to major development, discussing what PiP is, how it is already in use, and the potential implications of the proposals for developers.

What is PiP?

PiP was introduced in 2017 as an alternative route to obtain planning permission for “housing-led development”. “Changes to the current planning system” explains that PiP:

“give[s] up-front certainty that the fundamental principles of development are acceptable before developers need to work up detailed plans and commission technical studies. It also ensures that the principle of development only needs to be established once”.

There are two stages to obtaining full permission through the PiP route: the “permission in principle” stage establishes the principle of whether a site is suitable for housing led development; and the “technical details consent” stage then assesses the detail of the development proposals. PiP is also available to non-housing development provided that the majority of the floorspace in the scheme overall is housing and the non-housing development is compatible with the proposed residential development.

What types of development can currently be granted PiP?

Currently there are two routes for obtaining PiP: by submitting a valid application to the local planning authority (LPA); or through entry of a site in Part 2 of the LPA’s brownfield land register. PiP cannot be granted through either route for habitats development, householder development or EIA development. At the moment, PiP for “major” development can only be granted through entry of a site in Part 2 of the LPA’s brownfield land register, whereas PiP for other development on previously developed land can be granted PiP through the application route. “Major” development is development of 10 or more houses, or a building or buildings where the floor space to be created is 1,000 square metres or more, or on a site with an area of 1 or more hectares.

What are the proposed changes?

The government proposes to make PiP available to larger scale housing-led development by removing the major developments exception from the application route.

Why? The government points to town centre sites that are suitable for development and would support regeneration but, because they can be developed at a high density, could support more than 10 dwellings and are therefore not currently eligible for the PiP application route. A developer could apply for such a site to be listed on the LPA’s brownfield register, or could apply for full planning permission, but either option takes time and/or significant resources which can hold back development. The Planning White Paper proposes that land which is allocated for substantive development in local plans (identified as “Growth areas”) should be automatically granted outline planning permission. Acknowledging that these proposals will take time to implement, the government wants to implement these changes now.

Will this change really make a difference to the availability of PiP for major sites?

Perhaps not. The government itself says:

“We envisage that a change of this kind will particularly benefit small and medium-sized developers who tend to focus on building smaller major developments”.

This is because the existing prohibition on using PiP for habitats or EIA development will remain, which means that PiP still can’t be used for sites of 5 or more hectares or which will deliver more than 150 dwellings. Bearing in mind that PiP is available only for housing-led development, this may restrict its application even for mixed-use schemes. However, if a mixed-use scheme can qualify, it may benefit from another element of the government’s proposal which is to remove the current limit on the amount of commercial development that can be included (currently set at 1,000 sq m or 1 hectare). It may also benefit from the government’s proposal to reduce the fees payable for major site PiP applications to encourage development to come forward using this route.

What other changes are proposed?

The government is also considering whether to impose a maximum height threshold on major schemes consented through the PiP route, and whether to allow the use of social media to widen the publicity of major site applications.

The consultation closes on 1 October 2020. If you are interested in responding to the consultation and would like discuss this further, please get in touch.

For more information please contact:

Matthew White

Matthew White
Partner and head of UK planning practice, London
+44 20 7466 2461

Fiona Sawyer

Fiona Sawyer
Professional support lawyer, planning, London
+44 20 7466 2674

Changes to the current planning system – First Homes

It has been an ambition of successive governments that it should be easier for first-time buyers to get on to the property ladder. On 6 August 2020, alongside the Planning White Paper, the government launched a consultation called Changes to the current planning system, setting out four proposals including how the government proposes to secure an affordable housing product which achieves this ambition. This product is called “First Homes”. The government first consulted on the design and delivery of First Homes earlier this year. The current consultation seeks views on the government’s proposals for implementing the scheme.

The government wants to implement First Homes as part of the current planning system in England, but also wants to take it forward into the new planning system proposed by the White Paper. However, this is not the first affordable housing product aimed at first-time buyers – the Starter Homes initiative was launched by the Coalition Government in 2014 and progressed by subsequent governments but, despite significant investment (including a £1.2 billion Starter Homes Land Fund), regulations to implement the scheme were never taken forward and no Starter Homes were ever built (see here for the NAO report on its investigation into Starter Homes).

What is the difference between First Homes and Starter Homes, to what extent will developers be required to include First Homes as part of their affordable housing offer, and what are the next steps?

First Homes v Starter Homes

Table 1 summarises the main attributes of both First Homes and Starter Homes. The products bear many similarities: both are aimed at first-time buyers with a mortgage who earn less than £90,000 in London and £80,000 in the rest of England; both are subject to a minimum discount below market value and an overall price cap; and both are available to Armed Forces personnel.

However, there are differences. To put it very simply, the government has beefed-up the Starter Homes offer significantly. First Homes must be offered at a greater discount below market value, in perpetuity. There is also a compulsory requirement – a minimum of 25% of all affordable housing units secured through section 106 obligations must be First Homes, whether on-site, through cash in-lieu or as a combination of the two. First Homes must take priority over other affordable housing products. There may be an exemption for Build to Rent schemes, and also an exemption from CIL (once regulations have been implemented), but otherwise all schemes delivering affordable housing through section 106 obligations will be affected. This will have a major impact on the range of affordable housing tenures provided by developers and particularly on the provision of social housing and other affordable rented products.

Another significant difference between Starter Homes and First Homes is the “local connection” requirement for First Homes buyers. The Starter Home requirement that a first-time buyer must be under 40 has gone, but local planning authorities can require that developers must market First Homes to local buyers only (with the exception of Armed Forces personnel) for three months before the units can be sold to first-time buyers outwith the local area.

Table 1: Comparison between First Homes and Starter Homes

Next steps

The government intends to implement First Homes through changes to national policy and by producing standardised wording for section 106 agreements. However, as it wants consistent implementation by local authorities across England, it acknowledges that primary legislation may be necessary, which will presumably be achieved through the Planning White Paper reforms. These reforms certainly include the “significant reforms to developer contributions” that the consultation refers to as another next step – the Planning White Paper proposes to replace both CIL and section 106 affordable housing contributions with a new Infrastructure Levy – although if First Homes are implemented before this then changes to the CIL Regulations 2010 will be needed to introduce the promised exemption for First Homes from CIL.

The principle that developers will have to provide First Homes seems established, albeit that the same had been said for Starter Homes. Developers do, however, still have an opportunity to comment on the following aspects of the First Homes policy by responding to the Changes to the current planning system consultation:

  • how the remaining 75% of affordable housing on a site should be delivered (after the first 25% has been delivered as First Homes);
  • what exemptions (if any) there should be from the requirement to provide First Homes (eg Build to Rent exemption);
  • transitional arrangements for local and neighbourhood plans already well advanced through the plan-making process, and for applications that are well progressed on the basis of a different affordable housing tenure mix;
  • the level of discount below market value; and
  • views on exception sites and rural exception sites.

The consultation closes on 1 October 2020.

For further information please contact:

Matthew White

Matthew White
Partner and head of UK planning practice, London
+44 20 7466 2461

Fiona Sawyer

Fiona Sawyer
Professional support lawyer, planning, London
+44 20 7466 2674

The Planning White Paper – Planning to use PropTech properly

Technological improvements in the planning system are long overdue. Technology has advanced significantly since the Town and Country Planning Act was first introduced, which begs the question: why is the planning system so outdated when it comes to obtaining planning permission?

This is a point taken up by “Planning for the future“, the Planning White Paper published on 6 August 2020, which notes that:

“The planning system is based on 20th century technology: planning systems are reliant on legacy software that burden the sector with repetitive tasks”

We have seen a seismic shift towards the use of technology in the planning system as a result of the Covid-19 pandemic, with a number of planning appeals and development consent order inquiries set to be fully virtual. It is clear that the government wants to keep up this momentum. How does it propose to achieve this?

The White Paper refers to local plans needing to be “visual and map-based, standardised, based on the latest digital technology and supported by a new standard template”. It goes on to say that the planning process would be increasingly digitised, moving from “a process based on documents to a process driven by data”. Local planning authorities would be helped to use digital tools to support “a new civic engagement process for local plans and decision-making”. This would certainly assist councils in fulfilling their plan making and consultation responsibilities, but would it really benefit developers in the same way?

The Prime Minister’s Foreward starts by saying let’s “tear it down and start again”, but when you consider how far technology has come and the advances made in other industries, the proposals in the White Paper are not really that radical. The vision is there, but the White Paper does not mention any ground-breaking technologies. In fact, “interactive maps technologies” have been in existence for a number of years and the UK has a long way to go if it is to achieve the goal of becoming a “world-leader in digital planning”.

It might be hard to imagine a planning system which is fully automated and of course, we don’t want planning permission to become a complete tick-box exercise, but with the right technology a lot of issues could be flushed out in advance and the process for obtaining planning permission could be made much simpler and quicker. Take for example digital twin technology, which creates virtual replicas of buildings, infrastructure and physical assets, and builds interactive 3D city models that pull together vast amounts of interactive data. This sort of technology has the ability to help predict and visualise outcomes and could transform the planning process. Similarly, smart phone technology has the potential to revolutionise public involvement and make the system much more accessible and efficient.

The good news is that the White Paper does refer to 3D visualisation technologies and it recognises the need to build new technology to help improve citizen engagement and planning processes. It also suggests that routine tasks could be automated and refers to machine-readable plans that could automatically screen developments to identify where they align with policies and/or codes. The government is also promising to engage with the UK PropTech sector through the PropTech Innovation Council (announced in November 2019) to make the most of innovative new approaches in technology.

Don’t worry though – all this technology isn’t necessarily intended to replace humans. After all, planning for beautiful and sustainable places (Pillar Two of the White Paper) requires some degree of human judgement!

For further information, please contact:

Lisa Bazalo

Lisa Bazalo
Senior Associate (New Zealand), planning, London
+44 20 7466 2957

Planning White Paper lays foundations for a new route to housing

The Planning White Paper published this month proposes a major overhaul of the planning regime in England, yet includes just one reference to the development consent regime. This is despite the fact that the introduction of that regime in 2008 was, in my view, one of the most successful changes made to the English planning system for decades.

The White Paper suggests that one of the ways in which full planning permission could be obtained for very large sites within Growth Areas under the new system is through a development consent order pursuant to the Planning Act 2008 (though technically a development consent order (DCO) cannot grant planning permission, and instead actually disapplies the need for planning permission). The example given in the White Paper of the type of scheme that could use this route is a new town. Despite the absence of details, the idea of allowing a housing scheme to be consented through the development consent regime has caused great excitement within the industry.

The development consent regime was developed to create a fast track, streamlined route to obtaining consent for nationally significant infrastructure projects (NSIPs). The main benefits include: greater certainty over timescales; the ability to wrap in other consents including compulsory acquisition powers; the principle of development being established up front (for schemes falling within the scope of a National Policy Statement (NPS)); elevating the decision-making to the national level (particularly helpful for locally unpopular but nationally needed schemes); and better quality decisions that are far less likely to be quashed by the court.

Given the major housing shortage in England and the government’s 2017 pledge to fix our broken housing market, it seems obvious that housing should be the type of project that should benefit from this regime. However, not only does housing not fall within the definition of an NSIP but the 2008 Act expressly prohibits the grant of consent for associated development comprising “the construction or extension of one or more dwellings”. Consistent with the government’s emerging localism agenda when the Planning Act 2008 came into force, it was considered that local authorities were better placed to decide on matters such as housing need and that decisions on the siting of housing should therefore only be taken at the local level.

This approach, however, overlooked the fact that major infrastructure schemes require lots of construction workers, not all of whom will live locally and thus must be found temporary local accommodation, often in areas that would suffer severe impacts were they to be temporarily flooded by workers. To address this, some developers have sought to include temporary accommodation as part of their development consent schemes. In R (on the application of Innovia Cellophane Ltd) v Infrastructure Planning Commission (2011), in which Herbert Smith Freehills acted for the interested party, the Court held that the dwellings exclusion in the 2008 Act did not preclude granting consent for temporary accommodation.

That was clearly the right decision, both as a matter of law and principle. Yet temporary accommodation is just that, temporary, meaning that at the end of the project it must be removed. In areas suffering from significant housing shortages, there may be merits in allowing more permanent housing to be granted through the development consent regime, allowing a legacy benefit for the affected communities.

The government finally saw sense in 2016 when it brought forward the Housing and Planning Act which allowed housing that is “related” to a NSIP to be authorised by a development consent order. Yet there are strict rules in place for what related means in this context by reference, for example, to the size and location of the proposed housing, which has significantly constrained its use.

This month’s White Paper seems to be proposing that major housing sites could be treated as NSIPs in their own right, which would represent a major step forward for the consenting of housing in England. If implemented (and it would require new legislation) this could pave the way for major new housing sites to come forward without being held back by local politics, under-resourced councils and difficulty in securing separate compulsory acquisition and other required powers.

The government should ensure that clear guidance is provided (potentially through a new Housing NPS) to applicants on how to assess their proposals at the application stage to minimise duplication or gaps and ensure consistency with the analysis undertaken at the local plan stage. In due course the government will also need to publish details of the applicable thresholds (eg will this be defined by reference to minimum housing numbers?) and whether this will be a voluntary “opt in” process by virtue of a section 35 direction under the 2008 Act or compulsory (meaning it would be a criminal offence to fail to obtain development consent).

I applaud the government in making this proposal, which in my view is long overdue, and eagerly look forward to the publication of more details in due course.

Charlotte is Of Counsel within the planning team at Herbert Smith Freehills. She has extensive experience of the development consent regime and in particular for the last 12 years she has advised EDF on obtaining development consent for its new nuclear power stations at Hinkley Point C and now Sizewell C. She is also experienced in advising on major housing schemes, such as a proposed 10,000 home settlement near Stansted Airport and a 2,000 home scheme in the Green Belt in Surrey.

For more information please contact:

Charlotte Dyer

Charlotte Dyer
Of counsel, planning, London
+44 20 7466 2275