Introduction: The Planning System
The UK's planning system is multi-faceted and there are many aspects that developers need to be aware of when operating in a specific region. In this section, we delve into constraints, housing delivery, and policy changes.
Local Plan Status
The Local Plan is supposed to be the cornerstone of the English planning system.
Local authorities are supposed to prepare a cohesive and comprehensive plan for their area. It should provide for the housing needs (and every other kind of need) expected within a fifteen-year plan period; they’re also supposed to review these plans every five years to ensure that they stay up to date.
According to the analysis that we’ve undertaken, less than 30% of local authorities in the South East of England currently have a Local Plan that was adopted less than five years ago in place. Around 42% of councils in the south east are relying on policies that are older than five years - leaving themselves open to the risk of planning application refusals being overturned by the Planning Inspectorate on appeal.
Although some councils are working towards the preparation and adoption of a new Local Plan, only around 14% of Councils in the South East are still actively working towards this goal, with 17% of Councils having actively stopped, or at least significantly delayed, the preparation of a Local Plan in the last year.
Green Belt and Other Constraints
Much of the tension around plan making, and indeed planning applications, felt in the South East is related to the Green Belt and whether sites should be released from this designation to allow more houses to be built where people want to live.
It is an emotive and often-politicised issue. The Green Belt is one of the most talked about, but least understood, aspects of the English planning system. Far from the rolling natural wilderness of the imagination, the Green Belt is separate from any ecological or biodiversity value and is simply a policy in place to prevent urban sprawl. Development in the Green Belt cannot affect the ‘openness’ of this area and this usually rules out development for housing.
The South East is significantly affected by London’s Metropolitan Green Belt, 16% of the total area of the wider region is located within the Green Belt. When you add in the impact of Areas of Outstanding Natural Beauty (AONBs), National Parks, and Sites of Special Scientific Interest (SSSIs) (together 40%), which also act to suppress or prevent residential development, a total of 49.6% of the South East region is ruled out for residential development.
On top of these constraints, the development industry in the South East is affected by the effective moratorium on development caused by Nutrient Neutrality requirements, including in the Solent and Kent. Plus Water Neutrality requirements in and around Horsham. These issues are severely affecting the development industry, despite being mainly caused not by housing but by years of under-investment in our water infrastructure.
Within the South East, the Councils most severely affected by Nutrient Neutrality are Eastleigh, Southampton, and Test Valley – all of which are affected by these restrictions across their entire area. Fareham, Havant, Gosport, Winchester, Portsmouth, New Forest, and Isle of Wight Council Areas are all also affected on over 90% of their total area. In total 22.8% of the South East is affected by Nutrient Neutrality restrictions.
Addressing Nutrient Neutrality is a complex and land-hungry issue. Although some developers are leading the way in securing approval for nutrient-neutral developments, the changes to the NPPF that are being considered may make it more difficult to find appropriate offsetting sites.
Water Neutrality is more locally restricted - focused on Horsham, Chichester, and Crawley - but the impacts are more severe with few obvious solutions to this development restriction in the short term. Although the Water Neutrality restrictions only affect just over 5% of the region as a whole, practically the whole of Horsham is affected, along with around half of Chichester and half of Crawley.
The current politicisation of planning, particularly in areas that are also affected by Green Belt policy, is leading to delays and unnecessary expense. Democracy, being at the heart of planning, means that planning decisions are made by local politicians on the advice of their professional officers. However, when the politicians ignore their officers’ advice and refuse planning permission in the face of a recommendation for approval it can lead to months of delays for applicants, and high legal fees for Councils.
Focussing on the South East, in the last quarter of 2022/23 Wealden Council was faced with legal fees of nearly £500,000 to defend their Members’ indefensible decisions at appeal. Indeed 30% of all appeals in Wealden have been allowed over the last five years.
It’s a similar situation in Brighton and Hove (35% allowed), Eastbourne (38% allowed), and Winchester (39% allowed). Although the situation is not universally this bad (only 13% allowed in Reading and 12% in Southampton), appeals in the South East region are allowed at an average rate of 24%, which means that nearly a quarter of applications are approved by the Planning Inspectors in the face of local refusal or inaction. This demonstrates a strong influence of the NIMBY (not in my back yard), or even the BANANA (Build Absolutely Nothing Anywhere Near Anything) groups in local politics.
So, despite all this political upheaval in plan making and decision taking, are the local councils in the South East delivering the houses that the area needs? The 2021 Housing Delivery Test data, which was released by DHLUC last year paints an inconsistent picture across the region.
Councils like Mole Valley (70%), Worthing (35%), and Eastbourne (32%) are consistently failing to deliver the housing that their future population needs, meanwhile other areas are contributing a great deal. West Oxfordshire (195%), Vale of White Horse (195%), and Crawley (406%) are smashing their housing targets. Overall, the Government’s Housing Delivery Test shows that the South East is delivering 110% of its housing need, but is this delivery in the right place, and how is this affecting the housing market? More on this later.
In December 2022, the Government released a range of changes to the current national planning policy (the NPPF), as well as a prospectus outlining further policy changes that will come in 2023.
Although these changes are significant enough to warrant an update of their own (and in fact, that is currently in process) among the most significant changes proposed within this update relate to the protections afforded to Green Belt.
Currently, local unmet housing need can be used as part of the ‘exceptional circumstances’ that can allow Green Belt to be released from protection as part of a Local Plan review, or as part of the ‘very special circumstances’ to allow protected Green Belt to be built on as part of a (usually speculative) development. The latter usually takes place during an appeal and in situations where local policies are out of date or where a five-year land supply cannot be demonstrated (note the situation in Wealden outlined above).
The changes proposed to the NPPF make it explicit that Green Belt does not have to be reviewed to allow housing targets to be met, it also protects Councils from speculative development in cases where they do not have a five-year land supply – if their Local Plan is less than five years old. These changes will come into effect immediately upon publication of the new NPPF, so we may see appeal wins drop off a cliff in the second quarter of 2023.
Proposed policy changes (including the NPPF change, but also the White Paper and the Levelling Up and Regeneration Bill) have also had an immediate effect on Local Plan progress in the South East where twelve local councils have delayed or withdrawn work on their local plan over the last year. Together these areas are required by the Standard Method to deliver 10,768 houses per year. Mole Valley Council, for example, recently resolved to snatch back its Local Plan from the jaws of adoption to remove all the previously assessed Green Belt allocations.
These changes will have an impact on the housing delivery statistics for 2023 and beyond - we will keep tracking this.
Alongside this change to the level of protection afforded to the Green Belt, the NPPF changes also protect councils from housing delivery where doing so would require density that is out of character with the surrounding area - so no densification of existing urban areas near to services and transportation either. They also propose to offer more protection to Best and Most Versatile (BMV) agricultural land, meaning that it may become more difficult to find the large sites necessary for Nutrient Neutrality or Biodiversity offsetting as sites are protected in the name of food security.
On top of all this, the long-awaited Biodiversity Net Gain requirements brought in by the Environment Act, are due to kick in in November 2023. This may bring further delays as developers battle it out over offset sites that may be necessary to make larger green-field sites deliver the required 10% uplift in biodiversity. In light of all this, it will be very interesting to see how the Housing Delivery numbers change over the coming months.
If you've enjoyed the data insights about demographics in the South East, check out our other reports for the region below: