Alternatives to Appendix 6 (1)

Alternatives to Appendix 6


6 May 2016

LONDON - In response to concerns that the proposed revision to the Planning Practice Guidance in the Local Plans Expert Group report last month includes some technical errors, leading experts in demography, economic forecasting and planning have suggested a technically robust alternative.

The draft proposal addresses the most obvious problems with the LPEG version, but still represents a simplification and streamlining of the process.

While the LPEG report contains many welcome recommendations, its proposals on measuring housing need, at Appendix 6 of the report, are unhelpful. The proposals have disastrous technical faults.

If implemented, they would delay and complicate plan-making even more than the present system. They would put need in the wrong places, so the most popular places may still be undersupplied, while too much land is allocated in places with weak demand, putting viability at risk. These are much more than technical issues, because housing numbers are such an important part of planning.

The group's submission to Government does not just criticise the LPEG proposals. It also puts forward an alternative method, which is just as simple as LPEG’s, but does not share LPEG’s faults.

The submission was produced by Neil McDonald of NMSS, Cristina Howick of Peter Brett Associates (PBA) and Prof Ludi Simpson of the University of Manchester. Neil is an independent consultant, until 2015 a Visiting Fellow at the Cambridge Centre for Housing and Planning Research (2012-15), previously Director at DCLG and Chief Executive at the National Housing and Planning Advice Unit (NHPAU). Cristina is a partner at PBA who wrote the Planning Advisory Service (PAS) technical advice note on housing needs and housing targets. Ludi is the founder and designer of the planning industry standard demographic software POPGROUP and has advised government and other bodies on demography for over 30 years. Other contributors include Piers Elias and John Hollis of the British Society of Population Studies, Sunil Joshi of Experian Economics and senior local government officers.

As regards the likely impact of the LPEG method, the group estimates that:

  • To meet the LPEG housing need 324 of the 325 local planning authorities would have to lift their rates of delivery by more than 50% (the exception is Burton-on-Trent).
  • 162 authorities would have to more than double their recent delivery 72 authorities would have to more than triple it and 34 authorities would have to more than quadruple it.
  • Under the LPEG method London’s housing need would rise from 49,000 new homes per year to 85,000
  • London’s unmet need would have to be accommodated in the 23 local authorities that form rest of the London HMA. To meet the need in full, these authorities, which are largely in the Green Belt, would have to multiply their recent rates of delivery tenfold.

The group agrees with LPEG that there should be a simpler and more standardised method for measuring housing need - and its proposals for such a method include:

  • In establishing the ‘demographic starting point, projected internal migration (domestic and international) on flows in the most recent 10-year period for which data are available.
  • The market signals adjustment should be much simplified, so it uses just two indicators and fixed adjustments. But the indicators and adjustments should be recalibrated so they apply to a minority of local authority areas, where market pressures are exceptional.
  • Where Unattributable Population Change (UPC) is large, to provide a robust demographic starting point, the 10-year projection mentioned earlier should be adjusted so it includes in its migration base a portion of the 2001-11 UPC.
  • The revised PPG should include a short section to guide calculations of labour market alignment. Among other things this should advise on ensuring that forecasts of job demand and labour supply are based on mutually consistent assumptions. The guidance should have the benefit of technical advice from economic forecasters.
  • The affordable housing uplift should be treated as a policy issue, separate from the OAN. The PPG should say that, if housing development in line with the OAN would not generate enough developer contributions to meet the affordable housing need, the authority should consider lifting its policy target (requirement) by 10%, subject to demand and viability.
  • In addition the revised PPG should make it clear that affordable housing need is not part of the OAN and the OAN is not required to meet it in full.
  • ‘Backlog’ inherited form previous plans should not be added to the objectively assessed housing need. There should be other measures to ensure that local planning authorities should not benefit from past failures.

For more information, contact Cristina Howick or Richard Pestell or download the full report here.