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Published: 04 April 2017
Area of Law: Planning

Do Neighbourhood Plans really boost housing supply?

The Government told us in the recent Housing White Paper that it intends to “boost housing supply and, over the long term, create a more efficient housing market”. At the same time, it’s clear that it also wishes to expand and strengthen the system of neighbourhood planning that was first introduced by the Localism Act 2011.

For many involved in the planning system, there is an obvious tension between those two aims.

Those with direct experience of the planning system often feel that neighbourhood plans are designed to stifle development - exactly the opposite of what the Government tells us it wants to achieve. The White Paper attempts to square this circle by claiming that neighbourhood planning actually boosts housing supply. It suggests that, where neighbourhood plans contain a target figure for new housing, the evidence shows that this is typically 10% greater than the number planned for by the local authority in its local plan. This figure was repeated by the Secretary of State for Communities and Local Government, Sajid Javid, when he spoke at an event that we recently attended in Bromsgrove, Worcestershire.

But is it right? The Department of Communities and Local Government has produced Neighbourhood Planning: progress on housing delivery , the most recent update to which was in October 2016. The document suggests that it:

“… gives further weight to early findings suggesting that neighbourhood plans that provided a housing number have on average planned for approximately 10% (rounded down) more homes than the Local Plan housing figure (or an expectation set out by the local planning authority) for those areas.”

So far so good. But a closer examination of the document uncovers a number of problems. Firstly, its conclusions are based on a small sample of only 39 neighbourhood plans, out of more than 270 that the Government says are in force.   This appears to be because the paper’s authors considered only the neighbourhood plans that both contained a housing number and had been in force for more than 3 months. It could be, of course, that those plans containing an explicit housing target are those that plan most positively for development. Perhaps neighbourhood plans that seek to restrict development are less likely to contain a housing number. If that were the case, they would have been excluded from the study, skewing the results. This point does not appear to have occurred to the report’s authors.

Secondly, the numbers given for “local plan allocations” in some cases don’t refer those given in an adopted local plan at all, because in those cases there was no up to date local plan. It appears that the numbers used are from emerging plans or from strategic housing land availability assessments, neither of which will have been subject to a test of “soundness” during a local plan examination. Following the examination process, those numbers may well be revised upwards, to match or exceed the neighbourhood plan figure.

Thirdly, as the paper acknowledges, the neighbourhood plans it studied did not always present their housing numbers in a consistent way. It gives as an example the fact that some plans included sites that already have planning permission, while some did not. Plans that include existing permissions may appear to provide for more houses, but – importantly – in those cases the increase will have nothing at all to do with the neighbourhood plan itself.

So it appears that the evidence on which the Government relies is less than robust, to say the least. Lawyers acting for a large number of housebuilders in a judicial review of December’s Written Ministerial Statement on neighbourhood planning go even further.

In a pre-action letter to the Government, which is widely available on the internet, they attack the “10%” figure as “completely fallacious”. They go on to describe the analysis in the October 2015 version of the paper as “woefully inadequate in terms of its intended purposes” and identify what they say are a number of significant errors. The Government’s response (again widely available on the internet) accepts that the analysis in the October 2015 and 2016 papers is “plainly provisional and of limited weight”, but goes on to say that the goals of significantly boosting housing supply and support for the neighbourhood planning system “are not seen to be in conflict with each other”.

Whatever your view, it’s clear that a lot is riding on the Government being right on this point. If the widespread adoption of neighbourhood plans doesn’t lead to more houses being built there is a real danger that the Government will – like many before it – fail to achieve its goals. It therefore seems surprising that the system is being expanded without much hard evidence that it will support the Government’s aims - and a suspicion amongst many that it will actively hamper them.

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