What will Neighbourhood Plans be like in a new planning system?

by Ed Dade

Posted on Aug. 14, 2020

This post explores what the government's proposed reforms to the planning system might mean for Neighbourhood Plans.

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It is a little over a week since the government launched its proposals for the future of the planning system and there has already been many articles and blog posts providing excellent critique of the changes which may lay ahead. In this post I don’t attempt to cover all the government’s proposals, instead focusing on those of greatest relevance to neighbourhood planning.

Radical reform

The government’s Planning for the Future White Paper proposes a major overhaul of the planning system, promising 'radical reform unlike anything we have seen since the Second World War'. It proposes 'a whole new planning system for England'. In other words, bringing the changes into effect may involve changes to swathes of legislation and national policy.

What is clear through the White Paper is that the government views the planning system as a barrier to growth - a claim which has been strongly disputed by the TCPA. Crucially, the White Paper claims the 'proposals will help us to build the homes our country needs'.

For a summary of the White Paper’s main proposals, see this quick guide from MHCLG.

The Planning for the Future White Paper is a consultation document. Alongside its proposals are a series of questions. I would encourage those involved in neighbourhood planning to form their own view and participate in the consultation.

In addition to consultation on the White Paper, the government is also consulting on changes to the current planning system, notably:

  • A revised method for calculating ‘Local Housing Need’ i.e. increasing local authority housing targets to hit the government’s objective of 300,000 homes per annum.
  • Raising the threshold for on-site provision of affordable housing to 40/50 new homes i.e. only requiring developers of very large sites to provide affordable homes.
  • Requiring 25% of affordable homes provided on-site to be ‘First Homes’ i.e. discounted homes for sale to first-time buyers and key workers.

‘More focused’

The White Paper proposes that Neighbourhood Plans should be retained under the new planning system. However, the White Paper states -

“we will want to consider whether their [Neighbourhood Plans] content should become more focused to reflect our proposals for Local Plans…”

Under the government’s proposals, Local Plans will be markedly scaled-back and simplified. Local Plans will focus on identifying land under three categories – ‘Growth areas’, ‘Renewal areas’, and ‘Protected areas’, and will have a more focused role in ‘identifying site and area-specific requirements, alongside locally produced design codes’. Local Plans will no longer set local policies for development, but rather ‘general development management policies’ will be set by the government which will apply nationally.

Whilst the government likes the idea of Neighbourhood Plans, frankly it isn’t clear what is left for them to actually do - since identifying areas for growth is the role of Local Plans, and policies for managing development will be set nationally by the government. Allowing Neighbourhood Plans to do either of these things would add the complexity the government is seeking to avoid.

The White Paper places great emphasis on design, local preferences and character. There is a fairly obvious role for neighbourhood planning in preparing design guides and codes. However, this is not a new concept - most current Neighbourhood Plans already set design requirements for new development.

By massively paring-back Local Plans and removing the ability to set policies at a local level the government appears overwhelmingly to be taking powers away from districts and communities when, in light of the successes of neighbourhood planning, it should instead be handing more powers down.

Engagement and digital tools

The White Paper places great emphasis on community engagement throughout the planning system as a whole. Simplifying and streamlining processes may to some extent help to achieve this goal.

The White Paper promotes a ‘digital-first approach to modernise the planning process’ which is something I advocate as many people are increasingly used to doing things online and may have an expectation that they can engage in the planning system online.

It is important that, through this digital revolution, Neighbourhood Plans are not left behind - an issue I care passionately about having recently launched my own online Neighbourhood Plan consultation service.

The White Paper identifies the opportunities that digital technologies can provide in assisting the preparation of Neighbourhood Plans, including through ‘new digital co-creation platforms and 3D visualisation technologies to explore proposals within the local context’.

The White Paper suggests the government will provide support to neighbourhood planning groups to help them adopt such technologies, stating

"We will develop pilot projects and data standards which help neighbourhood planning groups make the most of this potential".

Utilising digital technologies can be a fantastic way making information and engagement more accessible to many people. For others, such as those who do not have the necessary skills or resources to access digital material, being too reliant on digital technologies risks excluding them from the plan-making process. Whilst incredibly useful, it is important to keep sight of the limitations of digital technologies.

Urban Neighbourhood Planning

Whilst there are many notable examples of Neighbourhood Plans in urban areas, it has overwhelmingly been a rural phenomenon. The new system seeks to further spread the use of Neighbourhood Plans to towns and cities, and improving take up of neighbourhood planning in urban areas can only be a good thing.

The White Paper poses the idea of extending and adapting the concept of neighbourhood planning so that "very small areas – such as individual streets – can set their own rules for the form of development which they are happy to see". For such a concept to be successful it would likely need a more straight-forward approach to plan preparation - under the current system it would likely prove disproportionately resource intensive to plan for a very small area, such as a street. Yet the idea that every street in England could have its own set of planning rules feels in stark contrast to the simpler, streamlined approach advocated throughout the White Paper.

Infrastructure Levy

The White Paper proposes getting rid of the Community Infrastructure Levy (CIL). CIL generally appears popular with Town and Parish Councils, namely because 15% of CIL receipts raised in an area are passed onto the town or parish council. This share rises to 25% where a Neighbourhood Plan is in place.

For some communities, CIL has been an incentive to prepare a Neighbourhood Plan - both in terms of accessing the funding, and having greater say on how it is spent.

Under the White Paper’s proposals, CIL will be replaced with an Infrastructure Levy raised from the final value of a development, rather than based on built floorspace (as is the case with CIL).

It is not clear whether communities will be eligible for a portion of the Infrastructure Levy. However the White Paper assures that "local communities will have more control over how it is spent".

Changes to the current planning system

The proposals outlined in the White Paper will require significant changes to legislation, and therefore may take some time to deliver this radical overhaul of the planning system. Conversely, the proposals contained in the separate consultation on changes to the current planning system can be brought into effect more expediently through revisions to national policy.

New method for calculating Local Housing Need

Local Housing Need is a formulaic approach to setting a district’s housing target, based on ONS data on household projections and local affordability. You can find the Local Housing Need figure for your area using my LHN database app.

There is a problem with the current method for calculating Local Housing Need - it falls far short of the government’s objective to build 300,000 homes each year. The proposal is to change the methodology to one which gives the right answer.

The basic principle of the Local Housing Need calculation is in itself problematic. It compounds existing problems, rather than addressing the root causes of the housing crisis. For example, it simply raises housing targets in London and the south east, rather than addressing the problem that London is far too dominant in the nation’s economy at the expense of towns and cities in the midlands and north.

The proposed new ‘standard method’ for calculating Local Housing Need takes into account changes in affordability over a longer period, giving an increased target overall and exceeding the government’s 300k homes objective. However, the increase in housing targets are not distributed evenly. Some local authorities will see their target stay about the same, others will even fall - whilst some local authority areas are poised to see their Local Housing Need requirement increase astronomically. This blog from Lichfields provides a comparison of the current and proposed LHN methods.

Changes to the Local Housing Need will have knock-on effects for Neighbourhood Plans in some areas. For example, it may increase the number of homes identified to be delivered in a Neighbourhood Area. It may also have implications for a local authority’s housing land supply position, effect how the ‘presumption in favour of sustainable development’ is applied and whether a Neighbourhood Plan’s policies are treated as up to date.

Affordable housing threshold and First Homes

Typically, for sites of 10 or more dwellings, Local Plans and/or Neighbourhood Plans require the developer to provide a portion of those homes as ‘affordable housing’. The government is proposing increasing this threshold to apply only to sites of 40 or 50 homes to help speed up the delivery of new development.

In addition, the government will require the first 25% of affordable homes to be ‘First Homes’ - for sale at a discounted rate to first-time buyers, key workers and serving members and veterans of the armed forces.

The need for affordable housing can vary greatly from place to place due to the cost of housing and other local characteristics. The problem for Neighbourhood Plans (and Local Plans) is that these proposed requirements are set at a national level and do not take into account local circumstances. Neighbourhood Plans may find it very difficult to write their own policies to provide affordable housing in a manner which is relevant to their local area without resulting in conflict with national policy.

Whilst it is unclear quite what role Neighbourhood Plans will have in the new planning system, it is likely that Neighbourhood Plans of the future will look very different to those of today - with potentially less power to address the issues which really matter.

For those writing a Neighbourhood Plan at present, continue - it could provide much needed stability whilst the rest of the planning system is dismantled around it.

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Leave a Comment:


Henry Peterson | Aug. 15, 2020, 12:10 p.m.

Thanks for the helpful summary of the White Paper. You ask ' it isn’t clear what is left for neighbourhood plans to do'?

I have see other comments, from legal firms in the planning field, suggestion that neighbourhood plans will no longer be able to allocate sites, and that this function will be 'taken away' by the changes. Is this so?

Why will a NP no longer be able to allocate sites for specific uses, within a area already zoned in the Local Plan? Sites for housing infill in a conservation area in a 'protected' zone, or for social and community uses in 'renewal' zone? My experience of neighbourhood planning is in urban areas in London. In rural areas, will things be different?

Ed Dade | Aug. 16, 2020, 9:19 a.m.
Thank you for your comment. At present it is difficult to say whether, under the government's proposals, Neighbourhood Plans will continue to have the power to allocate sites. The White Paper isn't altogether clear what the role of Neighbourhood Plans will be, but the suggestion they will be 'more focused' may imply a narrower scope in their powers. Under the government's proposals, Local Plans will put all areas of land into one of three areas - 'growth areas', 'renewal areas' and 'protected areas'. Identifying land as a growth area will automatically grant outline planning permission - it may therefore be difficult for Neighbourhood Plans to place additional requirements on areas already with planning consent. Perhaps, like you suggest in your comment, Neighbourhood Plans could place additional requirements on land in renewal and protected zones - or identify additional land for development by changing a 'protected' area to a 'growth' area. However, it isn't clear if this two-tiered approach is what the government wants. It is clear from the White Paper that Local Plans will be prepared and reviewed more quickly, and community engagement will be of great importance. Perhaps the government would argue that communities will, under the proposed new system, have greater opportunity to influence the designation of land through engaging in the Local Plan process.

Paul Ogden | Aug. 16, 2020, 10:05 a.m.

Thanks for the analysis of this.
Do you know what this would mean for existing NPs? Our urban NP was adopted last year and runs to 2030. Also, the Greater Manchester Spatial Framework is in the last lap of its development and is due to run until 2037 - would this now be redundant?

Ed Dade | Aug. 16, 2020, 11:28 p.m.
Thank you for your comment. The government is proposing that all local authorities will be required to adopt a new-style Local Plan within 2.5 years from the new legislation being brought into force, or 3.5 years where the authority has adopted a Local Plan within the previous three years or where the Local Plan has been submitted for examination. This is markedly shorter than the current requirement to review a Local Plan every five years. It isn't clear how the changeover to the proposed new system might effect existing Neighbourhood Plans, as the government is yet to set out fully its 'transitional arrangements'. It is possible (or perhaps even likely) that many existing Neighbourhood Plans will need to be reviewed to ensure they are aligned with new national planning policies and any new Local Plans.