The new Labour Government has not wasted any time in acting on its manifesto promises to tackle the housing crisis, with the publication of a consultation on a revised National Planning Policy Framework (NPPF), proposed revisions to the standard method of calculating housing need, and a series of ministerial announcements and letters to local planning authorities on Local Plan preparation and meeting housing need.
Presuming that the NPPF is updated along the lines of the consultation document, a significant opportunity will arise to promote strategic land through Local Plans.
Universal local plan coverage
The Deputy Prime Minister’s letter to all local authorities on 30 July 2024 set out the Government’s intentions to ensure that there is universal local plan coverage across the country, with an aim for all local authorities to have an up-to-date local plan within this parliament. The letter indicates that the Government will not hesitate to intervene where local authorities do not have up-to-date local plans, including by taking control of plan making directly.
There are several local authorities across the country with out-of-date local plans, and a large number have paused plan-making over the past 12 months or longer due to uncertainty over the direction of national planning policy. It can therefore be expected that a significant number of local authorities will need to start progressing work on new local plans, and quickly if they are to avoid intervention by the Government.
Changes to the Standard Method and implications for local plans
Alongside the consultation on the NPPF, the Government has published details of a revised standard method of calculating housing need. The new method significantly increases the number of homes required across the country to over 371,000 per annum. Combined local housing need will increase by around 22% and all regions, with the exception of London, will see a significant increase in the number of homes needed.
The revised standard method will also result in a redistribution of housing need to the north of England. The use of household projections in the current standard method to calculate baseline local housing need has repressed housing need in the north. A move to a stock-based approach in the new method would significantly increase the number of homes that need to be planned for in the north (housing need in the North East would increase by 99% and in the North West by 76%). At a local authority level, all but 25 local authorities would see an increase in their local housing need. Those with the largest increases would be Redcar and Cleveland (1,338%), Burnley (625%), Hyndburn (528%), and Blackpool (328%).
The implications of the revised standard method for plan making are considerable. The consultation version of the NPPF expects new local plans to be ambitious and meet local housing need, proposing to remove the ability for local plans to plan for a lower local housing need introduced in December 2023 revisions to the NPPF. Plans at an early stage of preparation will need to be prepared using the revised standard method, seeking to meet that need in full unless there are exceptional circumstances. To ensure balance between tackling the housing crisis and ensuring universal local plan coverage, local plans at advanced stages of preparation (Reg 19) can continue to examination, but only where there is not a significant gap (more than 200 homes) between the housing requirement in the draft plan and the revised standard method. Even where local plans are at examination, if there is a significant gap between the housing requirement in the plan and the revised standard method, there is an expectation that, following adoption, there will be an immediate review of that local plan to ensure that the plan is updated straight away to deliver the higher revised standard method housing need.
Given the significant increases in local housing need that will result from the revised standard method, most local authorities will need to allocate larger amounts of land, and some considerably more, if local plans are to meet their local housing need and be found “sound”.
Given the current NPPF does not require local authorities to meet their local housing need in full, and allows alternative methods of calculating housing need to be used, there may be many local authorities who have started preparation of new local plans on the basis of a much lower local housing need than would be required. Such authorities will need to reconsider their approach and will quickly need to identify significant amounts of new land to meeting increased housing needs.
