Planning: can the government transform the ‘sclerotic’ system?

Can the government’s planning white paper create a simpler, faster, more predictable system? Julia Cahill speaks to two successful regional developers about their experiences of the planning system and what they think of the latest attempt to overhaul it, while Lisa Tye identifies the best and worst aspects of the proposed reforms and Richard Shepherd focuses on the reaction in Manchester. During his keynote speech to the Conservative Party conference on 6 October, prime minister Boris Johnson promised to “transform” the country’s “sclerotic planning system”. That evocative pledge followed the launch this summer of the government’s Planning for the Future White Paper, which aims to create a “significantly simpler, faster and more predictable system” and thereby accelerate the delivery of new homes. The proposals include major changes to the local plan format and process, pushing for adoption in a third of the time it currently takes and local plans based on rules not policy. Local residents would help to create design codes at the plan-making stage. There would be an automatic outline permission for “growth” areas and “beautiful” schemes and greater use of digital tools such as interactive maps and modelling. But perhaps most significantly for the development sector, the white paper also proposes a new infrastructure levy to replace both Section 106 and CIL. So what do those at the coalface of development in our regional cities make of the government’s proposals? Interview: Richard Knight, director, Land & Communities, Peel L&P With a £2.3bn portfolio encompassing 13m sq ft of property and 33,000 acres of land and water, Peel L&P knows the intricacies of the planning system better than most. The property arm of John Whittaker’s Peel Group focuses primarily on the North West, home to its high-profile MediaCityUK development, but also invests across the UK, including major schemes in Glasgow and Chatham in Kent. Its high-profile, multi-partner waterside urban regeneration schemes also include the £5bn Liverpool Waters project, where it is awaiting a planning decision on Everton’s 52,888-capacity stadium. Elsewhere, director Richard Knight says the team was recently buoyed by the housing secretary Robert Jenrick’s decision in July to approve its 1,000-home Hulton Park golf resort – if Bolton is chosen to host the Ryder Cup. The scheme was called in because it would use greenbelt land. It is also bringing forward a pipeline of family housing through its Northstone housebuilding arm, launched in 2018, which it aims to grow into a 400 to 500 homes per annum business. Northstone is currently on site at its maiden development, Silkash, in Bolton, where it has set out its store to “build beautiful and low-carbon” family and affordable homes. “Like most housebuilding, it’s a question of whether you can get the sites and meet the demand which is so obviously there,” says Knight. “Planning is a challenge, pace of planning is a challenge.” This was evident in Peel L&P’s attempts to build 600 homes on greenfield land at Broadoak, Worsley, which was ultimately blocked in 2018 when the secretary of state supported Salford council’s policy to protect the site as a “vital green lung”. “We’re at the end of the road with it now,” Knight says. Peel had argued that Salford’s need for family and affordable housing was not being met by a five-year pipeline dominated by urban apartments, while Salford stressed its commitment to maximising development on brownfield land and said there were plenty of other sites where Peel could build much-needed family homes. Local residents formed a group called Residents Against Inappropriate Development to make their case against Peel’s proposals. Salford’s revised draft Local Plan – consultation on which finished in March this year – further strengthens protection of the site. An ongoing planning headache is the delay to Peel L&P’s plans for a £155m manufacturing and logistics hub in St Helens, known as Haydock Point. In May, Jenrick called in three neighbouring industrial schemes. This prompted Peel to appeal its Haydock Point plans on the grounds of “non-determination” and seek to have the appeal heard at the same inquiry with the other local schemes. At the same time, it has submitted a second fresh application to the council for the scheme. “I can see why the government might have done it, because the sites are all in the greenbelt,” says Knight. “But the schemes have all got local support. The evidence is there. This is delay and uncertainty in an area that really has a shortage and needs to be cracking on. Why does it need a major delay and a lot of government intervention?” Planning white paper Q&A with Richard Knight, director, Land & Communities, Peel L&P Does the planning system need reform? It clearly needs some reform: it doesn’t work, it’s too slow, too uncertain and too politicised. Development gets delayed or stopped because of local politics. That’s a reality up and down the country. The government has recognised all of that. It urgently needs to do something. What is your main frustration with how things work now? On the ground, locally, opposition to development drives behaviour in planning. That means local plans are too cautious and even now with many schemes, you don’t know if you’re going to get planning right up until the planning committee takes that vote on it. There should be more certainty earlier in the process. Does the planning white paper address any of these problems? We would agree with most of the proposals. Yes we want local plans sped up, faster decisions, more certain decisions, a more interactive, digital system. It would make complete sense to be able to frontload the system so that you’re not going back and asking the community the same question twice about a development. Most of the proposals about design and sustainability and environmental net gain are very much welcome. What’s missing? There is really not much detail, it’s so high-level. So we need to see what happens next in terms of the detailed proposals and legislation. A classic example is how is government going to decide what the housing numbers should be for each local authority? How do you square off a need for housing with a local authority that’s covered in greenbelt? The answer to that question is not in the white paper and the government hasn’t really addressed what is a fairly obvious point: How do they reconcile the irresistible force and the immoveable object? The white paper is so incredibly focussed on housing, despite it not really resolving that issue, that you can also question: where is the strategy for economic development, for logistics, for sectoral development? That’s another thing that’s really missing. What are your biggest concerns about the planning white paper? One is the risk of a hiatus, that local councils progressing their own local plans or having to make decisions on difficult schemes say “let’s wait and see”. We’ve already picked up on a few areas where this is starting to happen. There are councils saying “we’ve got elections coming up in May, the government wants to change everything, so why don’t we just park everything”. This is exactly what we don’t need given the current economic situation. We need decisions to be made now. These reforms could take up to three years to come in and bed in, so the industry needs continuity in the meantime. One other area that is a risk and needs a lot more work is the proposal for a new infrastructure levy to replace Section 106 agreements and the current community infrastructure levy. The whole question of land value capture is a live one. Most development is and should be contributing its way one. This is now proposing a completely different way of going about it and that could cause significant upheaval. So depending on how that works, it’s obviously a risk to sites coming forward – if there’s a national levy you can imagine in weaker areas where you’re trying to create a market and regenerate an area that something like that could be a real threat. There is something in the documents about having exemptions and thresholds, but we don’t know what the detail of that looks like yet. The white paper claims to be radical but in reality there’s not that much that’s radically different. The infrastructure levy is potentially the most radical thing in there and it really needs industry engagement to understand how it’s going to work, right down to how development comes forward. What are the funding institutions going to make of it? Is it going to hit people’s balance sheets? It could have impacts across the whole sector because it’s changing the dynamic and economics of development. Will it happen? You can already see from the MPs revolting in parliament that even just the suggestion that they are going to have to accept more development is causing a backlash to start. So is the government going to carry it through? Every government before it for the past few decades has failed to really, which is the principal driver of our housing crisis. We’ve had all these promises over and over again in past reviews of the planning system and we’re still here with a system that doesn’t work. So it’s difficult to believe. Fingers crossed this government and this white paper is different to previous ones in that it seems to be very much led and spearheaded from number 10. Interview: Simon McCabe, director, and Paul Kelly, development director, Scarborough Group International In the UK, Scarborough Group International is working with strategic partners to deliver a portfolio with a gross development value of £2bn. The privately owned group, founded by Kevin McCabe, has more than 2,500 new homes in the pipeline and 4.5m sq ft of commercial space, predominantly in the Northern Powerhouse cities. Key projects include Middlewood Locks in Salford, where it is delivering more than 2,000 homes and 900,000 sq ft of commercial space on a long-standing derelict site, the 300-acre Thorpe Park in Leeds and 200-acre Sheffield Olympic Legacy Park. Its strong focus on strategic brownfield sites shapes much of its current involvement in the planning system. “Where we achieve the most, is where we have a good working relationship with the local authority,” says director Simon McCabe. “We don’t always get what we want, but the co-operation between the parties makes things happen.” Development director Paul Kelly agrees: “We’re lucky that we’ve got key strategic sites that make a difference to the local authority – their delivery is not a standalone scheme of 100 residential units or 50,000 sq ft of offices. They are big projects in themselves and the impact has a ripple effect to the wider surrounding areas.” What’s wrong with the current system? Kelly: Speculative property development sits very, very high on the risk curve and is all about timing. You need to get on site. In the current system you can invest a lot of time and effort getting to that point – but then the market moves. So reforming the system to make it quicker and more certain is what we need, because a lot of the stuff that we do is fraught with uncertainty. We’ve seen the impact of Brexit, we’re living the impact of Covid, if the reform makes some of that outline decision-making a lot more certain, then that allows us to accelerate. Our mantra is to keep building. What do you welcome in the planning white paper? Kelly: If the engagement is done upfront through the local plan review, which again is condensed to a shorter time frame, then the need for engagement reduces. The ability to concentrate on design – and design guided by design codes – is probably a better focus of our time and the planning officers’ time because we’re working within known parameters, collectively. The digitisation of the planning system has to be in everyone’s interests if it allows some of the engagement to be done upfront in a quicker, slicker way. It also acknowledges that the market moves more quickly now than previously. What are your biggest concerns about the white paper? Kelly: A wholesale or drastic change will invariably cause delays while we all get up to speed. There will probably be a bottleneck period, where we move from an existing long-established planning system to a reformed, refined expedient planning system. That will invariably create uncertainty and delay. Not everything will be thought out in full detail before the new system goes live so there will be a settling in period – managing that process is going to be interesting. McCabe: In today’s world, a delay of a week or a month can have a massive impact on your decision-making process, whereas pre-Covid you could live with and manage that better. Planning reforms – the good the bad and the ugly For me, the fundamental aim of the planning white paper is flawed – seeking to make planning more “rules-based” because there is too much discretion in the system and it is far too complicated. Planning is, by its very nature, complex and difficult and necessarily involves delicate balancing of competing interests, subjective considerations and judgments. I don’t think it should be reduced down to an algorithm that spits out the answer as to whether or not permission should be granted. This is never more so than in our regional cities where there are multiple layers of those who work, live and/or play in them; varying infrastructure and transport needs; economic and social drivers often going in different directions; historic buildings and layouts, all alongside an ever-changing retail landscape as well as the current (r)evolution around how people live and work. However, the following elements of the white paper are to be welcomed: The automatic grant of outline permission for sites that have been considered suitable for development through the local plan process – while I struggle to see how this is much more than a site allocation, it does take away the need to get support through two different processes; Emphasis on planning officers using delegated powers – this will speed up decision-making and will take some of the politics out; Digitisation of the system – increased use of technology has been a necessary feature of the last few months and should continue to be encouraged; Wider public engagement – the holy grail. Digitisation should help with this but it will remain easier to engage those who are opposed to development than those who support good development. Set against this my key criticisms are: The assumption that a single size fits all – this can be seen in the way the standard methodology proposed for housing numbers has led to bizarre results that focus the majority of growth in areas that don’t need it and leaves the regions behind. Cities in the north, even those where there is an established housing market, are left languishing in numbers terms. This is not the levelling-up agenda we were promised. Aligned to that is an emphasis on a top-down approach which becomes necessary when you want a rules-based system. While taking politics out of some planning decisions is to be welcomed, local communities and their elected representatives, the metro mayors in particular, are best placed to figure out what works in their towns and cities. Too much emphasis on home ownership – “generation buy” – ignores the contribution of the build-to-rent sector and the role that it plays in allowing for the flexibility and dynamism that the current live/work environment demands, particularly for the young professionals who are the lifeblood of our cities. Lack of proper funding to make it work – the changes will require much more proactive input from already seriously stretched local planning authorities but there is no ring-fenced funding being offered to ensure that those resources are available. My real issue is that the problems identified by the white paper are real ones but they are not caused by the planning system and the changes proposed will therefore not resolve them, it is just too easy a target. Lisa Tye is a partner and joint head of Shoosmiths’ planning and CPO team Q&A with Richard Shepherd, director, Nexus Planning What could be positive for Manchester from the planning white paper (if anything)? While this is not specific to Manchester, the overarching aim of the white paper is to provide more certainty in order to aid delivery. If successfully implemented, the reforms may lead to greater confidence from investors that development proposals are likely to secure planning permission. This could both speed up the process and help ensure that development occurs. Notwithstanding this, it should be noted that Manchester has been hugely successful in recent years in securing investment.  As a consequence, the city council’s view is that the reforms are unnecessary and may slow the plan-making process. What are the main elements causing concern from the local authority perspective? Manchester City Council set out its views on the planning white paper in a report to its Economy Scrutiny Committee.  Its principal concerns relate to the perceived inflexibility of a zonal planning approach. The city council believes the white paper proposes a more rigid approach for local plans, which does not reflect the need to react to changing circumstances. The council is concerned the three proposed area types do not reflect the complexity of a major urban area like Manchester, where areas of what might be categorised as growth, renewal and protection are intertwined. An example is the proposal that conservation areas are identified as an area for protection. In Manchester, many of the conservation areas effectively sit within areas of growth and/or renewal, thereby requiring a nuanced approach which provides for appropriate and sensitive development rather than simply being protected. In respect of the future consideration of new proposals for main town centre uses, it will be important that the mechanism for identifying the scope of “specified appropriate uses” ensures the right types of development are brought forward in the right location. While the government seeks to simplify the plan-making process (and reduce the volume of evidence base documents), we envisage a continued need for the local planning authority and interested parties to carefully consider the scope for additional commercial development with reference to baseline data. This will be necessary if “town centre first” principles are to be maintained. What are the implications for Manchester’s local plan? Changes to the planning system have rarely made the process more straightforward, particularly in the short term.  Manchester City Council believes the burden of sweeping up often very complex planning application matters into the local plan process will lengthen the time taken to produce a local plan. It is concerned that an increasing volume of material will be submitted into the local plan process in lieu of the fact it has now become the de facto planning committee. This content and much more can be found in the forthcoming edition of UK Cities, available 31 October.