Government launches housing white paper

Blog by Rebecca Larkin, Senior Economist at the CPA

The government’s White Paper on housing titled ‘Fixing our broken housing market’ has been published here.

This white paper reflects a set of proposals for discussion and consideration, and includes a consultation on proposed new policy measures. The majority of the 38 questions are related to planning, but the CPA intends to submit a response to questions relevant to construction product manufacturers.

Read CPA Senior Economist, Rebecca Larkin’s response to the white paper here.

Highlights of the paper relevant to construction product manufacturers and distributors include:

The right homes in the right places

  • Legislating through the Neighbourhood Planning Bill so that all local authorities have a local plan for housing for the next five years, based on an ‘honest assessment’ of the need for new homes, including provision for older and disabled people. Government will consult on options for introducing a standardised approach to assessing these housing requirements – expected to be in use from April 2018. Plans should include policies for ‘windfall’ sites and at least 10% of the sites allocated for residential development in local plans should be small sites of half a hectare or less. Local authorities will be expected to work with developers to encourage the sub-division of large sites.
  • Clarify what land is available for new housing, through greater transparency over who owns land and the options held on it.
  • Maximising the contribution from brownfield and surplus public land, regenerating estates, releasing more small and medium sized sites, allowing rural communities to grow and making it easier to build new settlements.
  • Green Belt protections to remain. Green belt land can only be used if there are no brownfield sites, underused land or public sector surplus land available, housing densities have been maximised on existing and proposed developments and possibilities of other local authorities helping to meet some of the identified development have been explored. Any land removed from Green Belt after these conditions have been met will need to be offset.
  • Encouraging the preparation of Neighbourhood Plans (whereby local communities determine local planning policy), with funding available 2018-2020. Plans should set out design expectations to increase certainty for planning applications.
  • Government will look at looking at further opportunities for simplification and rationalisation of building regulations while maintaining standards.
  • Consult on improving energy performance requirements on new homes if evidence suggests that there are opportunities to do so without making homes less affordable.
  • Avoid building homes at low densities; favour higher densities in urban areas, particularly around public transport hubs – through a review of the Nationally Described Space Standard.

Building homes faster

  • Boost local authority capacity and capability to deliver, improving the speed and quality with which planning cases are handled, while deterring unnecessary appeals. Local authorities will be able to increase planning fees by 20% from July 2017 if they commit to invest the additional fee income in their planning department. There will also be a consultation on introducing a fee for making a planning appeal that it does not discourage developers, particularly SMEs, from bringing forward legitimate appeals.
  • Ensure infrastructure is provided in the right place at the right time by coordinating Government investment and through the targeting of the £2.3bn Housing Infrastructure Fund – targeted at the areas of greatest housing need.
  • Secure timely connections to utilities so that this does not hold up getting homes built, including consulting on requiring local authorities to have planning policies setting out how high quality digital infrastructure will be delivered in their area.
  • Support developers to build out more quickly by tackling unnecessary delays caused by planning conditions, facilitating the strategic licensing of protected species and exploring a new approach to how developers contribute to infrastructure. Government will examine the options for reforming the system of developer contributions (Section 106 and Community Infrastructure Levy) including ensuring direct benefit for communities, and will respond to the independent review and make an announcement at Autumn Budget 2017. In addition, the licensing system for protected species will be undertaken at district level, rather than site-by-site surveys, rolling out a pilot undertaken by Woking Borough Council and Natural England.
  • Boosting productivity and innovation by encouraging modern methods of construction in house building.
  • Take steps to address skills shortages by growing the construction workforce. Government will review the Construction Industry Training Board’s purpose, functions and operations and will report in the Spring. A “new route into construction” will be launched in September 2019 and government will explore whether the training approach by major construction projects such as Crossrail and its Tunnelling and Underground Construction Academy can be applied more broadly in the construction sector.
  • Hold developers to account for the delivery of new homes through better and more transparent data and sharper tools to drive up delivery, including a consultation on requiring large housebuilders to publish aggregate information on build out rates and considering amending national planning policy to encourage local authorities to shorten the timescales for developers to implement a permission for housing development from the default period of three years to two years, except where a shorter timescale could hinder the viability or deliverability of a scheme. Compulsory purchase powers may also be used to support the build out of stalled sites.
  • Hold local authorities to account through a new housing delivery test. This test will highlight whether the number of homes being built is below target, provide a mechanism for establishing the reasons why, and where necessary trigger policy responses that will ensure that further land comes forward. The first assessment period will be for financial years April 2014 – March 2015 to April 2016 – March 2017. Local plans will be used as the baseline, measured against a rolling three-year average of net additions to the housing supply:
    • From November 2017, if delivery of housing falls below 95% of the authority’s annual housing requirement, we propose that the local authority should publish an action  plan, setting out its understanding of the key reasons for the situation and the actions that it and other parties need to take to get home-building back on track.
    • if delivery of housing falls below 85% of the housing requirement, authorities would in addition be expected to plan for a 20% buffer on their five-year land supply.
    • From November 2018, if delivery of housing falls below 25% of the housing requirement, the presumption in favour of sustainable development in the National Planning Policy Framework would apply automatically; From November 2019, if delivery falls below 45% the presumption would apply and From November 2020, if delivery falls below 65% the presumption would apply.

Diversify the market:

  • Back small and medium-sized builders to grow, including through the £3 billion Home Building Fund announced at the Conservative party conference: £1 billion of short-term loan finance targeted at SMEs, custom-builders and innovators to deliver up to 25,000 homes and £2 billion of long-term loan funding for infrastructure and large sites, unlocking up to 200,000 homes.
  • Support custom-build homes with greater access to land and finance through mainstream lenders and continue the exemption from the Community Infrastructure Levy.
  • Bring in new contractors through our Accelerated Construction programme that can build homes more quickly than traditional builders – aims for 15,000 starts over parliament.
  • Encourage more institutional investors into housing, including for building more homes for private rent, and encourage family-friendly tenancies through proactive plans for Build to Rent and options for three-year tenancies.
  • Support housing associations and local authorities to build more homes through providing certainty on rent setting for 2020, when 1% annual rent cut ends and driving efficiency.
  • Ensure the public sector plays its part, by encouraging and making possible more building by councils through bespoke housing deals with authorities in high demand areas.
  • Boost productivity and innovation by encouraging modern methods of construction in house building, including a joint working group with lenders, valuers and the industry to ensure that mortgages are readily available across a range of tested methods of construction.

Helping people now

  • Continue to support people to buy their own home – through Help to Buy and Starter Homes. Further eligibility criteria for Starter Homes announced, including maximum income of £80,000 (£90,000 in London), a 15-year discount repayment period and requirement for a mortgage. The NPPF will also include an expectation that housing sites deliver a minimum of 10% affordable home ownership units (compared to a mandatory 20% at consultation stage).
  • Investment in the Affordable Homes Programme.
  • Making renting fairer.
  • Crack down on empty homes, and support areas most affected by second homes.
  • Encourage the development of housing that meets the needs of our future population and explore the reasons behind a reluctance to downsize.


Other February Posts