Lancashire Local Plans: Residential targets and delivery update This White Paper follows a presentation delivered to the Place North West Lancashire Update event in January 2019 by Melissa Kurihara. It provides a brief overview of the current status of Local Plans in Lancashire, with a particular focus on residential targets and delivery performance against these targets. Current Adopted Local Plans/Core Strategy Figure 1: Year of Plan adoption that sets housing target for the authority Figure 1 shows the year that the latest Development Plan Document (Local Plan or Core Strategy) containing the respective authority’s housing targets was adopted. Several of the authorities have adopted Site Allocations or Area Action Plans since these dates but these plans have not sought to review or update the housing targets. Four Authorities in Lancashire are still working with pre-2012 NPPF Plans, with the oldest, the Wyre Plan, having time expired in 2006. These Plans and those that were adopted shortly after the publication of the 2012 NPPF are based on housing targets derived from the former Regional Spatial Strategy. The Plans that were adopted in the last five years have carried out a mixture of joint and individual Strategic Housing Market Assessments to establish their housing needs and set targets. As would be expected, several local authorities are actively progressing new Local Plans. Unsurprisingly, Wyre is well advanced in production of a new Plan, having held hearing sessions in 2018. An Inspector’s report is anticipated shortly. Ribble Valley and Lancaster are both currently at Examination with hearings scheduled for spring 20191. With the publication of a revised NPPF in 2018, all authorities in Lancashire will now have to review their Local Plan. Indeed the revised NPPF requires this to be done on a five year rolling programme. The implications for this are discussed further below. Figure 2 overleaf shows the annual net delivery of housing of each Authority against the adopted annual average housing target since the start of the respective plan period2. The only authority that has delivered above the set target is Chorley; this high delivery rate is predominantly thanks to the high levels of development that have taken place at Buckshaw Village. All other authorities have consistently under-delivered against the requirements set out in their Plans. However, the data shown like this masks more recent developments starting to pick up; for example in 1 The Ribble Valley document is a Housing & Economic Development DPD containing allocations to meet the housing targets set in the 2014 Core Strategy. The Lancaster Local Plan is a comprehensive Local Plan that will replace the Core Strategy and the saved parts of the former Local Plan. 2 It should be noted that Blackburn and West Lancashire have adopted a stepped trajectory and don’t monitor their delivery on this basis, but even taking this into account they are struggling to meet the targets. Lancaster which has had increasing starts and completions in recent years. In addition the City Deal appears to be supporting increasing starts in Preston. Figure 3 shows the same data but broken down by year. The charts show from 2003 – 2018. Breaking the data down like this allows some discernable trends to be noted. Wyre, Preston, Ribble Valley, Fylde and Lancaster are all showing clear upwards trends in terms of increasing annual net delivery of housing; with many now achieving annual net delivery above the required annual average. Blackburn, South Ribble, Burnley and Blackpool have a more varied delivery pattern, with some negative delivery showing in Blackpool and Burnley as a result of clearance and planned regeneration. However the overall trend is still positive. The worrying downwards trends in net delivery are noted in Pendle, Rossendale and to a certain extent in Hyndburn and West Lancashire. Figure 2: Annual average housing delivery shown relative to annual average targets Figure 3: Annual net housing delivery shown relative to annual average targets broken down by year (2003 -2018) NPPF 2018 Local Housing Needs Assessment The revised 2018 NPPF introduced a new methodology for assessing housing need. The new approach is a simplified calculation that looks at household projections for the next ten years, and applies an affordability ratio uplift based on median house prices to median work-place earnings3. Having established that most Lancashire authorities will need to update their Plans and housing targets, it is interesting to note the potential impacts of the new methodology on the County. Figure 4 shows the adopted housing targets compared to the new local housing need figure, as derived using the NPPF methodology. As can be seen, nearly all Authorities are shown as requiring significantly less housing than was being planned for under the previous approach, as a generalisation this is often the case in the North of England. Indeed, Lancashire has some of the lowest estimated percentage increases in housing in England. Figure 4: Adopted annual housing targets and proposed housing needs as assessed under the new NPPF methodology (2014 based) Unlike previous approaches to assessing housing need, the new methodology has no regard to economic factors or trends such as the City Deal, enterprise zones and planned business expansion. The result is that housing need in some areas is likely to be under-estimated in comparison to anticipated growth in jobs and the economy. Five Year Land Supply Since 2012 the five year land supply position has become an important factor in many development management decisions for new housing in Lancashire. Where an authority cannot demonstrate a 5 year housing land supply the presumption in favour of sustainable development set out in the NPPF is engaged. Figure 5 below shows, for the authorities that published a position in 20184, the current claimed housing land supply5. Nearly all authorities that published a statement claimed to have a five year supply (with the exception of Blackburn and Preston). The blue bars show the authorities that are still calculating their position against the targets set in their Local Plan or Core Strategy. The solid orange bars show those who are assessing their position against the housing needs as identified using the new 2018 NPPF housing needs methodology. Three of the authorities (Blackburn, Preston and South Ribble) are assessing their position against their locally set targets, but because their plans are over 5 years old 3 A cap is also applied if the new methodology raises needs above 40% of the current adopted needs. This doesn’t apply to any Lancashire authority. 4 Some of the authorities published their position in April and some have updated the position in October as a half year update. The graph shows a mixture of the two. 5 No assessment has been carried out to evaluate the accuracy of the claimed position. It may be that under scrutiny not all of the claimed supply is deliverable. the NPPF suggests they should be monitoring against the NPPF housing need methodology derived figures. The striped orange bars show the impacts, were each authority to do this. Figure 5: Claimed 2018 Five year housing land supply positions Housing Delivery Test In addition to the five year land supply position, the 2018 NPPF introduced another route into the presumption in favour of sustainable development that may affect future decisions across Lancashire; the Housing Delivery Test. Where the 5 year supply assessment looks at the future pipeline of anticipated delivery, the housing delivery test assesses an authority’s past delivery performance (expressed as a percentage of the required delivery). Looking at the previous 3 years delivery against the previous 3 years requirement, if an authority is below • 95% it must prepare an action plan, assessing the causes of under delivery and identifying actions to increase delivery. • 85% it must apply 20% buffer in 5 year land supply assessment. • 75% it must apply presumption in favour of sustainable development in decision making. F i gure 6: Predicted results of 2018 Housing Delivery Test This test will apply as above from 2020. Transitional arrangements dictate that for 2018 and 2019 the presumption will only apply if delivery is below 25% and 45% respectively. The government has not yet released the 2018 housing delivery test results6; Figure 6 shows an estimation of the results for 2018. As 6 These were expected to be published in November 2018. can be seen no authority is yet in the position of having to apply the presumption, thanks to the transitional arrangements. However, if the test were to be applied with no transitional arrangements, Blackpool, West Lancashire, Rossendale and Pendle would all have to apply the presumption. Conclusions It is a time of uncertainty for the planning system following the raft of changes brought about by the revised NPPF. These national changes will have a significant local effect on the production and implementation of Local Plans across Lancashire. It is important that Authorities apply local understanding of the housing market and local economic circumstances in revising their residential targets. Whilst the Government’s intention of simplifying housing needs assessment was commendable, certainly in Lancashire it appears to be too blunt an instrument to properly reflect the nuances of regenerative growth that many authorities have been planning for. The requirement for authorities to maintain a robust pipeline of sites for delivery retains its importance through the five year land supply. The introduction of the housing delivery test will require local authorities to take an active role in ensuring that this pipeline comes forward. LUC can provide help and advice with regards to all aspects of housing supply assessment and the housing delivery test. LUC January 2019 .