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The ‘Planning White Paper’ and a basis for possible reform

The Government’s Planning White Paper proposes to replace the current regime of local authority determination of specific development proposals by a system of zoning.

Local Plans would define three zones: growth zone (where designated sites have “outline permission”), renewal zone (statutory presumption in favour of development being granted for the uses specified as being suitable), Protected zone (“more stringent development controls”). There is an option to combine growth and renewal areas.

For growth and renewal zones plans would “set out suitable development uses, as well as limitations on height and/or density as relevant. These could be specified for sub-areas” (eg town centres).

For protected areas, plans “would explain what is permissible by cross-reference to the National Planning Policy Framework”.

Development Management policies would be set by National Planning Policy Framework (with an option to have limited development management policies in local plans), plus local design code(s) supported by national design code. There is a national design guide and manual for streets (where there is no local design code, the national one would be applied).

How zoning works in the US

Traditional zoning involves local municipal zones for locales with zoning ordinances (ordinance is a municipal by-law).  These can be by land use and sub-categories within land use – ie different housing types ( single detached dwellings/apartments) or by density (low/medium/high).

There are a number of important variations:

a) Inclusive zoning (includes affordable housing)
b) Incentivised zoning (allows higher density development in exchange for higher local taxation)
c) Form based zoning (new urbanist approach – design based rather than directly land use/functional based)
d) Performance zoning ( based on environmental impacts)
e) PUDs (Planned Urban Development) Zoning sets parameters but individual schemes negotiated between developer and municipality

The Planning White Paper is however unclear on what form of zoning would apply in England.

Current  planning practice in England

Local plans (district/borough wide) allocate development sites  and/ or for specific uses and set both specific policies for designated sites and more general policies for non-designated ones. Local plans set policy requirements to supplement national planning policy requirements and/or facilitate their implementation locally. 

These can set density policies and housing type requirements for different sub-areas or for individual sites. Area Action Plans/ Area Supplementary planning guidance can be determined for development/ redevelopment areas. These can be supplemented by design guidance/ design code, by masterplans (for major sites) and site briefs. Local Development Orders can set specific policy requirements for areas within a local plan area.

UK Land use allocations can be considered to be a form of zoning (though the term not widely used) though not all Local Plans allocate specific land uses to sites and development can still be considered on non-allocated sites. Land use allocations may also not be strictly applied and although in theory we have a plan-led system, alternative uses may be permitted.

Local Plans however set parameters within which individual development allocations should be considered.  This system is comparable with the US PUD system which is also a two-stage system. The distinction between American system as ‘zonal’ and the English system as ‘discretionary’ is a gross over-simplification.

In England, Section 106 planning contributions (s106) can be negotiated on site by site basis in exchange for increased density and Community Infrastructure Levy can be varied by sub area (both in practice similar to US incentivised zoning system).  Affordable housing requirements set in local plan policy, which can vary by area, are parallel to US inclusive zoning approach.

The Planning White Paper would appear to propose a very simplified broad-brush approach to zoning – simplified when compared to the traditional US approach to zoning, which allows much more specific zoning categories.

The key question is whether the proposed English approach to zoning will allow for any of the variable approaches operated in US cities (where zoning is determined by the municipal authority), which are in effect deliverable in practice within the pre-existing English planning regime.

A basis for possible reform

The current planning system and planning practice in England does need reforming. (As planning is a devolved function,  the White Paper proposals do not apply to Scotland, Wales or Northern Ireland). There is a case for Local Plans being much more specific about permissible land uses on specific sites and the specific requirements which would then apply.

This would certainly increase certainty for both developers and local residents. It would also ensure land values reflect permissible uses. However, local authorities, at both officer and member level, need to have the power to ensure that development proposals are fully compliant both with the land use allocations in the published plan and with the policy requirements set out in the plan.

This means that a LA development management function is still required. This will include any decisions as to community mitigation and benefit through a form of scheme specific planning obligations regime, which would, where appropriate, be additional to any value-based form of infrastructure levy.

Objectors should not however be able to block schemes which are fully compliant with the published Local Plan in terms of land use and policy requirements. Moreover, applicants should not be able to appeal against LA planning decisions which are supported by a published Local Plan.

However,  local plan making must be set within a wider strategic context, as many local authorities cannot meet their housing needs within their own area, while other authorities may  resist  helping out neighbouring authorities within their travel to work area. 

The Planning White Paper is largely silent on this critical issue, and in fact proposes to abolish the current ‘duty to co-operate’ with neighbouring authorities and the requirement to produce statements of common ground. 

It is necessary that we re-establish a framework of national and regional planning which links national funding of infrastructure to decisions about the locations most appropriate for both residential and employment growth.

Neighbouring authorities should be required to agree a strategic plan within this national and regional framework. No local council should be allowed to opt out of making a contribution to meeting an area’s housing and employment needs.

Localism on its own is not enough and we need a balance of powers between the different spatial levels of governance and democratic accountability.

<span class="has-inline-color has-accent-color"><strong>Duncan Bowie</strong></span>
Duncan Bowie

Duncan Bowie is a semi-retired academic and strategic planner who has written a number of books on housing and planning.

He is a long-term member of the Labour Housing Group.

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We need a flexible zoning system to end the housing crisis

There are three things which are connected yet almost unique about the British economy. It has exceptionally stark geographic inequality; it has an extremely sharp housing crisis in its most expensive cities; and it has an unusually dysfunctional planning system.

Addressing those regional divides and the housing shortage requires replacing our discretionary planning system with a new flexible zoning system. The new reforms underway are one approach, but there are other examples from abroad which would also be major improvements over what we have now. But there must be fundamental change in how the planning system works if we want fundamental changes in inequality and housing outcomes.

Our discretionary planning system rations new homes

The current planning system is highly discretionary. This means that the planning system is empowered with a great deal of discretion to decide whether a development should take place on a specific site or not. In effect, new homes are rationed by the planning system, case-by-case.

Although there is often a local plan which “leads” development, this is not always true – York has not agreed one since the 1950s. Even when there is a local plan, the real power as to whether new homes can be built or not is in the case-by-case decisions by planners and planning committees. Applying for planning permission to build private homes, affordable homes, or social housing is never certain. One in ten planning applications fail, despite the fact that developers are presenting proposals they believe will succeed.

The discretionary planning system makes inequality worse

This discretionary planning system creates poor outcomes which have previously been set out in Red Brick, and which underpinned Centre for Cities’ contributions to the Labour Planning Commission. It forces new development into the sites with the lowest political costs rather than the sites most suitable for new homes. This is why half of all suburban neighbourhoods build less than one house a year and a fifth build zero, even though these neighbourhoods already have the infrastructure to absorb some population growth over a long timeframe.

The discretionary element also makes inequality worse, as it decouples the local supply of new homes from local demand. Some of the most expensive and prosperous cities in the country, such as Bournemouth and Oxford, build far less housing than cities with weaker economies such as Wakefield and Telford. These local housing shortages mean that the average house in Oxford costs 17 times the average income, and 6 times average incomes in Wakefield.

This mismatch between supply and demand creates terrible housing crises in the cities with the most successful labour markets and fuels inequality. In expensive cities, it widens divides between renters and homeowners. As housing costs for renters in Bristol increase, so does the wealth of their homeowning neighbours as house prices rise.

But it also creates divides across the country. As we do not build enough homes in cities like Brighton to stabilise prices, average housing equity per house in Brighton rose by £89,000 from 2013-2018. But an identical twin of such a homeowner in Sunderland would only have gained £3,000, as local land values have not risen due to the struggling local economy. This is the opposite of levelling up – the planning system redistributes wealth from the poor to the rich.

The discretionary design of the planning system creates a permanent shortage of homes

For reform to solve these problems, we need to understand why the planning system systemically creates them. The explanation lies in the discretionary, case-by-case decision making of the current planning system. Few places abroad have such a system where this feature is so important. Ireland and San Francisco are two locations which do, and accordingly have dire housing shortages.

In fact, England’s discretionary planning system can be understood most clearly by comparing it to the planning systems of the former Eastern Bloc. In these planned economies, production was also rationed by the discretionary and uncertain granting of permits by planners, but for things such as mayonnaise or cars rather than new homes. Many of the behaviours which are sometimes described in England as unique to housing popped up across sectors in these Soviet-style economies – shortages, equivalents to land-banking, absorption rates, endless negotiations between planners and firms, poor quality new products, inequality in access to supply and speculation, among others.

These are more than just parallels. Both the former Eastern Bloc and the UK housing market are “shortage economies”. Their permanent state of undersupply is maintained by how the discretionary design of their planning institutions rations production, and is the defining characteristic of their systems. A few policy tweaks here or there or a little bit more funding won’t solve this core problem.

Instead England’s planning system needs fundamental reform which learns from other planning systems abroad that result in better housing outcomes, and for the discretionary element in our system to be minimised or removed.

England’s new zoning system is a move in the right direction

Moving away from a discretionary system implies a new flexible zoning system, where provided a proposal agrees with the local plan and building regulations so that the new structures are safe, it legally must be granted permission. This is a common form of planning around the world.

The new zoning reforms introduced earlier this month – establishing growth, renewal, and protected zones in England – are a big step in this direction. Within growth zones, there is no discretionary element, as the principle of development is already accepted by the zoning. Developments which comply with a design code and legally must be granted planning permission, after planning has resolved technical elements such as road layouts. This certainty will, within growth zones, end the unpredictable rationing of new homes that the current planning system creates, and by extension, address the housing shortage.

We can argue about the details, but we need a new zoning system to end the housing crisis

There are political choices to be made as to the inner workings of such a new zoning system, and Centre for Cities has previously set out how these could work. Japan is the clearest example of such an alternative framework abroad, where there are twelve different zones which shape the density and use of land while still providing much more flexibility than our current system.

As a result, Japan has much more affordable housing than England, as it builds 900,000 homes a year while England struggles to build 240,000. An English flexible zoning system could achieve this too. We could also make the political choice to provide far more social housing than Japan, or have a greater focus on energy efficiency and climate change, or public realm and design, and the Labour Planning Commission set out some of these areas as priorities.

But while the details of such a new flexible zoning system are contestable, the principle that we need one to solve the housing crisis is not. The discretionary granting of planning permissions is the single biggest systemic problem with our framework. If we want to improve the conditions and affordability of homes across England, we need to do things differently. We need to replace our planning system with a new flexible zoning system.

<strong><span class="has-inline-color has-accent-color">Anthony Breach</span></strong>
Anthony Breach

Anthony is an Analyst who has worked as part of the research team at Centre for Cities since 2017, where he focuses on housing and planning. He won the Thinkhouse Early Career Researcher Prize 2019 for Capital cities: How the planning system creates housing shortages and drives wealth inequality.

Anthony has also worked on research on commercial property in cities, services exports, productivity, and manufacturing. He also has a particular interest in lessons for planning, housing, and UK cities from Japan and the countries of the former Soviet Union. Previously he worked at the Fawcett Society as a Research Officer.