STRATEGIC PLANNING JOINT ADVISORY PANEL

Date: 2 April 2003 Item 7

Report by: Hampshire Director of Environment, Portsmouth City Planning Officer and Southampton Executive Director of Development and Sustainability

HAMPSHIRE COUNTY STRUCTURE PLAN (REVIEW)

POLICY H4 MONITORING PAPER 2003

Written by: Antony Payne, tel 01962 846766

Purpose and Summary:

To inform the Panel of the conclusions arising from the Hampshire County Structure Plan (Review) HCSP(R) 1996-2011 Policy H4 Monitoring Paper 2003 and the outcome of consultation. The  Paper  has  been  previously circulated and can also be viewed at http://www.hants.gov.uk/structureplan/monitoring/policyh4index.html. Further hard copies can be supplied on request. A summary of the consultation responses, together with officer comments, is attached as an appendix.

The Paper concludes that the forecast of dwellings supply 2002-2011 exceeds the current requirement from Regional Planning Guidance (RPG). Taking the supply figures at face value indicates that there is no requirement at this time to release any of the Structure Plan housing reserve. However, this does not mean that the reserve will not be needed at all in the period to 2011. There is some uncertainty regarding the supply figures, particularly in relation to the likely contribution from Major Development Areas (MDAs) and urban capacity, and also the possibility that the housing requirement in RPG may be raised.

The Paper ends by listing key actions that local planning authorities should undertake to help ensure that the housing supply forecasts are delivered in full.

The consultation exercise has generated a wide range of views on the Monitoring Paper. The development industry considers that the Paper is overly optimistic about the forthcoming level of supply, believing that it has taken a simplistic and too generalised view of the matters affecting supply. As a consequence, it does not support the conclusions of the Paper and calls for an immediate release of some, if not all, of the reserve provision now. Other consultees have tended to back the overall findings of the Paper.

Local Planning Authorities (LPAs) that have identified housing reserve sites are concerned that they are not disadvantaged by their actions, should this Panel decide that a release is required. In the interests of fairness this Panel should clarify that, if it became necessary to release the reserve, the identification of sites in local plans would not be a material consideration in its deliberations. Planning authorities that do not make provision may subsequently find that decisions over which sites to release are taken out of their hands (eg by Inspectors at planning appeals).

Finally, it should be noted that if all parts of Hampshire had delivered their pro-rata share of the Structure Plan baseline for 2001-02, the additional dwellings built in some areas would have almost been sufficient to meet the RPG target. If this could be sustained the likelihood of releasing the reserve would diminish. LPAs should, accordingly, be urged to take proactive steps to manage housing land supply to meet their Structure Plan baseline housing requirement, and make provision for the reserve provision where required.

RECOMMENDATIONS:

That the three Strategic Planning Authorities be recommended to:

(i) note the consultation responses and agree the proposed actions listed in the appendix;

(ii) agree no reserve sites be released at the present time;

(iii) urge all local planning authorities to take proactive steps to manage housing land supply to meet their Structure Plan baseline housing requirement and make provision for the reserve provision, where required;

(iv) agree that the existence or otherwise of reserve sites in local plans will not be a material consideration when deciding where to release any reserve housing provision, should the need arise; and

(v) thank all consultees who responded to this year's Monitoring Paper for their comments, enclosing a copy of this report and appendix and informing them of the decisions made by this Panel in respect of it.

1. Introduction

1.1 Policy H4 in the adopted HCSP(R) 1996-2011 provides a reserve of land for house building that will be released if, and when, the strategic and local planning authorities decide it is needed. The purpose of the policy is to ensure that sufficient housing land is provided throughout the Structure Plan area to meet identified needs, while avoiding the unnecessary use of greenfield land. This is a process for managing the supply of land for housing, including speedy decisions in response to monitoring. It represents the `monitor and manage' elements of the Government's 'plan, monitor and manage' approach to providing land for new housing.

1.2 Supplementary Planning Guidance (SPG) called 'Implementing Policy H4' was published by the three strategic authorities in June 2001 and explained how Policy H4 would be implemented. The cornerstone in the process is the publication of an annual monitoring paper.

1.3 The first Policy H4 Monitoring Paper to assess the need for release of reserve housing provision was published in April 2002 and was largely based on information available in March 2001. It concluded that there was no case at that time for triggering the release of any of the reserve provision, but that the situation needed to be considered again when better information was available.

1.4 The follow up Paper - HCSP(R) Policy H4 Monitoring Paper 2003 - was published in December 2002 and is based on completions information up to March 2002 and the most up-to-date estimates of future housing supply.

2. Details on the Monitoring Paper

2.1 There were a number of constructive criticisms made on Policy H4 Monitoring Paper 2002 and the 2003 version has sought to address these and present a more robust analysis of dwellings supply.

2.3 The Monitoring Paper 2002 over-estimated actual completions for 2001-02 and completions failed to meet either the Structure Plan baseline or the RPG target.

2.4 The 2003 forecast of supply compared with requirement shows that the total number of completions 2001-2006 is expected to exceed the aggregated annual average RPG figure. Dwellings supply for the period 2006-2011 is also forecast to slightly exceed the current aggregated annual average RPG figure.

2.5 Taking the supply figures at face value indicates that there is no requirement at this time to release any of the Structure Plan housing reserve. However, this does not mean that the reserve will not be needed at all in the period to 2011.

2.6 The main reasons why some, or all, of the reserve housing provision may still be required by 2011 are:

(i) identified sites not developed, or being developed too slowly to deliver the anticipated number of dwellings in the period to 2011;

(ii) contributions from the MDAs, urban capacity sites and windfalls delivering fewer dwellings than expected in the period up to 2011; and

(iii) the housing requirement in RPG being raised.

2.7 For these reasons local planning authorities should continue to identify the full reserve provision in their local plans, as required by the Structure Plan.

2.8 The Paper concludes by listing key actions that local planning authorities should undertake to help ensure that the housing supply forecasts in the Paper are delivered in full. In this regard it is worth noting that, if all local planning authorities had delivered their Structure Plan baseline figure as a minimum last year, the surplus built in some would have almost been sufficient to meet the RPG requirement for the county. The need to release reserve provision would be significantly reduced if the LPAs were more proactive in managing the release of land for housing that contributed to baseline supply.

3. Consultation

3.1 The Monitoring Paper was sent to over 60 consultees representing a wide variety of interests (eg developers, LPAs, parish councils and conservation groups). A total of 31 (46%) made detailed comments on the Paper.

3.2 Response rates showed wide variations:

(i) developer interests - 25 consulted, of which 68% replied;

(ii) environmental/conservation groups - 13 consulted, 38% replied;

(iii) local authorities - 11 consulted, 55% replied;

(iv) parish councils/residents' groups - 10 consulted, 10% replied; and

(v) others - 7 consulted, 29% replied.

3.3 From the above it will be seen that developer interests were not only the largest group consulted, they also had the best response rate. The combined effect of this is reflected in the nature of the comments made, as shown in the attached Summary of the main points arising from consultation responses (see attached appendix ).

4. Main Points Arising from Comments

Regional Planning Guidance Figures

4.1 An issue was raised regarding the treatment of RPG housing figures. Some respondents believe that the shortfall in completions during 1996-2001 compared to previous RPG figures should be rolled forward and provided for in the provision post-2001. The difference amounts to 3,199 dwellings. The Policy H4 Paper uses current (2001) RPG as its guide. The Government Office for the South East (GOSE) has confirmed that there is no requirement to address any shortfalls arising from 1996-2001 period.

Identified Large and Small Site Supply

4.2 Many respondents claimed that the identified large and small site supply was over optimistic, and therefore the figures should be discounted. However, a discount of 7% was indeed applied to the expected completions from large sites for the next five years in the Paper, in recognition that not all will be built within that period. The contribution per annum expected from small sites between 2002-2011 is very similar to that actually built between 1996 and 2002 and appears to be a reasonable estimate.

Urban Capacity

4.3 There were a number of points regarding urban capacity. Supply was considered to be overly optimistic and calls were made to compare supply against actual completions from this source since 1996. The actual contribution from these sources 1996-2002 is only slightly lower than that forecast in the Paper 2002-2011 suggesting that, based on past trends, the predictions are reasonable.

4.4 Requests were made for the assessments undertaken by the SPAs of the urban capacity studies to be published and opened up to independent scrutiny. The assessments were undertaken with the cooperation of the LPAs on the basis that they would not be made public. There is a need for further work on the assumptions used in urban capacity studies and those that have been produced in tandem with a local plan will be scrutinised at forthcoming local plan inquiries.

Major Development Areas

4.5 The general view from the development industry was that the Paper was still too optimistic about the date when the MDAs will contribute dwellings and, as a consequence, the supply from this source was too high. However, those directly involved in their development stated that they are looking to take steps to meet or even exceed the figures used in the Paper.

4.6 There was some concern over the implications for reserve MDA provision and other reserve sites if the baseline MDAs do not deliver by 2011 the capacity set out in the Structure Plan.

4.7 The current position regarding the Eastleigh MDA was singled out as a particular concern, especially as the Borough Council now proposes significant greenfield releases as an alternative to the MDA concept. This is considered by respondents to be a piecemeal and unsatisfactory approach to designating land for housing. The status of the Eastleigh Borough Local Plan is considered in further detail in the concurrent report on Hampshire Local Plans Progress and Issues elsewhere on the agenda.

Reserve Provision

4.8 A number of respondents raised questions on the provision of the housing reserve, particularly the lack of progress in identifying sites. Some argued that it would be inequitable if those authorities that had identified the reserve were disadvantaged by their compliance with the Structure Plan.

4.9 Almost half of the reserve provision has not been identified in local plans. In two cases there is a real prospect that the Strategic Planning Authorities (SPAs) will be challenging its omission at a public local inquiry. There is merit in the SPAs confirming the view that the absence of reserve provision will not have a bearing on considerations as to where a release should be made, if required. In practice this would mean that, in cases where a local plan has not identified the reserve, it would be left to the development control process (including the appeals mechanism, if necessary) to identify the sites.

Overall Supply

4.10 Many respondents argued that, by not releasing the reserve now, the Paper is ignoring its own findings and those of the Hampshire House Completions Study. It is also contrary to the `plan, monitor and manage' approach and good planning. They believe that there is a need to act now rather than "wait and see" and that if this Panel does not release sites, GOSE should consider intervening. Some respondents have written to GOSE to this effect.

4.11 There were a number of proposals to improve future monitoring papers. It will be possible to meet some of these requests, although others have significant resource implications that will need to be evaluated against the benefits arising.

5. Conclusions

5.1 The conclusions are that:

(i) Although the Paper was generally seen as an improvement upon the previous document, there remains much scepticism amongst the development industry regarding the overall supply figures used, the accuracy of the forecasts and consequentially its conclusions. Other interested parties such as local planning authorities and local interest groups were much more supportive of the Paper and its findings.

(ii) Forecasting is, by its nature, an inexact science. The Policy H4 approach requires a higher degree of sophistication in the forecasting accuracy of housing supply and completions than was the case in the past. The forecast of completions used in last year's Monitoring Paper were not sufficiently accurate for the new Plan Monitor and Manage regime and steps have been taken to improve their accuracy.

(iii) Despite the misgivings of many respondents, the overall conclusion of the Paper - that there will be sufficient supply to meet requirements to 2011 - is considered to be a fair assessment based on current information. However, the Paper shows that the forecast of supply only just exceeds requirements and next years Paper may reach a different conclusion.

(iv) The Government is looking for an increase in house completions and is making additional funding available through the `Planning Delivery Grant' to help local planning authorities improve performance. It also proposes to intervene in areas which are not meeting their housing requirements. Planning authorities in Hampshire are rising to this challenge - good progress is being made on local plan production; urban capacity studies have been produced for the whole of the county and progress on the MDAs (with the notable exception of Eastleigh) continues. Some planning authorities, such as Basingstoke, are now actively managing their land and bringing forward sites to increase the rate of development.

(v) One area that is not showing sufficient progress is the identification of the reserve provision itself. There are good reasons why, notwithstanding the conclusion in this Paper, the reserve may still be required in the future. The reserve provision may be necessary for the county to meet its RPG target, and all planning authorities should be concerned that it is not currently being fully planned. The SPAs should clarify the position regarding non-identification, namely that this will not be a consideration when deciding which district(s) should release further housing sites, if required. In such circumstances, sites could come forward through applications for planning permission on sites not identified for development, rather than through the plan-led system.

(vi) If all parts of Hampshire had delivered their baseline for 2001-02 the surplus generated by some would have almost been sufficient to meet the RPG target. If this could be sustained the likelihood of releasing the reserve would diminish. LPAs should, accordingly, be urged to take proactive steps to manage housing land supply to meet their Structure Plan baseline housing requirement and make provision for the reserve provision, where required.

5.2 The next Policy H4 Monitoring Report is due to be published in November 2003.

Section 100 D - Local Government Act 1972 - background papers

The following documents disclose facts or matters on which this report, or an important part of it, is based and has been relied upon to a material extent in the preparation of this report.

NB the list excludes:

1.

Published works.

2.

Documents which disclose exempt or confidential information as defined in the Act.

TITLE

LOCATION

None.