On 30 July 2024, the new Labour government published a draft of the revised NPPF, which is now available for public consultation until 24th September.

Secretary of State for Housing, Communities and Local government Angela Rayner addressed Parliament to outline the reasons why change is necessary. Key amongst these is the need to increase the supply of new homes in England to meet the government’s 1.5m homes target (the equivalent of 300,000 homes per year). This is in contrast to current expectations which show the rate of delivery will drop below 200,000 dwellings this year (as discussed in Savills latest research).

Housing provision

Alongside changes to the NPPF, a revised Standard Method is proposed that sets the start point for each local authority housing requirement. This revised Method is to be used as part of the process of preparing local plans, but is also applicable where currently adopted plans are out of date as is the case in circa 78% of local planning authorities (see Savills research).

The Secretary of State was clear that it is a matter of ‘how’ and not ‘if’ new homes are built and therefore  the design of what is to be built ‘should reflect local views’.

The revised  Method has as its starting point a multiplier of 0.8% of existing housing stock, plus a revised affordability adjustment. The modified NPPF removes the previous 40% cap on any uplift above the previously adopted local plan housing figure as well as the 35% uplift that applied to the 20 largest cities. Applied nationally, the revised Method equates to 371,541 dwellings per annum, which is an uplift of circa 21% on the number derived from the previous Method. This acknowledges that there will inevitably be a certain number of homes that will be planned but will not be delivered due to unforeseen circumstances, such as constraints that are identified on allocated sites at the more detailed level of planning.

It is intended that the new Method will apply to all new local plans a month after the new NPPF is published in its final form – so would likely be enforced by the end of the year. The government proposes that where a draft Regulation 19 local plan is recommending a level of housing provision that is 200 or more homes per year below that stipulated by the Method, the new Method must be used.

At the same time, key elements of the NPPF introduced in the revised version of  December 2023 are to be deleted. The application of a four year housing land supply requirement in certain circumstances, for example, is to be abolished, while the 5% and 20% buffers to be applied to five year housing land supply assessments that had been abolished are now reinstated.

The Secretary of State explained the Method is being revised to ‘better reflect urgency of supply for local areas’ and ‘includes an uplift where house prices are most out of step with local incomes’.

Green Belt

As widely trailed, a new definition of Grey Belt is introduced into the NPPF in order to guide where revisions to Green Belt boundaries should take place. Historically, national policy has advised that Green Belt boundaries should only be changed in ‘exceptional circumstances’. The consultation NPPF states that ‘exceptional circumstances’ should include instances where an authority cannot meet its identified need for residential and commercial units. In such cases local authorities will now be required to review Green Belt boundaries and propose alterations in order to meet needs in full. The starting point for such reviews to the Green Belt should be to release previously developed sites first, followed by the Grey Belt and then the most sustainable locations for growth in the Green Belt.

In respect of decision making, the consultation NPPF sets out a major change. Where local authorities cannot demonstrate a five year supply of deliverable housing sites or where the Housing Delivery Test indicates that the delivery of housing was below 75% of the housing requirement over the previous three years, development that would utilise Grey Belt land should not be regarded as ‘inappropriate development’ (so long as the development would not fundamentally undermine the function of the Green Belt across the area of the plan as a whole). This indicates shorter term scope for development within Grey Belt locations.  .

The consultation NPPF also requires that 50% of housing allocated/approved in the Green Belt should be affordable and also that such developments should ensure that sufficient infrastructure and improvements to green infrastructure is also provided.

Economic

The consultation NPPF retains the requirement for local plans to proactively and positively encourage sustainable economic growth. It outlines that plans should set criteria and identify strategic sites, for local and inward investment to match the strategy and to meet anticipated needs.

The NPPF states that appropriate sites for commercial development that meet the needs of a modern economy should be identified, including for uses such as laboratories, gigafactories, data centres, digital infrastructure, freight and logistics. There is also enhanced support (subject to caveats) for storage and distribution operations to support supply chain, transport innovation and decarbonisation.

Design & energy infrastructure

The goal of planning policy remains to ensure ‘high quality’ design. The consultation NPPF also retains referencing to design codes and guides, although some references to ‘building beautiful’ have been removed.

In respect of energy infrastructure, the Secretary of State has said on-shore wind is to be brought more positively back into the National Strategic Infrastructure regime, alongside an expectation for local plans to identify sites for renewables infrastructure.

Next steps

The government has placed planning reform at the heart of its growth-led agenda. In her maiden speech as Chancellor of the Exchequer, Rachel Reeves set out Labour’s initial proposals to ‘kickstart growth’ based on three pillars – Economic Stability, Investment and Reform. The chancellor described the existing planning system as a ‘graveyard for economic ambition’ and promised that Labour would implement planning reform (see the Savills summary here).

The Secretary of State  was clear that there will be a ‘pace of reform’, with the Housing Minister Matthew Pennycook due to meet with local authorities imminently. The minister also wrote to all housing industry stakeholders, including Savills, to reaffirm the intentions of the new government policy.  .

Whilst the secretary of state was keen to emphasise the need to avoid too much reform – to enable quickly produced local plans – Savills anticipates more to come. Notably the measures in the Planning & Infrastructure Bill, those in respect of ensuring both natural capital and economic growth gains going ‘hand in hand’, and the still unanswered questions in respect of what remaining elements of the Levelling Up Act are  to be implemented – for example National Development Management Policies. The Secretary of State  also identified  announcements to come on strategic planning and the first round of New Towns designations.

We should therefore continue to keep our eyes on the  planning horizon this autumn with the expectation of more announcements to come alongside the immediate interest in the consultation on this revised NPPF.