How can we unlock housing delivery in the North-west of England?

At first glance, many of the challenges affecting housing delivery, such as land availability, planning, development costs and new regulations such as biodiversity net gain, are universal. Yet, over the course of an hour and a half of lively conversation, it became clear that while these development challenges are not unique, their impact on the housing sector in the North-west varies fairly significantly, from place to place – and from council to council.

In late June, just over a week before the general election took place, a group of seven housing experts convened in the ornately decorated, neo-baroque grade II-listed Midland Hotel in Manchester.

Hosted by Daniel Gayne, senior reporter at Housing Today and Building, and sponsored by Willmott Dixon, the roundtable covered an array of topics, including the need to reform the planning system, deal with the North-west’s ageing housing stock and ease complex restrictions around funding pots.

Planning: “It’s become even more politically driven”

As soon as Kat Kitchener, regional head of land and development at Willmott Dixon, uttered the word “planning” murmurs of agreement echoed around the room.

Kitchener noted the well-documented challenges around pace, capacity and skill in the planning system, saying: “It feels like it’s become even more politically driven, as opposed to policy driven.”

She added that if a scheme is recommended for approval, and the cabinet rejects it, she believes “the onus is on them to make the planning point as to why they reject it”.

Due to the council and metro mayor elections on 2 May, and the general election on 4 July, Kitchener noted, “We’ve had 12 weeks of purdah this year, so that’s three months gone out of your calendar anyway.”

In the view of Rachel Glover White, director at planning and development consultancy NJL Consulting, a key part of improving the planning system is local authorities having an adopted local plan. 

Glover White argued that if a local authority has a local plan and a scheme “ticks all of the boxes and it’s recommended for approval, why does it need to go to planning committee?”.

She said that discussions regarding a council’s development policy and expectations for schemes should take place when a local plan is being adopted, not when a planning application is submitted.

However, Glover White noted an exception for planning applications that are “really controversial or deviate from the plan”, which she said should be decided by elected council members.

“One of the inevitable conclusions to this is that you take the planning system away from being publicly accountable,” said Ben Williamson, director at architecture firm PRP.

Nonetheless, Williamson acknowledged, “We are sensitive to so many factors in a [planning] system that is run by public opinion.”

He added that while Keir Starmer’s willingness to go against public opinion to deliver schemes “might be helpful” and is something he supports professionally, “If it ends up being a big development on my doorstep, I might see it differently.”

Strong local leadership

 The discussion on planning also touched upon the importance of strong local leadership in facilitating development.

Tahreen Shad, regional partnerships director for the North West and North Wales at Lovell Partnerships, stated: “When you’re dealing with a logjam in the planning system, it needs a message from the top regarding acceptable outcomes and timescales.”

Shad explained that some local authorities are better than others, saying: “It’s always because there is a strong leader at the top to pull the levers and get things done.”

She cited an example of a council in the North-west where the combination of a strong council leader and chief executive “made things happen”.

Conversely, she described working with another local authority where “officers hold developers to ransom, and you’re working to their timescales”. These extended timescales increase costs, she noted, which then adds onto the cost of the end product and affordability.

Williamson reflected: “When we look back at the delivery of homes, particularly affordable ones, it takes someone in central government to singlemindedly say, ‘This is what we are doing,’ and for the government to put money behind it.”

Consistency is king

On the issue of leadership at a central government level, Tom Cadman, associate partner at Baily Garner, emphasised that the sector needs consistency and for people in housing roles to be qualified.

“We hear all these grand sweeping statements about reform, when actually what we need is consistency. Instead of trying to reinvent the wheel, let’s just be consistent,” Cadman said.

He argued that the turnover in the housing minister role, which was occupied by 16 different MPs since 2010 under the last government, is part of the issue. “How many housing ministers have we had? I appreciate it’s a comment everyone makes, but it falls on deaf ears,” he said.

Cadman added: “Given that it [housing] is such a consistent challenge and a hard nut to crack, let’s look at the skillset of the person that is given that role. Let’s make sure they’re qualified to do that job.”

Williamson expressed concern that there are “so many distractions, of cost, new regulations, working with planning authorities […] that we are losing sight of quality in what we do”. He worries that this means “a lot of the homes we’re delivering now are the problems of the not-so-distant future. It’s got to be more and better.”

Because scheme delivery spans several years and viability can change over time, largely because of expectations on land values, consistency is key, he said. “It enables people to plan, then we can stop having to re-educate ourselves and getting distracted by all the burdens on systems, particularly the planning system.

”Then we can focus on the real issue, which is delivering homes,” Williamson asserted. 

Claire Jarvis, managing director at David Wilson Homes North-west, said that at a local level, planning delays and consistency in development policies are key to helping housebuilders like David Wilson Homes bring forward schemes.

“The lack of consistency for us creates planning delays. We’re looking at targets, outlets, bringing them forward – those delays impact us and our viabilities,” she said.

As an example, Jarvis cited a council changing its criteria for footpaths through developments and then asking for a scheme David Wilson Homes is building to be tarmacked and with lighting – something that was not in the original planning agreement.

She said: “Our appraisal of viability doesn’t have that in, and we don’t have an open cheque book, but I think there is that perception. It’s about educating local authorities on commerciality and how we assess developments when we’re taking them through.” She added that the changes have caused delays, impacting delivery of homes.

Regeneration

Bronwen Rapley, chief executive at Manchester-based housing association Onward, said: “We’ve got to face up to the properties that are at the end of their life and start to see that as part of the solution.”

She added that the short-term political cycle makes things difficult, saying, “Everything is stacked against us in terms of getting a regeneration scheme off the ground.”

Rapley believes regeneration has “huge potential” in the North-west as it can release land for development that is popular, adds to the neighbourhood and delivers schemes that are better to live in.

However, she pointed out that the rules governing the proceeds from Right to Buy sales “penalise us, so if we demolish anything, we can’t use any recycled grant until we’ve built as many homes as we’ve demolished”.

Rapley said Homes for the North, an alliance of 17 housing associations, has identified over 80 sites where “we realistically believe we could deliver significant regeneration”. These sites could deliver just under 43,000 new homes and add £4bn to GDP, she said.

Linked to regeneration is the issue of funding pots. Due to the longer-term nature of regeneration initiatives, Rapley said, “we need to know the pot of money we’ve got, and also a) not have funding pots that need to be spent by Tuesday or b) that have so many rules and regulations around them that you can’t make a sensible decision about what would work”. 

Biodiversity net gain: “Everybody’s scratching their head over it”

As well as challenges around planning resources, the roundtable spoke about responding to new regulatory requirements and skills gaps, with biodiversity net gain (BNG) being one recent example that Glover White said “everybody’s scratching their head over”.

She pointed out that BNG is proving particularly challenging for local authorities: “We’ve got consultants on tap to ring up and ask questions, but the local authorities don’t have that and they’re expected to keep pace.”

Jarvis explained that Barratt Developments, which owns David Wilson Homes, brought in the 10% BNG target 12 months before it became mandatory in February. She said this means “they’ve been working in the background getting used to it before it became policy”.

“Everything is stacked against us in terms of getting a regeneration scheme off the ground.”

Bronwen Rapley, Onward

However, Glover White noted: “I suppose the local authorities you’re submitting planning applications to haven’t brought it in 12 months early, so they’re playing catch-up.”

Jarvis agreed, adding that she had recently been in talks with a local authority regarding the potential for delivering biodiversity net gain offsite.

“We would always want on-site [BNG] offsets, but there are opportunities for offsets offsite if you just can’t make it work on site,” she said. “Local authorities are still getting their heads around that at the moment and looking at motorway verges or other areas where they could benefit from these offsets.”

However, Glover White cited an example where a requirement to deliver BNG offsite is affecting a registered provider’s ability to deliver affordable housing.

She explained that the registered provider will need to pay almost £1m to offset BNG, and “ironically they’re an RP going down a viability assessment route to get rid of affordable housing”. She added “we have to do it because it’s law”, but said she thinks taking away 150 affordable homes in an area that needs them is a loss.

Glover White believes that competing priorities such as delivering BNG, carbon neutral homes and affordable housing are all important, but need to be balanced carefully. “As soon as things are mandatory, it takes away the ability to argue the nuance on a case-by-case basis,” she said.

The funding question

Towards the end of the discussion came the question: Can housing delivery be unlocked, and the housing crisis be solved, without the government spending more money?

There was agreement around the table that some policy and culture changes, such as having local plans and development policies, and ensuring planning is driven by policy rather than politics, would not cost more money. In addition, with a whole raft of different legislative priorities being thrown at housebuilders and registered providers, Glover White and Williamson both argued that experts like those at the roundtable are well placed to make things work and deliver developments with the pot of money they have.

However, Rapley said that the sector does need more funding to deliver affordable housing, in particular the 90,000 social homes per year that the National Housing Federation and Shelter have called for. “The market will do so much, but we’ve got to face up to that need for subsidy.”

She noted that solving the housing crisis is dependent on creating economic growth, explaining the circularity of the situation whereby growth creates more money, which in turn fosters more growth. “We need to see that cycle, but in the opposite direction,” she said.