On Tuesday 29 August 2023, the Government announced proposed reforms around nutrient neutrality in an attempt to unlock homes in the development pipeline. But what is the current status, what do we know about the suggested changes, and what will they mean for housebuilders, developers and the environment? 

It is argued that the housebuilding industry has been disproportionately affected across England and Wales by nutrient neutrality rules, being a relatively small contributor to the overall supply of nutrients, via waste water, and, in many cases, having struggled to secure appropriate solutions. The Government claims that a backlog of up to 100,000 homes could be cleared by 2030 if rules around building houses near waterways in protected areas are relaxed. 


The numbers

Natural England guidance, as it stands, means 62 local authorities in England cannot allow new residential development to take place unless builders can prove their projects are "nutrient neutral" in protected areas, including Somerset, Norfolk, Teesside, Kent, Wiltshire and the Solent.

In these nutrient neutrality catchment areas, as of March 2023, there were 232 sites for which a full planning application had been submitted, with a total combined capacity to deliver 29,095 homes. For sites with full permission granted, the numbers are lower, with 10,132 homes spread across 112 sites. 

Further analysis has shown that the number of homes allocated in Local Plans (three years to March 2021) totals 48,677. 

The Government’s recognition of this backlog and the importance of unlocking much needed housing is welcomed, as is the commitment to address the contribution of other key nutrient inputs such as agriculture. 

A reaffirmation of the commitment to investing in and upgrading water waste treatment, restoration programmes and using nature-based solutions as a way of improving the environment is equally encouraging. 

Nutrient neutrality, a concept which arose in late 2018 concerning the interpretation of the Habitats Directive, has raised the profile of water pollution in this country and has resulted in a number of mitigation schemes coming forward. Further investment in this important area is needed in order to address the issues raised by nutrient pollution, while also recognising the significant benefits they can have in achieving other key environmental aims, such as biodiversity net gain. 

The proposed reforms: a summary

• Changes to be delivered through the Department for Levelling Up, Housing and Communities (DLUHC) as an amendment to the Levelling Up and Regeneration Bill, which is currently with the House of Lords and targeted for royal assent in 2024
• Proposal to insert new clauses into the Habitat Regulations which will largely remove the consideration of the impacts of nutrient pollution for most planning applications
• Natural England will be provided with additional funding to implement measures to mitigate the nutrient production of new developments within catchments
• Some sort of ‘fair contribution’ will be required from larger developments to contribute to the delivery of Natural England’s nutrient neutrality solutions
• There will be additional funding and requirements for the agricultural sector and water companies to improve sewage and nutrient run off treatment, particularly slurry treatment for farming, and nature-based solutions (such as wetland creation) for water companies
• Development will be scrutinised for its impact on water recycling centres, particularly in relation to storm water management and avoiding overloading water infrastructure, potentially through additional sustainable urban drainage systems

Timing

The big question on everyone’s lips now is one of timing – how long will the changes take to come into force? We have seen over the course of last week the amount of publicity generated by the announcement. A clear sign that the proposed amendments will be controversial. Today the Levelling Up and Regeneration Bill (LURB) goes back before the House of Lords for further debate. Will the amendments survive unscathed? What effect will a general election have? 

Conclusion

The DLUHC has announced an ongoing consultation with the Home Builders Federation and local authorities to work out the details of the proposals, particularly on the delivery of mitigation and the mechanics of a ‘fair contribution’. 

Building on this theme, it will be important that the industry and various stakeholders collaborate in order to continue the momentum that has accrued in addressing an important problem impacting our waterways. 

The aim should be to work towards a shared goal of a better environment that balances the need for new homes.

Further information

Contact Andrew Watson or Richard Shuldham