This could be viewed as a signal of the intention to prioritise economic development. However, the draft NPPF also assigns substantial weight to 18 other material considerations, which dilutes the impact.

Rural large-scale economic development needs more support

Development plans will now be able to encourage economic growth ‘outside of urban areas’. The change in wording is subtle because it does not explicitly encourage economic development in rural areas. This policy should go further and explicitly state that economic development in rural areas is appropriate.

Economic development in rural areas is often a sticking point for local authorities, particularly for industrial and logistics projects. In a practical sense, the proposed changes mean that economic development is generally inappropriate outside of urban areas except in certain circumstances. While the direction of travel is positive, the NPPF should make clear that it views sustainable, rural large-scale development favourably, signalling that such development is essential for delivering the national economic agenda. 

Identifying emergent sectors

The current NPPF list of sectors that must be considered in plan-making includes freight & logistics, gigafactories, data centres, and digital infrastructure. The draft NPPF adds other sectors to the list, including: knowledge and data-driven, creative or high-tech industries; storage and distribution; and the expansion of other businesses of local, regional or national importance. Identifying these additional areas of economic activity in local plans is now mandatory.

This is a significant shift because local authorities will now need to explicitly plan for these sectors. Currently, most local plans and evidence are tied to a binary framework of industrial or office uses. This does not support a diverse, agile and modern economy. Industrial and office buildings can be used for a wide range of sectors whose needs differ widely.

Instead of planning for economic development solely by broad economic activity, the policy should ask plan-makers to identify emergent sectors under which the end uses will fall. While it’s not always easy to forecast growth sectors, it is beneficial to have a more nuanced understanding of local economic dynamics.

Local authorities should be given greater encouragement not to prescribe employment uses

The draft NPPF recognises that commercial property requirements change over time and also directs development plans not to be ‘overly prescriptive’ about the types of uses on particular sites. This is part of the shift towards greater flexibility. The policy also adds the caveat that only where there is a ‘clear and justified rationale’ is the designation of a specific use permitted.

The change is a step in the right direction, and should be welcomed, but its cautious approach limits the impetus for robust economic growth. It is likely that many local planning authorities will continue to prescribe use types for employment designations since the policy wording provides considerable leeway.

It will be interesting to learn from local plan examinations exactly when plans are considered overly prescriptive and what constitutes a clear and justified rationale for prescribing specific uses.

The UK economy faces significant structural challenges and the NPPF has a major role to play in helping to overcome them. The current proposals are important but even more focus may yet be needed.

Further information

Contact David Wasserberg or Vitus Cheung