As expected, this carries forward many of the changes proposed in the consultation version, which are summarised here. Savills responded to the consultation in September 2024, our response can be read here. The key points of note in the new document are: -
- The Standard Method to assess the level of housing need increases by circa 20% in England;
- A six-year housing land supply requirement comes into effect for local authorities with a local plan housing requirement over five years old, where it is 80% or less of the level set by the new Standard Method;
- The introduction of Grey Belt and clarification on circumstances whereby Green Belt land can be released for development;
- The level of affordable housing required on housing sites removed from the Grey / Green Belt;
- The approach to the sequential test for assessing Flood Risk; and
- The transition arrangements for the application of the new NPPF for decision taking and plan making.
The NPPF becomes national policy today affecting planning decisions and local plan making. Alongside this, the revised Standard Method has been published, which defines the local housing need for all local authorities in England and aggregates to a national total of 371,541 per annum. This increase responds to areas with poor housing affordability, including uplifts in southern England in particular.
Relevant parts of the Planning Practice Guidance (PPG) have also been updated, including housing and economic needs assessment, housing supply/ delivery and plan making.
Housing provision
Alongside the revised NPPF, there is an updated Standard Method for calculating local housing need, which increases significantly the level of housing which local authorities have to plan for and is applicable from today for decision making in areas without an up-to-date local plan. In such areas this may now mean that many more local authorities can no longer demonstrate a five-year housing land supply. The Standard Method has been refined from the version consulted on in the summer in relation to the affordability ratio. The national total still requires over 370,000 per annum but with an adjustment from north to south including an adjustment in London to circa 87,992 per annum.
The further emphasis on the application of the Standard Method in local authorities without an up-to-date local plan, will likely give rise to an increase in planning applications for housing to increase local levels of land supply.
It is clear that a wide range of sites, dwellings types and tenures (including a range of affordable) will be required to enable the delivery of the Government’s ambitious housing targets. Savills Research also indicates the need for supported sales to facilitate the added level of delivery.
In addition, Savills research indicates that a significant amount of additional planning permissions for residential units will be required, to exceed the national housing requirement to reflect market dynamics, phasing and delivery. In short, much higher levels of planning permissions will be required in the shorter term, noting that it might be 2029 before all local plans have been updated to incorporate the new levels of housing set by the Standard Method. Having plans in place at this level is key to enable the delivery of at least 300,000 per annum, toward the Government’s 1.5m target for this Parliament.
Importantly, the requirement for local authorities to maintain a five-year housing land supply at all times is reinstated, setting aside the four-year requirement applicable in certain circumstances in the previous NPPF (2023). The role of neighbourhood plans continues to be of importance, with the protections retained for five-years where these are up to date and make allocate land for the delivery of new homes.
Presumption in Favour
The ‘presumption in favour’ of sustainable development is retained in the NPPF, though modified to clarify the circumstances in which it may apply where a local plan is out of date. This includes important principles such as the sustainability of the location, the suitability of the land use, quality of design and provision of affordable homes.
Green Belt
In the most significant change to national Green Belt policy for a generation, the NPPF introduces the concept of Grey Belt land. Land that qualifies as Grey Belt will be suitable for new housing where certain conditions are met including an absence of a five-year housing land supply. The key test is for the land to not strongly / fundamentally contribute to some of the purposes of Green Belt, including urban sprawl and the merging of built development. The prospect of Green Belt land being released for development in new local plans has also been clarified, noting that meeting housing needs is an ‘exceptional circumstance’ justifying a review of Green Belt boundaries.
A greater proportion of Affordable Housing is expected from Green Belt / Grey Belt land released for housing. The summer consultation document identified a 50% target for housing land that had been released from the Green /Grey Belt. In the published NPPF this has been modified to a 15% uplift above existing affordable housing policy levels (capped at 50%). The NPPF does not allow for viability considerations to justify any reduced provision, though as a change to the consultation draft there will be no national benchmark land value.
Flood risk / sequential tests
There has been a helpful change to the requirement for a sequential test for flooding in a new Paragraph 175. The change applies a common sense approach to flooding policy and now only where development itself (as opposed to open space or land for BNG etc) falls within the land at risk of flooding will a sequential test be required. In line with the Government response to the consultation there will also be further clarification on aspects of the sequential test in the Planning Practice Guidance in due course.
Economic Growth
There is direct reference to the national industrial strategy (as currently set out in Invest 2035: The UK’s Modern Industrial Strategy), and the need for planning policies to have regard to this document. However, despite the Government’s objective of boosting economic growth, the new NPPF does not set out employment floorspace targets, nor does it prescribe any method for assessing employment land supply.
The NPPF sets out the Government’s ambition for growth to deliver economic development, with the Government focused on development of commercial sites to meet the needs of a modern economy. This includes a range of economic uses including laboratories, gigafactories, data centres, digital infrastructure, freight and logistics.
The Government’s ambitions are set out within the emerging national industrial strategy, which includes the development of clusters in a number of growth sectors. What is common to each of these is the need for a reliable supply chain, so the importance of the industrial and logistics sector as the backbone of the economy should be acknowledged so there is equal weight on this sector as well as support for housing delivery.
The Government has declared support for data centres, recognising these facilities as critical national infrastructure. This is a significant policy change requiring that Local Planning Authorities should recognise Data Centres as a form of infrastructure with specific locational requirements. The recent decision of the Secretary of State in relation to the proposed data centre at Court Lane, Iver – demonstrates Government support for the sector.
Other Matters
In respect of design, whilst the word ‘beautiful’ has been removed from the published version of the NPPF, the goal of planning policy remains to ensure ‘high quality’ design.
In respect of renewable energy and infrastructure, the amendment to the NPPF footnotes made in the consultation draft NPPF to bring onshore wind provision on to the same footing as other forms of renewable energy has been carried forward into the NPPF. This brings to an end the effective ban on onshore wind in England that has persisted for a decade.
Plan making & transitional arrangements
For decision taking, the NPPF applies from today. In respect of local plan making, transitions apply and Savills provided commentary on the transitional arrangements outlined in the draft NPPF. The NPPF modifies the draft approach, extending the period in which LPAs have to prepare and publish a Regulation 19 Local Plan to 12th March 2025 to use the 2023 version of the NPPF and housing requirements of the former version of the Standard Method (provided the emerging plan seeks at least 80% of the new Standard Method requirement). After this date, there are a variety of routes which apply depending on the stage of the draft Local Plan.
Next Steps & Further Reform
Savills understand there will be a further update to the NPPF in 2025 to take account of the National Development Management Policies anticipated at the same time. This was outlined (along with an overview of the wider planning reforms the Government are proposing) by Minister Matthew Pennycook speaking at the Housing, Communities and Local Government Committee in November, which you can watch here.
Pennycook outlined the Government’s latest plans to address the ongoing housing crisis, of which the NPPF is a first step. He emphasised the importance of densifying development on brownfield land and urged councils to review the extent of Green Belt coverage (currently 13% of the country). He also emphasised the release of Grey Belt land for building and local authorities who still cannot meet their housing needs due to capacity or hard constraints are encouraged to cooperate with neighbouring authorities in a bid to accommodate their unmet need. He also wants local authorities to bring forward local plans that shaping their areas as well as share the Government’s ambitions. For those deemed persistently uncooperative, Pennycook highlighted that the Government is prepared to use its intervention powers to ensure progress, including drafting a local plan directly. Savills data demonstrates the current situation of up to date local plans which is at low levels and thereby contributing to a lower level of housing delivery.
The Government has also confirmed the introduction of the Planning and Infrastructure Bill next year, which will add further changes to the planning system – including a national scheme of delegation, which may effectively give more powers to professional planning officers and standardise the scope of elected planning committees. The Government seeks to address this via £50 million of new funding for the planning system, which includes the recruitment of 300 graduate and apprentice planners to strengthen local authority resources. All of this comes in the context of a Devolution Bill, which will reshape the future of local government in England, including further Combined Authorities, Mayoral Combined Authorities and Unitary Authorities. In addition, the Government is seeking long-term propositions for a series of New Towns. Plenty more to come therefore in 2025.