Local development plans - deliverability of site allocations: research

2 Policy and Research Review 

2.1 Deliverability has come into greater focus in Scottish planning policy in recent years.  The first Scottish Government National Planning Framework (NPF), published in 2004, advised that in preparing local housing strategies, development plans and community plans, ‘the requirements and mechanisms for delivery are taken fully into account’. 

2.2 This thinking evolved further through NPF2 (2009), which, taking account of the reforms introduced by the Planning etc. (Scotland) Act 2006, promoted a vision of a planning system that delivers more homes. This requires a “whole market perspective and coordinated delivery”. The vital role of action programmes to “set out a list of actions to deliver the policies and proposals contained in the relevant plan”^[1] and support and implement effective delivery became clear in 2008, alongside collective stakeholder working. 

2.3 Scottish Planning Policy (2010) recognised that delivery of development is wholly dependent on the timely release of allocated sites to meet needs.  However, a number of factors such as: the quality of planning applications and the timings of legal agreement; as well as access to funding, the state of the housing market and construction industry; all have a direct impact on delivery, and fall outwith planning authority control.    

2.4 The Affordable Housing & Housing Land Audits Planning Advice Note 2/2010 provides assessment criteria for the effectiveness of housing land; these are: 

• Ownership: within the control of a party which can be expected to release it for development
• Physical nature: free from constraints, or where constraints can be overcome and remedial works funded
• Contamination: free from, or has commitments to remediate to a standard for marketable housing
• Deficit funding: has been committed if required
• Marketability: site or relevant parts can be developed during the identified period
• Infrastructure: free from constraints, or can be provided realistically by a developer or another party
• Land use: housing is the sole preferred planning use, or a realistic option

2.5 Circular 6/2013 ‘Development Planning’ developed the thinking around delivery with specific references to LDPs. It stated that the selection of preferred LDP sites (within a Mains Issues Report (MIR)) should consider “deliverability factors such as site viability and housing land effectiveness”. The likely timescales and sequence of development should also be considered, as well as the role of infrastructure. Development viability – ie. the financial costs and returns –becomes more prominent in assessing the deliverability of site allocations ^[2]. 

2.6 Circular 6/2013 also notes that many authorities a ‘call for sites’ prior to preparing the MIR. This is not a legislative requirement, but can be useful. This research project has reviewed LDP call for sites pro formas currently used in the Scottish planning system to help develop approaches to sites assessment in Section 4.

2.7 Even a site which passes the planning system’s broad infrastructure, viability and effectiveness tests might still fall short in terms of landowner willingness, developer appetite and financing (including infrastructure). This is particularly true for large, complex areas with significant upfront costs and risks. 

2.8 In 2014, NPF3 and SPP2 recognised that infrastructure capacity is essential to the delivery of new housing (specifically). These advocate that the planning system should “have a sharp focus on the delivery of allocated sites embedded in action programmes, informed by strong engagement with stakeholders”.  This pinpoints the vital role of collaborative working in delivering the spatial strategies and allocated sites within development plans. 

2.9 The introduction of action plans, then action programmes (and the now proposed delivery programmes), and the transition from local plans to local development plans, signals the increasing focus on the deliverability of sites within the Scottish planning system.

2.10 Further developing the focus on deliverability, the Scottish Government issued draft Planning Delivery Advice on Housing and Infrastructure (March 2016). The draft recognised that good practice is happening, but needed to be shared and spread. Although the draft was withdrawn in December 2017, a number of its references to the delivery of housing and infrastructure and related site information are relevant to this research project. These are summarised below.

2.10.1 Marketability (paragraphs 60 and 61) was no longer one of the effectiveness criteria for housing sites in the withdrawn draft guidance. This was because marketability is not a fixed constraint, but can change over time. Marketability was proposed to become an additional consideration for private housing, rather than being one of the normal site effectiveness criteria. 

2.10.2 Development plans have a “critical role to play in making the case for new or enhanced infrastructure needed to support development strategies” (paragraph 87). Coordinated infrastructure planning is thus required, particularly for large, phased sites. Action Programmes were explicitly linked to site effectiveness. Infrastructure planning should set out where developers will or will not contribute; if contributions are to be sought a policy statement or specific delivery mechanism is required, including costs (proportionate and prioritised) and known funding (for example City Deals). Developers should be prepared to provide clear information about infrastructure requirements, although more precise cost estimates will come later in the planning process.

2.10.3 The draft guidance stated that the plan should “balance the wider development strategy with information on deliverable sites” (Appendix 2, paragraph 2, our bold).  It noted that too much information at calls for sites is costly and time-consuming, whereas too little risks taking forward undeliverable sites. Appendix 2 set out the call for (housing) sites process and Annex C provided two-stage call for sites templates.  The draft guidance notes that the call for sites could identify not only land, but also the associated infrastructure requirements, and indeed use those requirements as part of guiding site submissions towards preferred locations within the development plan strategy. Transparency and clear and consistent links between sites information, action programmes and housing land audits were recommended. 

2.10.4 The draft guidance stated that action programmes “should set out the pathway to delivery of developments” (Appendix 3, paragraph 5, our bold). This recognises the distinction between delivery, and encouraging that via deliverability.

2.10.5 At the call for sites stage, the draft guidance^[3] advocated that site promoters “submit information on the nature of their proposals and their views on how these will impact on utilities infrastructure” (Annex D, our bold). This information would be expected to help understand individual and cumulative site impacts. For transport, the draft guidance sought impacts on transport corridors, distance from existing public transport routes, and impacts (using proportionate analysis) on local and strategic transport network constraints. For education, the anticipated impact on education infrastructure covering individual and cumulative impacts using school catchments, capacity and pupil generation over time was sought. 

2.10.6 Overall, the withdrawn draft housing and infrastructure guidance advocated a proportionate, evidence-based approach to site assessment. 

2.11 The independent review of the Scottish planning system (May 2016), Empowering Planning to Deliver Great Places, confirmed the vital role which deliverability plays in successful planning.  Housing delivery was identified as one of six key themes, with the panel recommending a clearer definition of effective land and pioneering ideas to increase flexibility and attract investment.

2.12 This recommendation evolved to form part of Proposal 5: Making plans that deliver, in the Scottish Government’s consultation paper ‘People, Places & Planning’ (January 2017), with a focus on providing greater confidence on the effectiveness of sites and when they can be delivered (paragraph 1.44):-“Information on site assessment should be submitted by the site proposer and appraised before any site is allocated in the plan.  This would include economic and market appraisal information to provide greater confidence about the effectiveness of sites and when they can be delivered.  This could allow for closer monitoring of performance.“  

2.13 Consultation responses were analysed in detail by Kevin Murray Associates. Respondents observed that the ability of planning to provide confidence in the delivery of sites is only possible up to a point; and that housing issues cannot be solved by planning alone. Regarding^[4] whether development plans could be strengthened by setting out the information required to accompany proposed allocations, 89% of respondents agreed. However the development industry – which would typically be asked to provide that information – noted a concern that information in the early stages of a proposal will likely change as the proposal becomes more detailed. Subsequent questions on whether specific information should be provided to support allocations also attracted positive responses: 

• site feasibility 91%; 
• increased consultation requirements for non-allocated sites 79%;
• working to ensure that key agency support for allocations extends to not objecting to the principle of planning applications 73%;
• stronger delivery programmes could drive delivery of development 84%

This final point suggests a faith in the planning system to not only promote deliverability, but to actually drive the delivery of development. The question of what respondents understand by “stronger” delivery programmes – ie. better information, analysis and programming; or, greater planning control over development activity, is unanswered. Respondents do however believe that “planning can only facilitate delivery up to a point, particularly where external market factors are involved.” 

2.14 The issue of site viability arises within the consultation responses. Developers offer that “viability work” - presumably a development appraisal - will often precede a planning application, but some details may be unknown prior to grant of consent. The report notes that viability work would most likely only be undertaken by an active developer rather than other types of landowner. Respondents noted that information on site “feasibility” (undefined) should be proportionate and allow for changing circumstances.

2.15 The Scottish Government issued its Position Statement on ‘People, Places & Planning’ in June 2017. The Statement recognised the continued support for a plan-led system, implemented through a strong delivery programme. It noted that establishing development viability is essential to securing greater certainty in the delivery of development plans and sites allocated for housing. 

2.16 The Statement was expanded in a Technical Paper (September, 2017) on how key changes could work in practice. This envisages early verification of housing land requirements at the newly-proposed development plan ‘gate check’ stage. Planning system changes include moving from 5 to 10 year LDP cycles, giving SPP statutory weight within LDPs, removing the SDP, replacing the MIR with a Draft Plan, creating Local Place Plans and moving from an action programme to a delivery programme. Overall, LDPs would be more place-based, and less about policy wording. The aim is to support transition to the new system in advance of NPF4 in 2020.

2.17 Turning to the wider UK, NPPF^[5] for England seeks to ensure site viability and deliverability (paragraph 173). It states that development costs and burdens should still “provide competitive returns to a willing land owner and willing developer to enable the development to be deliverable.”  

2.18 English guidance on Local Plans^[6] has no statutory requirement for a call for sites, although most planning authorities have an options stage. The guidance states “Where sites are proposed for allocation, sufficient detail should be given to provide clarity to developers, local communities and other interests about the nature and scale of development.” Planning to fund infrastructure and bring land on stream for a 5-year period is required but, echoing NPPF, Local Plan infrastructure requirements should not prejudice development viability.

2.19 A recent major study in Wales^[7] assesses whether housing sites are being delivered in accordance with programmed outputs and policy requirements, and the viability information which was submitted at each stage of the planning process. At the early stages of plan preparation, site information concerns ‘deliverability’ in its broadest sense, such as land ownership, presence of infrastructure or environmental constraints. Viability information did not typically form part of call for sites assessments. Some authorities did undertake early viability work, but problems with delivery persisted, due to landowner in(action) and sites rolled over without development, public assets not yet disposed of, and complex sites requiring regeneration solutions. 

2.20 The Welsh Government research recommends a more prescriptive approach to the level of detail required for a site to pass through the allocation process. With its focus on viability, it recommends that a residual land value should be provided by site promoters at the call for sites stages; sites with a negative value should not progress without further evidence. For strategic sites, an outline development appraisal is recommended, allowing authorities to not only understand viability but also test policy impacts, for example affordable housing requirements. The research report suggests this would provide greater certainty over the viability of allocated sites, reduce abortive work, create better evidence at Plan examination with the loss of fewer sites, and potentially result in less negotiation at development management stage.