Projects and Policy Manager Henry Smith examines whether new government policies will have a significant impact on the delivery of genuinely affordable homes, as part of a project supported by the Nationwide Foundation.


Introduction

The government has published two major policy documents in recent weeks: the final revised National Planning Policy Framework (NPPF) on 24th July and the Social Housing Green Paper on 14th August (which is open for consultation until 6th November). These signal the government’s intent to increase the number of homes of all tenures, but do they represent a fundamental shift in direction to deliver more genuinely affordable housing?

This TCPA blog analyses whether the policy changes will have a significant impact on the delivery of genuinely affordable homes and is based on conversations with over 120 different councils across the country over the last few months as part of a TCPA project supported by the Nationwide Foundation.

Planning for mixed communities

At its best, the planning system can deliver mixed and thriving communities, with high-quality homes of different tenures integrated in to new developments.

In recent years, however, greater reliance has been placed on the planning system to deliver affordable housing as a result of falling grant levels, with 70% of councils saying that they now rely “substantially” on the planning system to deliver their need for affordable homes[1].

The Social Housing Green Paper highlights the ambition of government to increase the supply of more social homes, saying that “central and local government, housing associations, private developers and others must pull together and radically increase the number of homes built every year”. To achieve this, councils have told us that in practice the planning system cannot replace the much greater levels of investment needed by government particularly in social rented housing.

Definition of affordable housing

Councils have consistently highlighted social rent – homes available at the lowest rent level – as the tenure in greatest need in their local authority area[2].

The fact that social rent has been reinstated in the definition of affordable housing in the final revised NPPF is a welcome change. However, the inclusion of a requirement for 10% of new housing to be for affordable home ownership could impact on the total number of social rented homes built. Councils have said that they must be free to determine locally set needs for affordable housing within this framework.

The Social Housing Green Paper also provides important clarity on the government’s use of the term “social housing” – which now includes all housing to rent below market level rents or to buy through schemes such as shared ownership.

The current planning framework and delivering affordable homes

Only 2% of councils surveyed said that their policies for affordable housing were met by developers all the time. The government has made changes to the viability test in an attempt to strengthen policy requirements. While welcoming a greater move towards transparency in viability, councils raised issues during the consultation about the implementation of this change[3].

The role of councils

Councils are showing their leadership and commitment towards boosting the supply of affordable housing, as highlighted by a TCPA report which included a range of case studies and made recommendations to government about policy changes required to support this innovation[4].

The Social Housing Green Paper is accompanied by a separate consultation on the government’s intention to review the use of Right to Buy receipts which ends on the 9th October[5]. The Green Paper also signals a willingness to further reform the Housing Revenue Account (HRA) borrowing cap, following on from the government’s prospectus for lifting the HRA cap in areas of high affordability pressure[6]. Together with the rise in local housing companies, there is a real opportunity for councils to be at the cutting edge of solving the housing crisis, playing a full and active role in planning, delivering and managing homes of all tenures, including social and affordable homes.

Conclusion and next steps

The final report of the project on ‘planning for affordable housing’ is being launched in parliament on 11th October. For more information, please contact [email protected]. Following the report launch, guidance and training will be delivered for councils across the country on securing affordable housing through the planning system.


[1] Planning for affordable housing: Briefing Paper on a TCPA survey of councils on the draft revised NPPF”, May 2018. https://www.tcpa.org.uk/planning-for-affordable-housing

[2] See TCPA project supported by the Nationwide Foundation: “How can councils secure the delivery of more affordable housing? New partnerships, models and innovations” November 2017 https://www.tcpa.org.uk/how-can-councils-secure-the-delivery-of-more-affordable-homes-final-report

[3] TCPA, Planning for affordable housing: Briefing Paper on a TCPA survey of councils on the draft revised NPPF”, May 2018. https://www.tcpa.org.uk/planning-for-affordable-housing

[4] TCPA, “How can councils secure the delivery of more affordable homes? New models, partnerships and innovations”, November 2017 https://www.tcpa.org.uk/how-can-councils-secure-the-delivery-of-more-affordable-homes-final-report

[5] MHCLG, Use of receipts from Right to Buy sales: consultation, August 2018 https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/733469/Right_to_Buy_consultation.pdf

[6] MHCLG, Additional housing revenue account borrowing programme: prospectus, June 2018 https://www.gov.uk/government/publications/additional-housing-revenue-account-borrowing-programme-prospectus