Revisions to the National Planning Policy Framework – A step in the right direction for community-led housing?
Here we examine the latest planning policy revisions in England and Wales and their implications for community-led housing proposals.
December 2023 saw the publication of numerous revisions to the National Planning Policy Framework (NPPF) by the Government’s Department for Levelling Up, Housing and Communities (DLUHC).
The NPPF sets out the planning policies for England and provides guidance that informs local plans for the delivery of housing and other development projects.
Prior to the revisions published in December 2023, the NPPF had been virtually silent on “community-led development”, a situation which stakeholders, including the Community Land Trust Network, its member trusts and the Nationwide Foundation have been lobbying hard to rectify.
So, what has changed?
There are now eight separate references to community-led development in the revised NPPF.
Most notably, there is a new “community-led exception site” policy. This gives community-led organisations the opportunity to get planning permission on sites not hitherto allocated for housing. And importantly, sites can be developed to deliver any tenure of affordable housing as defined by the NPPF. There is an opportunity for this revision to help deliver genuinely affordable new homes, designed and managed for, and by, the local community.
The revision sends a clear message to local authorities that they should be supporting developing exception sites, creating fresh land supply for the community-led housing sector. The specific community-led exception site status creates a distinct point of difference from planning policies that are supportive of other developments that sit outside of standard commercial developments of housing, such as self-build and custom-build.
The revised NPPF also includes a provision that local planning authorities should be encouraged to include opportunities within their local plans to support small sites to come forward for community-led projects.
Not only does this assist community groups in obtaining planning permission for themselves, but the revision also empowers them when approaching landowners and developers. By partnering with a community group such as a community land trust, the revision delivers a stronger presumption in favour, delivering a clearer path to planning permission.
Additionally, the revisions include specific reference to being responsive to proposals that reflect local needs, including proposals for community-led development for housing in rural areas for the first time; a small but notable change.
What sites are potentially enabled by the revisions to NPPF?
For the NPPF revisions to have genuine impact, it requires local authorities and local neighbourhood planners to adopt positive policies that embrace the community-led housing sector in their area. There are some leading lights already, notably in East Cambridgeshire and North Norfolk, with bespoke local planning policies resulting in a genuinely progressive partnership approaches between community groups, the local authority and developer partners that have delivered new affordable housing capacity.
Currently, the NPPF supports small sites – defined as smaller than one hectare, and medium sites, requiring local planning authorities to meet at least 10% of their overall housing requirement on these.
Community-led exception sites are specifically defined as sites that would not otherwise be suitable as rural exception sites. These sites should be on land which is not already allocated for housing and should:
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comprise a community-led development including one or more type of affordable housing (a proportion of open market homes may be permitted at the local planning authority’s discretion where considered pivotal to the delivery of affordable units without grant funding).
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be adjacent to existing settlements and proportionate in size. i.e. less than one hectare or not exceeding 5% of the size of the existing settlement.
How is community-led development now defined?
The NPPF defines a community-led development as “a development instigated and taken forward by a not-for-profit organisation set up and run primarily for the purpose of meeting the housing needs of its members and the wider local community, rather than being a primarily commercial enterprise.
The organisation is created, managed and democratically controlled by its members. It may take any one of various legal forms including a Community Land Trust, Housing Co-operative and Community Benefit Society. Membership of the organisation is open to all beneficiaries and prospective beneficiaries of that organisation. The organisation should own, manage or steward the homes in a manner consistent with its purpose, for example through a mutually supported arrangement with a Registered Provider of Social Housing. The benefits of the development to the specified community should be clearly defined and consideration given to how these benefits can be protected over time, including in the event of the organisation being wound up.”
The above definition provides some helpful clarity and prominence within the revised NPPF. It would however be good to see this built on to include reference to other forms of community-led housing, such as cohousing schemes, which may well deliver affordable housing as part of their wider project.
There is concern within the sector that the definition implies that developments are required to be instigated and led by community groups. If correct, then this could exclude projects that are developer led but are designed in partnership with and for an otherwise qualifying community group. Groups would be well advised to think creatively as to how best to work with a development partner to ensure they can demonstrate the development is truly community-led.
Adverse impact on funding
Groups often find it best to partner with a sector-friendly developer as not only are community groups typically less well-resourced to instigate and lead, but it is also fair to say that projects that are led by an experienced developer partner are more likely to find favour with funders due to a perceived reduction in the risk profile and the presence of an established financial track record.
For many community groups, the opportunities arising from the NPPF revisions will represent an opportunity to get their first housing project underway. The challenge of bridging the credibility gap and attracting willing lenders, let alone competitive terms without a strong balance sheet and track record behind them, is huge. Put simply, if the cost of funds is too high, (and we have seen a marked increase in the cost of borrowing across the board in the past 2 years) the impact on community projects wishing to deliver genuinely affordable accommodation in perpetuity is severe.
Positive signs for community-led housing in Wales
The publication of Edition 12 of Planning Policy Wales in February 2024 includes, for the first time, explicit reference to “Community Led Housing organisations” as accepted owners of affordable housing, and that “affordable housing is a material consideration which must be taken into account in formulating development plan policies and determining relevant planning applications in Wales”.
The Welsh Government defines affordable housing as “housing where there are secure mechanisms in place to ensure that it is accessible to those who cannot afford market housing, both on first occupation and for subsequent occupiers”.
What else needs to be done?
Reaction within the community-led housing sector to the NPPF revisions is mixed. The recognition of community-led projects is very welcome, and the prominence is, it is hoped, a catalyst for wider adoption of enabling policies for community-led projects within local plans.
There is some feedback in the sector that it would like to see some widening of both the definition of qualifying community-led projects and the relatively narrow opportunities offered by the current definition of community-led exception sites.
Feedback to the NPPF from a range of references within the community-led sector raises some consistent asks:
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That community-led exception sites be expanded in scope to include developments within existing settlements, not just adjacent to them. This could open opportunities for sensitive densification on sites such as garages, car parks and spaces between buildings. Community-led groups know their patch better than most and have the potential to be locally trusted enablers for such sites to deliver more affordable homes.
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Removing / adjusting the cap on the maximum size of community-led housing sites
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Amending the definition of community-led development to remove the expectation that is instigated and taken forward by a community-led organisation. This could open partnership projects with developers and councils.
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Greater weight to be given to community-led development in areas such as AONBs and national parks. Such areas are of course highly sensitive, but also suffer disproportionately from a lack of affordable homes due in part to the high concentration of second homes, and holiday lets.
In conclusion, whilst there is welcome recognition of the community-led housing sector as a visible and viable option within both the NPPF revisions in England, and Edition 12 of Planning Policy Wales, there is much more to do to deliver a truly impactful and dynamic sector. Planning Policy is only part of the picture. Wider decisions on adequately resourcing our planning system and allocating targeted public funding to help deliver community-led affordable housing remain at the top of many a wish list.
At Wrigleys we talk to and advise a growing number of community groups that want to contribute to the delivery of affordable housing in their local area. In our experience, such groups are focussed on designing communities and homes that meet the needs of local people and contribute to the social regeneration of their area in a sustainable manner. We continue to advocate for positive change that supports these objectives, whilst of course protecting precious natural assets.
For more information about our work in the sector, visit https://www.wrigleys.co.uk/charities-and-social-economy/community-led-housing/
References
Community Land Trust Network, Member Briefing – Changes to (English) National Planning Policy Framework, Dec 2023 https://www.communitylandtrusts.org.uk/policy-vision/reports/
NPPF Document, from perspective of “We Can Make”, Mike Rogers BA(Hons) BTP, MRTPI, 24/01/24 https://wecanmake.org/approach/
Community-Led Development in the NPPF, Oxfordshire CLT https://www.oclt.org.uk/
Our Shared Future, Town and Country Planning Association, A White Paper for Homes and Communities, January 2024. https://www.tcpa.org.uk/
Policy documents
https://www.gov.uk/government/publications/national-planning-policy-framework--2
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