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Response of the Manchester Social Housing Commission to the Call for Evidence, Environmental Audit Committee, December 2024.
This evidence is submitted on behalf of the Commission by Dr Naomi Luhde-Thompson, Dr Stuart Hodkinson, and Dr Sophie King.
About
The Manchester Social Housing Commission has formed with the aim of developing an evidence-based set of practical and financially robust recommendations for increasing the availability of sustainable social rent homes that meet the climate challenges of the future. Our sights are set on ending Manchester’s social housing crisis, but our work provides evidence-based recommendations for national and local reforms that will be of benefit to cities and citizens across England in terms of land use planning. Some of the comments on the wider situation are relevant to the whole of the UK.
We bring together senior politicians and council officers, with senior housing academics, public and voluntary sector housing sector professionals, and experienced community representatives from housing movements across the city. Our Commissioners recognise the need for a range of housing tenures. However, our purpose in coming together is to bring our diverse knowledge and expertise to bear on the complex challenge of how to secure increased investment in better quality, more sustainable, homes for social rent at scale, while commissioning additional issue-specific research to strengthen our recommendations.
The revised NPPF was published on 12 December 2024 and therefore the evidence submitted here relates to that version.
Response
1. What provisions will the National Policy Planning Framework, as revised under the Government’s proposals, make for protection and enhancement of the environment? Are these provisions likely to be adequate?
The Commission is concerned with the development and environment of new social homes. In terms of environmental protection, there should not be an inequality of environment within communities. This means both access to clean air, natural green space, and protection from climate change impacts, such as overheating or flood risk.
Children are affected by the places in which they grow up. The environment in their home and on their doorstep is crucial to their mental and physical wellbeing. And yet, the use of permitted development rights for office to residential conversions, high rise developments, and car-dependent and car focused developments (there is no change in the recent NPPF for parking standards, paragraph 113, nor has there been change to the office to residential permitted development rights) all conspire to create unfriendly and unhealthy environments for children. It is therefore crucial that local plans are specifically asked to consider children’s needs when considering strategic policies on allocating sites, on the design and layout of sites, and in existing areas, how increasing access to child safe streets and new improved greenspace can be achieved around developments including social rent.
The NPPF could make it a requirement to adopt the Accessible Natural Greenspace Standards, and the proximity principle for greenspace for all local communities. Only in the ‘golden rules’ of the development of open space around towns and cities, aimed at preventing sprawl over the long term, have national standards on accessible green spaces been required (paragraph 159).
In addition, the NPPF could require (rather than seek, or encourage) plans to map out the sites and locations to achieve this proximity for all local communities, and to focus on the communities most in need of this greenspace and to prioritise delivery in those areas by allocating and improving space. This space then needs to be protected much more strongly – particularly for example by considering the contribution that green space is also making to issues such as overheating in urban places.
2. What policy levers does the Government plan to use to ensure that local authorities deliver the development which the revised NPPF ‘standard method’ requires? Do the Government’s plans result in local planning authorities being penalized if delivery falls short? What policy levers will be available to local authorities to ensure that developments which have received planning approval are delivered in accordance with consents?
We are concerned that the proposals made so far in the NPPF focus on delivering housing numbers, but not on the type of housing that is needed. England faces a significant and growing deficit of homes for social rent. Between 1979 and 2023, the total stock of social housing fell from 5.5 million to 3.8 million due to the long-term effects of the Right to Buy, constraints on local authority house building, and cuts to the social housing grant. Around 260,000 social homes for rent have been lost in the past decade due to sales, demolitions and conversions pointing to an ongoing loss. The situation has now reached a critical point with 1.29 million households on social housing waiting lists in 2023,1 and 109,000 households living in temporary accommodation,2 the highest figures since records began in 1998.
Over 150,000 children are experiencing homelessness. Recent estimates suggest that at least 90,000 net additional social rented homes are needed every year to address unmet demand, and yet we are currently building less than 10,000 new social homes per year while still losing 26,700 per year primarily from right to buy sales. Instead of building social rent, affordable housing supply has become synonymous with marketised tenures such as Affordable Rent - let at up to 80% of market rates - and discounted home ownership that are beyond the reach of low-income households.
While the social housing crisis is predominantly the result of a long-term privatisation agenda that has eroded historic council housing stock via the right to buy and straitjacketed local authorities from building new council homes for social rent, the current planning system contributes to the shortfall in three main ways. First, in 2012 the Coalition Government scrapped the statutory requirement on developers to provide a portion of social rented homes as part of new developments under section 106 agreements, leaving this up to local authorities to decide as part of Local Plans (which many local authorities do not have up to date and/or reflective of social rent needs in their areas).
Second, the Coalition changed the definition of affordable housing for the purposes of planning consent to include an array of marketised tenures and products that have served to diminish the obligation for social rent.
Third, the Coalition introduced financial viability assessments that have enabled developers to reduce, renegotiate or even evade section 106 obligations to provide social and affordable housing where they threaten developer profit margins. These policies have led to a huge reduction in the amount of social rented housing being delivered via developer contributions: between 2015/16 and 2022/2023, section 106 agreements contributed 265,910 ‘affordable’ homes, of which less than 20,000 were for social rent.3 Central government have also failed to provide sufficient capital grant to support housing associations' new homes development programmes, including the replacement of uneconomic to repair older homes.
More recently, a new problem has arisen with social housing delivered via the planning system. Cash-strapped housing associations have been unable to purchase section 106 properties from developers, leaving thousands of social homes lying empty and the prospect of for-profit providers entering the social housing sector to purchase these homes with serious implications for rent levels, tenure and those most in need of social rented homes.4 An issue also arises with the poor quality of homes that are being built that will cost housing associations and local authorities to remediate and retrofit in the future. This includes not meeting Future Home Standards or even building energy efficient homes of C and above. The other issue is the location of these homes, as there is no consistent requirement at the moment to build social rent homes on site where they were granted planning permission. Therefore these homes are not necessarily well located or next to proper infrastructure and facilities.
The problems of relying on the housing market to deliver social housing or even affordable have been researched and set out by the New Economics Foundation in their 2022 report.5 However some structural parts of the existing consenting policy framework, such as the failure to require energy performance building, or the failure to require a proportion of locally appropriate social rent from market developments, have over the last decade added to the housing issue. To deliver social homes for rent that are zero carbon, regulation is required so as to set a level playing field, and a floor rather than a ceiling for ambition.
When councils were able to borrow money over 60 years at low interest rates, they were able to build council housing and repay the borrowing through rents. It cost the public purse very little (the issue was the impact on the public sector borrowing). It is estimated that around £11.74 billion was spent on housing support for tenants in the PRS across Great Britain in 2023-24, many of whom are being forced to rent overpriced homes.6 That is more than enough to fund a social housing programme of 10,000 homes a year. Currently government is spending far more on subsidising private landlords than building affordable and social rented homes.7
The difference between the value of land before and after allocation for development is a publicly granted uplift in value, that entails a series of public costs including health, education, transport, energy, water and waste. These public costs should be accounted for by the uplift in land value being captured to pay for these costs. However landowners and the private sector have steadily encroached on this ‘uplift value’, which together with deregulation such as permitted development rights (office to residential conversion for example), has put huge pressure on the scope of funds available to pay for the ‘public costs’ of development.
The presumption in favour of development and the housing delivery test policies in the national planning policy framework do little to increase the delivery of social homes or to enable exemplary standards. Delivery depends on changing the current private sector development model, increasing the number of ‘developers’ including allowing local government to participate as developers through borrowing, and having a long term plan for a sustainable supply of material and skills. Government should focus on the causes of the delivery issue and look for other solutions.8 The other serious issue is that even when local authorities refuse permission for a development for valid reasons, developers have appealed leading to pressure on underfunded local authorities.9
3. To what extent is the current planning presumption in favour of sustainable development compatible with the environmental objective of the planning system? To what extent will the proposed ‘streamlining’ of the sustainable development presumption work to deliver developments which will meet this objective and be compatible with the Government’s environmental targets and obligations?
The ‘tilted’ balance of the presumption in favour of development sets the bar high for the refusal of unsustainable development. But the insertion of a new footnote picks out specific policies that will apply, including that a mix of tenures is required including social rent (paragraph 66). There is no minimum target set however, and the Government response to the NPPF points to a later consideration of this in 2025. In our view, it is essential that energy performance in buildings requirements are matched by a percentage delivery of social rent – those on the low income households should not have higher or indeed, unaffordable, heating bills long into the future.
4. How will the revised NPPF work to deliver the social and environmental objectives of the planning system? To what extent will it promote outcomes which deliver sustainable social and environmental benefits together, such as access to essential amenities, to public transport and to active travel routes?
Creating walking and cycling routes to schools must be a priority for planning authorities – and this means reducing the space that private cars take up on the roads, and prioritising these safe routes to schools on major land allocations for housing development which will also contribute to the reduction in emissions. There is no effective change to the policy that promotes car-dependent developments – simply because there is no deterrent (paragraph 116) because these developments will not be refused except in cases of ‘severe’ impacts on safety or the road network.
5. What contribution can the NPPF make to meeting Government targets for the reduction of greenhouse gas emissions? What account does the NPPF take of advice from the Climate Change Committee on reducing the use of embodied carbon as well as operational carbon in the built environment?
Our concern is that low income households living in new social rent homes will continue to experience higher bills and greater costs, unless energy performance standards, and sustainability – such as the generation of renewables, the reduction of urban heat and flood risk through SUDS – are built into all social home developments. Retrofitting is much more expensive than building quality first. As evidenced recently, the poor quality of homes built for the affordable housing market means that these are unattractive for investment by housing providers. The planning system has the potential to ensure that social housing is properly defined, that social housing needs can be met, and that the infrastructure that people need for good health can be provided, while at the same time ensuring that places are resilient to climate change, and that homes are efficient and well built.
Reducing climate changing emissions and adapting to climate change is an essential part of protecting and enhancing the environment. However there is no change to the WMS on energy efficiency (December 2023) which states that “Any planning policies that propose local energy efficiency standards for buildings that go beyond current or planned buildings regulation should be rejected at examination if they do not have a well-reasoned and robustly costed rationale […]”. It then limits the additional requirement to a ‘Target Emissions Rate’ rather than an energy performance standard as promoted by LETI.10 . The difference is that energy performance requires a fabric-first approach, rather than a retrofit later.