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Poorest areas are deprived of affordable housing, report suggests

Words: Laura Edgar
Blackpool town centre | Shaun Dunmall

Blackpool, Knowsley and Pendle residents take home some of the lowest incomes in England, yet no new affordable housing was delivered through the planning system in 2016/17, according to a report published today (11 October).

Ipswich and Hounslow councils also both failed to deliver any affordable housing.

Additionally, less than 16 per cent of their requirements were met by other means, with Blackpool delivering 43, Knowsley 81, Pendle 47, Ipswich 89 and Hounslow 281.

The report issues a number of recommendations to address a lack of affordable homes being delivered in deprived areas, including reinstating a definition of affordable housing that links affordability to income.

Overall, Planning for Affordable Housing, observes that English councils in the most deprived areas of England are meeting only a fraction of their requirements for affordable housing through the planning system because it is not set up to deliver homes for people in the greatest need.

At the other end of the scale, the Town and Country Planning Association (TCPA) and Nationwide Foundation report that more affluent areas – such as the Vale of White Horse – were able to deliver 96 per cent of their affordable housing using the planning system.

In England, 70 per cent of councils say they rely on the planning system to enable them to meet housing need. Figures in the report suggest that over half of councils have set a minimum threshold for affordable homes using their local plans, but only 2 per cent achieved it.

The organisations highlight that developers tend to bypass local requirements for affordable housing by initially submitting a scheme that meets the threshold but later back out of the commitment, claiming unworkable profit margins.

Although the government introduced a rule earlier this year that aims to restrict the use of viability testing to only “particular circumstances”, the TCPA and Nationwide Foundation report that councils don’t think this will curb the problem.

Additionally, Planning for Affordable Housing states that councils specify much lower numbers of affordable housing in their local plans than necessary because they believe that the true requirement would deter developers from investing in their areas. Deprived areas have set their target as low as 5 per cent when their need is as high as 84 per cent.

Recommendations in Planning for Affordable Housing include:

  • Reinstate a definition of affordable housing that links affordability to income;
  • Set an overall target for the number of affordable homes required in England (including those available for people in greatest need) and issue a clear strategy on the routes for delivering them and the role of the planning system.
  • Improve the status of the local plan to provide greater certainty on the delivery of affordable housing.
  • Create a fairer and more effective way to share the betterment gained through the granting of planning permission, to produce a more equal distribution of values and deliver greater amounts of affordable housing.
  • Further reform the viability test in planning guidance to close the loophole that enables developers to avoid building affordable housing.
  • Make changes to the compensation code to remove ‘hope value’.
  • Reform planning guidance to help councils secure affordable homes on smaller sites.

Henry Smith, projects and policy manager at the TCPA, said: “Although housing costs are often lower in more deprived areas of the country, they’re still out of reach for many local people. This research shows that the housing crisis truly is a national problem and not only limited to major cities and those living in the South East.”

It leaves councils in a difficult position – trying to attract development to meet a five-year target while also negotiate with developers so that there is some affordable housing available to those who need it most, he said.

The government, Smith explained, “needs to immediately increase grant levels, for councils and housing associations to enable them to deliver genuinely affordable homes. It is also essential that the government creates a definition of affordable housing, which links affordability to income and people’s ability to pay rather than an arbitrary portion of the market rate.”

Victoria Hills, chief executive at the RTPI, told The Planner: “The TCPA’s new report restates what our members know and have been saying for years; that local authorities should be enabled to play a much bigger role in building homes. The inadequate affordable housing provision is a complex issue and it’s too simplistic to say this is due to failings of the planning system.”

The over-reliance of using the planning system to provide affordable housing, Hills explained, challenges the delivery of other infrastructure and distracts from the golden opportunity that now exists for local authorities to build more.

“Last year we published research on Local Authority Direct Provision of Housing which showed that the majority of local authorities have laid the foundations for taking a major role in delivering housing to meet a range of needs.

“Since then, additional funding for affordable housing, coupled with Homes England’s efforts and the removal of the borrowing cap have provided a welcome boost for local authorities. Planners will join the dots across this complex arena to support delivery of homes where they are needed most.”

Planning for Affordable Housing can be found here on the TCPA website (pdf). 

Image credit | Shaun Dunmall