DCLG announces lower S106 threshold for National Parks and AONBs

The government has announced that proposals to exempt developments of 10 homes or less from section 106 affordable housing contributions will go ahead, but has said that a lower threshold will apply in designated rural areas such as National Parks.

Rural homes: DCLG has published response to consultation
Rural homes: DCLG has published response to consultation

In March, the Department for Communities and Local Government (DCLG) consulted on a proposed new 10-unit threshold for section 106 affordable housing contributions to reduce planning costs to developers.

In its response to the consultation, published last week, the DCLG said that the proposal had received support from developers, development representative bodies and some members of the public, who argued that "excessive affordable housing contributions were often being applied".

But the DCLG added that local authority responses "generally opposed both the principle of a national threshold for affordable housing contributions and the size of the proposed threshold".

The consultation response said that, after "careful consideration" of the responses, the government will make changes to national policy to prevent local planning authorities from seeking affordable housing contributions from "sites of 10-units or less, and which have a maximum combined gross floorspace of 1,000 square metres".

The consultation response said that a lower threshold could be implemented in designated rural areas such as National Parks and Areas of Outstanding Natural Beauty (AONBs).

This concession, made to address concerns "highlighting the greater impact a 10-unit threshold might have on rural areas and in National Parks and AONBs", had not been proposed in the original consultation document.

Last month, England's 10 National Parks wrote to Pickles requesting an exemption from the proposals.
 
In these designated rural areas, the DCLG's consultation response said, "authorities may choose to implement a lower threshold of five units or less, beneath which affordable housing an tariff style contributions should not be sought".

Within this designated areas, the response said, if the five unit threshold is implemented "then payment of affordable housing and tariff style contributions of between six and 10 units should also be sought as a cash payment only and be commented until after completion of units within the development".

The consultation response confirmed that the changes in policy will not apply to Rural Exception Sites "which, subject to the local area demonstrating sufficient need, remain available to support the delivery of affordable homes for local people".

Communities secretary Eric Pickles said that the move would be a boost to the self-build and custom-build sector.

He said: "Small builders are being hammered by charges, which have undermined the building industry, cut jobs and forced up the cost of housing.

"By getting rid of these five and six-figure charges, we will build more homes and help provide more low-cost and market housing."

But rural network Action with Communities in Rural England (ACRE) said that the policy would have a "devastating impact" on affordable housing for rural communities.

ACRE's head of rural insight Nick Chase said that figures from DCLG showed that in 2012/13, 66 per cent (1,905) of homes in settlements under 3,000 were delivered through section 106 agreements.

Chase said: "Despite warnings from housing associations and other rural organisations, the minister has gone ahead with a policy change that could reduce the number of rural affordable housing on small sites to nil over the coming years.

"This decision takes power away from local communities who should have the right to say what type of housing they want in their area. This is a real slap in the face for hard-working families on low incomes. They will now find it almost impossible to afford a house in their community and may be forced to move if rents continue to rise."

Margaret Baddeley, a planning director at consultancy Nathaniel Lichfield & Partners, said that the guidance is "good news for small-scale developers, custom and self-builders".

"This sector of housebuilders saw more than a 50 per cent decline between 2000-07 average housing output and the 2013 figure," she said.

But Baddeley added: "As with any threshold, the guidance could trigger unintended impacts - split sites, or the under-development of sites to create schemes of 10 units or less."

Planning Contributions (Section 106 planning obligations): Government response to consultation is available here.


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