How the vote to leave the EU is impacting local plan preparation

Councils are coming under growing pressure to review their housing numbers following the vote to leave the EU, but consultants give short shrift to the idea that Brexit will mean fewer homes need to be built.

Housebuilding: developers are concerned councils are using Brexit as an excuse to review their housing numbers
Housebuilding: developers are concerned councils are using Brexit as an excuse to review their housing numbers

News last week that Craven District Council is delaying its local plan preparation process, in part to ensure it can factor in the latest "post-Brexit" data to its housing numbers, shows the impact the EU referendum vote is starting to have on plan preparation.

More worrying for the housebuilding lobby was the action taken by Guildford Borough Council, which, in the face of concerted local opposition to its housing plans, decided over the summer to review its strategic housing market assessment in the light of Brexit. Council leader Paul Spooner said in July that "following the Brexit vote" he wanted to review numbers before submitting the plan to the secretary of state.

Guildford councillor Colin Cross told Planning that Brexit was likely to lead to less migration. "It stands to reason that this is a sea-changing decision," Cross said. However, experts say it will not be straightforward for councils such as Guildford to cite Brexit as the reason behind reducing housing numbers.

Certainly, the development industry is braced for other cases, with growing pressure for Brexit reviews in many parts of the country. North Warwickshire MP Craig Tracey last week said in Parliament it was "reasonable to assume" Coventry's 79,000-home assessed housing need "may no longer be a true reflection of need once the Brexit negotiation is concluded", and called for a moratorium on green belt development until "the exact nature of what Brexit will look like is concluded". The Campaign to Protect Rural England (CPRE) is also calling for post-Brexit reviews of housing numbers in Oxfordshire.

However, an assumption that a post-Brexit UK that accepts fewer immigrants will therefore need to build fewer houses is given short shrift by planning professionals. This is partly because no Brexit deal has been struck, meaning there is no basis on which to make new predictions; but the main reason is that existing housing projections already factor in a 45 per cent reduction in net immigration to 185,000 per annum by 2021.

With half of immigration coming from outside the EU, even a dramatic drop in EU migration would not reduce household growth assumptions. "A significant reduction in migration is already factored in," said Matthew Spry, senior director at planning consultancy Nathaniel Lichfield & Partners. "There is no alternative nationally consistent statistical basis for arriving at a different conclusion." Roger Hepher, founder of consultant Hepher Grincell, puts it more strongly still. "This smacks a little of desperation and is really rather disreputable," he said.

Although developers are confident they can fight off calls for reviews based on declining future immigration levels, the issue is not totally cut and dried. This is because government guidance says councils' assessment of objectively assessed housing need (OAN) must consider the additional requirement for homes driven by predicted local job growth, as well as demographic and migration factors. In many areas, this economic requirement for homes is a large proportion of the OAN.

Guildford Council said its review would include "the latest post-Brexit economic forecasts ... to make sure the evidence base is robust, up to date and accurate". Likewise, the delay in Craven's plan process, according to the council's spatial planning manager, Sian Watson, is down to evidence of a "significant reduction in job growth", meaning up to 45 homes a year, out of a current proposed total of 290, may now not be needed.

This is why the CPRE is focusing its campaign in Oxfordshire on the issue of job creation. Around half of the proposed 100,000 extra homes by 2031 are predicated on the creation of 85,000 new jobs in the county, according to the CPRE. Lower growth post-Brexit would mean fewer jobs and, therefore, fewer homes. Helen Marshall, director of CPRE Oxfordshire, said: "I'm not trying to talk down the Oxfordshire economy, but we're in uncharted territory. Our view is that Brexit is a once in a lifetime change - it's not a tweak. Most people would think it'd be sensible to look again."

However, there is so far little consensus regarding economic growth post-Brexit. Andrew Whitaker, planning director at the Home Builders' Federation, said: "It's too early to tell or make any robust forecast. And I don't hear the CPRE demanding housing numbers go up when the economic forecasts improve." Simon Macklen, planning director at consultancy Barton Willmore, said: "We just don't know how Brexit is going to impact upon the economy as a whole, and certainly not on local economic growth."

Given this uncertainty and debate, some are calling for government action to stop councils being tempted to use Brexit as an excuse for delay. Planning minister Gavin Barwell did refer in Parliament last week to the fact that a fall in migration was already factored into household projections, but has not set out a detailed view. Hepher said: "It would be helpful if the secretary of state could nip this in the bud, perhaps with a chief planner's letter, making it clear there is no basis for local authorities doing this." Without action, the debate is likely to continue.

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