The potential implications of Letwin's proposed new planning regime for large sites

A former Tory Cabinet minister's recommendation that new planning rules should be introduced to require diversity of housing on large-scale sites has prompted some concerns in the sector about a "parallel planning system".

Sir Oliver Letwin
Sir Oliver Letwin

No-one could accuse Sir Oliver Letwin of lacking ambition. Publishing his review of housing build-out rates, the former Tory Cabinet minister outlined plans for a whole new approach to planning for sites of more than 1,500 homes. Letwin concluded that the key way to speed up construction is to diversify the mix of housing being built. According to his report, the proposals could be initially delivered through a written ministerial statement but would, in the longer term, require a new planning policy document that could be annexed to the National Planning Policy Framework (NPPF). The new planning rules should require developers to provide a mix of housing types, sizes, styles and tenures, Letwin said, recommending that a "national expert committee" be established to settle any disputes.

Duncan Field, head of planning at law firm Norton Rose Fulbright, said: "He’s effectively saying there should be a parallel planning system for large sites. My own feeling is that’s a slightly disproportionate reaction to the problem." Field said strengthening the wording in the revised NPPF on large sites would be a "better place to start" than introducing a whole new framework. But he added: "I think Letwin was slightly unconvinced by the references in the new NPPF to diversifying housing offers because similar wording had already been in the first NPPF and the problem had persisted."

Hannah Quarterman, senior associate at law firm Hogan Lovells, said the housing diversity requirements will leave developers with "an additional financial burden". Nevertheless, housebuilders have given the report a cautious welcome. Andrew Whitaker, planning director at the Home Builders Federation, said Letwin has recognised that housebuilders already provide a mix of housing types and tenures and are open to improving both diversity of uses and build-out rates. "It is important that local planning authorities work with housebuilders and vice versa but it is reassuring that Letwin proposes an expert panel to mediate in any dispute," he added.

"Negotiations over housing mix and viability could take time, particularly if referred to an expert committee," said Matthew Spry, senior director at consultancy Lichfields. "If sites are built out a bit faster but take longer to get started, is that a desirable outcome?" Spry also questioned how the new planning framework might work with the current local plan process. "If the process of deciding to allocate large-scale sites took place separately to the normal plan-making process, what would be the strategic choice left for local plans, particularly outside large urban areas? Under Letwin’s new planning rules, what would be the mechanism for deciding transparently, and with consultation, whether a large-scale development is itself the right option for that area?"

The Royal Town Planning Institute (RTPI) welcomed the report’s proposed strengthening of the role of local authorities. Richard Blyth, the RTPI’s head of policy, said there is much to like about Letwin’s view that councils could take a more active role in master planning and driving forward development. "We seem to be at an important moment politically," said Blyth, "where the idea that the purpose of planning is just to grant permission is being reviewed across the political spectrum".

Five key recommendations from the Letwin Review

  1. Introduce new planning rules for sites of more than 1,500 units, requiring a mix of housing types, sizes, styles and tenures.
  2. Establish a national expert committee to advise councils on the new rules and arbitrate in disputes with developers.
  3. Promote diversity on existing large sites by making government funding conditional upon a section 106 agreement that specifies a mix of housing types.
  4. Powers for planning authorities to designate large sites in local plans and create masterplans and design codes to promote a mix of uses and rapid build-out rates.
  5. Statutory powers for councils to compulsorily purchase large sites at ten times their existing use value.

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