The councils set to lose their five year housing land supply due to the delivery test

The 2019 housing delivery test results mean that eight councils are now subject to the National Planning Policy Framework's presumption in favour of sustainable development. However, three more local authorities are likely to also be subject to the same penalty as a result of their housing land supply buffer increasing under the test, research suggests.

The 2019 housing delivery test results were finally published by the Ministry of Housing, Communities and Local Government (MHCLG) earlier this month. The delivery test aims to measure how effectively each local authority is delivering housing against its requirement. It works by comparing the net additional dwelling figures in each council area over a three-year period up to the previous March 31 against the total number of homes required. The 2019 test covered the 2016/17-2018/19 period.

Under the test, authorities delivering under 95 per cent of their housing requirement have to produce an action plan outlining the causes of their under-delivery. Those scoring under 85 per cent also need to add a 20 per cent buffer to their required five-year housing land supply, instead of the usual five per cent buffer. Meanwhile, the worst performers - those under 45 per cent - are subject to the National Planning Policy Framework's (NPPF's) presumption in favour of sustainable development, which renders their local planning policies for housing out of date and leaves them vulnerable to speculative applications.

Under the 2019 results, eight authorities fell below the 45 per cent threshold and are now subject to the NPPF's presumption penalty. However, of these, only the City of London - which had the lowest score of all English councils - did not already face the presumption. Three Rivers and North Hertfordshire said they are already subject to the presumption penalty due to their lack of a sufficient land supply. According to consultancy Savills, the five other councils also have a housing land supply deficit and so are subject to the presumption. The City of London is the only one of the seven with an up-to-date local plan.

However, there are also 20 local authorities among the 75 whose delivery fell between 85 per cent and 45 per cent that now have an increased housing land supply target, moving from a five per cent to a 20 per cent buffer. Of these, research has calculated that three are now likely to lose their five-year housing land supply as a result of the additional buffer and therefore become subject to the presumption penalty.

These councils are: the London Borough of Tower Hamlets, Braintree in Essex, and West Somerset. According to their most recent housing land supply positions, published either in local plans, annual monitoring reports or strategic housing land availability assessments, they had supplies of just over five years with their previous five per cent buffers included.

"Any council that has a housing land supply of between five and six years should be looking to reinforce that, advised Jonathan Dixon, director of planning at consultancy Savills. If they fall foul of the housing delivery test and the buffer increases they may need to up their supply or could be prone to challenge via appeals. Some councils with housing delivery problems have supported development on larger sites, said Dixon. "They are an important source of supply but can take a long time to start producing homes. Ideally, councils need to ensure they include a wide range of types and sizes of sites in their land supply," he suggested.

The requirement to include a 20 per cent buffer in the five year land supply comes into effect immediately, said Jo Lee, a senior associate planner at consultancy Stantec. "There will be landowners and developers thinking about appealing on schemes which have been turned down in the areas possibly subject to the presumption in favour of sustainable development," she suggested. Ivan Tennant, an associate planning director at consultancy GL Hearn said: "In those areas, the local plan is no longer relevant and councils have few grounds for refusal if they meet the basic criteria set out in the NPPF."

However, Tennant pointed out that the annual test results can fluctuate significantly from one year to the next, particularly for smaller authorities with lower housing requirements and delivery levels. For example, the City of London, which delivered just 88 homes against a requirement of 275 between 2016/17 and 2018/19, said that next year it will exceed its housing target. A spokesman said the 2019 result does not take into account the 145 homes completed at its Sugar Quay scheme, adding: "Our performance delivery is over 90 per cent when this scheme is recognised in the figures."

The most effective way for councils to address the housing delivery test, is to have an up-to-date local plan, advised Richard Crawley, programme manager at the Local Government Association's Planning Advisory Service. If a council does not have an up-to-date plan, its delivery test requirement is based on the the government’s standard method for assessing housing need which in many cases, particularly in London and the South East, produces a higher figure. "The local plan is a chance for a council to assess what can be delivered and produce a housing target which fits local conditions," he said.

Likewise, Tennant said some local authorities are accelerating the production of their plans to improve their land supply situation. "North Hertfordshire council, which achieved only 44 per cent of its housing requirement, is at quite an advanced stage with the preparation of its local plan and is accelerating its production," he said.