Crunch time as over 100 councils fail Housing Delivery Test

By Daniel Fryd, Senior Consultant

The results of the first MHCLG Housing Delivery Test – long touted as the mechanism that would hold councils to account for their failure to build new homes – were finally revealed in February.

Over 100 councils will have to take action following the results of the test, with 87 having to identify 20% more land in their local plans to build new homes on. This is clearly not an insignificant uplift, so the impact on authorities including Harlow, Mole Valley, East Hertfordshire, Guildford, Basildon and Ipswich is expected to be marked.

The remaining councils will have to put together an action plan setting out how they will ramp up delivery and meet their housing need in the future.

What is the test?

The housing delivery test is MHCLG’s method for checking whether local authorities are providing the right number homes for their area. The test results set out the percentage of new homes delivered, against the number required over the past three years.

Under the guidelines which were first shared in the revised NPPF, authorities providing under 95% need to produce an action plan, those under 85% have to add the 20% buffer, and those under 25% face the NPPF’s presumption in favour of sustainable development.

No authorities face the harshest punishment yet, but that is all set to change in November when the minimum bar is raised for councils up to 45%.

Feeling the squeeze

Seven councils are currently on course to fall below the 45% threshold which comes into force in November, unless they record a significant increase in new homes this year.

This includes Redbridge (38%), Barking & Dagenham (43%) and Thanet Council (44%), which are all among the worst performing authorities with woefully low delivery percentages.

If they do not seriously look at sensibly delivering many more homes in their area over the next year, they face opening themselves up to speculative development through the presumption in favour of development.

These measures, alongside tough MHCLG talk on intervening in the lack of local plan making, is all part of a wider government drive to increase housing numbers.

There has been much talk about whether MHCLG would choose to intervene in the local plans of councils falling way below the housing levels expected of them. Councils at Wirral and Thanet have been given directions by MHCLG to complete their plans within a specified period, and Castle Point is expected to have directions to ignore its last council and vote on the local plan and to proceed with it as it has been drafted.

What next?

Many local authorities already have a 20% buffer on land supply in the local plans they have submitted: they need to ensure delivery. Those councils which have submitted local plans with housing figures below housing need can expect modifications to increase that supply and an early review.

Considering the revised NPPF came out last year, councils who have to step up delivery and have plans close to submission have had plenty of time to ensure that their emerging plans provide a sufficient supply.

There will be an array of Examinations in Public coming in the next few months for the many emerging local plans across the country. Inspectors now have every right to put their foot down and ask for an increase in delivery in under-performing authorities.

Maybe, just maybe, we’ll start to see more new homes coming forward.