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Thank you for consulting the Home Builders Federation (HBF) on the Consultation Draft Plan for Colchester Borough Council. The HBF is the principal representative body of the housebuilding industry in England and Wales and our representations reflect the views of discussions with our membership of national and multinational plc's, through regional developers to small, local builders. Our members account for over 80% of all new housing built in England and Wales in any one year.
Duty to cooperate
The preparation of aligned plans for the North Essex Housing Market Area consisting of Braintree, Colchester, Chelmsford and Tendring is a positive sign of effective cooperation to address the strategic challenges confronting the area. The nature of these challenges is discussed in the spatial portrait section of the draft plan and the Vision for the Strategic Area (page 17) acknowledges that North Essex will be an area of significant growth of the next 20 years.
While the cooperation to date to deliver this vision is encouraging we feel that the three councils should give some more attention to the delivery timetables for the new garden communities that are being proposed. The homes that are to be provided in these new settlements will be critical to meeting the projected housing needs of the area by 2033. Colchester Council will need to provide some more details about the new settlements that is proposed in its area (the West of Colchester / East Braintree New Garden Community - see page 41 and East Colchester / West Tendring New Garden Community - see page 38) in the next iteration of its local plan (the Regulation 19 consultation local plan). This additional detail will help the Council to defend these allocations at examination.
We also advise all three councils to liaise very closely with their development partners who will be responsible for building these new settlements. Evidence relating to the infrastructure needs of the three new settlements and how this will be paid for will need to be agreed well in advance with the appointed delivery partners. This is a question which will inevitably have implications for the local plan viability assessment, the infrastructure schedule and the local transport plan. The authorities must not impose significant costs on the developers responsible for building these new settlements without warning. The terms of development should be agreed well in advance by both sides.
Meeting the Need for New Homes
The authorities have concluded that the objectively assessed need (OAN) for the three authorities is 2,315 dwellings per annum (dpa). When Chelmsford is included that OAN rises to 3,090 dpa. This is summarised in paragraph 2.37 and the table in Policy SP2.
We have noted the Objectively Assessed Housing Need Study (July 2015) and its arguments relating to the alternative scenarios. The HBF shares the view expressed in the report (paragraph 4.41) that the SNPP 2012 and DCLG 2012-based household Projections serve as a perfectly reasonable starting point. Planning for future housing needs is an inexact science, and this is why we agree that the baseline demographic position is unlikely to be lower than the DCLG projection, which in the case of Colchester is 868 dpa (table 4.3).
We do not, however, support the argument in the report justifying a departure from the official starting point in the case of Tendring. We do not think that this has been adequately substantiated in the way that the NPPG requires. For Tendring we consider that the demographic starting point is the Sub-National Population Projection of 705 dpa. We note paragraph 4.28. It is unclear what is being argued here. One would assume that if the 2011 Census was correct, then it follows that there should be no need for an adjustment for UPC, because, as the report notes in paragraph 4.18, the ONS has decided to exclude UPC from the official projections owing to the uncertainty over the reasons for the unattributable population change at a national level. The report admits it cannot explain this discrepancy (paragraph 4.39) it can only provide possible explanations. The report does not provide a robust and locally justified case for dispensing with the official projection in favour of a baseline demographic figure of 479 dpa. This is 226 dwellings per year fewer than the ONS / DCLG projection and could represent a very significant under-estimation of need especially if the council's guesses about what the base population is prove to be wrong.
We note that the DCLG 2014-based Household Projections indicate that 600 households per annum may form over the period 2013-2037 used by the ONS assessment to assess the housing need. This latest projection of 600 hpa suggests that the demographic baseline in Tendring may lie somewhere in between the 2012 SNPP figure 654 households per annum and the 444 households per annum implied by the ten year trend adjusted for UPC (see table 4.4).
We agree with the decision to use the 2012 SNPP as the basis for the assessment of the OAN in Colchester. We consider this is probably a conservative starting point in view of future uncertainties around the question of migration, especially with London, but also the large unmet needs of housing elsewhere in the greater south east of England.
We note that the Objectively Assessed Housing Need Study (July 2015) acknowledges the uncertainties associated with Tendring and therefore recommends that Colchester (along with Chelmsford and Braintree) plan for the high end of the ranges in table 9.5. This would require 920 dpa in the case of Colchester. This is what the Colchester Plan proposes. Generally we consider that this figure provides a reasonable representation of the OAN for the borough. We note that the evidence is inconclusive on the need for an upward adjustment for employment but the report concludes that a modest adjustment of an average of 8% across the HMA, but equal to 6% in Colchester, would address a combination of uncertainties relating to employment, market signals, the possibility of housing demand having been supressed by poor past delivery and the potential for higher rates of need as a consequence of migration dynamics with London (increased inward migration from and decreased outward migration to London). This results in an OAN of 920 dpa (868 + 52 = 920).
However, we consider that the demographic starting point should be the 2012 SNPP to which an allowance for London should be added. We note that the report considers that this adjustment to account for the GLA's London Plan demographic assumptions would result in an additional 45 dwellings per annum in Colchester. This generates an alternative starting point of 913 dpa. Since this is merely a trend-based projection, it is arguable whether delivery at this level would do anything to counteract the tendency for housing to become increasingly expensive in the HMA including Colchester itself over the last 10 years (see paragraph 7.73). We note in Figure 7-16 that the ratio of lower quartile house prices to lower quartile earnings currently stands around 8 (lower quartile house prices are eight times more expensive than lower quartile incomes). In this case we consider that a 10% increase is justified, in line with adjustments made by authorities elsewhere to compensate for the possibility that the demographic projections may provide a conservative picture of future needs (e.g. Cambridge and Canterbury). Indeed, we note that the Local Plans Expert Group has recommended that a 20% increase should be made for market signals where the price to earnings ratio is between 7.0 but lower than 8.7 (see appendix 6). A 10% increase on the demographic starting point adjusted for London migration of 913 dpa would result in a need for 1004 dpa (913 + 91 = 1004). This should be rounded down to 1,000 dpa for the plan.
We disagree with the tendency for some authorities to conflate the adjustments that the NPPG recommends that plan-makers should make to accommodate alternative migration assumptions with the need to make an adjustment for market signals. The demographic element of the assessment based is upon trend based population and household projections, while the market signals uplift is an adjustment made to the basic demographic projections to try and improve affordability - i.e. it is an intervention to lift supply above the basic level to try and counter the effects of an undesirable trend which is increasing house prices and rental costs.
In addition to the problem of deteriorating affordability in Colchester, it is also necessary to plan for the likelihood of increased demand coming out of London. In view of Colchester town's good rail connections with London (see paragraph 6.23 of the draft plan) it is highly likely that the town will experience higher levels of housing demand over the plan period owing to a combination of the Mayor of London's own migration assumptions but also the scale of the unmet need in London. For this reason it is appropriate to treat the demographic starting point as the figure of 913 dpa and it is necessary to make a 10% market signals adjustment in addition to this.
We also note on page 179 that Colchester's student population is expected to expand by about 3,500 students by 2019. This is a significant increase over a short period of time and it is unclear whether the HE sector will expand further by 2033. Planning for students is a vexed issue because it is unclear to what extent institutional needs (the need for C2 use class accommodation) is captured in the background demographic projections. The projections assume that the institutional population largely remains the same (students, people in residential care homes, prisons, military personnel etc). If, however, there is a planned expansion in the institutional population then this will need to be planned for. This was not so much an issue in the past, but it has become a more urgent one recently since the government allowed local planning authorities to count C2 use class bed-spaces as housing completions. The NPPG advises that plan-makers should engage with educational establishments to understand the student accommodation requirement (NPPG, ID 2a-021). The Council has done this but our concern is that if the Council counts C2 use class student bed-spaces as homes, but the expansion of the higher education sector has not been factored-into the assessment of need, then the number of homes available for conventional housing needs will be reduced. The Council should give consideration to this issue. One of the simplest solutions would be to not count student accommodation towards the housing requirement (as Norwich and Canterbury have chosen to do). Or, it should increase the housing requirement by an amount to reflect the anticipated expansion in student numbers over the plan period while recognising that an increase in student accommodation may release conventional homes for conventional needs.
Policy SP2: Meeting Housing Needs
We note that there is a discrepancy with the planning periods proposed by the three authorities. While Colchester and Tendring are proposing local plans based on the period 2013 to 2033 we note that Braintree is proposing the period 2016 to 2033. This is curious, given that the Objectively Assessed Housing Need Study (July 2015) for the HMA has assessed the need on the basis of 2013 to 2037. The plan periods need to be aligned otherwise there is the risk that Braintree may be under-providing housing compared to its neighbours with an earlier base date. This is because a later base date will mean that the higher levels of housing need suggested by the 2011 Census and the related DCLG household projections will not have been reflected in an updated local plan.
We note that the three local plans will endeavour to meet the OAN in full. This is positive. What does remain unclear at this juncture is how the delivery of the overall need for the HMA will be managed given that the three new settlements straddle administrative boundaries. It is unclear from the draft plan how the delivery of the requirement will be apportioned. For example, in the case of the East Colchester and West Tendring New Garden Community, it is unclear how the 2,500 homes earmarked to be completed before 2033 will be apportioned between the two authorities. This could become very messy and there is a distinct risk of double-counting. The same is true with the other two proposed settlements. All four Councils (because we include Uttlesford) will need to give careful consideration to this matter.
Cross Boundary Garden Communities
We note that the three authorities have identified the broad locations for the proposed three new garden communities. All three locations are expected to provide about 2,500 homes within the plan period. We look forward to the next iteration of the Colchester Plan when the location of its two new settlements will be finalised.
The willingness of the three authorities to plan for these new settlements is to be applauded but the councils will need to provide more information in the Regulation 19 consultation to demonstrate that the homes earmarked for these settlements can be delivered in full over the next 15 years. These three settlements will be vital to meeting the housing and employment needs of the HMA up to 2033 and beyond. It would be helpful if the three councils could provide more detailed timetables relating to the identification of the location, the planning and delivery of each site, and an assessment of any key obstacles that would need to be resolved to enable these settlements to deliver. Evidence of support from the statutory authorities would be helpful.
Policy SG2: Housing Delivery
We note under table SG2 that Colchester expects 1,250 homes to be completed in the East New Settlement and 1,350 to be completed in the West New Settlement over the period 2017-2033.
We accept that identifying previously developed land in Colchester's urban area will be more limited in the future. The contribution to the housing requirement by the two new settlements in Colchester will therefore be very important. It should consider carefully the delivery trajectories of the East and West of Colchester new settlements and the expected build-out rates for each of these locations. This evidence will be important for the Regulation 19 consultation version of the plan.
We consider that the Council should consider increasing the allocations in its 18 Sustainable Settlements as a contingency in case delivery falters on the strategic sites. The Council could do this by identifying a number of reserve sites which could be made available for development immediately if by 2019 there are signs of delay on the strategic sites. This would avoid the risk of the plan becoming out of date very quickly as a consequence of being unable to maintain a five year housing land supply.
Policy SG7: Neighbourhood Plans
We note that a neighbourhood plan is being prepared for Marks Tey even though this settlement is earmarked as a possible location for one of the Garden Communities in Colchester (paragraph 6.184). However, if it does not become the location for one of the Garden Communities, we note that it has a housing allocation of zero in the draft plan (see table SG2). This is a highly sustainable location, as paragraph 6.182 acknowledges, so even if it does not become the location for a new settlement then it ought to provide some housing. We consider that the local plan should make a provisional allocation for this settlement in case it is not selected as the location for a new settlement.