"It would appear that the Local Housing Need approach is too simplified"
The current National Planning Policy Framework (NPPF) introduces the concept of objectively assessed needs (OAN) for housing, which LPAs are required to make every effort to accommodate in their local plans. The accompanying PPG sets out in detail the framework for calculating OAN and the multitude of variables that might be considered. The result is a near infinite number of interpretations, which has led to significant delays to plan making across England.
MHCLG’s solution is to boil housing need down to a single equation to calculate a local authority’s local housing need (LHN). This is introduced in paragraph 61 of the draft revised NPPF as the minimum number of houses that an LPA should plan for. Theoretically this is a good idea but in practice, there are a range of issues.
The current framework for OAN is complicated because it is a complex area of study drawing together demography, housing economics and wider economic factors. The latter of these is excluded completely from the LHN standard method set out in the draft PPG that accompanies the draft revised NPPF. The result is a limited degree of accuracy when compared to current official estimates of OAN.
Furthermore, LHN does not replace OAN. OAN is still the target for the presumption in favour of sustainable development and the tests of soundness for plan making. However, the relationship between LHN and OAN is not explained anywhere in the draft revised NPPF, beyond that the LHN should be the minimum.
This would suggest that the OAN cannot be less than the LHN but could be greater, possibly where economic trends have an influence in uplifting housing need. However, if OAN is to be truly objective, it should be allowed to be lower than LHN if that is what the evidence shows; after all, LHN is clearly a blunt instrument with only limited accuracy. If OAN is proven to be less than the LHN, there will be clear conflict between paragraph 61 and the presumption in favour of sustainable development.
Other conflicts are also possible when considering unmet need. Paragraph 61 refers to the need to address unmet need from neighbouring authorities in the context of LHN while the presumption in favour of sustainable development refers to it in the context of OAN. If the two are not equal, it will be unclear as to what the unmet need is for the purposes of the statutory Duty to Cooperate.
Where the LHN is undoubtedly a minimum and it is clear that the OAN will be far greater, as in the case of much of Oxfordshire, there will be a need to make a suitable uplift to the LHN. Frustratingly, the draft PPG currently states that in such cases housing need should be considered as a range with the lower point (the LHN) being used for calculating 5-year housing land supply and the housing delivery test. Consequently, once adopted, there will be no requirement for a LPA to pursue the higher OAN figure.
There is undoubtedly a need to move away from the current calculation of OAN to a simplified methodology but it would appear that the LHN approach is too simplified both in content and implementation to work in practice.
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