Interim Viability Study (November 2019)
Comment
Stage C Evidence Base
Representation ID: 21903
Received: 12/03/2020
Respondent: Home Builders Federation
As the Council will be aware paragraph 57 of the NPPF now places far greater weight on testing the viability of development during the preparation of the local plan with far less scope for negotiation on an application by application basis. It is therefore essential that the approach to viability is sound and reflects the approach set out in PPG. In addition, it is also important that the policies in the plan itself take account of the evidence. In some circumstances this may require policies to reflect the varied viability relating to site typologies or value areas in order to meet the broad test in paragraph 57 that planning applications that comply with the policies in an up to date local plan can be assumed to be viable. We note that the Council’s policy has taken account of difference in viability based on the location of development and this is to be welcomed.
However, we have some broad concerns regarding the viability assessment. Firstly, the Council have not taken into account abnormal costs and the impact such costs may have on viability and the willingness of landowners to sell land at reduced rates. Whilst we recognise that it is difficult to quantify these costs these are very real costs for many developments and some assessment as to their impact should be considered. Secondly the Council will need to considers costs relating to policies on electric vehicle charging points for example. The expectation is not set out in this plan but given that these could impact on viability some consideration should be given to their impact in the viability study. Finally, for larger sites the study seems to only look at CIL payments and does not appear to factor in any strategic infrastructure costs that
may occur. We note that between 10% and 20% uplift to construction costs are included for site and infrastructure. However, this would principally cover landscaping and roads to be delivered on site and not any strategic infrastructure costs. We would suggest that the Council considers the inclusion of cost to reflect any additional strategic infrastructure costs over above CIL.
To assist Councils the HBF has published a briefing note on viability, (See attached), which sets out our concerns regarding viability. We trust this will be of assistance in taking forward the viability study and if you have any question regarding his briefing please feel free to contact us.
Please find attached the HBF’s comments on the GNLP.
Comment
Stage C Evidence Base
Representation ID: 23125
Received: 16/03/2020
Respondent: ClientEarth
As set out below, there are a number of areas in the GNLP draft strategy and evidence base where this approach does not appear to have been followed. However, this list is not intended to be exhaustive, and we would urge a thorough review of the approach taken in all areas of policy that may affect the area’s greenhouse gas emissions.
1. In respect of energy efficiency, we welcome the statement that “the evidence and justification establish a clear need to set a local energy efficiency policy which goes beyond 2013 Building Regulations” (p. 62). However, the accompanying statement that going further than a 20% improvement on Part L would not be viable would not appear to be supported by the Interim Viability Assessment (November 2019). In particular, it is not clear from the viability assessment that higher standards have been assessed. In this context, a zero carbon standard should be the starting point that is worked back from to the extent that any viability constraints are identified. Where there are viability constraints affecting a particular category of dwelling or scale of development, then standards should be reduced for that category or development size only, avoiding a ‘lowest common denominator’ approach. It is also not clear where the £15,000 cost per dwelling figure for higher efficiency standards (cited at page 63 of the draft strategy) is derived from or to what standard this figure relates.
In September 2019, we wrote to the Greater Norwich planning authorities about the need to integrate emissions reduction objectives throughout local plan policy. We are therefore pleased to see a commitment in the draft strategy to ensure policies in the GNLP “contribute to meeting the national target to bring all greenhouse gas emissions to net zero by 2050, as well as helping to meet local targets, statements and plans” (p. 40). We also welcome the statement that “policies in the GNLP will need to contribute to national targets to reduce emissions [and] plan for transition to a post-carbon economy” and that mitigating climate change is “a cornerstone of the GNLP” (paras 82 and 86).
However, we are concerned that these commitments have not in fact been met in the development of the proposed plan policies. It is not sufficient that the plan merely includes policies “which address climate change mitigation” (as suggested at para 140). Plan policies taken as a whole must be “designed to secure that the development and use of land in the local planning authority's area contribute to the mitigation of climate change”.1 In this context, they must “contribute to radical reductions in greenhouse gas emissions” and “take a proactive approach” to mitigating climate change “in line with the objectives and provisions of the Climate Change Act 2008.”2
To comply with this obligation and the other law and policy requirements described in September letter, local planning authorities need to demonstrate that the proposed plan policies are expected to contribute to the mitigation of climate change. At a minimum, this means showing that the policies contribute to the delivery of the national 2050 target under the Climate Change Act 2008, which is a reduction in net greenhouse gas emissions of “at least 100%”.
Comment
Stage C Evidence Base
Representation ID: 23189
Received: 27/04/2020
Respondent: Persimmon Homes (Anglia)
Number of people: 4
Agent: Bidwells
Viability Inputs
127. Revenues are overstated and unsubstantiated.
128. Discounts to affordable rent tenure are too low and do not reflect registered provider bids in the current market.
129. Build costs adopted are below BCIS median rates. No explanation or rationale is provided for this.
130. Build costs make no allowance for Part L of the 2020 Building Regulations nor for
regulations M49”) and M4(3).
131. The allowance for Site and Infrastructure works is likely to prove inadequate for most schemes. This allowance should not include the cost of garages which are a build cost.
132. Benchmark land values have been reduced by 30% from the 2017 Hamson report without any reference to data, reasoning or justification. The levels adopted are likely to prevent land coming forward for development.
133. The outcome of using the inputs chosen in the interim study produces appraisals that
very significantly over-state viability.
Typologies
134. We have focussed only on Typology 9 in this report. We make no comment about any other typologies.
135. A Typology for large (1,000 unit plus) schemes should be provided accounting for the specific infrastructure and community facilities these sites are expected to provide.
136. Without this typology, the study cannot be considered complete.
Appraisals
137. Based on our review of Typology 9 only, we consider the methodology adopted in the preparation of the appraisals to be sound.
138. We cannot calculate the interest charges to match those used in the interim study, but this is not unusual when comparing viabilities.
General
139. We are concerned that the instructions to the consultant that prepared the interim study are not made clear in the report. We are also concerned that there may be a conflict of interest that has not been declared.
140. Both issues undermine the veracity of the report and its conclusions, especially when combined with the consistent adoption of inputs that improve viability.
141. We are especially concerned at the lack of background data, reasoning and justification for many of the inputs to the interim study.
142. We therefore conclude that the NPS Interim Viability Study does not provide a reliable, robust or accurate assessment of viability for the purposes of the emerging GNLP
Also submitted by Bidwells on behalf of Consortium.
See attachment for full submission