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Government to change housing need formula following Tory backlash
The government will introduce an “updated” housing need formula that will prioritise brownfield sites and urban areas, following fierce opposition from its own MPs.
The government announced today it will instead introduce “an updated” method for measuring housing need that will prioritise brownfield sites and urban areas.
The move comes after the new housing algorithm proposed by the government in a consultation this summer attracted fierce opposition from councils and MPs.
Former prime minister Theresa May labelled the plans “mechanistic” and “ill conceived”, while the Local Government Association warned the formula would lead to fewer homes being delivered in the North.
A government source confirmed to Inside Housing in November that the government was looking to “rebalance” the proposed formula following the criticism.
At the time, it was expected that the revised formula would shift more weight to development in the Midlands and the North, as well as urban areas.
Today, the government confirmed that it would be tweaking the summer formula and its new proposals will encourage cities to plan for more family homes and make the most of vacant buildings and underused land to protect green spaces.
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The government has allocated more than £67m from its £400m brownfield fund to the West Midlands and Greater Manchester Combined Authorities.
The government also announced today that it will soon launch a new £100m Brownfield Land Release fund to support brownfield development, estates regeneration, and development on public sector land and self- and custom-build serviced plots.
It also confirmed plans, announced as part of last month’s Spending Review, to revise its ‘80:20’ rule, which sees 80% of funding given to areas with affordability pressures, which are predominantly in the South.
The government also said it is working with the Greater London Authority to agree a strengthened role for Homes England in the capital.
Housing secretary Robert Jenrick said: “This government wants to build more homes as a matter of social justice, for intergenerational fairness and to create jobs for working people. We are reforming our planning system to ensure it is simpler and more certain without compromising standards of design, quality and environmental protection.
“The COVID-19 pandemic has accelerated and magnified patterns that already existed, creating a generational opportunity for the repurposing of offices and retail as housing and for urban renewal. We want this to be an opportunity for a new trajectory for our major cities – one which helps to forge a new country beyond COVID, which is more beautiful, healthier, more prosperous, more neighbourly and where more people have the security and dignity of a home of their own.
“A new expert Urban Centre Recovery Task Force has been set up to advise on the development and regeneration of our great town and city centres. The task force includes Peter Freeman, the visionary behind the redevelopment of King’s Cross and new chair of Homes England.”
Tracy Harrison, chief executive at Northern Housing Consortium said: “We welcome government’s recognition that the current 80:20 funding rule is concentrating funding in London and the South East. It is vital that the new National Home Building Fund lives up to its name, delivering truly national support and giving the North a more equal opportunity to level-up.
“We are concerned that government proposes to ‘revise’ the 80;20 rule rather than scrapping it altogether as many in the North have called for, and will be engaging with the ministry for housing, communities and local government (MHCLG) on their plans.
“We also welcome the confirmation of plans for the further £100m announced for brownfield sites at the Spending Review and will be bringing colleagues from non-mayoral areas together with MHCLG officials in January to discuss this opportunity and other ways government can support the development of new homes in non-mayoral combined authority areas.
"Earlier this year we established that £276m of the previously announced £400m fund was allocated to combined authorities in the North, recognising the opportunity to level-up with new homes on tricky brownfield sites.”
Nigel Wilson, chair of Homes for the North said; “We welcome today’s announcement. Homes for the North has long been lobbying government to look again at its housing policy that has been hampering growth in the North.
"Homes for the North, with the support of political and business leaders, has been calling for a change to the funding rules and planning formula to ensure the right homes are built in the right places. We are really pleased that the government has been listening and seems to be serious about changing policies which have been a real barrier to the delivery of the type of homes that are needed in the North.
“Good quality housing is of critical importance to the growth of the northern economy, the wellbeing of its people, and the people who wish to make the North their home in the future.
“We will continue to work with this government to make the case for housing as a fundamental part of the levelling-up agenda and will be watching carefully to see if the detail to come matches up to the positive headlines announced today.”
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