Permitted Development Rights

 Permitted development rights (PDR) – what are they?-  Permitted Development Rights are granted by the Government and allow individuals and developers to perform building and conversion work without asking the local planning authority (in most cases the borough) for planning permission. Permitted Development Rights can be gained by applying directly to the Government. The local planning authority can remove Permitted Development Rights using an Article 4 direction, which is designed to reduce development in protected areas, such as conservation areas. Other than this, local planning authorities have little power to challenge Permitted Development Rights. New housing can be created using Permitted Development Rights, but it must comply with national space standards. For example: a one-bedroom flat must have at least 37 metres squared floorspace, with a shower room. This requirement was announced by the Secretary of State for Housing, Robert Jenrick MP, on 30th July 2021.

Government expansion of Permitted Development Rights – In 2019, the Government set a housebuilding target to create 300,000 homes per year by the mid-2020s. However, the Government is set to miss this target. The Government is now looking for new ways to try and meet the target, including through the use of Permitted Development Rights. On 1st August 2021, the Government changed planning rules, enabling Permitted Development Rights to be used to convert Class E premises – including primary offices, restaurants, shops, professional services and light industrial facilities – into homes (Class C3 dwellings). While the Government had allowed Permitted Development Rights for the conversion of office space into housing since 2013, the expanded range of premises included in Class E means that more types of spaces can now be converted into housing.

Impact of the expansion of Permitted Development Rights – These types of conversions could lead to sub-standard housing and the loss of businesses and social spaces in town centres, with local councils and communities having little power to prevent such changes. A well-known case of Permitted Development Rights leading to sub-standard housing is Terminus House in Harlow, Essex. The building was formerly an office block but was converted into housing in April 2018 using Permitted Development Rights. It has been popularly dubbed a ‘human warehouse’ due to the cramped conditions that its residents live in. One resident described how tenants “have to eat, drink and sleep in their beds. There’s no room to move about. It is not good for them. It is ridiculous really.” Greenway House and Templefields House are other housing developments in Harlow that have been converted from offices. Unlike Terminus House, these developments are located in business parks on the outskirts of town. Residents at Greenway have to walk 40 minutes to the nearest shop and do not have any play facilities for their children, who are growing up in housing surrounded by industrial facilities.

Another aspect of Permitted Development Rights is the risk they pose to town centres. A recent study conducted by the Town and Country Planning Association (TCPA) and University College London found that “80% of shops and other commercial premises on highstreets across England could be lost because of further changes to planning rules.” The study was based on an examination of Barnet, Leicester, Crawley and Huntingdon town centres. Permitted Development Rights pose a risk to residents as they allow housing to be created from facilities that are unfit for habitation, and for the loss of vital businesses and community spaces. The nature of Permitted Development Rights means that unlike the conventional planning process, residents are not provided with a clear outlet to influence development. 

Permitted Development Rights in Southwark – Using Article 4 Directions, Southwark Council has removed Permitted Development Rights for converting Class E (business, commercial and leisure facilities) into housing (Class C3) in certain parts of the borough. This includes the parts of Southwark that lie in London’s Central Activities Zone – this includes the whole of Bankside, London Bridge, Elephant and Castle, Borough, and parts of Bermondsey and Walworth. Other areas of Southwark covered by the Article 4 Directions include town centres, shopping frontages, New Southwark Plan (NSP) Site Allocations and NSP proposed Strategic Protected Industrial Land, and railway arches. In other areas of the borough, Permitted Development Rights can still be used for the conversion of business, commercial and leisure facilities into housing. Further details, including a map of the affected areas, can be found on the Southwark Council website: https://www.southwark.gov.uk/planning-and-building-control/planning-policy-and-transport-policy/article-4-directions?utm_content=&utm_medium=email&utm_name=&utm_source=govdelivery&utm_term=

Housing in Southwark – Southwark has more local authority housing than any other London borough. Yet between 1997 and 2020, Southwark lost 28% of its local authority housing, while the borough’s waiting list for local authority housing increased by 116% within the same period. This growth in the council housing waiting list reflects how in Southwark, by the Council’s own estimation, the average cost of private renting or homeownership is over double what the median household in Southwark can reasonably afford. Based on figures from the Greater London Authority, the population of Southwark is expected to grow by between 22% and 5% between 2021 and 2043, meaning unless house prices and rents decrease, or a significant amount of affordable housing is constructed, waiting lists for local authority housing in Southwark are likely to grow further. There is a clear need for the creation of more high-quality social housing in Southwark. Yet expecting Permitted Development Rights to meet this need would be unrealistic. This is due to the lack of resident or council participation in influencing Permitted Development Rights and the developments arising from them, and the potential for these Rights to led to both the creation of sub-standard housing and the loss of community and business space in town centres.

Sources consulted – The Construction Index, 3rd August 2021. https://www.theconstructionindex.co.uk/news/view/study-quantifies-potential-impact-of-new-permitted-development-rules Dominic Brady, Inside Housing, ‘New permitted development rights homes must meet space standards, government says’, 30th September 2020. https://www.insidehousing.co.uk/news/new-permitted-development-rights-homes-must-meet-space-standards-government-says–68070 Firstplan, ‘Permitted Development Rights for Class E to Residential Given the Green Light’, 7th April 2021. https://www.firstplan.co.uk/news/permitted-development-rights-for-class-e-to-residential-given-the-green-light/ Greater London Authority, ‘GLA Population Projections – Custom Age Tables’. https://data.london.gov.uk/dataset/gla-population-projections-custom-age-tables Isaac LeQuesne, ‘Press Release: 80% of shops on high streets could be lost to PDRs’, 2nd August 2021. https://www.tcpa.org.uk/news/80-of-shops-on-high-streets-could-be-lost-to-pdrs Jon Stone, The Independent, ‘Government set to miss housebuilding target by almost a decade’, 9th January 2021. https://www.independent.co.uk/news/uk/politics/government-housing-target-300000-b1784575.html Landmark Chambers, ‘Permitted Development: Pitfalls’, 30th September 2020. https://www.landmarkchambers.co.uk/permitted-development-pitfalls/Matt Precey, Julian Sturdy and Lawrence Cawley, ‘Inside Harlow’s office block ‘human warehouse’ housing’, 3rd April 2019. https://www.bbc.co.uk/news/uk-england-essex-47720887 Ministry of Housing, Communities and Local Government, ‘Households on Local Authority Waiting List, Borough’. https://data.london.gov.uk/dataset/households-local-authority-waiting-list-borough Ministry of Housing, Communities and Local Government, ‘Local Authority Housing Stock’. https://data.london.gov.uk/dataset/local-authority-housing-stock Planning portal, ‘Permitted Development Rights’. https://www.planningportal.co.uk/info/200187/your_responsibilities/37/planning_permission/2 Southwark Council, ‘Southwark Housing Strategy 2020’ Wendy Wilson, House of Commons Library, ‘Stimulating housing supply – Government initiatives (England)’, 11th February 2021. https://commonslibrary.parliament.uk/research-briefings/sn06416/

Briefing paper: the financial impact of COVID-19 on Southwark council tenants

Introduction- This briefing paper examines the impact of COVID-19 on council tenants in Southwark. It focuses on an examination of rent arrears and evictions in Southwark, in the context of fluctuating levels of Government support, employment and Council action. The final section offers some concluding advice to the Council.

Overview- Between June 2019 and June 2021, average arrears for council tenant households in Southwark had risen from 7% to 9% as a proportion of annual rent. In June 2021, this was the equivalent of each of these households being over a month behind in rent. Between January and December 2020, the number of universal credit claimants increased in Southwark by just over 12,000 (representing an increase of around 48%). By May 2021, the number of households in Southwark claiming universal credit lay at 38,996, with 33,695 in payment. Much of this increase in arrears and universal credit can be attributed to the impact of the COVID-19 Pandemic on employment, which reduced incomes both through increasing unemployment and also through putting large numbers of workers on furlough. In March 2020, the UK unemployment rate stood at 4%, yet this rose to a peak of 5.2% by November 2020. Yet these unemployment figures do not represent the full impact of the Pandemic on employment. Between the announcement of the furlough scheme (the Coronavirus Job Retention Scheme – CJRS) on 20th March 2020 and early April 2020, just under nine million jobs were put on furlough. Until August 2020, the Government paid furloughed workers 80% of their usual salary, while offering financial support to businesses forced to close or reduce operations during the Pandemic. In April 2020, a £20 per week uplift in Universal Credit was also introduced.

Reduction in support – The CRJS furlough scheme is due to end on 30th September 2021, and on 6th October, the £20 per week universal credit uplift will end. In addition to this, the amount of funding allocated to Southwark for Discretionary Housing Payments (DHP) is being reduced by 44%,meaning Southwark Council are less able to use this additional payment to support council tenants who still struggle to pay rent with their universal credit. These reductions in support are most likely to hit council tenants in arrears the hardest, as universal credit can be reduced to allow for deductions covering rent arrears.

Southwark Council’s approach to arrears, possession, and eviction – Southwark Council is able to evict council tenants who consistently don’t pay their rent. Yet the Council is required to take action to try and prevent this stage from being reached. Actions include trying to reach an individual arrangement with the tenant or household in question; helping with housing benefit or universal credit; writing to the tenant about the arrears; and offering other relevant support. Between 27th March and 20th September 2020, Southwark Council paused all possession claims, so no evictions could take place. The Court had the ability to act in an individual case but indicated that it would very rarely do this. Between 17th November 2020 and 31st May 2021 there was also an eviction ban, but with some evictions still going ahead under limited circumstances. Since 31st May, there has been nothing to stop evictions from taking place. On 1st August 2021, the notice seeking possession (NSP – the notice before an eviction takes place) was reduced from 4 to 6 months, to 2 months.

Conclusions- While unemployment is currently falling (yet it has not reach pre-pandemic levels), the end of furlough and the reductions in universal credit and Discretionary Housing Payments are likely to reduce the income of council tenants in Southwark. There is a risk that rent arrears will continue to increase. With the resumption of evictions, it is important that Southwark Council exercises a large degree of discretion when dealing with evictions. This is an incredibly challenging time for tenants and unless this is reflected in Southwark Council’s actions, we are likely to see an increase in homelessness and in the number of residents residing in insecure, temporary accommodation.

Sources consulted- Brigid Francis-Devine and Daniel Ferguson, ‘The furlough scheme: One year on’, 24th March 2021, House of Commons Library. https://commonslibrary.parliament.uk/the-furlough-scheme-one-year-on/ Calum Masters and Harriet Anderson, ‘UK heading for the biggest overnight cut to the basic rate of social security since World War II’, 23rd July 2021, Joseph Rowntree Foundation. https://www.jrf.org.uk/press/uk-heading-biggest-overnight-cut-basic-rate-social-security-world-war-iiGov.uk, ‘Universal Credit: Households’. https://dwp-stats.maps.arcgis.com/apps/Cascade/index.html?appid=8560a06de0f2430ab71505772163e8b4 Gov.uk, Universal Credit statistics, 29 April 2013 to 8 July 2021. https://www.gov.uk/government/statistics/universal-credit-statistics-29-april-2013-to-8-july-2021/universal-credit-statistics-29-april-2013-to-8-july-2021 Office for National Statistics, 17th August 2021. https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/bulletins/uklabourmarket/august2021 Office for National Statistics, ‘Claimant Count by Sex and Age’, December 2020 Office for National Statistics, ‘Unemployment rate (aged 16 and over, seasonally adjusted) Shelter, ‘Grounds for evicting council tenants’. https://england.shelter.org.uk/housing_advice/eviction/grounds_for_evicting_secure_council_tenants Shelter, ‘What to do about universal credit deductions for debt’.  https://england.shelter.org.uk/housing_advice/benefits/what_to_do_about_universal_credit_deductions_for_debt Southwark Homelessness Forum