I was asked a question along these lines recently:
The new standardised methodology (Local Housing Need or LHN) has a market signal in it [median house price] which acts as a factor of previous under-supply. So, when using LHN in a plan-making context (as a starting point) we don't need to separately allow for previous under-delivery.
And, we understand that when the new NPPF is published the LHN figure is going to be used for calculating the 5 year housing land supply where plans are more than 5 years old.
So, in July when the NPPF is published and our plan dates from 2009, if our new LHN figure is 500 we have to find a land supply of at least 5 x 500 = 2500 dwellings.
But how does this work a year later when we still don't have a plan ? Do we just still need to demonstrate a land supply of 2500 even if we only delivered 300 in the year ? What has happened to the "missing" 200 ? Do we need to put that backlog into our new plan ?
My response was something like*
Yes, plan-making uses LHN as a starting point and is blind to previous under-delivery including under-delivery during the making of the plan.
The 5 year Land supply question is superceded by the way the housing delivery test works. Accounting and responding to under-delivery is not something that happens in AMR, it is something that happens in HDT and Action Plans. Your "missing 200" will appear in the housing delivery calc, and you will need to respond to this under-delivery according to the consequences. Perhaps making more land available so needing to demonstrate 6 x 500 = 3000 dwellings
More generally, while the work may feel and look quite similar, we will all probably begin to parcel and group the work of monitoring the most recent three years and looking forward to the next five years into the same task - and that is not a bad thing.
BUT you should not start to try to make your plan that is under construction start to play catch-up already**. The LHN is the starting point.
Does anyone disagree ? Or can you put it better than me ?
* obviously lots of caveats that this is a consultation etc etc
** this is code for "don't ignore the issue, but don't get bogged down with history - concentrate on tackling the issue of under-delivery"
