The last iteration of the Greater Manchester Spatial Framework (GMSF) used the 2012-based DCLG Household Projections from 2012-2035 to inform its Objectively Assessed Housing Need (OAN).
The Office for National Statistics (ONS) released the 2016-based Household Projections on 20 September 2018. These Household Projections coupled with the Population Projections, which were released in May 2018, could have far reaching implications for the next version of the GMSF.
The first draft of the GMSF in October 2016 used the 2012-based DCLG Household Projections from 2012-2035 to inform its OAN.
The Greater Manchester Combined Authority (GMCA) will take the decision next month (October 2018) on when to consult on the second draft of the GMSF, which was previously delayed to take account of updated population and household projections.
2012 vs 2016 Household Projections: Greater Manchester Context
The ‘2012-based Household Projections predicted Greater Manchester would see a growth of 213,380 households over the period 2012-2035 with an average annual growth of 0.75% per annum. However, the 2016-based Household Projections now anticipates that Greater Manchester will only see a growth of 164,006 over the same period, with an average annual growth of 0.59%. A reduction of almost 50,000 households.
Nearly all of the Greater Manchester authorities are anticipated to see reduced household growth compared with the 2012-based projections over the period 2012-2035; the biggest reductions include Bolton with the difference of -9,178 households, Tameside at -8,324 households and Manchester at -7,430 households. Rochdale is the only Greater Manchester Authority where increased growth is forecast of 1,163 households.
Are the figures reliable?
The assumptions used in household projections are based on past demographic trends. However, demographic behaviour is inherently uncertain, so projections become increasingly uncertain the further they are carried forward.
The ONS figures have also not been adjusted to take account of the following:
Changes in the stock of households and communal establishments (for example, new builds, demolitions and changes of use);
Future economic conditions;
Future changes to the housing market, such as house prices or changes to the private or social renting sectors;
Changes in marital status, income, economic activity or any other demographic factors of the population; and
How will the GMSF be affected?
The updated Household Projections show a decrease in the anticipated growth across Greater Manchester of almost 50,000 households over the period 2012-2035.
The revised NPPF now requires a housing need assessment to be conducted using the standard method in national planning guidance unless exceptional circumstances justify an alternative approach. The standard method uses the household projections as baseline and starting point for calculating the OAN, to which adjustment factors are made. It is likely that the latest household projections would result in a reduced OAN using the standard method. In a recent Planning Update Newsletter by Steve Quartermain on 14 September 2018, the Government “will consider adjusting the method after the household projections are released, in late September 2018, and consult on the specific details of any change at that time”.
Notwithstanding this, the GMCA could still choose more ambitious targets above the standard method and in line with previous plans to deliver over 227,000 new homes by 2035.
Before any changes are made to the amount of housing planned for, the GMCA will need to undertake further analysis on the household projections, making adjustments where necessary and taking into consideration other factors such as market signals. Paragraph 60 of the revised NPPF requires strategic policies to be informed by a local housing need assessment using the standard method in national planning guidance, unless exceptional circumstances justify an alternative approach. Therefore, the GMCA will also need to ensure any revision to the housing need is in accordance with paragraph 60 of the revised NPPF.
The new Household Projections show a decrease in the anticipated growth across Greater Manchester of almost 50,000 households over the period 2012-2035, however the GMCA will need to undertake further analysis to assess the Objectively Assessed Housing Need for the Greater Manchester region.
The GMCA may choose to use 2016 projections to inform the next version of the GMSF, which could result in less ambitious growth plans for the region.
A decision on the impact of the new household projections and when to consult on the next version of the GMSF is due to be made by the GMCA in October 2018.
 ONS, September 2018. Methodology used to produce household projections for England: 2016-based. [Available at: https://www.ons.gov.uk/peoplepopulationandcommunity/populationandmigration/populationprojections/methodologies/methodologyusedtoproducehouseholdprojectionsforengland2016based#assumptions-and-properties-of-the-household-projections-methodology].
 Steve Quartermain CBE, 14 September 2018, Planning Update Newsletter. [Available at: https://www.gov.uk/guidance/planning-guidance-letters-to-chief-planning-officers].