Monday, 17 July 2017

Is DCC's LAA living in LAA LAA land?

It looks like someone at DCC has too much time on their hands now the Minerals Plan has been adopted.

DCC has just issued its 6th Local Aggregate Assessment, and with it some whizzy new projections and fancy new buzzwords; buzzwords such as "stress test" and "housing trajectory". The Executive Summary spells it out:
The ability of Devon to maintain land-won aggregate supply in the event of predicted increased construction levels has been tested by modelling ten year sales average and housing trajectory models. This test indicates that the crushed rock landbank will enable supply to be maintained, but that the present sand and gravel landbank would fall below the seven years minimum during the period 2020 to 2023.
This conclusion may seem odd to some people, given that at the end of 2016 Devon had sand and gravel reserves of 7.04 million tonnes, enough to last 13.4 years (based on a rolling average of 10 years sales data as advised in the NPPF).

So how has DCC arrived at this doomsday scenario "with the landbank dropping below [the required] seven years in 2020"?

DCC starts by saying that the LAA has "demonstrated that there is a correlation between land-won aggregate sales and housing completions in Devon over the past ten years" 4.2.2.

That’s hardly surprising for land-won aggregates you might think, but for sand and gravel the link appears more tenuous, given that while housing starts have bounced back from the recession, Devon’s sand and gravel sales continue to fall; given that in 2016, when housing starts hit a 9-year high, Devon's sand and gravel sales fell 14%.

But DCC has looked in its crystal ball. It has ignored headlines such as "A recession is 'almost inevitable'...", and says "the next ten years are forecast to see significantly higher levels of house building together with other infrastructure development" 4.2.2, and thinks that:
it is feasible to ‘stress test’ the capacity of Devon’s landbanks of land-won aggregates to cope with increased sales that mirror the predicted housing trajectory over the next ten years. This test has used two scenarios whereby, for the ten years to 2026, land-won aggregate sales follow either the ten year averages given in Table 9 [sic] or the forecast housing trajectory illustrated in Figure 9. 4.2.4
The bottom line of this stress test is that "the housing trajectory scenario would see the sand and gravel landbank exhausted by the end of 2026, with the landbank dropping below seven years in 2020" 4.2.5.

Amazing. But all this should be taken with a huge pinch of reality:

For a start, DCC has mis-calculated. As shown below, even using this fantasy scenario, the landbank in years as defined by the NPPF - "reserves" divided by "10yr average" - wouldn’t fall below 7 years until 2021, even with an inconceivable quantum leap in demand.

Secondly, "the average annual predicted sand and gravel sales in the housing trajectory scenario (0.705Mt)" 4.2.8, is a staggering 51% higher than sales in 2016 - and this is the year, as previously noted, that housing starts already sit at a 9-year high.

And thirdly, even DCC recognises:
A note of caution should be attached to predictions for future rates of house building, as experience shows that these may not be realised. In 2008, the Draft Regional Spatial Strategy for the South West identified an annual average housing requirement for Devon of 6,960 for the period 2006 to 2016, which exceeds by 71% the house completions achieved over the last ten years. 4.1.4
So, given that our council tax pays for these pie in the sky forecasts, is this 'stress test' of any use at all?

Or is it just a way of trying to help a certain aggregates company justify a planning application to quarry a small greenfield site in East Devon when there’s already 13 years of permitted sand and gravel reserves?