The research, based on a survey of home builders and a Freedom of Information (FOI) request of local authorities, finds that 98% of small and medium-sized enterprise (SME) builders are finding implementation of the new requirements a challenge, with delays in the process as a result of a lack of local authority capacity being the most significant barrier.

BNG was introduced through new legislation in 2019 and ensures that new development enhances wildlife habitats and ecology, requiring developers to achieve a net gain of at least 10% in biodiversity. Since the requirement was introduced in February 2024, it has proven that new homes and environmental benefits can be delivered together.

A lack of capacity in Local Authority planning departments has long been a major frustration for industry. Resultant delays in the processing of planning applications prevent builders from accessing sites to commence work, thereby delaying the delivery of vital new homes.

Overstretched departments now have the additional responsibility of BNG to contend with, further delaying application sign-off and creating yet another barrier to increasing housing delivery.

94% of respondents to HBF’s survey reported experiencing delays in processing planning applications due to BNG, while 90% cited delays precisely due to insufficient BNG expertise or resources within local authorities.

Despite the significant additional workload required to oversee and monitor BNG, the FOI carried out by HBF found that:

• Nearly 40% of local authorities lack access to in-house ecological expertise.
• A quarter of councils have experienced the departure of ecologists from their roles in the past year.
• One in three councils has not expanded its ecology team since BNG was introduced.
• Approximately one-quarter of the staff recruited to support BNG requirements are temporary.

Local authorities are also increasingly reliant on external consultants, spending an average of £23,000 per year per council on BNG-related consultancy fees.

This constitutes the majority of Defra’s BNG fundin%0g for local authorities before the costs of hiring new staff or providing training for existing staff are even taken into account.

Furthermore, the National Audit Office estimates that Government funding equates to just 0.66 full-time equivalent (FTE) ecologists per council, far below the level required for effective implementation.

The number of SME builders has declined significantly in recent decades, with the increasingly complex and bureaucratic planning system being a primary reason. SME home builders face additional difficulties in navigating the costly and lengthy process, and many are stopping house building as a result.

Whilst more significant sites may be able to accommodate BNG requirements on-site by creating green spaces or adding features that support biodiversity, smaller sites, where there is no available space to do so, are often reliant on purchasing off-site biodiversity units to meet the requirements.

However, one year on, there is still a shortage of suitable credits available, which increases their costs and poses a substantial threat to the viability of smaller house-building sites.

85% of home builders with small sites believe the costs of BNG are not proportionate to the size of their projects.