reform Archives - Red Brick

Planning for 1.5m homes: What are Labour’s Options for Reform?

Key to Labour’s policy offer is a pledge to build 1.5 million homes during the next parliament. Doing so would be transformative, lowering costs, creating tens of thousands of new jobs, and funding the creation of a new generation of affordable and social houses.

Increasing housebuilding is easier said than done. Despite a similar target of 300,000 homes a year, the current government is well short of this. Only 232,800 homes were delivered last year, and a downturn is expected as the country’s economic situation worsens.

Reforming the planning system will be a key plank of achieving this goal, after being identified as the most substantial barrier to delivering new homes in a survey by the Federation of Master Builders. This will not be easy, however, given how complicated the planning system is.

The problems with the planning system go well beyond the obstacles it presents to building new homes, and it rarely incentivises building high-quality dwellings well-resourced by local infrastructure and amenities. But, in order to achieve its goal of 1.5 million homes, a future Labour government will need to find priority areas to alter in ways which maximise impact while reducing controversy.

Reducing the Burden

The planning system is burdensome for everyone involved. While debate often focuses on the onus on housebuilders, any document filled in by a developer also has to be read by a planning officer, councillors, and locals keen to have an input into developments in their area.

This is in part due to regulations being duplicated, between national and local requirements, and within the same local authority. There will be a degree of overlap, for instance, between a tree survey, arboriculture impact assessment, and biodiversity survey. But some councils ask developers for all three.

This can also be due to regulation being in the planning system inappropriately, regardless of how noble its intensions are. For instance, it is currently impossible to build homes in areas with particularly high nutrient pollution – even though new housing contributes to less than 1% of said pollution.

A root and branch review of the planning system, ensuring that regulations are not duplicated are in the right place, would reduce the burden for everybody involved in planning and speed up the pipeline of new homes.

Standardising Requirements

Similarly, the complexity of the planning map is an obstacle to building new homes. England contains 391 local planning authorities, ranging from Rutland and its 41,381 residents to Birmingham, the largest local authority in Europe.

Each of these areas will then have subtle differences in regulations required. These can be seen in the ‘planning validation checklist’, a list of planning documents local planning that authorities are required to publish. Research conducted by the Housing Forum has shown that many authorities lack an up-to-date checklist, and of those that did, the number of documents required to build as few as 10 homes could range from 24 to 42.

Simplifying and standardising requirements between local authorities, and even considering more radical steps like transferring planning powers to county or combined authorities, would reduce local variation, without reducing the quality of regulation.

Supporting Planners

Delays in the planning system are in part caused by capacity issues in local authorities. Only one in ten local authorities have fully staffed planning departments, with 70% reporting difficulties recruiting new planners. This is fuelled by pay disparity between public and private sectors, difficult backlogs, and online abuse – as a result a quarter of planners have left the public sector in the last ten years.

It is in part due to this that one in five local authorities still lack an up-to-date local plan.

Reversing this decline in the public sector would speed up the delivery of planning applications, improve the institutional expertise within the planning system, and help local authorities and developers to work together more effectively to deliver locally appropriate schemes.

Repositioning Democratic Input

Much as excessive paperwork makes navigating the planning system difficult for everyone involved, so too does the nature of democratic input frustrate both those seeking to build new homes, and residents looking to have an impact on their local community.

Currently, locals get most involved in commenting on individual planning applications, which will already have been drawn up in partnership with a developer and a local authority. The fact that 90 percent of planning applications in the UK are approved points to the fact that most of these are a finalised and detailed product. Thus local input is often perfunctory and ineffective, and many can feel that they have little voice in the process.

Similarly, developers often express concern that plans can either be delayed or cancelled outright by a particularly vocal local campaign, and councillors can often feel pressured by a vocal minority of residents who often little as small as 1 – 3 percent of a local population

Meanwhile, as Labour’s Planning Commission (2019) notes, engaging at an earlier stage, when councils draw up their local plans, “often made plan making unapproachable and sometimes intimidating for residents”. After all, residents are seldom planners, architects, or contractors: but they contain valuable knowledge about their local area which should be put to use in constructing local plans.

Simplifying democratic input at the local plan making stage would make it easier for local people to get involved, for councils to focus attention to a single event, while empowering a greater range of voices.

This is similar to the calls for a ‘zoning’ system, promoted by organisations such as the Centre for Cities. This would bring the UK in line with comparable democracies, by removing the discretionary nature of the planning system, where planning committees decide on individual applications. Instead land would be designated for a certain use, such as ‘housing’, ‘industry’, or ‘commercial use’, and a set of regulations then applied. Developments which followed these regulations would then be automatically approved.

Countries like New Zealand, and individual cities like Austin in the US changed their planning systems from discretionary ones to zoning systems, and both saw an increase in housebuilding and a comparative decrease in house prices.

While moving to such a system would require intensive legislation, moving community input upstream in the planning system could be a suitable stepping stone to simplify the democratic process while broadening it out to a wider audience.

Reforming the planning system is far from an easy process, and successive governments have promised it and failed to deliver. But identifying achievable and high impact goals will be crucial for a future Labour government to speed up the delivery of homes and meet its 1.5 million home goal.

This is the first part of a 4-part series in what a Labour government can do to meet its 1.5 million homes goal. Stay tuned for future instalments!

Alex Toal is Communications Executive at The Housing Forum, a cross-sector housing membership organisation representing local authorities, housing associations, contractors and a range of other housing sector organisations. Before joining THF, Alex worked at the Institute for Government and Make Votes Matter, and is a ward organiser for Cities of London and Westminster PPC Rachel Blake. Based in Haringey, Alex helps to run his local LGBTQ+ tennis group and volunteers at his local food bank.

Why solving the housing crisis requires planning reform

The UK has entered and will leave this pandemic while experiencing a decades-long housing shortage. The country will soon begin to repair the harm done to the economy and society by this disease, but it cannot continue to afford this housing crisis. The inequality it fuels and the damage it causes to national and local economies are too great to bear. We cannot go back to how things were before.

At its core, ending the housing shortage requires more homes. But where new homes are built matters. Yet at present, not enough houses are built in some cities, and arguably too many are built in others. This mismatch emerges as the design of the planning system means it rations the supply of land available for new homes. Ending the housing crisis will therefore require reform of the green belt and a new, flexible zoning planning system to build enough new homes.

The housing crisis is local, not national

The reason why the planning system is so important can be found in the geography of the housing shortage. Some cities have far greater affordability problems than others. For example, while in 2019 the average house in Barnsley cost 5.3 times the local average income, in Brighton that ratio rose to 13.5 times local average incomes. Despite their higher average wages, prosperous cities such as York and Bristol are generally less affordable than places with struggling economies and lower wages such as Dundee or Blackpool.

So solving the housing crisis therefore requires a focus on the most expensive cities with the worst affordability problems. But currently, as Fig. 1 below shows, there is no link between cities’ demand for housing and their supply of new homes. Many expensive cities including Oxford and Bournemouth are building far fewer homes than those which are more affordable such as Wakefield or Telford. The supply and demand of new homes have been disconnected.

Source: EPC Domestic Register 2019; Census 2011; ONS, Annual Survey of Hours and Earnings (ASHE) 2011; Land Registry, Price Paid Data 2011

The planning system disconnects local housing supply from local demand

This decoupling of supply from demand originates in the planning system, as the amount of land it makes available for housing is rationed. Development of new homes normally cannot proceed unless the council decides at their discretion to grant a planning permission to a site. Measures such as the green belt block new homes across large areas of land adjacent to many cities and railway stations, including Bristol, Newcastle, Manchester, Birmingham, and London.

The rationing of land, not prices or affordability or need, ultimately decides how many houses cities build. It explains why some cities which have low demand build more than the average city, and far more than some very unaffordable cities.

The planning system prevents redevelopment in large parts of the existing suburbs

The planning system’s rationing of land can be seen in how it warps the supply of new homes within cities. Consider Exeter, an expensive city which is building lots of new homes above the average rate for cities, in Fig.2 below. A substantial number of homes have been built in the city centre (8 per cent growth since 2011), and there is a cluster of new homes being built on the eastern outskirts of the city, including near the brand new railway station of Newcourt.

Fig. 2 Housing supply in Exeter from 2011-2019

Source: EPC Domestic Register 2019; Census 2011

Nevertheless, 48 per cent of suburban neighbourhoods in Exeter are building less than one house a year. 14 per cent of suburban neighbourhoods in Exeter have actually built no new houses over this period, including a built-up area close to Digby & Sowton station. Even though Exeter has built lots of new houses, the amount of land which has been made available for development has still been subject to rationing.

These dormant suburbs which make little or no contribution to new housing supply are not unique to Exeter. 51 per cent of all suburban neighbourhoods in England and Wales built less than one house a year, or zero, from 2011-2019, providing only 2 per cent of all new suburban homes over that period.

This national pattern across cities emerges from the design of the planning system. As the supply of new homes is controlled by the discretionary granting of planning permissions by elected councillors, it is both uncertain for developers to navigate and sensitive to political pressure from anti-housing activists. The result is that as so much of the suburbs and unremarkable green belt land are off-limits to new homes, new housing supply is forced into easy-to-develop pockets on the outskirts of cities, and pressure for redevelopment is put on city centres and locations such as social housing estates and offices into flats.

Local shortages which emerge from the planning system make inequality worse within and between cities

By stunting the supply of housing in expensive cities, the planning system creates two different inequalities.

First, it drives inequality in housing costs within prosperous cities between renters and homeowners. As rents rise due to the shortage of homes, so does the wealth of homeowning neighbours as through their housing equity.

Second, it drives inequality in housing wealth between homeowners in more prosperous and weaker economies. From 2013-18, average housing equity per house in Brighton rose by £83,000 – but in Doncaster it rose by just £5,000. By preventing new homes from being built in the most expensive cities to stabilise local prices, the planning system reinforces economic inequality in them and across the country.

Ending the housing crisis requires a new flexible zoning system for planning

Solving the housing crisis and tackling these issues requires reconnecting local supply to local demand, and that entails reform of the planning system. Green belt reform is one area where this is needed, and Centre for Cities have calculated that 1.7 to 2.1 million new homes could be built on less than 2 per cent of the green belt within walking distance of railway stations outside Bristol, Newcastle, Birmingham, Manchester and London.

More building by councils and housing associations can play a large role here. However, the root cause of the housing crisis lies not in a specific lack of social housing but in the institutional design of the planning system. For instance, England still has one of the largest social housing sectors in Europe, at 17 per cent of all housing stock, yet it also has one of the continent’s most dire housing crises.

Ultimately, the design of the planning system must change. Building more homes in the most expensive cities will require a shift from its discretionary model towards a flexible zoning system, as in Japan and certain US cities.

This approach, where planning permission legally must be granted if a proposal complies with a national zoning code and national building regulations to ensure the structures are safe, is compatible with more social and council housing. But it would fix the institutional problems the private sector faces by reconnecting local supply to local demand, and end the housing crisis by building more homes in the least affordable places with the greatest need.

Anthony Breach

Anthony is an Analyst who has worked as part of the research team at Centre for Cities since 2017, where he focuses on housing and planning. He won the Thinkhouse Early Career Researcher Prize 2019 for Capital cities: How the planning system creates housing shortages and drives wealth inequality.

Anthony has also worked on research on commercial property in cities, services exports, productivity, and manufacturing. He also has a particular interest in lessons for planning, housing, and UK cities from Japan and the countries of the former Soviet Union. Previously he worked at the Fawcett Society as a Research Officer.

TWITTER