Government Announces Radical Changes to Planning System, Sets Target for 1.5 Million New Homes in Next Five Years
In a bold move to address the UK’s housing crisis, the government has announced a shake-up of the planning system that aims to pave the way for 1.5 million new homes to be built over the next five years. Housing Secretary Angela Rayner stated that mandatory housing targets for England, which were previously scrapped by the Conservative government in December, will now be restored. Additionally, the annual target for new homes will be increased from 300,000 to just over 370,000.
Ms. Rayner also announced that the target for London will be lowered from 100,000 to around 80,000, which she said the Mayor of London, Sadiq Khan, is determined to rise to. She stated that the government is changing the method used to calculate housing needs in each area to better reflect the urgency of supply. The new rules will require 50% of new housing to be affordable, with a focus on social rent.
To support the building of affordable homes, the government will provide £450 million of the local authority housing fund to councils to build 2,000 new homes. Ms. Rayner acknowledged that these changes may be controversial, but stated that the housing crisis is urgent and these measures are necessary.
Housing Minister Matthew Pennycook will meet with major developers on Tuesday to ensure they commit to matching the government’s pace of reform. More than 30 home builders have already signed a statement supporting the reintroduction of mandatory housing targets and the release of “grey belt” land.
However, Shadow Housing Secretary Kemi Badenoch accused Ms. Rayner of giving the go-ahead to build “1.5 million ugly homes” as part of the new planning reforms. Ms. Rayner addressed this criticism by stating that the government wants to drop the requirement for new homes to be “beautiful”, as beauty is subjective and difficult to define, leading to inconsistent decision-making on planning applications.
The reforms also make it explicit that brownfield development should be the first option for new housing, promoting higher density building in urban areas. Some low-quality green belt land will also be freed up for construction, with a new definition provided for what constitutes low-quality land. However, Ms. Rayner assured that there will be a requirement for developers to provide money for supportive infrastructure, such as schools, GP surgeries, and transport links, as well as improvements to accessible green space.
The government also plans to consult on changing the Right to Buy initiative and introducing a planning and infrastructure bill. This bill aims to ensure that planning committees focus on the right applications with the necessary expertise. Ms. Rayner also promised fair compensation for landowners, while ensuring that excessive amounts are not paid to put planning departments on sustainable footing.
The Home Builders Federation’s Chief Executive Neil Jefferson praised the government’s announcement as the “first and most important step” in addressing the barriers to delivering new homes. He added that the planning system has long failed to provide the land needed for affordable housing, and supply has plummeted in recent years due to the removal of housing targets.
However, Dr. David Crosthwaite, Chief Economist at BCIS, expressed doubt about Labour’s ability to achieve its ambitious housebuilding targets due to private developers controlling the supply to maximize their returns. The government plans to reveal further details, including a “council house revolution” and plans to give local authorities “rent stability” to borrow and invest, in the upcoming autumn budget on October 30th.
