Planning reforms won’t fix the housing crisis

Building more homes is not the answer unless they are built for those who need them.

Lalkar writers

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Amid the covid-19 pandemic, and as the first lockdown was being relaxed, the government announced a ‘once in a generation’ shake-up of England’s planning system. On 6 August 2020, the government published its white paper Planning for the Future, which proposes significant changes to the current planning system.

These changes are presented as a solution to the lack of housing provision across the country and the need to construct 300,000 homes a year as part of the government’s ‘Build, build, build’ agenda.

The blame for the lack of housing is laid by government squarely at the doors of the planning system, which is accused of slowing down the process of development, leading to a shortage of homes. As prime minister Boris Johnson put it when announcing the reforms: “Thanks to our planning system, we have nowhere near enough homes in the right places.”

Put simply, the changes are a raft of reforms that aim to deregulate the planning system, simplifying it and removing so-called red tape so as to ‘enable’ development. In short, what is being effected is a significant blow to local authorities’ ability to do any actual planning.

Rather than setting requirements, standards and parameters for developers to adhere to; and rather than incorporating a proper level of scrutiny over individual applications in the pre-development process, there is to be a broad plan for an authority showing areas that should and should not be developed, with the idea being that the market can be left to do the rest.

It is obvious to most of us that, with the market at the helm, the results of such proposals are not going to be affordable, grand design, leafy streets and spacious abodes for one and all.

The planning white paper

The reforms outlined in the white paper make some significant changes to the role of local plans and land use allocations. Currently, we have a system where local plans are drawn up by authorities, which allocate uses to land that future development has to adhere to when seeking planning permission.

The production process for local plans is notoriously long-winded, but it does involve a level of public consultation and scrutiny, and it covers a ten or 15-year period. Most proposed developments will require planning approval from the local authority, which involves a further round of consultation, both with the public and with expert bodies.

The government now proposes to get councils to zone all land in their areas within one of three categories: ‘growth’, ‘renewal’ or ‘protected’, which will determine the level of planning permission needed.

In ‘growth’ areas, planning permission would be granted automatically to new homes, shops, offices, hospitals and schools. In ‘renewal’ areas, development would be given ‘permission in principle’, subject to basic checks (in practice not much different to the first category of automatic approval). In ‘protected’ areas like green belt land, areas of outstanding natural beauty, etc, any proposed development would have to go through a full planning application process.

The result of the proposed new zoning system will certainly be the unleashing of ever more market forces on our towns, cities and villages, with far less scrutiny and a fast track for rubber-stamping for most developments. This will certainly speed up the process for developers, but it also increases the likelihood of creating “concrete deserts” that are “devoid of green space”, as National Trust director Hilary McGrady has warned.

Housing algorithm backlash

No sooner had Boris Johnson announced the big planning shake-up than his housing secretary, Robert Jenrick, was facing a backlash from none other than the Tory back benches.

This was not because they were concerned about the lack of control or the undermining of good design and amenities that the reforms will introduce. No, it was a classic case of Nimbyism; the ‘Not in my back yard’ approach to planning. Their opposition, one of the most vocal critics being former prime minster Theresa May, was to an algorithm, a central part of the reforms, which it had allocated new housing quotas across the country to meet the target of building 300,000 homes per year.

Furthermore, the Times reported: “Boris Johnson has been accused of hypocrisy after he objected to a scheme for 514 homes in his constituency claiming it was ‘inappropriate’ and ‘out of character’ for the area.

“In letters obtained by the Times through a freedom of information request, Mr Johnson said that the plans for houses in his Uxbridge & South Ruislip seat constituted ‘overdevelopment’.”

However, housing secretary Robert Jenrick has ridden to the rescue of his prime minister and “has intervened in the case and is blocking planning permission from being granted to the scheme, which includes 179 affordable homes”.

It would never do to upset Boris Johnson’s Nimby constituents, as after all “Mr Johnson’s majority of 7,210 in his west London constituency is the smallest of any prime minister in recent times”. (‘Build, build’ Johnson opposed new homes in his constituency by George Grylls, 14 December 2020)

As was pointed out by several commentators, one would have thought the government had had enough of algorithms after the exam grading debacle in the summer. Indeed, when questioned about the housing algorithm, the prime minister joked: “Algorithms are banned.”

The housing algorithm was at the heart of these latest planning reforms, however. Johnson’s original comment in announcing them stressed: “We have nowhere near enough homes in the right places,” and the algorithm was designed to address just this point.

The formula was designed to ensure not only that the government would meet its target of building 300,000 new homes a year but that they would be built where housing pressures are greatest. It identified where housing demand was high based on the affordability of existing homes in an area and how this had changed over the past decade.

It should have been no surprise that the areas with the highest targets were the affluent suburbs in the south-east. The algorithm increased the target for the southeast region by 57 percent and that of the southwest region by 41 percent, while it reduced targets in the midlands and the north.

Cue uproar from the Tory backbenches and the very prompt about-turn by Mr Jenrick in the proposed method for calculating the housing targets that the proposed new planning regime will be centred on.

The change to the algorithm has been presented as embodying the government’s “desire to build homes on brownfield sites” and “in our great cities and urban centres”.

The new forumula requires Britain’s 20 biggest cities to provide up to 35 percent more housing than previously planned for. Or, as Simon Nixon in the Times pointed out: “The algorithm is therefore to be revised so that it gives a more palatable answer. Instead of building the new homes where people want to live, they will now be built where Tory MPs think they should live. That is in urban areas, preferably in the north. You could call it levelling up.” (Housing algorithm was doomed but planning system must be reformed, 17 December 2020)

Does more development equal more housing?

“Build, build build” is Boris’s latest mantra. The bigger questions are: what is being built and for whom? While the latest planning reforms have the potential to speed up the building process, they do nothing to address these central questions.

In fact, over the past decade the numbers of new homes being built has been steadily rising, yet so too have house prices, while wages have not. The result is that, although there is more housing stock, home ownership is increasingly unaffordable for many.

Yet with more houses being unaffordable, the approach of providing ‘affordable housing’ – those sold or rented below the market rate – has also come under question as part of the current planning reforms.

Currently about half of all ‘affordable housing’ is provided by developers through Section 106 contributions agreed with the local authorities. The planning white paper proposes scrapping Section 106 and replacing it with a flat rate infrastructure levy. It is claimed that the levy will contribute as much if not more affordable housing as the current system, but there is very little by way of detail to back up this assertion, and plenty of well-founded scepticism that the result will be less housing designated as ‘affordable’.

Social housing continues to come under the cosh

As has been seen, the proposed planning reform makes no attempt to address the housing crisis in the private sector and, unsurprisingly, neither does it do anything to address the crisis in social housing.

In fact, the planning paper does not mention social housing – the replacement for council housing on which people on low incomes rely. Council housing was once a significant part of the housing supply, but over the last 50 years the construction of new social housing has been drastically reduced.

“Between 1980 and 1984, local authorities built 220,000 new homes, a quarter of the total built. In the last five years they have contributed just 10,000 – roughly 1 percent of total new supply. The number of homes built by housing associations has increased, but not enough to fill the gap left by councils …

“Rhys Moore, an executive director at the National Housing Federation (which represents housing associations), has warned that ‘simply building more homes would not help the 8.4 million people currently hit by the housing crisis in this country … Instead, we desperately need more social housing that people on lower incomes can afford – and there are many unanswered questions about what effect the proposed reforms will have here.’” (England planning shake-up provides few affordable housing guarantees by George Hammond, Financial Times, 3 September 2020)

The planning white paper sets the target of 300,000 new homes, ostensibly to address the fact that there is a housing crisis that has left many people in need of a home. What it fails to do is guarantee that any of those 300,000 homes would be for the people who are actually in need of them.

The reforms continue to push open the door for private developers to build with fewer controls, standards or requirements. Build, build, building is not going to address the country’s housing crisis; instead, it will result in more bricks and mortar standing empty as those who desperately need them continue to be priced out of living in them.

Questions over the safety of existing housing stock

The ongoing inquiry into the Grenfell Tower fire continues to expose the inner workings of the building industry, in the process calling into question the safety of thousands of existing homes across the country.

In previous articles we have examined how the first phase of the inquiry confirmed that the type of cladding – aluminium composite material (ACM) – used at Grenfell was responsible for the rapid spread of the fire that led to the deaths of 72 people and left hundreds more destitute and traumatised.

The recent exposures regarding the combustible insulation that was used in the Grenfell refurbishment has highlighted how many flats in Britain are in an equally dangerous state. The scandal of Kingspan insulation’s reckless practices has been highlighted by the flagrant language in emails sent by one of the technical directors when dealing with questions of fire safety.

Philip Heath, former technical manager, received a question in 2008 from an employee of Bowmer & Kirkland, who wrote: “To date you have not substantiated on what basis K15 is suitable for buildings over 18m.” Mr Heath forwarded the message to colleagues with the comment: “I think Bowmer & Kirkland [multinational blue chip main contractor] are getting me confused with someone who gives a dam [sic]. I’m trying to think of a way out of this one, imagine a fire running up this tower!!!”

In another string of emails, after facade engineering firm Wintech had questioned the suitability of his company’s product and was reportedly digging its heels in on a couple of projects, Mr Heath told a colleague: “Wintech can go f*** themselves and if they’re not careful we’ll sue the arse off them.” (Grenfell insulation firm manager ‘sneered at customers’ safety fears’, inquiry told by Sean O’Neill, The Times, 1 December 2020)

Mr Heath’s attitude is indicative of the attitude of the entire construction industry to fire safety. While he can be singled out, he is a product of the way business operates: since maximum profit must be extracted, there is neither space, time nor money for considering people or safety.

Kingspan had falsely claimed its product was suitable for use in high-rise buildings by obtaining official test results using different materials than the ones in product on offer. In more damning internal communication, text messages between members of Kingspan’s technical team, Peter Moss and Arron Chalmers, written a year before the Grenfell conflagration, joked about the way the firm had managed to get its Kooltherm K15 insulation categorised as ‘class 0’ — that is, appropriate for use in buildings higher than 18 metres — by this cunning ruse.

Chalmers: “Doesn’t actually get class 0 when we test the whole product tho. LOL.” Moss: “WHAT. We lied? Honest opinion now.” Chalmers: “Yeahhhh …”, and later in the conversation, “All lies, mate … Alls we do is lie here.” (Grenfell is becoming our worst corporate scandal by Dominic Lawson, The Sunday Times, 13 December 2020)

The Sunday Times has also reported that, following revelations regarding the combustibility of ACM cladding, 30,000 high-rise blocks have been identified as having combustible cladding, with 700,000 people still living in affected flats.

Now the inquiry “has exposed a further 186,000 private high-rise flats wrapped in other flammable materials. Next it could leave up to 1.5m modern flats, 6 percent of England’s homes, unmortgageable because they cannot prove their walls are safe, breaking the first rung of the property ladder.” (Thousands of families trapped as ‘unsafe’ flats paralyse property market by Martina Lees, The Sunday Times, 20 September 2020)

Up to four million people now live in unsafe houses, with exorbitant insurance and waking watch bills pushing many into serious financial difficulty. The government has allocated £1.6bn in grant funding, yet MPs on the housing select committee have found that repairs could cost £15bn. The bill for the rest is going to fall at the feet of homeowners and leaseholders.

The government’s answer to that is to consider providing long-term loans, a loan for £30,000 to fix a typical mix of risky cladding, missing fire stops and flammable balconies would add about £1,500 a year to household bills at a 3 percent interest rate. Yet no compensation is being sought from those responsible for building the death traps.

The five biggest housebuilders, every one of which is responsible for developments where fire risks have rendered unsaleable the homes they built and sold, have made pre-tax profits of almost £10bn since the lethal Grenfell fire (not including Persimmon’s results for the current tax year, which will increase the total). (Government’s solution to cladding scandal: just take out a second loan by Martina Lees, Sunday Times, 6 December 2020)

The corporate supply chain is likewise let off the hook. To add insult to injury, Kingspan’s founder Eugene Murtagh and his son Gene, who now runs the company, cashed in shares worth £98m in the weeks before the inquiry turned its attention to the question of Kingspan’s insulation testing, certification and supply.

As ever, those who have been creaming all the profit would appear to be the ones in least danger of footing the bill for remediation of their failures.

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