Planning Reform Climbdown Could Harm Economic Growth, Housing Experts Warn
3 min read
Housing experts are raising the alarm that rowing back on planning reform will slow down the pace of building in Britain – at a time when government is in desperate search of economic growth.
Prior to the election the government identified planning reform as a central pillar of improving the UK's poor economic growth.
But in July the government amended its Planning and Infrastructure Bill to strengthen environmental protections, introducing new conditions for building on the greenbelt and in rural areas.
Changes to the legislation mean measures to protect nature and rare species can begin before a development is approved.
Housing experts are concerned the government’s rowback on its initial legislation will stunt growth when the economy desperately needs it.
Maxwell Marlow, director of research at YIMBY Initiative, told PoliticsHome: “The government’s planning reforms should be welcomed from all sides – but they must go further in slashing development costs, fighting planning unreliability, and ensuring that developments of any shape and size can be fast tracked.
“Britain’s economic difficulties can be linked squarely to a failure to allow companies, industry, and developers from building. The government can, and must, turn this bill into a Developers' Charter.”
Marc Harris, co-chair of Labour YIMBY, told PoliticsHome the government’s planning reforms are a welcome move but it must go further to boost growth to fund better public services.
“If the government goes further, it can unlock even more growth, build more homes, and cut housing costs for everyone. Planning reform is the key to rebuilding Britain. Back the builders, not the blockers and deliver the 1.5 million homes the country needs.”
The government set a target of building more than 1.5m homes over the course of the parliament.
The Office for Budget Responsibility stated in its assessment in March that the government's inital planning reforms will increase the level of productivity by 0.2 per cent by 2029. The report added that the increase in residential planning reforms would increase construction sector productivity and housing services.
At the same time the government is in desperate need to stimulate growing industries and find more tax revenue after an independent report suggested the Chancellor was set to miss her 'stability rule' by £41.2bn.
The National Institute of Economic and Social Research stated that higher-than-expected public borrowing, the reversal of welfare cuts and weaker GDP growth have contributed to this. The think-tank expects UK GDP to grow modestly at 1.3 per cent and 1.2 per cent in 2026.
Ant Breach, director at Centre for Cities, told PoliticsHome: "Planning reform is at the heart of the government's economic strategy because the planning system is one of Britain's biggest economic problems. It blocks new homes, delays new development and regeneration, and makes us all poorer."
Sebastian Charleton, digital and communications manager at the Adam Smith Institute, said: “The government must not make the mistake of caving in to the demands of a vocal minority of Nimbys. After decades of failure to build homes and infrastructure, any serious attempt to grow Britain’s economy must start with getting Britain building.
“Liberalising planning permission would not only cut housing costs, boost productivity, and give young people a much‑needed foot on the housing ladder – it would also generate the growth required to fill the Treasury’s coffers.”
James Yucel, Director of Conservative YIMBY, said: “Labour talk a good game on growth when it suits them - but fail to understand the tangible consequences of surrendering on planning reform to a bunch of obscure eco-lobbyists.”
The Housing and Communities department was contacted for comment.
