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Planning reforms to release more land for housing Matthew Warburton - 27/10/2014

NewBuild300Fully half the text of the Lyons Review report and 18 of its 39 recommendations relate to the first of the two major challenges it identifies - releasing more land for housing, primarily through reform of the planning system.

 

The primary thrust of the recommendations is to reduce local resistance to new development by ensuring local access to new developments and coupling investment in new housing with prior or parallel investment in infrastructure that is needed to make additional homes part of thriving communities.

 

Local housing markets do not respect local authority boundaries but operate across larger areas driven by the geography of commuting, migration and transport flows. Councils need to work together to develop local plans which support coherent strategies for these wider areas.

 

The current duty to cooperate, argues Lyons, is insufficient to make this happen, and should be strengthened with a duty for councils to work together to produce Strategic Housing Market Plans which, in appropriate circumstances, provide land-locked towns or cities with a "Right to Grow".

 

There are also proposals to simplify and speed up the plan-making process. Councils, it is argued, should also have the power to ensure that new development includes a mix of types and tenures that meets local housing need and to require that local first time buyers get first refusal on a proportion of new homes.

 

The report recognizes that local authority planning departments currently lack resources and skills. They would be encouraged to pool resources to work together on strategic plans, but also freed to raise planning fees to meet the full cost of improved services.

 

There is a widespread perception that landowners and developers hoard land with planning permission, speculating on an increase in land values which may be greater if fewer homes are built. This view, as one might expect, is contested by developers. Lyons does not take sides in this argument, but argues for steps to ensure greater transparency about the land market, with the Land Registry making land ownership information available to the public, including where land is subject to option arrangements.

 

This would provide clarity, he argues, about the extent to which speculation is actually taking place and provide the evidence to justify any action necessary to address it. Councils should also get greater powers to ensure planning permissions are implemented within a reasonable time. On his proposals, the life of a planning permission would be reduced to two years, and councils would get the power to charge council tax on development land after five years as if homes had been built.

 

Under current government proposals, the old section 106 arrangements for ensuring that local communities benefit from a proportion of planning gain are being phased out in favour of the Community Infrastructure Levy.

 

Lyons is critical of the likely impact of CIL and calls for a review, together with definitive guidance to ensure a single and robust methodology for assessing scheme viability, and hence how large a community contribution it is appropriate to ask for.

 

Without asking developers to make the maximum reasonable contribution, he argues, the costs of necessary infrastructure will create too large a burden on the public purse. However, a commitment to a sustained increase in public investment in infrastructure will also be essential if the aspiration of 200,000 new homes annually is to be achieved by 2020.

 

While the Lyons Review was commissioned by the Labour Party to advise on policy for the next government, should Labour form it, its analysis and recommendations repay careful consideration by any government looking to increase housing supply. It would be a pity if the ideas on planning in this report were ignored simply because of who paid for it.

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