The TCPA Annual Conference at The Liberal Club came as blessed relief recently. A time to reflect on the past, present and future of the planning system. An enjoyable and valuable time out from the cycle of meetings, presentations, train journeys and hotel check ins. I still can’t quite believe it’s only been 4 months since I was lucky enough to take on this national role.
The conference also allowed me to reflect on all the various land, housing and planning presentations I have seen since joining Barratt. I came to the conclusion that one of my favourites was by Andrew Carter at a fringe event at the Labour Party conference. Why? Well firstly because he reflected many of my own views (obviously essential) but he also provided interesting new evidence on the subject. In particular Andrew made the point that whilst in his view the land, housing and planning systems are dysfunctional – everyone behaves rationally. No sector or grouping can be described as irrational given what is front of them.
Planners tend to behave rationally in my experience. The problem is that planning departments are massively understaffed and they sometimes get asked by local politicians to take decisions which feel to them (and us) as irrational.
Local politicians behave rationally in a localism world. Their job is to get elected. New housing is unpopular so they are often opposed to it. They get elected by a small community. They reflect what that community wants rather than what is required by the duty to cooperate or some “larger than local” planning issue. They sometimes berate developers, again perfectly rational because many communities don’t want development.
Housebuilders also behave rationally. We have to build houses (clue in title) and we have to do it profitably. No job for me if we don’t. We face an under resourced planning system and a shortage of adopted plans. We also have perhaps too little risk appetite. Why? Because many of us nearly went bust 5 years ago. Again perfectly rational when you consider planning consent costs are roughly £2m per 1000 houses – from pre app to construction. Therefore we are now compete trying to outbid each other to buy land from either the public sector or the land promoters who have taken the risk to secure planning permission. We then try to build and sell in a way which ensures we make a profit – for the reason given above. Again all rational.
Local communities tend to behave rationally. It is a peculiarly British trait that when it comes to retirement planning we often place some reliance on the value of our prime asset – the home. As such when the housebuilder comes along to build houses at the end of the street we think it might adversely affect the value of our home. Especially if we are not too far off retirement age. The thinking is that if planning permission is NOT granted then I can afford gold standard retirement provision. If permission IS granted it might be silver or bronze. Of course the reality is that new homes tend to lift local house prices but the fear and subsequent action cannot be described as irrational without compelling evidence to the contrary.
So what can be done? I don’t think that an overhaul of national planning policy is the answer. Looking back to days of PPG3 and PPS3 you would have to be a monumentally churlish developer to say Nick Boles hasn’t done a great job in delivering NPPF and NPPG in the face of huge opposition. Much of it from his own party! Sure there remain difficult issues at the local and “larger than local” level but in this modern multimedia world I suspect even the most hard-nosed planner and housebuilder accepts that a policy of forcing millions of homes on an unwilling Middle England would be difficult. Between 1947 and 1950 alone the state rocked up at 11 separate communities and told them all they were the now the fortunate recipients of a massive New Town. Personally I can’t see that being replicated going forward without major political difficulties if not civil unrest. Yes we need a more strategic approach but waving a New Town wand will be hard.
In the meantime NPPF tells us that if a Council doesn’t have a plan or a 5 year land supply it may be more difficult to defend a refusal of permission. In my view this way better than what we had 5-10 years ago.
For me the answer is that there is not one single answer. There are many levers to increase housebuilding and they all need to be pulled right now. Thinking about the most important themes at I am again drawn to the one of the key questions in Andrew Carter’s presentation. Namely how do we get more land into the hands of housebuilders earlier and at a price which make it easier for us to build beautiful developments with abundant social, physical and environmental infrastructure? Remember we actually want to do that because it means our homes sell more quickly and nobody should under-estimate the importance of early return on equity in delivering a profitable development. Debt is expensive.
The other theme for me is collaboration. Especially as there are no way we housebuilders can deliver what is needed on our own. I am doing more work in Scotland and they do seem to have cracked this consensus nut better than down here. Perhaps some lessons to learn. Also I am struck by the cross-sector cross party support for the brilliant “Yes to Homes” campaign. Anyone fancy launching a “Yes to Planning” campaign which focuses on how, when planning is done well, it delivers growth and beautiful places.