Recently the Mayor of London, Sadiq Khan, joined housebuilders in a call for urgent investment in new homes to avoid a national downturn. Following a 41 per cent year-on-year drop in major planning applications, the Mayor reconvened his London Housing Delivery Taskforce in August to prevent housebuilding “grinding to a halt”. On the 6th November the Taskforce set out 29 proposals to safeguard the deliver of thousands of homes, putting council housing at the heart of the plan. It comes as industry warns housebuilding levels are falling to their lowest levels since World War II.
The Taskforce set out a joint position statement that set out the current challenges impacting housing delivery, such as macroeconomic conditions, lack of government investment, policy uncertainty, funding rigidity, and planning. While the statement made a nod to uncertainty around second-stairs and funding cuts to local planning authorities, it failed to mention at all the dire need of reform that has been more recently highlighted by Sir Keir Starmer.
There was no calls for ‘planning passports’ for urban brownfield development, no calls for a package of devolution to Mayors with stronger powers over planning and control over housing investment, and no mention of the restrictive planning system blocking the aspirations of millions for home ownership. The plan to get Britain building again, which was cited by Sir Keir in his speech at conference as “a signal of our determination to fight the blockers who hold a veto over British aspiration”, was completely missing from the Taskforce’s statement.
Instead, in an email sent on the 5th November 2023 to the Secretary of State Michael Gove, the Mayor of London repeated calls for the Government to “inject an additional £2.2bn in Affordable Housing Programme grant to the capital”, as well as called on the Government to “reduce Public Work Loan Board (PWLB) interest rates”. It must be noted that the interest rates for the PWLB are determined by the Debt Management Office on behalf of HM Treasury in accordance with Section 5 of the National Loans Act 1968.
What did not make sense about this latter call, was how making PWLB lending criteria in line with private sector lending practices would make any difference at all, if the private sector would choose a similar rate anyway. It is obvious in an increasing interest rate environment that development will become less viable, for the very reason that is the intention of the rate hikes to remove capital from the economy.
The Mayor of London had previously much to be proud of with regard to the 140,000 new jobs created as a result of his record-breaking affordable housing delivery under the 2016-2023 Affordable Homes Programme. While it has been obvious that Government delays on fire safety rules have had a considerable impact on holding up the delivery of new homes, with this number cited by the Mayor at 34,000.
But calling for rent freezes, mortgage payment freezes, and the aforementioned calls to reduce PWLB interest rates seems more like screaming at the clouds when it rains. As opposed to calling for changes that will make sure the proverbial renter does not get wet in the future.
Meanwhile, Sir Keir Starmer has called for reforms to what has been dubbed as the “grey belt”, which include “disused car parks” and “dreary waste land”. This type of land has less viability issues associated with its development than brownfield. Yet this is at odds with the Mayor of London’s election pledges from 2021, which set out not just calls for ineffective rent controls, but also pushed ahead with a London Plan that fought against reducing “protection” for Green Belt and Metropolitan Open Land.
Sadiq has in effect sought to block all development on so-called Green Belt. In turn emboldening the NIMBY elements that perniciously reside in Greater London boroughs. One would have hoped the Taskforce would have leant in on the national picture and what the Labour Party leader has set out. Instead it appears to have removed its teeth on the real issues of reviewing Grey Belt and wider planning reform to placate appetite for easy to ask for, difficult to provide, funding reforms.
The late Sir Peter Hall highlighted the challenges that faced London by the “fetishisation of greenfield land”, before debating the nuances of what target at that time should adopt. The incoming Labour Government of 1997 adopted a target of 50 per cent to be built on brownfield, while the Urban Task Force of 1999 suggested 60 per cent. Sadiq Khan’s approach to date has been more extreme than the Conservatives when it comes to the Green Belt. His latest letter to Gove, despite citing significant falls in planning applications, avoided any discussion in this regard. Instead haplessly pointing towards asking for more money and the interest rate reduction fairy to wave a wand. None of which would help unblock our restrictive planning system.
