All Change? Best laid plans – Labour’s planning reforms

An analysis of the ‘why’, the ‘what’ and some of the ‘how’ of Labour’s central offer to deliver 1.5m new homes through planning reform.

Labour have been clear about the ‘why’ of their reforms to the planning system in England: their manifesto described it as a ‘major brake on economic growth’, imposing barriers to infrastructure and getting in the way of their ambition to build 1.5m new homes over the next parliament. The ‘what’ is removal of those brakes and barriers. This seems to us like an ‘anti-planning’ message, but the truth of the detail is that Labour will be required, and intend, to use the planning system as a positive tool for the change they seek to achieve.

Assuming a parliament of five years, the change sought is very ambitious – it works out to an average of 300,000 homes per year, which according to ONS data has not been achieved since 1977-78; and presumably Labour can’t expect to hit 300,000 in their first year, so that means they will have to exceed this number in later years of the parliament – say, the 1969-70 figure of 378,000. And yet, as will be seen, this ambition isn’t matched by any large injection of state money, except to recruit 300 extra planning officers – so these reforms are hoped to provide boosts to growth, without additional public spending.

Given the scale of the challenge, which developers of new homes are expected to play their part in resolving, we think it is worth understanding the detailed ‘how’ of Labour’s policy on planning reform.

The major building blocks of Labour’s plan for planning are:

1. Changes to substantive planning rules;
2. Changes to the planning decision-making system – including one funded spending commitment for planning officers; and
3. Proposals for new towns.

Substantive planning: Fail to plan, plan for failure

England’s planning rules set the framework within which decisions are made. Some of Labour’s ideas about what to do to that framework are new, and some are amplifying existing provisions or reversions to earlier policy positions.

First, the new. The headline-grabbing change is the release of some greenbelt land for housing (with a particular focus on the lower quality ‘grey belt’) ‘without changing its purpose or general extent,’ and subject to ‘golden rules’ to ensure development benefits communities and nature.  In Angela Rayner’s speech to UKREiiF just before the General Election, she enumerated the golden rules as ‘ensur[ing] any grey belt development delivers affordable development, new public services, and improved green spaces’. This is where, as we said earlier, a first impression of Labour’s rhetoric may be contradicted by the substance. This reads like an ‘anti-planning’ policy – the removal of an impediment that is holding housing back. But it sounds as if the implementation will be a careful amelioration of the greenbelt policy which features in the public mind as a blanket prohibition on building new homes in the greenbelt. The reality is that the greenbelt has been encroached and built upon since it was first established. This policy is not abolishing a rule, but putting exceptions to it on a rational footing which focuses on the lower quality greenbelt.

Chief among the reversions is the re-imposition of mandatory housing targets through changes to the National Planning Policy Framework (NPPF). These targets were made advisory by the previous Conservative government following a backbench rebellion. It is probably inaccurate to characterise the advisory housing targets as a ‘brake’ on housebuilding – the truth is better expressed that planning isn’t being used to its maximum potential with an advisory target, and this change will likely contribute to the stated aim.

There are examples of amplification, such as strengthening of the presumption in favour of sustainable development. While Labour’s outline proposal is light on detail, and as lawyers we could think of ways to make this presumption copper-bottomed, this is not a new presumption (having celebrated its one-hundredth birthday last year). We’ll have to wait and see the detail.

Another amplifying move is threats to take tough action to ensure Local Plans are up to date: the Local Plans are meant to be the bedrock of the planning system and of the implementation of national policy in a local context, so this is really reinforcing what should already be happening, but is consistently not happening, namely the adoption and regular updating of Local Plans. The absence of an up to date Local Plan presents uncertainty and difficulty for planners and developers alike. This is likely to have a positive impact in delivery of new homes. We class this as a change to the substantive rules, because ultimately, the Local Plan is what should be setting the framework for decisions within a particular place. 

Planning system changes: another brick in the wall

Changes to the system – rather than the rules applied by the system – include one Government spending commitment. 

Labour intend to fund 300 new planning officers to support local planning authorities in considering and granting planning permission. This will be paid for by half of £40m expected to be raised by an increase in stamp duty surcharge from 2 to 3 percent on home purchases by overseas buyers. The increase in local authority planning resource will no doubt tend to have a positive impact on the speed of decision-making. Planning officers are the blood transporting the oxygen of decision-making through the body of the planning system. Whether an impact will be discernible, either in the short-term or by the end of the parliament, isn’t clear, and will depend on when the ranks of the public sector planning profession actually swell.

Labour have indicated they will take forward structural or mechanical changes – mechanisms for cross boundary strategic planning, giving Combined Authorities new planning powers and ‘freedoms and flexibilities to make better use of grant funding’ – which though vague at the moment, are in sync with the theme of enabling development and removing barriers.

New towns: Rome wasn’t built in a day – how about 12 months?

Back to the ‘what’ and the ‘how’ – how do you exceed all of the annual housebuilding figures since 1978? One of Labour’s answers is ‘a new generation of new towns, inspired by the proud legacy of the 1945 Labour government’ – as well as regenerating parts of existing developed areas or smaller scale development, foster the development of a ‘series of large-scale communities across England’. In October 2023, speaking at the annual Labour party conference, Kier Starmer linked this pledge to the use of new development corporations to ‘remove the blockages’. In the past, development corporations have played a significant role in high volumes of housebuilding in specific locations: prominent examples include the London Docklands Development Corporation which helped to  transform London Docklands, and the London Legacy Development Corporation which did (and continues to do) so much to deliver thousands of homes in and around the 2021 Olympic venues.

On the day before the general election was called, Labour’s Angela Rayner, now Deputy Prime Minister and Secretary of State for Levelling Up, Housing and Communities, addressed UKREiiF and put a major focus on new towns. She mentioned an independent taskforce and list of projects within the first 12 months of government, as well as homes on these sites within the first term of a Labour Government. She said that Labour would set out a New Towns Code requiring:

• “More social and affordable homes and a gold standard aim of 40%”
• “Buildings with character, in tree-lined streets that fit in with nearby areas”
• “Design that pays attention to local history and identity”
• “Planning for the future with good links to towns and city centres”
• “Guaranteed public transport and public services”
• “Access to nature, parks and places for children to play”

These promises are clearly inspired by the ethos behind the New Towns of the 1945 Labour Government. They also take on board long-running criticisms of New Town projects, and criticisms of some contemporary housing development, as ‘ugly’ by specifically referring to ‘character’ and ‘design that pays attention’: some potential ideas in response came from influential think tank Create Streets which emphasises local buy-in and beautiful homes.

This part of Labour’s ‘how’ has not been expanded upon during the General Election campaign and was not amplified further in Labour’s manifesto. Successful large-scale developments may be critical to reaching the 1.5m homes ambition – but it may rely on Labour’s other reforms to speed up that process significantly. There’s a particular tension between Labour’s potentially top-down, centralised taskforce drawing up a list of projects within 12 months, and Labour’s commitments to local identity and buy-in: it may be beautiful gentle density is the answer, or it may be that is another new utopia that won’t work – we don’t know. But the detail we have so far about the New Towns Code and the references to 1945 show, in our estimation, Labour’s acceptance of the need and purpose for planning as a vehicle for social and economic transformation through regulated development, not merely an obstacle to be bulldozed through, or irritating red tape to be heaped on the bonfire.

The future

We have some detail of Labour’s plans and can anticipate the positive impact this is likely to have on the development of new homes in England. Questions remain – some will be answered within the first months and year of the Labour government.

This article, written by Hannah Langford and William O’Brien, is one of our ‘All Change’ series analysing the likely impact of Labour’s manifesto commitments, now they’re in power. Visit our All Change article hub to read all available articles.