Miliband gives ultimatum to housebuilders

Miliband and housing minister Yvette Cooper met leading industry representatives on 21 September where they discussed the ODPM’s concerns that the increase in housing supply is flattening out – despite the impetus supplied by the government’s drive for increased growth across the South-east.

The department’s latest housebuilding statistics show that although completions were up 5% in the quarter ending June 2005, starts increased just 2%.

Last week, Building revealed mounting concerns that the government’s growth area strategy was falling apart.

At the meeting last week, ministers asked the housebuilders what the government could do to increase housing supply. The move comes in response to housebuilders’ claims that a lack of demand in the market was to blame for the looming fall-off in completions.

Housebuilding sources who attended the meeting said it had been “constructive”.

Miliband is understood to have told the housebuilders that he needed some guarantee that the industry would increase supply if the government took the political gamble of undertaking further planning reforms.

Miliband, who has tightened his grip on the ODPM following the appointment of his former schools aide, Peter Housden, as permanent secretary, is weighing up the department’s response to Kate Barker’s recommendation of further planning reform to stimulate increased housing supply.

The growth area strategies are holding up all sorts of development

Roger Humber

Planning consultant Roger Humber said the government’s growth area strategy was delaying rather than speeding up housing delivery. “The growth area strategies are holding up all sorts of development that should be taking place.”

He said the infrastructure-led approach to development outlined in the communities plan meant that development could not take place without upfront public investment.

As an example he cited Cambridge, where developments across the county are waiting for decisions on the widening of the A14 and the installation of a guided bus route, both of which require public capital investment.

John Slaughter, head of external affairs at the Home Builders Federation, confirmed that Miliband had met industry representatives but refused to provide any details of what had been discussed.

But he said that the HBF backed the government’s proposals, outlined in a recent consultation paper, to make the planning system more responsive to market signals. He said: “We have to make sure that we can provide a land supply to deliver whatever is agreed.”

He added that much of the opposition to the ODPM’s proposals was based on the “misconceived concept” that they were designed to rip out the heart of the planning system by allowing the release of sites for housing when the market was strong.