Housing minister says councils will replace ’unsustainable’ developments after ’shake-out’

Grant Shapps, the housing minister, has admitted that the coalition’s abolition of the regional planning system will lead to councils cancelling large housing schemes.

In his frankest comments so far on the lengthening planning hiatus, Shapps said it was “no surprise that unsustainable schemes are being canned” by local authorities.

Shapps has written to councils to remind them that he intends to offer financial incentives to those that allowed housebuilding to go ahead. However, the wording of the letter, which is thought to have been delayed for two weeks by the need to gain approval from the Treasury, gave no details as to how the scheme would work, or what the incentives would be.

His comments came in the week Cala Homes announced it was seeking a judicial review of the decision by Eric Pickles, the communities secretary, to abolish the regional strategies that set housing targets (see below).

Shapps said: “The big picture is that if you tell people they no longer have to build in areas they don’t want to build, then there’s going to be an early shake-out, and it’s good that there is.”

However, he maintained that ultimately more homes would be built under the new system, as councils realised the financial implications of halting development. He said: “We’re pro-development. But it’s a radical departure for local authorities, who keep asking us what we want them to do. I tell them ’It’s really up to you.’”

Last week it emerged that councils in two of Labour’s four growth areas planned to rein in housebuilding. When asked about this, Shapps hinted that the coalition might abandon the growth areas policy. He said: “From now on it’ll be up to them if they want to be growth areas. The days of government picking solutions has led to nothing.”

Shapps wrote to councils in growth areas in July saying they could get access to £167m of “growth” funding only if they could show local support.

Richard Kemp, vice chairman of the Local Government Association, said this week’s letter to councils would not solve the planning crisis. “The government needs to do a lot more work before the finance directors of councils will make important decisions on vague policy directions.”

Roger Humber, strategic policy adviser at the House Builder’s Association, said the letter showed merely that Shapps had Treasury approval for his plan: “There is absolutely no detail - councils need to know how attractive an incentive this is.”

’We’re giving control of planning to local people’

Grant Shapps, the housing minister, explains why coalition policy is going to mean a faster, fairer planning system With housebuilding languishing at levels not seen in any peacetime year since 1924, it’s crystal clear that something has to be done to ensure that we build the homes the country needs. And with five million people on social housing waiting lists, it is also clear that urgent action is required.

We have wasted no time in scrapping the ineffective, top-down planning system that forced unsustainable development on communities. Instead, we are returning control of a faster and more responsive planning system to local people.

So instead of regional spatial strategies that dictate where developments should take place with little regard for the views of residents, it will be up to communities to decide how and where to build, and how their areas should grow.

But perhaps most radical of all will be the introduction of a New Homes Bonus early in the next Comprehensive Spending Review period. This bonus system will ensure that councils that go for growth and housebuilding will receive direct and substantial extra funding to spend as they wish. This could be used to offer council tax discounts to residents, improve facilities or boost services.

This week, I have written to councils outlining the need for them to have an open debate with council tax payers about the benefits of new developments - and how the New Homes Bonus will ensure they reap the rewards, not just cover the costs.

My message to council planners is simple: the action you take now to give planning consent and support new developments where they are needed and wanted will lead to this New Homes Bonus. Seize the moment.

It’s grim down south

How the abolition of the regional planning has allowed councils to rein in housing development:

a) Ashford is consulting on reducing 31,000 homes target by up to 25%

b) Aylesbury Vale is reviewing the need for 5,400-home Salden Chase scheme

c) Bristol council has reduced target by 6,000 homes

d) Cotswold council has reduced target by 900 homes

e) Exeter council has reduced target by 3,000 homes

f) Forest Heath council has turned down 1,200 home Hatchfield Farm scheme because of RSS decision

g) North Somerset council has reduced target by 10,750 homes and

h) North Hertfordshire council and Stevenage council have suspended plans for 9,200 homes.

i) Torbay council has reduced target by 5,000 homes

Minister halts 1,300 homes in Milton Keynes

1 Housing minister Grant Shapps has intervened to get the Homes and Communities Agency to withdraw its planning application for the 1,300-home Oakgrove scheme in Milton Keynes, following lobbying from a local MP.

Shapps said he asked the HCA to look again at the scheme, which it is developing with Crest Nicholson, after being informed by Mark Lancaster, the Conservative MP for Milton Keynes, that it lacked local support. The HCA withdrew the application, and is now in discussion with local campaigners to reduce the number of homes by 200 and change the design of the scheme, before resubmitting it.

Shapps said: “I told the HCA in no uncertain terms that it was outrageous that it was totally ignoring government policy, which is to follow the wishes of the local community. You can’t instill localism into the public realm unless government agencies get it as well.”

The Oakgrove scheme is the second version of the development; the first was ripped up after local opposition to the partial pedestrianisation of the city’s high-speed grid roads.

John Bint, a councillor whose ward contains Oakgrove, said he had met with Crest, the HCA and Mark Lancaster since the application was pulled and received assurances the application would be revised. He said the HCA had agreed to reduce the density and the build height of the scheme, and increase the number of schools. “We’re hoping they’ll come back with something we can support,” he added.

Cec Tallack, the Lib Dem leader of the council, said: “We’re not opposed to Oakgrove but the previous proposals were completely unacceptable.”

The HCA chief executive Sir Bob Kerslake said he hoped to submit a revised application in September.

Milton Keynes council is considering reducing the 2,130 planned annually to as little as 1,250.

Harlow extension in doubt

2 Land Securities’ plan to build a 10,000-home extension to Harlow in Essex has been thrown into doubt following the abolition of regional planning strategies.

The developer has been working on the scheme with Places for People since they bought the site from BP’s pension fund in 2008.

The development is supported by Epping Forest council, which covers Harlow, but the extension is in the borough of East Hertfordshire, which opposes the plan.

The area was earmarked for 10,000 homes in the East of England plan, but the revocation of regional strategies means it is now up to individual councils to decide how much housing to build.

Tony Jackson, leader of East Herts council, said: “We’ll continue to consultant our residents, and if they’re enthusiastic we could change our mind, but I think we know our voters.”

Cala: ditching RSS ’illegal’

3 Housebuilder Cala Homes has launched a legal challenge against the government’s decision to scrap regional planning strategies.

The Edinburgh-based builder said the decision by communities secretary Eric Pickles to abolish the RSSs, which contain housing targets for councils, was unlawful without primary legislation, and should be put to judicial review.

Cala had its 2,000-home Barton Farm scheme in Winchester, Hampshire, turned down in June, shortly after the plans were abolished, and says it has been left with no basis to appeal because of a lack of transitional arrangements. An appeal date has since been postponed.

A Cala spokesperson said: “We are simply seeking to establish the legal framework that we operate within.”

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