Starmer pledges planning reform as industry predicts collapse in housebuilding

Reforming the planning system to deliver more homes is to be a key plank of the Labour’s plan to grow the economy if elected as the next UK government, party leader Keir Starmer said today.

A document published this morning detailing Labour’s plan to deliver on Starmer’s economic growth mission said Labour would reform planning rules to deliver more affordable homes and help first time buyers on to the housing ladder.

The promise comes as the Home Builders Federation published a new report predicting that housebuilding rates could half to a post-war low in response to the decision by Michael Gove to water down housing targets in the face of backbench pressure.

The report, “Planning for Economic Failure”, said the proposed reforms to national planning policy, combined with the continued failure to address the challenge of nutrient neutrality and other planning blockages meant that net additions to the housing stock could fall from last year’s figure of 233,000 to under 120,000 – lower than in the wake of the Global Financial Crisis.

Starmer’s planning comments came after the Labour leader last week made a promise to deliver the strongest growth in the G7 one of five national “missions” that he says will define a forthcoming Labour government, if elected.

The document he published yesterday said that improving access to housing was vital to a thriving economy, and that among a Labour government’s first policy steps would be “helping first-time buyers onto the housing ladder and building more affordable homes by reforming planning rules.”

It added that Labour also intended to reform “arcane compulsory purchase rules” – which some see as the key to unlocking greater public and local authority housing development – and that Labour would provide “new protections for renters”.

Labour added that “updating” the planning system would also be among the first steps of a new Labour government, in order to “remove barriers to investment in new industries”.

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In a speech to the UK Finance conference launching the economic growth plan, Starmer said the idea that the planning system “should favour the already wealthy, not the new houses, wind farms, and laboratories we need to create more wealth”, was “not going to work for us”. He said this was because “that’s not going to work for growth, and won’t deliver what our country needs.”

Starmer said he wanted his plan to “to create more wealth, [and] lead Britain out of its low wage, high tax, doom-loop.”

However, the party gave no detail as to the nature of the planning reforms it intended.

Starmer’s intervention on planning comes after growing criticism from Labour of the government’s decision to back down on housing numbers in the face of back bench pressure from Conservative MPs. Housing secretary Michael Gove decided to water down housing targets under pressure from at least 60 Tory MPs before Christmas who had signalled their intention to support rebel amendments to the Levelling Up and Regeneration Bill, despite Starmer offering to lend the government the votes needed to get its housing policies through unchanged.

The HBF’s report blamed the government’s “anti-development approach” and its decision to “appease its backbenchers” for policies that it said will have “disastrous impacts on housing supply”.

In an analysis carried out by Lichfields its report concluded that the watering down of housing targets in the proposed NPPF reforms will cost 77,000 a year, with the blockages created by nutrient and water neutrality and recreational impact zones knocking anything up to a further 45,000 homes off annual supply.

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The HBF’s report said this scale of reduction would cost around 400,000 UK jobs and £20bn of economic activity, and reduce investment in affordable housing by £3bn.

Stewart Baseley, executive chairman of HBF, said: “The government’s capitulation to the NIMBY lobby and its mishandling of water and drainage legislation could see fewer homes built than ever before.

“The social and economic implications are stark and threaten to widen the ever growing intergenerational divide while costing hundreds of thousands of jobs. As we try to tackle the housing crisis during a recession, with tighter mortgage availability and no government scheme to assist buyers purchase new builds for the first time in decades, short-term political decisions to appease backbenchers seriously threaten confidence.”

Labour shadow housing and planning minister Matthew Pennycook, who last week promised to repeal the government’s proposed new Infrastructure Levy, said: “Rishi Sunak and Michael Gove chose to prioritise keeping Tory backbenchers happy over meeting housing need and the country is going to pay the price. Time for a Labour government serious about boosting the supply of new homes to buy and rent.”

Starmer described prime minister Rishi Sunak in the wake of the deal to water down housing targets as a “blancmange” that had “wobbled” in the face of the challenge from Tory backbenchers. He said: “He did a grubby deal with a handful of his MPs and sold out the aspirations of those who want to own their own home.”

Sunak at the time said the government was investing millions to develop brownfield sites and protecting the green belt. The consultation on the proposals to reform the NPPF closes this week.

A spokesperson for the Department for Levelling Up, Housing and Communities, responding to the HBF report, said: “We do not accept this analysis. We remain committed to delivering 300,000 new homes per year and we are investing £11.5 billion to build the affordable, quality homes this country needs.

“The proposed changes to the planning system are designed to support areas to get more local plans in place and therefore deliver more housing. They will stop communities being exposed to development by appeal, where developers push new sites through the system before they have built out existing permissions.

“We are currently consulting on these measures and will carefully consider any responses before deciding final policy.”