Published:

45 comments

There was something soul-crushingly inevitable about announcement that the Government is going to abandon the algorithm at the heart of its planning reforms. But how big a setback is it?

To hear them tell it, not much. The core overhaul of the planning system – summarised here by London YIMBY – remains in place, including the part where areas are ‘zoned for growth’, a process that will, as Housing Today puts it, “grant automatic permission for development in certain areas”.

But ‘zoning for growth’ is only useful if you do it where the demand is. It is quite clearly a mechanism for brute-forcing a degree of much-needed development past the “more homes yes, but not here” brigade. Yet following a mutiny by Conservative backbenchers, Robert Jenrick has abandoned the algorithm the Government had been using to decide where such zones should go.

We don’t yet know what is going to replace it, but we do know that it will fall much less heavily on leafy, Tory-voting shire seats in the South East – a tactical victory for MPs such as Theresa May, whose Maidenhead constituency is now spared the shadow of a few hundred new homes.

The go-to solution for these MPs seems to be more development in urban areas. But this is clearly parcel-passing, and the problems are various. In London, where the demand really is, it will likely mean another unpopular application of ‘zoning for growth’ to push for densification in the (also Conservative-voting) suburbs. Otherwise it entails, as Bob Seely suggested in a piece for this site, shifting housebuilding targets northwards (where the demand isn’t) in the vague hope that economic regeneration will follow.

Unless you have ‘simultaneously build more houses and make no dent in the housing shortage’ on your housing policy bingo card – and given the state of British housing policy, you might – this likely isn’t a good idea.

In any event, given the backlash it will likely spark (Google ‘garden grabbing’ for a foretaste of it) it seems probable that the Government will eventually retreat from this as well, raising the spectre of a wholesale surrender of any effort to fix the Southern housing shortage by shifting the focus northwards under the rubric of ‘levelling up’.

If so, that would stand in a long and counter-productive Conservative tradition of trying to solve the problem without aggravating any of the vested interests in the Party’s electoral coalition, such as the repeated efforts of Chancellors from George Osborne onwards to solve a supply problem by pumping more demand into the market via schemes such as Help to Buy.

Yes, housing is a complicated problem and issues such as excessive credit – which we tackled in the ‘Homes’ section of the ConHome Manifesto – are part of it. But if your goal is to spread genuine property ownership, then jury-rigging mechanisms for getting cut-price assets into the hands of first-time buyers runs into the same problem that Margaret Thatcher’s attempt to create a ‘shareholding democracy’ did: how do you stop people selling them on at full price? Laws restricting the scale of mortgage lending to more old-fashioned levels may be part of the answer, but its absurd to pretend that they’re an alternative to building more houses.

Addressing the housing shortage – and once again for those at the back, the Southern housing shortage – has to be a strategic priority for the Conservatives. The current situation is delaying home-ownership, family formation, and otherwise reshaping society in ways antithetical to conservatism.

Not only is this squeezing the Party’s position in London, where the Tory vote in many seats has collapsed even since 2010, but it will spread the issue across the South East and the East of England as more London-based workers trade a longer commute for more affordable housing. Where Brighton and Canterbury have lead, many more true-blue seats could follow.

But what to do? Some of the Conservative-leaning think-tanks have their ideas. Alex Morton, the head of policy at the Centre for Policy Studies and a housing specialist, is working proposals to make an obligation to build part of planning permissions, to prevent developers banking the land value uplift without doing anything in return.

A paper for the Adam Smith Institute suggests the right ‘YIMBY’ policies could unlock up to five million homes in London alone, and they have elsewhere floated the idea of building ‘commuter villages’ near existing railway stations, effectively replicating the ‘Metroland’ project which saw swathes of north-west London basically built by the Metropolitan Railway. But it isn’t obvious that London’s main commuter lines could take this extra pressure (at least until High Speed ‘it’s-capacity-really’ 2 is finished), and in any event a proposal that involves building on the green belt is politically-speaking just a thought experiment.

Policy Exchange also lean towards densification, drawing on the work of the late Sir Roger Scruton’s lamentably-named ‘Building Better, Building Beautiful Commission’.

However rather than trying to brute-force development through in the teeth of local opposition, which is what ‘zoning for growth’ aimed to do, this agenda aims to win public support both by making sure new developments are attractive (cue the lamentations of architects) and by making sure existing homeowners profit from new developments:

“They propose that we allow streets to hold a vote on whether to let homeowners redevelop their homes. If a two-thirds majority support it, homeowners would receive planning permission to add floors to their homes and to take up more of their plot area. The limits on what streets should be able to grant themselves would be those of traditional European cities: five-storey buildings in a terraced format. Many streets would probably choose to go up to these limits in order to maximise the increase in property values.”

Stuffing the mouths of vested interests with gold is a British policymaking tradition – it’s how Labour sold doctors on the NHS, after all – and is probably going to be essential if the Government intends to succumb to Tory MPs’ demands that planning be ‘locally-led’. The alternative is waiting until Labour get into office and unleash a housing programme drawn up with no regard whatsoever to the interests and preferences of Conservative voters and MPs. Which, at that point, some might feel they deserve.

Whatever path he chooses, the clock is now ticking for Boris Johnson. If he wants the new planning system to have had any impact on the situation in the country by the next election, he really needs to have it on the books by the end of 2021. Otherwise new applications and so on won’t have time to get through. But if he rushes into a second policy that gets thrown out by MPs, that’s very likely to mark the end of any serious efforts at planning reform in this Parliament.

As I noted recently with regards to green targets, this country has a very bad habit of endlessly putting off difficult infrastructure decisions. That the Government is still dithering over expanding Heathrow suggests this hasn’t changed. The Prime Minister’s tendency towards procrastination is well-known.

But solving the housing crisis is not just of national but of existential political importance to the Tories in a way our ports, airports, and road network frankly aren’t. Johnson needs to make a decision; it needs to be the right decision; and it needs to be soon. If he isn’t prepared to be Britain’s house-building Bonaparte, the Prime Minister needs to be clear what Plan B is.