The changes announced to the planning system by George Osborne (remember when planning used to be handled by DCLG?) are broadly to be welcomed but fail on two counts. They aren’t anywhere near radical enough and, anyway, it ignores the fact that planning permission is not really the main reason why so few homes get built in this country.
The key proposals aim to generate 200,000 planning permissions a year by 2020. That sounds amazing — until you consider that last year (2014) planning permission was granted for 195,000 homes in England and Wales. Adding an extra 5,000 to this over five years hardly smacks of ambition – it’s still 50,000 below the annual housebuilding target of 250,000 – and suggests that the problem of our woeful shortfall lies elsewhere.
It lies, primarily, in the way the housing market is set up. We rely, by and large, on the business decisions of around 8 major house builders for the overwhelming majority of our new builds in this country. Everyone I speak to in the housing sector tells me that the big developers are, broadly speaking, happy with (and indeed set up to build) their current levels. Much more and they risk their business models and, of course, risk pressure on prices.
The point is that the housing system needs to change radically in order to radically increase the number of houses. That means – and I would say this – unleashing the latent demand from self builders (1 in 7 wants to build their own home) but, frankly, planning changes announced today won’t help massively. We need exemptions for small sites; individual homes built all over the place and a liberalised regulatory regime. That might be too much for the UK’s NIMBY population, and it might be too much for our Government, too.