In a Tory Party election bloodbath, last week saw Sir Keir Starmer’s Labour Party win the general election in a landslide victory. There will undoubtedly be subsequent repercussions on the Property Industry and the planning matters as Labour has promised to address shortcomings in the planning system within the Party’s manifesto. With change anticipated to start imminently, we reflect upon Labour’s proposed reform and policy initiatives, and how these might start to be implemented within Labour’s first 100 days of power.

The Planning System

Importantly, the new Labour Government intends to offer reform which is hoped will result in the delivery of a planning system which is fit for purpose. Following previous announcements, by Rachel Reeves, Angela Rayner and Keir Starmer, it is widely expected that we will see at least three housing announcements the first fortnight of a Labour government. The first of these announcements has already been delivered by Chancellor, Rachel Reeves who has vowed to “fix broken planning system for housebuilding” through restoring mandatory house-building targets for Local Authorities in her first major speech as Chancellor. Further announcements are expected to include a local authority-led review of green belt land and the introduction of policy to support the development of lower quality ‘Grey Belt’ land and a commitment to working with local communities to bring forward a new generation of new towns; and a revised draft of the National Planning Policy Framework (NPPF) is also expected. We expand on these points in turn below.

Housebuilding

Keir Starmer has pledged to ‘get Britain building again’ through the commitment to build 1.5 million homes over the new parliament which was reinforced in the speech delivered by Rachel Reeves where she stated that Labour would tackle the long-standing shortage of homes. This equates to 300,000 homes per annum. The Conservative government previously set a target of building 300,000 homes a year in its 2019 manifesto, however, they only managed to build 234,000 homes per year. Therefore, if Labour is to succeed where their predecessors have failed, significant planning reform will be critical.

Rachel Reeves has announced that under Labour’s plans, the “right mix” of affordable housing and homes for social rent will be built. Labour has pledged to introduce a “Freedom to Buy” mortgage guarantee scheme which will be aimed at first time buyers with small deposits, akin to the Help To Buy scheme which ended in March 2023. There are limited details on the proposal, but it should enhance affordability for first time buyers, which will drive confidence amongst house builders.

Amongst Labour’s proposals and following on from Rachel Reeves speech, Labour have pledged a raft of measures including ‘mandatory housing targets that bite on individual Local Planning Authorities.’ It is unclear exactly what ‘mandatory’ targets would entail, however, housing targets as part of Council’s Local Plans were watered down, making them advisory rather than mandatory in late 2022. 

Revisions to NPPF

Undoubtedly, one of the most anticipated pledges set out within the Labour manifesto which are aimed at helping to help boost housebuilding are the proposals to revise the National Planning Policy Framework (NPPF) and reverse the December changes to restore housing targets and strengthen the presumption in favour of sustainable development. Labour could use the Written Ministerial Statement (WMS) and updates to Planning Practice Guidance (PPG) to push through changes without consultation therefore, revisions to the NPPF could occur as early as days or weeks into labour’s governance.

Under the latest iteration of the NPPF (December 2023), Local Planning Authority’s (LPAs) which have an emerging Local Plan that has either been submitted for examination or has reached Regulation 18 or Regulation 19 stage (including both a policies map and proposed allocations towards meeting housing need), are only required to identify a minimum of four years’ worth of housing. If these changes are reversed, we have calculated that at least 20 local planning authorities across the country would consequently lose their four-year protection, which would need to be addressed swiftly. 

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The introduction of the ‘Grey Belt’ would see the development of lower quality or Previously Developed Site’s be developed under a sequential approach. Additionally, Labour is seeking to reverse the December NPPF changes and explicitly states that there is a requirement for Green Belt boundaries to be reviewed through the Local Plan process. Whilst politicians hope these changes will act as a mechanism to speed up the delivery of housing, it will be imperative that clarity is provided on the definition of ‘Grey Belt’.  

There will also be a need to take stock in respect of the delivery of high street regeneration and the application of the town centre first policy approach. For example, the sequential and impact tests will have an ongoing role, but further direction in their application may give clarity to developers and local planning authorities alike.

It has only been a matter of days since the new UK Labour government came into power, yet change has already begun to take effect. In her recent speech, Rachel Reeves has announced that Labour will accelerate the development of large green energy projects by assessing them nationally and not locally and that Labour have plans for the onshore wind moratorium to be removed. A policy paper has been published on 8 July 2024 which announced that the government is set to lift the de-facto ban on onshore wind in England. The changes took immediate effect however, the government will confirm this position to Parliament on 18 July before these changes are also reflected in the forthcoming NPPF update.

New Towns

Labour previously announced that it would draft up a “New Towns Code” which will include requirements for 40% affordable housing, tree-lined streets, locally inspired design, good links to town and city centres, guaranteed public transport and public services, from doctors’ surgeries to schools as well as access to nature and children’s play spaces. The Government has committed to appointing a new towns taskforce of independent experts to select the possible sites, with factors to consider including local views, plus a suitably high demand for new housing and the prospect of jobs and transport infrastructure. Labour is aiming to reveal the new town sites within the first year in power.

CPO

Following the reforms made to CPO Levelling Up and Regeneration Act 2023, Labour has committed to further reforms to the compulsory purchase compensation code under its Election Manifesto. Whether that will mean wholesale reform or tinkering at the edges to make the process speedier and more efficient is yet to be seen. The promise of “fair compensation” will be of particular interest as the LURA reforms have removed the ability to claim for hope and development value in some circumstances. There is no indication Labour will repeal this part of the 2023 reforms.

How CPOs will be used more strategically to unlock large scale housing and infrastructure delivery and by whom will be a key. The delivery of housing across local authority boundaries and in New Towns may mean enhanced CPO powers to Combined and Mayoral Authorities or new Urban Development Corporations. The last Labour Government established various quasi-public bodies to ensure delivery in key areas of growth and need and this Labour Government may seek to do the same.

Town Centres / Funding Delivery

The Government will need to review the success of Levelling Up, together with other funding programmes supporting the high street, and understand the return on allocated investment. In practice, a recent cross-party committee which scrutinises government spending to assess its value for money identified that only 10% of the funds allocated for the Levelling Up Fund, Towns Fund and UK Shared Prosperity Fund had been spent as of March 2024. Although the last Government expected the capital spend on projects to increase over the next 2 years, the chair of the Public Accounts Committee stated that the Government is “struggling to even get the money out of the door to begin with”. This is also due, in part, to the impact of significant hikes in interest rates and construction costs, which now means that many projects costed for over 2 years ago are no longer viable.

 As Lambert Smith Hampton and Revo’s recent joint Places and Spaces Reinvented report underlined, town centre regeneration can take a generation – as evidenced by Kings Cross and Battersea in London, Liverpool One, and Birmingham Bull Ring. We therefore hope to see further capital funding which exists beyond a 3 to 5 year programme, with Homes England at the fore to help deliver wholesale change and create attractive and entertaining places where people of all ages want to live, work, shop, study, play and socialise.

Legislative Changes

Whilst changes set out above could be executed through use of a Written Ministerial Statements or updates to the National Planning Policy Framework or Planning Practice Guidance, other pledges within the labour manifesto can only be implemented through legislative changes. 

Parliament is convening on 9 July and Labour government’s first King’s Speech outlining legislative priorities is to be held on 17 July. It is predicted that primary legislation will include additional New Towns legislation, including a new “Towns Bill”, which will also seek to address compulsory purchase powers. 

Legislation to support deeper devolution including new and devolved powers relating to housing and planning through a Take Back Control Bill as well as provision for further planning reform including cross-boundary strategic planning and measures to speed up the system.

Given that the process of bringing forward New Towns will be lengthy, it is expected that Labour’s ambitious plans to tackle the national housing shortage will quickly be announced inviting areas to bid almost immediately. 

As ever, the devil will be in the detail, and we will be producing more content and information as soon as further details are released in the coming weeks and months.