The Subplot | Govt is resurrecting regional planning: here’s how

This month’s long read

• Blind faith: why the government is about to give regional planning another try
• Elevator pitch: your regular guide to what’s going up, and what’s heading the other way

Listen to the podcast

SLOW HAND-CLAP?

Regional planning is back

Welcome back, old friend. Regional planning, abolished in 2011, could be about to make a comeback as the government struggles to find ways to grow the economy. But we’ve been here before, and we don’t know whether it works.

Expectation management is not easy at the best of times, and this isn’t the best of times. Chancellor Rachel Reeves, speaking on Tuesday at Hull’s Great Northern Conference, had a tough job. Six months into a new government, the chancellor of the exchequer isn’t spreading much seasonal comfort and joy. She needs a win. From the Treasury, it looks like sorting out the regional planning system is an easy (and relatively cheap) way ahead.

Welcome to the graveyard

Planning has been a top target since day one of the Labour government. Reeves, speaking days after the election, called the planning system the “graveyard of economic ambition” so you would expect rapid action. But the rhetoric has struggled to match activity. The Labour manifesto from June this year said: “We will immediately update the National Policy Planning Framework [sic] to undo damaging Conservative changes, including restoring mandatory housing targets.” “Immediately” turned out to mean “before Christmas” and the word on the Whitehall streets is that a response to six months of consultation will come before Parliament goes into recess on 19 December.

Troubled rewrite

The delay is no surprise to anyone involved in development because nobody thought there was any easy rewrite that could deliver. The NPPF sets the rules for development, it doesn’t suddenly change what is viable. Moreover, tampering has all kinds of unhappy side effects: last week, in the wake of Storm Bert, environment secretary Steve Reed said it was “an inevitability” that new homes would have to be built on flood plains. At the very least that’s a hostage to fortune.

Eyes on the detail

Maybe the place to look for change is in the deadly dull detail of what’s called a local authority’s duty to co-operate. Last week Matthew Pennycook, minister for housing and planning, spoke in a brief Commons debate on the subject, and was instructive.

Veto the veto

Pennycook’s first target was the veto that local council’s have over metro mayoral plans. In the metro areas of the North’s great cities, the leaders of all local councils have to agree on planning (and much else), and when that doesn’t happen, things fall apart. Stockport’s withdrawal from the Greater Manchester Spatial Framework was a case in point. But Pennycook suggested the day of the veto might be drawing to a close. “A lack of effective levers, whether that be governance arrangements that require unanimity or an inability to set the strategic direction for where new affordable housing should be delivered, prevents mayors who do have spatial planning powers from realising the full potential of those powers,” he told MPs. That sounds a lot like a warning and will not be popular.

Talk to your neighbours

Elsewhere co-operation across local council borders is “entirely discretionary and the current incentives are weak,” Pennycook said. “The result has been large parts of England where no strategic planning activity takes place, a number of notable local plan failures, increased delays in local plan production, growing public antagonism towards the planning system, and a yawning gap between the amount of development that the country needs and what is actually being built.” The upshot, said Pennycook, was the NPPF gets revised to strengthen the requirement to co-operate.

If in doubt, legislate

And there’s more. The minister trailed a new law that will introduce “effective new mechanisms for cross-boundary strategic planning through legislation, with a view to implementing a universal system of strategic planning in this Parliament.” This feels like a return to the pre-2011 regional planning age: regional spatial strategies were developed between 1998 and 2010, at which point the coalition abolished them. The North West’s bit the dust in 2013. Only one survived, the London Plan, which sets the framework within which individual boroughs work. The new regional plans will work like London’s, said Pennycook, explaining it will be “where those larger than local level questions and negotiations about large-scale housing growth will be determined.”

Gone but not forgotten

Nobody really liked RSS – they took forever to write, and because they felt distant and top-down, managed to upset a lot of people. But removing them and replacing them with a cloudier duty to co-operate was recognised as a problem by the House of Commons housing committee almost immediately. The committee said without them low-status but politically tricky issues like waste disposal, energy projects, quarries, and traveller sites would be neglected. They were mostly right.

Does any of this work?

What we really don’t know is whether RSS made any difference to economic growth, or housing delivery, or anything. There is a remarkable lack of evidence not just for RSS, but for the effectiveness of any spatial planning document, and no obvious agreement on how you’d work it out. It will be interesting to see if the government can provide any when it publishes its regional planning bill in the new year. In the meantime, some suggest that over-reliance on planning documents might exacerbate, rather than open-up, the development process. Policy Exchange, the right-leaning think-tank, has argued that these documents are so vast and so complicated – and hence so hard to review or adapt – that they freeze land allocations, limit land supply, and thus, push up land prices. Worse, the plan is always open to interpretation: plans provide only “an informed prophecy of what kind of development is likely to be permitted and what is likely to be prohibited.”

True believers

Given that this is largely an evidence-free zone, faith is what seems to be driving the regional planning agenda. The thought seems to be: we tried it last time, so let’s try it again. If Centre for Cities is right that Labour will fail to hit its target of 1.5m homes before 2030 by nearly 400,000 then something more than faith may be required. One option would be for the government to build houses itself, but that’s been off the agenda for 40 years and probably isn’t coming back.

Not a one-trick pony

Of course, the government has other ideas – not just regional planning – as Reeves told her Hull audience. The £27.8bn National Wealth Fund, based in Leeds, has been touted as a regional game-changer. It is there to do big complicated things. But just £4bn is allocated to local authority-related work and it has many demanding calls on its resources. There’s also infrastructure promised, such as the £11.5bn electrification of the 76-mile central section of the TransPennine rail route, due to be completed by 2033. Yet government still expects tinkering with the planning system to do a lot of the heavy lifting.

ELEVATOR PITCH

What’s going up, who is going down

Investors who leaned heavily into BTR are enjoying massive occupancy and healthy profits – definitely a week to go up. But if you like rental controls, or slightly off-pitch office blocks, it’s not been such a good week. Doors closing, going down.

Rent controls

There’s no arguing that BTR has paid off for Newcastle-based mega landlord Grainger. A 48% leap in profits thanks to build-to-rent occupancy of 97.4% suggests a flourishing business model as the PLC prepares to transform itself into a real estate investment trust. Life as a REIT will be a lot easier now that the government has stopped flirting with the idea of residential rent controls in England.

Over the summer, ministers were forced to state outright that they had no plans to devolve power to control rents to the London Mayor. Andy Burnham got the message, too: the Greater Manchester Mayor is now working with landlord organisations to devise a Good Landlord Charter.

Instead, the government insists that improving the supply of properties is the best way to control rents, which sounds logical. But supply is not so much about new-build of the kind Grainger supports, but low-tech, buy-to-let of a kind governments have, recently, regarded as a nuisance. Supposing rents don’t fall, rent controls will inevitably come back onto the agenda.

Property bazball

Pick your cricket metaphor – caught behind, bowled out, stumped. Whatever it is, Logik Developments, the property business co-owned by former England fast-bowler Andrew Flintoff, was forced to walk back to the pavilion on Monday when its planning permission for a 215,000 sq ft office block at Mayfield in Manchester, expired. The site was a little off-pitch, if you’ll forgive the expression, and there were plenty of people predicting the scheme wouldn’t get far when consent was granted in 2020.

The winners are probably LandsecU+I and their chums in the Mayfield Partnership, who now have a clear path to build a £400m first phase. The word is that Lendlease will be contractor for a 240,000 sq ft block.

The official line is that the offices are coming soon, and paves the way to 1,700 apartments on a site that will have a more residential flavour than first thought. But LandsecU+I are not fools, options for this site are still open, and there’s a long time until the close of play.

Get in touch with David Thame: [email protected]