UK Labour plans housing, energy and infrastructure planning reforms

Iain Gilbey and Robbie Owen of Pinsent Masons were commenting after senior Labour members – including party leader Sir Keir Starmer – committed to reforming planning rules if the party is voted into government at the next UK general election.

Speaking at the annual Labour party conference in Liverpool, Starmer, deputy leader Angela Rayner, and shadow chancellor Rachel Reeves, all provided details on the party’s plans to “get Britain building again”.

Starmer pledged that Labour would ensure 1.5 million new homes are built over the course of the next parliament, through the creation of “new towns” and by exploiting so-called ‘grey belt’ and ‘brownfield’ sites for development.

Starmer also said new development corporations will be given powers to “remove the blockages” that curtail development currently. Development corporations have been used historically to deliver projects such as 'new towns', mixed use regeneration and urban extensions. They can help boost development by providing focus, coordinating plans for new development across different local authority boundaries and demonstrating the necessary public sector commitment to give the private sector the confidence to invest in sites and early infrastructure delivery.

Rayner said a Labour government would ensure new social and affordable housing is built faster, including by changing planning rules to “prevent developers from wriggling out of their responsibilities”. It is common for planning permission for development to be granted on a conditional basis. Developers often must commit to building a certain proportion of social or affordable housing, or infrastructure such as roads or community facilities, alongside their main plans for development, under ‘section 106’ agreements. Iain Gilbey said these agreements are negotiated hard through the formal planning application process, and the extent to which they can be avoided or renegotiated is tightly controlled.

Reeves said a Labour government would fund 300 new planning officer roles within local planning authorities to speed up planning decisions by raising the stamp duty surcharge on overseas buyers. However, Gilbey said that the reality of existing resourcing and skills gaps in local authorities is such that this number would not to be sufficient to achieve the step-change in service levels that will make a real difference to the delivery of schemes.

Labour said it would update all national policy statements relevant to NSIPs within the first six months of a Labour government. Starmer said it would enable “roads, tunnels, power stations” to be “built quicker and cheaper” and he also alluded to further efforts to speed-up connections to Britain’s electricity grid too.

Reeves described Labour’s proposals around planning as “a once in a generation set of reforms” that would help to “accelerate the building of critical infrastructure for energy, transport and housing”. She said it would help fast-track projects such as those that can deliver new battery factories, life sciences and 5G infrastructure, describing the current planning system as “antiquated”.

Reeves added that Labour wants to “tackle the litigation which devours time and money before we even see shovels in the ground” too. The party confirmed that this initiative would take the form of “clearer national guidance for developers on the engagement and consultation expected with local communities”.

Labour will also ensure local communities that host national infrastructure “feel the benefits” of doing so – such as through lower energy bills, Reeves said. The detail of how this will be secured is awaited.

Iain Gilbey said that Labour’s focus on the planning system was welcome but that the “sophisticated but flawed” nature of the system means “there are simply no quick fixes to its perceived or actual shortcomings”.

Gilbey said: “The main differences that a Labour government could make would be significant funding interventions in already stretched local authority planning departments, ring fencing increased planning fees to those departments and extending the reach of the NSIPs regime to include large scale residential led development and garden communities.”

“The reality is that the vast majority of affordable housing in this country is delivered and partly funded by or in partnership with the private sector. As such, if housing delivery is going to drive the economy, then there needs to be a period of certainty and stability in the planning system – further ‘quick fix’ and piecemeal reforms will not help with that, and will have the effect of slowing not accelerating housing delivery,” he added.

“The introduction of the term “grey belt” into the planning vocabulary signals a welcome review of the role that green-belt land could play in delivering new housing – but definitional certainty will be required if the release of that land isn’t going to meet continual and effective opposition from local authorities and communities. In the event of a Labour government, early interventions in local planning decision-making, by a new Secretary of State, will be watched with keen interest, to see if the stated intent is matched by real decision-making,” Gilbey said.

Robbie Owen said that it is important for any would-be party of government to demonstrate to industry that it understands the reasons why the NSIPs planning system has slowed in recent years and what could cure this. He said making sure that National Policy Statements, which are currently in the process of being refreshed, are then kept up-to-date, and that the resources of various public bodies that engage in the planning system are improved, are important measures in this regard. He said: “These measures are needed across the whole spectrum of national infrastructure required for the UK to succeed in the decades to come and so it would be a mistake just to restrict reforms such as fast-tracking to just battery factories, life sciences and 5G infrastructure”.

According to Owen, central government would likely need to retain a degree of power to impose development corporations on local authorities. He added that a “proper national spatial plan” was needed to facilitate Labour’s housebuilding aspirations and to maximise the impact that development corporations might have.

Owen said: “The reality is that the legislation for all types of development corporations is quite antiquated, dating from the early 1980s, as well as being very tortuous and complex. It could do with a complete overhaul rather than continuing with the legislative bolt-ons we’ve seen since the 1980s, with the creation of mayoral development corporations, locally-led new town development corporations and now, in the Levelling-up and Regeneration Bill, locally-led urban development corporations.”

He added that there were likely to be practical challenges in delivering housing and other infrastructure on land where there is local opposition to development – even with the new incentives scheme Labour is proposing. He said: “Putting in place a formal benefits framework for local communities hosting national infrastructure would certainly be a valuable step forward but this will need to be done carefully and there must be total transparency in terms of the benefits being offered so there is no suggestion that local communities are being bought off.”