Addressing the housing crisis and delivering much-needed homes is central to achieving inclusive growth across the UK. Critical to delivering this is the New Towns Taskforce, established by the Ministry of Housing, Communities and Local Government, which is charged with identifying and supporting the development of a new wave of thriving towns across the country. A 2023 Parliament Report has estimated that building new towns could add £120bn to the economy annually, highlighting the significant economic potential of this initiative.
The task force is set to publish its comprehensive findings this summer. In February, it released an interim update outlining a series of key principles for the creation of new towns. It has already garnered significant attention, with more than 100 expressions of interest received, underscoring the ambition and potential of this initiative to drive housing supply, bolster economic growth and support the delivery of the industrial strategy. The priorities of economic growth, income, jobs and housing align with the findings of PwC’s 2024 Good Growth for Cities Report, further emphasising the importance of these elements in fostering sustainable development.
Drawing on the extensive experience of PwC and Trowers & Hamlins in advising on large-scale, complex brownfield regeneration and garden communities, there are five fundamentals central to unlocking delivery and achieving the government’s ambitious goals.
1. Clarity of purpose
The starting point for any new town must be a clear long-term vision; this will energise the project and attract support. In our experience, complexity is the enemy of delivery: the simpler the vision, the easier it will be to communicate to stakeholders and to execute.
This clarity of purpose will be driven by three main factors: place, people and partners.
Although some new towns may be built on bare land, according to the task force, the majority of submissions so far have been urban extensions, in which case the place that already exists will inform the purpose of the proposed new town. A detailed plan which recognises the unique nature of the land and infrastructure in situ and clearly maps out the necessary acquisition and development strategy is fundamental.
A clear understanding of the people the new town will serve will sit at the heart of a successful project and this will only be achieved through early and meaningful engagement with those communities.
Delivery depends on partners and, at the proposal stage, this will require pinpointing the unique institutions which will help anchor the identity of the project and identifying key delivery partners. In both cases, an understanding of the drivers of those partners, what success looks like for them and their red lines, must be embedded in the strategy from the outset.
2. Community buy-in
Early engagement with the local community is fundamental. Practically, this means those most affected should be consulted before key decisions have been made so their voices can help shape the vision for the new town.
When properly galvanised, communities can provide a helpful critical friend role and challenge norms from the perspective of their lived experience. This may require rethinking the usual approach to engagement in order to build trust. The starting place must be a genuine commitment to transparency and willingness to share decision-making with community stakeholders.
The co-production/co-design model is a useful tool to ensure community engagement is genuinely collaborative rather than a tick-box exercise. Although this will involve time and resources, the up-front investment can help de-risk a project by heading off local resistance and embedding long-term stewardship structures.
The form and content of communication must be carefully considered. In our experience, using plain language which is accessible to the community and a range of communication channels are important first steps. Moreover, a focus on the practical benefits the project will have on the local economy, social infrastructure, sustainability and green space are most likely to generate a positive reception.
3. Effective delivery models
New towns require robust powers, access to funding and delivery structures capable of managing scale, complexity and long-term coordination. Without effective delivery models that encompass land assembly, planning, infrastructure commissioning and funding, the risk of fragmented delivery and slow progress increases significantly.
Historically, development corporations have emerged as a key option for such projects. They offer strong powers, continuity beyond political cycles and the ability to borrow and plan strategically. But the cost and complexity of setting up these corporations pose challenges for project sponsors who cannot capitalise early through land acquisition and strategic planning.
Development corporations are not the only model available. Successful projects have been delivered through corporate joint ventures, master developer models and joint committee. However, each can present challenges including control, financial exposure and lack of statutory delivery powers.
While development corporations are likely to present the most effective model, the government must provide flexibility to capture local factors, such as risk appetite, local capacity and long-term vision, in order to guide the design of the delivery model.
Irrespective of delivery model, making entities easier and quicker to set up for identified new towns and providing the necessary powers and access to enabling resource funding in the early years will ensure a real impact during this and the next parliamentary term.
4. Where is the money coming from?
Creating new towns necessitates strategic planning, infrastructure delivery and effective placemaking. These activities generate value but this value often materialises later, leading to a mismatch between the costs incurred and the value realised. To bridge this gap, delivery models require effective borrowing powers.
Historically, various mechanisms have been employed to capture land value in strategic development. Direct land value capture involves acquiring land and selling it at a premium after planning and infrastructure are in place or negotiating contributions from developers. Indirect mechanisms include retaining incremental taxation generated through models such as tax incremental financing.
In practice, a combination of these methods is necessary to fully capture value to fund the infrastructure and placemaking efforts that create thriving communities. However, the extent of land value increase varies significantly by region, with higher increases typically seen in areas with higher house prices and greater viability.
To support the broader policy agenda, including devolution, inclusive economic growth and a regionally balanced industrial strategy, there is a need for geographically balanced delivery. This could involve grants for less viable projects, however, given broader financial pressures, the government has an opportunity to rethink land value capture, including the potential to “pool” value at sub-regional, regional or national levels to enable large-scale delivery across the country and meet broader policy objectives.
Beyond addressing land value capture, the government should consider other enabling roles to drive delivery, creating conditions that allow private capital to flow at scale and removing barriers for institutional capital to invest in shared ownership homes. There is also the need to create efficient subsidy routes and draw on private finance to deliver and own affordable housing long term.
The challenge of financing new towns is complex and multifaceted. The government must set the conditions and frameworks that allow local projects to select from a diverse array of funding and financing options, maximising their chances for success.
5. Planning and stewardship of community assets
To deliver homes at pace, the planning system must function efficiently. One of the key benefits of a development corporation is its planning powers, but unlike local authorities, such powers are focused on a single project, enabling quicker and tailored decision-making. Development corporations are also a step removed from the local politics that can slow down planning. However, just as within local authorities, development corporations need to be effectively funded and staffed in order to harness these efficiencies. The government could consider making new towns simplified planning zones, whereby permission in principle is granted. More radical measures could also be considered, such as relaxing environmental regulations within new town boundaries and limiting the role of statutory consultees to help speed up decision-making, which go further than those announced through the National Planning Policy Framework to date.
Long-term stewardship is a critical component of planning for new towns. It ensures that places are not just built, but cared for over time, maintaining quality, fostering community identity and adapting to future needs. Planning structures must embed stewardship from the outset, with clear responsibilities for the management of public spaces, infrastructure and community assets. Development corporations or stewardship trusts can provide this continuity beyond political cycles, ensuring that maintenance and placemaking evolve hand-in-hand.
Delivering the next generation of new towns is a bold ambition, but one that is necessary and achievable. It requires clear purpose, strong community relationships, the right delivery structures, viable funding and a planning system that supports long-term vision.
These fundamentals aren’t just technical, they are strategic. Getting them right means building places that are not only functional, but thriving, inclusive and future proof. As the task force prepares its final recommendations, now is the moment to turn ambition into delivery.
Images © Adobe Stock
Jessica Arczynski is a partner at Trowers & Hamlins and Adam Leslie is an associate director at PwC
