Labour should launch its own version of “levelling up” if it gets into power, a centre-left think tank has said.
Labour Together, which was co-founded by shadow chancellor Rachel Reeves in 2016, wants a redistribution of regional transport spending, a new body to oversee housebuilding and to slash the price of compulsory purchased land.
It also wants to direct private investment in energy, housing and infrastructure towards areas of the country where it is most needed.
At the core of its proposals are three new pieces of legislation, an energy bill, a homes bill and an infrastructure bill.
The British Homes Act would unlock Labour’s plans to build a new generation of new towns, it said. “Central to this bill should be extensive reform to the planning system. But it should also include institutional reform.”
A new national institution, GB Homes, would oversee national housebuilding and distribute proceeds from land sales around the rest of the country, while compulsory land purchase orders would also be reformed. Under the plans, authorities would pay “current use value” rather than the far higher speculative “hope value” that is currently paid.
The report does not call for additional public investment, but said existing investment must be targeted so that it has the biggest possible impact on the private sector.
“Both public and private investment are much lower in the UK than in comparable advanced economies,” the report said. “But 85% of the shortfall is due to private investment, so public investment cannot make up the shortfall alone. Every pound of public investment should sit alongside proactive measures to crowd in private investment.”
In addition, a British Infrastructure Act would rebalance national spending on infrastructure through streamlining the consultation and approval processes for big projects.
The think tank’s data shows that the UK’s productivity is growing at its slowest pace since the Napoleonic Wars. It added that had the UK kept pace with comparable nations since 2010 the average person would be £5,000 a year better off, with average wages at £44,000 instead of £39,000.
The report, titled Building a New Britain: Investing in Britain’s public realm,
The report, titled Building a New Britain: Investing in Britain’s public realm, adds that reform of CPOs “will enable not just more homebuilding but also more effective land value capture”.
“Land value capture sounds more radical than it is,” It adds. “The fundamental principle is that public action should create public not private benefits. Across the world, the use of these policies has been growing, with new instruments being developed and national strategies developed. The UK is an outlier because it only uses one of the five main instruments regularly – developer
obligations. It does not commonly use infrastructure levies, nor does it pool land for joint development, nor does it buy, develop and then sell land.”
The report points out that 32 New Towns built between 1946 and 1970 not only developed homes for 2.8m people, they also “generate around £1bn each year for the Treasury”.
To send feedback, e-mail piers.wehner@eg.co.uk or tweet @PiersWehner or @EGPropertyNews
