The last article I wrote about the poor quality of the planning system was in January 2017. Sadiq Khan was settling into his new role as London mayor and issues of viability and politics (namely Labour councils) threatened residential development.
Fast forward to today. The planning system is in a bigger mess than I’ve ever seen it in my 35 years in the business. It’s in a state of complete chaos.
Viability has turned into a clever tool for developers and advisors to outsmart councils and scrimp on affordable housing. And Labour councils, elected on affordable housing tickets which they can’t deliver, will delay, defer or refuse schemes for no good reason, other than political motives. The lunatics have taken over the asylum. But there is a solution.
Lunch at the Lords
The upside of my original rant, back in 2017, was that it got me invited to lunch at the House of Lords with a who’s who of residential development, including heads of major housebuilders, housing associations and private developers.
On the basis that I had never been before, and was unlikely to be invited again, I took the plunge and dug out my only tie. However, on arrival I discovered that guest of honour, then planning minister Gavin Barwell, had cancelled and been replaced. Instead, Sajid Javid gave a 90-second welcome speech and then swiftly departed, throwing a junior helper to the lion’s den of disgruntled developers.
When he opened the floor to questions, I asked him what the government was doing to help smaller developers (those with up to 50 units which account for the bulk of applications) and the constant battle with local planning authorities. His answer was: “We don’t like to interfere with local politics.”
After, he asked what I would do to change the system. (Perhaps, he mistook me – in my rather slick tie – as someone important) I told him, apply a charge per unit, per application, then use those funds to employ people who understand development: planning, construction, architecture, and all the other things required to create the right new homes and communities.
He said he didn’t think developers would pay and ran off. Two years on, I still disagree.
A new planning system
Developer-funded local planning authorities would make everyone a winner. For example, a £1,000 charge on a 50-unit scheme would deliver £50,000 for an LPA to provide someone who gets it. The developer gets planning consent faster and the government can have its affordable housing quicker.
Disband planning committees, as most of them generally know very little about development and have political motives.
Instead a new planning system should ensure:
- Every scheme of 10 units or more has a fixed amount of affordable housing.
- Provide density and massing within the set unitary development plans, so there can be no cause for refusal.
- Design concepts to be agreed during pre-application.
- All planning applications must be delivered within a three-month period after the pre-application phase.
- Combine community infrastructure levy and section 106 payments as one tax based on the way CIL is currently charged, or lose them completely and increase planning fees further and use the excess funds for the local community.
I’m sure there are landowners screaming expletives at this point. Many have already missed the boat when it comes to maximising the value of their site. They were too greedy and, as sales values decline, construction costs increase and affordable housing requirements rise, they are less likely to sell.
A difficult market means sites purchased over the last few years are either undeliverable or have shifted from the original vision. Landowners looking to maximise the value of their sites are beholden to LPAs. But, a system fuelled by developer payments, planning knowledge and common sense could have saved them, and still could.
Jonathan Vandermolen is chief executive of Vandermolen Real Estate
