The River Severn is about to get wider. A series of reforms and changes from the Cardiff government will mean the Welsh property industry looks a little less like its English neighbour.
City regions with sweeping economic development powers, a massive shake-up of local government, a new planning system – suddenly Wales seems to be striking out in new directions. And then there is a rear-guard action to link Cardiff and Newport to Bristol, which has met with mixed reactions (see panel overleaf).
Senior figures in Welsh property generally welcome the moves, which should – fingers crossed – improve an underperforming economy and give greater weight to the country’s economic success story, Cardiff.
The Planning (Wales) Bill, about to complete its passage through the National Assembly and due for royal assent this summer, marks the biggest change.
Chris Sutton, chair of CBI Wales and lead director in Cardiff for JLL, sees the legislation as a great opportunity. He says Wales now stands at a crossroads.
“Our planning system is on a par with the English system and how Wales implements this bill will determine whether the system becomes a structural disincentive for investment or a national asset,” he says.
“Doing this is like turning a supertanker, but what we should get is a slow move to a wide perspective with more strategic initiatives. Combine the new approach to planning with the £3.5bn investment in the Wales Infrastructure Plan – the first time we’ve had anything like this – and it could make a real difference.”
The newly inaugurated Cardiff Capital Region, given a special place in Welsh planning along with the Swansea city region and the A55 corridor, could yield eye-catching schemes. Hopes are high that a “metro” tram plan will be among them, to complement electrification of the rail lines into the valleys to join the newly electrified mainline to London, Newport and Swansea.
Peter Constantine, regional senior partner at Bilfinger GVA in Cardiff, says: “The city-region approach develops the co-operation we’re already seeing. For instance, Neath and Swansea are working on a joint strategy for retail development. But the new legislation provides certainty. No bad thing when some aspects of Welsh planning can confuse newcomers, like the relaxation of permitted development rights, which is big news in England but does not exist in Wales.”
Meanwhile a local authority reorganisation is also making its way through government. Twenty-two local councils will be reduced to 10. However, the creation of a Greater Cardiff council, taking in the valleys hinterland, is not considered likely or workable.
Owen Young, head of the Cardiff office at Alder King, expects great things from the new regional approach to planning and local government. “You have to connect people if the economy is to grow organically, rather than just handing out government grants. Starting to connect all south-east Wales to Cardiff can only be a good thing. It will bring the labour force into Cardiff quicker, and the region can grow.”
Ben Lewis, director at Bilfinger GVA Cardiff, says: “The new national development framework envisaged in the planning bill will, I hope, bring more strategic thinking, with more teeth, than the old system of strategic plans ever did. We await the first draft, once the planning bill is law, but that seems the direction of travel.”
“The planning bill’s creation of strategic regions in Swansea, Cardiff and the A55 corridor will build on what is already happening. It’s an exciting time.”
There are still some background doubts and hesitations. Can Wales make the new system work? Is the country’s political class up to the job of running bigger local authorities? Can planning and economic development officials deliver what is asked of them? With yet more devolution to Wales promised in the St David’s Day Declaration (see box), Owen Young, head of the Cardiff office at Alder King, has concerns.
“I’m worried about how we cope with those powers. New tax-raising powers could see us lose a corresponding amount of grants from the UK government. I don’t see the point of that. The UK government knows what it is doing. We in Wales are new to the system,” he says.
But one thing is clear. Welsh property – like Welsh politics and Welsh life in general – is heading in its own direction.
Asked what mattered to the country’s property business, Lewis is clear: “The focus now is on the Welsh general election in 2016. I hope the result, whatever it is, won’t mean reversing the legislation now going through.”
Severn powerhouse: Just a slogan?
From the ancient bards to today’s national poet Gillian Clarke, Wales has always venerated words. But can the words “Severn powerhouse” conjure a new economic force into existence?
Civic leaders in Bristol, Cardiff and Newport want to yoke their cities together. Their aim is to echo – and perhaps rival – the “Northern powerhouse” being forged around Manchester by chancellor of the Exchequer George Osborne.
With an economic output already said to be worth £58bn, the cross-border zone is already significant. Severn Bridge tolls are due to expire in 2018, while electrification of the Greater Western rail line linking the three cities is due for completion in 2017: both could be a substantial economic boost.
Or could it? There are already fears that the plan is cover for a revival of the Severn Barrage – a centuries-old project believed to have finally sunk in 2010. Others think the entire cross-border plan is pie in the sky.
In the latter camp is Richard Hayward, principal at Richard Hayward Properties. He is the man behind the 133,000 sq ft Millennium Plaza leisure scheme in Cardiff and the former passport office in Newport, which has been converted into a 90,000 sq ft mixed-use scheme. With Bristol and Cardiff matched in size, and often in competition with one another, he doesn’t see scope for co-operation.
“I can’t see Cardiff conceding anything to Bristol. It’s a nice idea, but the interests of the cities are not the same. Today it is almost impossible for Cardiff and Newport to agree – they never have – yet at the launch of the Severn powerhouse all three council leaders stood on Newport station, got some pictures taken and held hands, but the interests of the three are diverse, and they are often chasing the same inward investment targets,” he says.
But Chris Sutton, chair of CBI Wales and lead director in Cardiff for JLL, says: “There’s no harm in closer working.”
What’s changing on St David’s day
The St David’s Day Declaration means Wales belatedly gets a similar devolution deal to that offered to Scotland in 1999. That means more power, and simpler rules for using those powers. If the newly elected UK government offers Scotland even more, Wales will expect something similar.
Using its existing powers the Welsh government has promoted the planning bill that introduces national, regional and local strategic plans. There will be strategic development frameworks for the two city regions of south Wales and the A55 corridor in north Wales, and a national development plan to invest in large-scale infrastructure.
The £960m business rates regime is the first of a number of property taxes to be devolved to Wales. The Welsh system will involve regular revaluations, indexing to the consumer price index and the short-term extension of small business rate relief.
And a review of local government means that 22 councils will be reduced to 10. Welsh ministers are to reveal who merges with whom this summer.
