Written evidence submitted by the UK2070 Commission [FPS 128]

 

Context and Summary

 

1.      The UK2070 Commission submits the following response to the MHCLG Committee Consultation on the future of the planning system in England
 

  1. The UK2070 Commission is an independent inquiry into the deep-rooted spatial inequalities that exist across the UK, chaired by Lord Kerslake. It published the Report on its findings in February 2020. This drew upon a substantial body of evidence submitted to the Commission and from research it has commissioned. The full list of documents can be found on its website - http://uk2070.org.uk/publications/. In view of the direct relevance of the work of the UK2070 Commission to the Committee’s Inquiry, Lord Kerslake would be happy to give evidence to, and answer questions from, the Committee in person if the opportune is made available.

 

  1. The UK2070 Commission has set out a 10-Point Action Plan for addressing the spatial inequalities between the regions and nations of the UK. All ten areas of action have a bearing on the Committee’s Inquiry generally.
     
  2. The UK2070 Commission’s response to the detailed questions asked by the Committee are attached as an Annex to this response. This response by the UK2070 Commission has been guided not only by its original analysis of the nature of these problems but also fresh analysis in the light of the pandemic impact on the UK economy and potential rates of recovery. This has concluded that the pandemic has reinforced inequalities of health, housing conditions, worklessness, education and levels of poverty. The over-riding longer-term risk to the UK would arise if changes to the planning system was at the expense of the core policy goals which are critical to the wellbeing and sustainability of the nation, including reducing the levels of deprivation across the whole of the UK and delivering a zero-carbon economy.
     
  3. Current analysis indicates that except with the most optimistic assumptions, it would take well over 5 years to get back to where the UK economy was in January 2020. The past dependency on London’s growth cannot be guaranteed. So, there is a pressing need to stimulate growth. Yet without fundamental policy change, there is a risk that under any scenario of growth, the UK would be increasingly divided with past areas of growth continue to grow (albeit at a lower level than the past), whilst other regions continue to suffer recession created by the pandemic. Thus, it is vital that the levelling up of the UK is set a shared longer-term purpose and embedded in all areas of national policy, including the Planning system.


ANNEX: Response to Specific Questions Posed by the Committee
 

Question 1a: Is the current planning system working as it should do?
Response: The Current system fails to deliver its full potential because of the lack of any strategic planning arrangements, except where there are statutory joint arrangements or unitary rural counties (e.g. in the Combined Authority areas or Cornwall). Even within these areas they are constrained by the lack of a national planning framework for England. This contrasts with the experience in most advanced countries where a key means for coordinating and reconciling policy is through explicit national and regional spatial frameworks which:

 

Question 1b: What changes might need to be made? Are the Government’s proposals the right approach?

Response: Effective national spatial plans have explicit interlocking goals. For the UK, there is a need to secure the UK’s global economic role, whilst meeting the doubleheader

crisis of deep-rooted inequality and transition to zero-carbon economy.

The scope of a national spatial framework should be limited to those matters which can only be, or are best, defined at a national level in relation to such matters as:

 

It would provide a consistent basis for sectoral programmes of investment, in terms of the overall scales and balance of economic and demographic change and priorities for the levelling-up of the nation

 

The UK2070 Commission has considered the options in terms of the status of the plan, and concluded that the National Spatial for England should be a non-statutory expression of national policy proposed by the government of the day and endorsed by Parliament.

 

The national plan for England must not be seen as a departmental document. Its very nature is crosscutting and integrated. It is important therefore that it is serviced with an independent and permanently established technical capacity. There are various options based on experience elsewhere. However, in view of the specific context of England an option is that the National Infrastructure Commission’s role should be redefined as the National Infrastructure and Spatial Planning Commission. This body might also be able to be independently funded out of the ‘national infrastructure levy’

 

The relationship between a national and sub-national planning will be key. There is a well-established basis for local joint strategic planning, most notably in Scotland for the metropolitan area of Glasgow and the Clyde Valley. There are also strategic spatial plans emerging through the work of the Combined Authorities (e.g. Greater Manchester and Greater Cambridge and Peterborough) or joint statutory plans (e.g. Oxfordshire).

 

The long-standing gap in strategic planning capacity in England therefore is now starting to be filled, but needs to be extended across all of England, for all metropolitan and city regions, and elsewhere for the major rural counties. There are however issues (e.g. for transport and economic development) which require a pan-regional perspective, wider than individual city regions. The pan-regional partnerships for the Northern Powerhouse, Midlands Engine and Great Western Gateway have started to reflect this. As yet they do not have a linked spatial strategy and there is a void in the London and Wider South East pan-regional area. The work of the One Powerhouse Consortium has sought to prepare four ‘Spatial Blueprints’ which illustrate the potential for a pan-regional scale of spatial plan. These are based around five key themes: Economy and Prosperity and Innovation; People and Placemaking; Transport and Connectivity; Infrastructure; and Energy and Resilience. It is recommended that this scale of strategic spatial policy should be taken forward for the three-existing pan-regional partnership areas of England (The North, Midlands and the South West), and options explored for London and the Wider South East, including the Regional Plan Association model.


 

Question 2: In seeking to build 300,000 homes a year, is the greatest obstacle the planning system or the subsequent build-out of properties with permission?
Response: The planning system is not the main obstacle to delivering the number of homes required in England. The issues are complex but a key factor is the lack of a strategic planning capcity to resolve supply and demand within coherent housing market areas, and the lack of a national planning framework to resolve inter-regional balances. The integration of housing policies into local strategic governance arrangements is essential if housing needs are to be met in full involving the devolving the delivery, management and financing of housing; and linking spatial development strategies to resource allocations

 

These problems have been highlighted by the recent proposed new methodology. This will reinforce inequalities and unsustainable patterns of development across England, and impact on the devolved nations (see Annex and answer to Question 4)


 

Question 3: How can the planning system ensure that buildings are beautiful and fit for purpose?

Response: N/A
 

Question 4: What approach should be used to determine the housing need and requirement of a local authority?

Response: The approach to determining housing needs to be re-thought. Housing policy has been separated out from national infrastructure planning and does not take account of the need to level-up economic performance or meet the needs of the new economic geography, but is based on past trends. For example, Homes for the North has estimated that to meet the economic ambitions for the northern England a 40% increase in the current levels of planned provision is required (the latest proposed methodology runs totally counter to the planning needed to meet this need).

 

The UK2070 Commission therefore recommends a fundamental rethinking of housing policy as critical to developing fairer and stronger outcomes. Housing must be embedded in strategic planning processes:


 

Question 5: What is the best approach to ensure public engagement in the planning system? What role should modern technology and data play in this?

Response: This issue is wider than the remit of the Commission. It should however be noted that it is considered that better engagement in the planning process should be part of the promotion of a comprehensive inclusive devolution across England, involving new methods of engagement (for example citizens’ assemblies)

 

Question 6: How can the planning system ensure adequate and reasonable protection for areas and buildings of environmental, historical, and architectural importance?

Response: The safeguarding, management and enhancement of environmental and heritage assets are also key to the delivery of sustainable development and the UK’s commitment to delivering the Sustainable Development Goals (SDGs) that the UK Government has signed up to. The UK2070 Commission has identified the importance of these assets in contributing to rebalancing the economy of the UK.  The proposed abolition of the current duty to undertake an SA must raise concern since the White Paper implies a much more limited assessment of impacts in terms of the extent which plans or proposals satisfy ‘the requirements of UK and international law and treaties.’

 

Question 7: What changes, if any, are needed to the green belt?

Response: The current issues that have been raised around Green Belt policy are fundamentally a consequence of the lack of an effective strategic planning system in England.
 

Question 8: What progress has been made since the Committee’s 2018 report on capturing land value and how might the proposals improve outcomes? What further steps might also be needed?

Response: The current system for capturing the uplift in value and wealth requires considerable reform if it is to become an effective mechanism for the provision of local infrastructure. Most of the uplift in value and wealth created by public investment, infrastructure and policy is not shared equitably. There is scope for a more proactive approach to enable land and property value to be created that would not otherwise exist by being plan-led, as was historically the case with the development of New Towns.

 

This needs to capture a higher proportion of the uplift in land values for public purposes than is currently achieved. This would involve a more direct link to the provision of infrastructure that helps to create it than under the current systems of taxing development values (e.g. Stamp Duty Land Tax). This could be achieved by a more strategic approach with the pooling of land value uplift and sharing the longer-term strategic returns; for example, within combined authorities or labour markets. It is possible to envisage such principles being used in tiered funding on a regional basis. For example, such a regional approach could be applied in and around Cambridge help fund the renewal of the rail link to Wisbech in Fenland, one of the most deprived areas in southern England.

 

A more strategic approach could also be applied to the harnessing of land-value uplift locally. The experience of the UK New Towns, urban development corporations and urban development companies, has shown their value as mechanisms for very large schemes requiring front-end loading of infrastructure costs. This is especially the case where ‘market values’ are being created in currently depressed areas, allowing the pay-back as when values increase in the medium to longer-term.

 

Annex: UK2070 Commission Response to MHCLG Consultation on Standard Methodology for Calculating Housing Need

 

The proposed approach to setting a standard method for assessing housing numbers in strategic plans is not linked to wider national strategies to tackle regional inequalities, as follows:

(i)                  It is trend-based in its approach to assessing housing numbers; new housing requirements are conditioned by past building rates which in themselves are related to past planning policies,

(ii)                It does not take sufficient account of the fact that the low provision of affordable housing is a major factor in the under-provision of sufficient housing stock over recent years; the current reliance on developer contributions for affordable housing contributions has fallen far short of what is required, and in itself requires an over-heated housing market, and the expectation that it will continue, to enable developers to make significant contributions.

(iii)               It does not take account of the national policy for rebalancing the economic geography of the country required to deliver the levelling up goals of the government. It is therefore not linked to the economic and industrial strategy of the UK.

 

It is understood (based on Lichfield Research) that the methodology will result in the following indicative outcomes:

(i)                  A national figure to increase the number of homes built to over 300,000 homes/year, but:

(ii)                Over 90% of the increase in house building to be in London and the Wider South East;

(iii)               A reduction in new build requirements in Northern England below past building rates.
 

These issues could be reinforced by the proposal in the White Paper to remove the duty on local authorities to cooperate. This is a particular problem where local administrative areas are part of a wider housing and labour markets, and are dependent upon common transport networks. Unfortunately, the current system has failed, and cooperation has defaulted to being no more than an alliance of the willing (e.g. with the London Plan) thereby institutionalising ‘Nimbyism’.

 

This strategic gap is of particular concern for London and the Wider South East, where there is no effective strategic cooperation. The Minister has, however, asked the GLA to produce and deliver ‘a new strategy with authorities in the wider south east to offset unmet housing need in a joined-up way’. No parallel requirement is placed on other authorities outside London and the Mayor has no powers to require authorities in the wider south east to collaborate with, let alone agree, any such strategy. This problem is complicated by the high-density assumptions about the future of London, post-Covid, which may no longer be tenable.

 

In contrast, if England is to bridge the regional Productivity Gap which lies at the heart of many of the patterns of inequality in terms of income and wealth, there needs to be a shift in regional productivity. The UK2070 Commission provided indicative figures of the job implications (which would guide population and household assumptions).

 

This, for example, implies increasing employment in the North by 1.2 million over current trends and reducing the pressure on the London and Wider South East. This could form the context for economic planning in the nations and regions, breaking the dependence on trend projections. It would have consequential implications for the demand for housebuilding and infrastructure, the implications of which would have to be worked out locally since this would be determined, for example, by the levels of available of ‘spare’ labour and surplus housing stock.

 

If planning policies continue to focus development on London and the Wider South East, assuming economic growth (which the proposed assessment method implies), there will be sustained regional imbalance, reinforcing current levels of deprivation and inequality in regions already suffering from deprivation. There would be significant differences in the rates of growth between the regions and nations, as well as continued erosion in the quality of jobs outside the areas of high growth, making current low wage economies worse. Increased traffic congestion and housing cost pressures would become widespread among growth hot spots in London and the Wider South East, with the cost of housing increasing sharply compared with the national average earnings, and elsewhere in England.

 

 

October 2020