Dr Shann Turnball – Written Evidence (BEN0110)

1. This submission to the House of Lords Select Committee of Inquiry into National Policy for the Built Environment is made in response to their “call for written evidence” of July 27, 2015.

2. The submission may be made public and reflects the views of the writer, Dr Shann Turnbull, and does not necessarily represents the views of the New Garden Cities Alliance (NGCA) of which he is a founding member. Founders of the NGCA are listed on its Home page at: http://gardencities.info/. I was invited to make this submission when attending a “Principles” working group meeting of the NGCA in London on September 23 when all three directors of the NGCA were present. A draft was distributed on September 29th.

3. This submission builds on the expression of interest sent by my colleague, Thomas-Emanuel Hoepfner of May 30, 2014 to The Hon Nick Clegg and The Hon Rt. Eric Pickles pursuant to a prospectus issued in April 2014 inviting expressions of interest for initiating “Locally-led Garden Cities”[1]. Thomas Hoepfner became a founding director of the NGCA. His expression of interest was co-drafted by myself and can be viewed at: https://drive.google.com/file/d/0B13bh2n3zrFAVDczQkVFcjVtSGs/edit?usp=sharing.

4. I am a resident of Sydney, Australia and would I welcome the opportunity to answer any questions as may be desired by Skype. A bibliography of my writings on reforming the theories and practices of capitalism are posted at: https://independent.academia.edu/ShannTurnbull. My articles on reforming the invisible ownership, control and financing arrangements for the built environment are archived by the NGCA at: http://gardencities.info/reference-documents/01-principles/community-land-bank-clb/community-land-bank-bibliography/. 

5. There are three fundamental intellectual gaps in policy regarding the built environment:

5.1    The invisible architecture of ownership, control and financing of the built environment is not considered as a policy variable;

5.2    The existing invisible architecture creates gross inequality, inequity and alienation of citizens to deny them access to affordable housing;

5.3    Citizens lack the power to directly initiate changes to correct the above problems.

6. To correct all three problems it is recommended that Parliament:

6.1               Amend the Local Government Act 1972, or introduce other facilitating legislation, to allow citizens to initiate local referendums[2] within their local government areas to redesign the invisible architecture of their built environment to allow urban sites and services to become self-financing to remove the cost of land for home owners and commercial developers/investors.

6.2 Not undertake, approve or permit any major urban infrastructure expenditure unless the ownership and control of the land whose value is significantly increased by such expenditures becomes mutually owned and controlled by all resident voters of the affected precincts. In particular, this condition should apply to any expenditure pursuant the prospectus issued by the Department of Local Government and Communities in April 2014 referred to above. Otherwise the expenditures will become counter productive in providing affordable housing by increasing the cost of land and so housing. Mutual[3] ownership of land, but not necessarily any of its improvements is a core requirement for a precinct to be recognized as a Garden City by the NGCA.

7.  The right to call a “Locally-led” referendum would depend upon one or more developers providing a feasibility study that the precinct is sufficiently large to capture sufficient uplift in values from its development or redevelopment to make the ownership of sites and services self-financing.  This would eliminate the cost of land for both homeowners and commercial developers. The land value of UK housing can be expected to be at least half the price of a dwelling if it follows US[4] and Australian[5] and experience[6]. Making urban land self-financing would then half the cost of housing and also create a compelling magnet to attract commercial developments. This would reinforce the self-financing processes by attracting further investment to generate a virtuous self-reinforcing further uplift in land values and sources of rent/rates to cross subsidize the housing sector. Details of how land sites and services can be made self-financing are indicated in a study[7] by the London Center for Land Policy Studies and in my feasibilities studies and articles[8].

8. Only residents in the precinct with citizen voting rights would vote in the referendum. A vote of say 75%[9] of eligible voters would oblige all owners of property to exchange their existing title deeds for two separate but stapled deeds to allow the ownership of all land in the precinct to become mutually owned through a Cooperative Land Bank (CLB). This would create a “Duplex” title system. Existing private ownership of any improvements on the land would be retained on a negotiable basis. So no lender with a mortgage over existing titles would be disadvantaged as no equity values are lost and could well increase even without re-development proceeding[10]. No-residents would obtain equity in the form of non-voting participating redeemable and negotiable preference shares. Only residents obtain voting shares to enrich democracy[11] to further local self-determination.

9. If more than one developer provided a feasibility study then citizens could also vote for which developer was employed by the CLB. All residents whether owners or renters would vote to control the CLB. This constitution of the CLB would possess provision for any affected stakeholders to form their own advisory councils to create an inclusive “Network” system of governance as described at: https://tinyurl.com/NetGovernance to promote self-governance[12] and so further and enrich democracy with local self-determination[13].

10. It is important for Law Makers and their constituents to understand the differences between a CLB and the more widely known Community Land Trusts (CLTs). CLTs were developed and established by my close associate Robert Swann, the President of the E.F. Schumacher Society in the US[14]. He promoted[15] the CLB concept in various seminars, lectures and publications from the 1980’s as he recognized how they made a fundamental difference in ameliorating the inequities, inefficiencies and alienation created by current system of owning, controlling and governing the built environment as noted below because:

10.1     CLT’s require public money or private grants to acquire land to perpetuate the current inefficient and inequitable system of property rights;

10.2     CLTS exacerbate inequality by not sharing uplift in site values with residents who contribute to their creation because CLTs do not issue shares to residents;

10.3     CLTS make housing affordable by removing land values from the market and so in the words of Kelso & Kelso[16] on page 33 they introduce “the sterilization and morbidization of capital ownership”.

10.4     CLTs do not provide a basis for transforming the ownership and control of the existing built environment to a more equitable, efficient and sustainable system as proposed in paragraph 6.1.

10.5     Because of point 10.1, CLTs do not operate at a scale to: 

              (a)               Establish viable garden cities in green or brown field sites;

                            (b)               Provide competitive advantages in attracting commercial developments to cross subsidize affordable housing on a sustainable basis;

                            (c)               Possess the bargaining power to attract new commercial investment on a basis that denies the overpayment of investors in perpetuity;

              (d)              Establish a viable independent currency region.

11. The writer could provide further information as may be desired by Skype. For completeness, brief answers to the 13 questions raised by the Select Committee on “Policy making, integration and coordination” are set out below in italics. - The answers are made on the assumption that the recommendations in paragraph 6 are implemented.

Policymaking, integration and coordination

1P. Are the decisions that shape England’s built environment taken at the right administrative level?  No – There is little meaningful involvement at citizen level

What role should national policymakers play in shaping our built environment, and how does this relate to the work and role of local authorities and their partners? 
Policy makers should restrict their involvement to indirect empowerment as recommended in paragraph 6.

2P. How well is policy coordinated across those Government departments that have a role to play in matters such as housing, design, transport, infrastructure, sustainability and heritage?  No comment

How could integration and coordination be improved? 
 No comment

National policy for planning and the built environment

3P.               Does the National Planning Policy Framework (NPPF) provide sufficient policy guidance for those involved in planning, developing and protecting the built and natural environment? Policy cannot possibly be sufficient, as it is not guided by the citizens affected.

Are some factors within the NPPF more important than others? Yes – Citizen engagement to enrich the quality of democracy and self-determination.

              If so, what should be prioritised and why? 
Answer in previous question.

4P.               Is national planning policy in England lacking a spatial perspective? Yes, Kate Henderson, TCPA Chief Executive said[17]: “England is alone in North West Europe in having no national or sub-national spatial planning approach to the major challenges that face us as a nation, including housing, climate change and rebalancing the economy”.

What would be the effects of introducing a spatial element to national policy? 
Views on how to answer this question are currently under consideration by the NGCA.

5P.               Is there an optimum timescale for planning our future built environment needs and requirements? Timescale is to sustain humanity on the planet with minimum intergeneration changes.

How far ahead should those involved in the development of planning and built environment policy be looking? As above.

Buildings and places: New and old

6P.               What role should the Government play in seeking to address current issues of housing supply? Government role should be indirect by providing facilitating legislation as recommended in paragraph 6.1 and directly by not aggravating affordable housing with tax benefits, grants and subsidies, etc as proposed in paragraph 6.2.

Are further interventions, properly coordinated at central Government level, required? Only as proposed in paragraph 6.

              What will be the likely effect upon housing supply of recent reforms proposed for the planning system? 
No comment as no knowledge of recent reforms. But they are most likely to be based on simplistic grants, subsidies and so counterproductive as described in paragraph 6.2.

7P.               How do we develop built environments, which are sustainable and resilient, and what role should the Government play in any such undertaking? Introduce mutual ownership and control of urban sites and services as described above.

Will existing buildings and places be able to adapt to changing needs and circumstances in the years to come? Not efficiently unless the current ownership and control system of sites and services are mutualised as described above.

                    How can the best use of existing housing stock and built environment assets be made? 
It requires a case-by-case analysis. This would be required on a case-by-case basis to mutualise the ownership and control of all sites and services.

8P.               To what extent do we make optimum use of the historic environment in terms of future planning, regeneration and place-making? No comment.

                 How can more be made of these national assets? 
No comment.

Skills and design

9P.               Do the professions involved in this area (e.g. planners, surveyors, architects, engineers etc.) have the skills adequately to consider the built environment in a holistic manner? No – because they are poorly aware of the invisible structures of urban environments are not fit for purpose and lack an education in how to design their governance infrastructure[18].

              How could we begin to address any skills issues?  Sponsor education for governance architects[19] .

              Do local authorities have access to the skills and resources required to plan, shape and manage the built environment in their areas? 
 No skill or resources available to plan or shape the invisible governance architecture described in footnotes 12 & 13.

10P. Are we using the right tools and techniques to promote high quality design and ‘place-making’ at the national level? Adopt the two recommendations set out in paragraph 6.

              How could national leadership on these matters be enhanced? Adopt the two recommendations set out in paragraph 6.

Community involvement and community impact

11P. Do those involved in delivering and managing our built environment, including decision-makers and developers, take sufficient account of the way in which the built environment affects those who live and work within it? No – because they have no knowledge of network governance described in footnote 12.

How could we improve consideration of the impacts of the built environment upon the mental and physical health of users, and upon behaviours within communities? Introduce network governance to promote political, economic, social and resource self-sufficiency and self-governance.

12P. How effectively are communities able to engage with the process of decision making that shapes the built environment in which they live and work? Cannot be as effective as it could be because network governance is not adopted.

Are there any barriers to effective public engagement and, if so, how might they be addressed? Public engagement cannot be meaningful with government based on top down command and control hierarchies.

Financial measures

13P. Are there fiscal or financial measures potentially available which would help to address current issues of housing and land supply? Yes, introduce legislation to facilitate “Locally-led” initiatives to adopt self-financing mutually owned land ownership and control as recommended in paragraph 6.

Are there financial or other mechanisms that would encourage better design and place-making by private sector developers? Yes, by locally led bottom up feedback inherent in the governance architecture of Cooperative Land Banks.

Shann Turnbull PhD

Principal: International Institute for Self-governance

Founding member: Sustainable Money Working Group (UK)

Founding member: New Garden Cities Alliance

06 October 2015