One recommendation Barker made in the Review of Housing Supply did strike a positive note with just about everyone – the proposal to replace the two-stage system of obtaining both outlined and detailed planning permission with a single level of sanction.
Not surprisingly, housebuilders purred with approval. Tim Hough, managing director of Miller Homes, was one. “She accepted that the planning process needed to be speeded up. These recommendations will ultimately drive the delivery of more new homes, which can only be good news,” he said.
Hough was not so chipper about Barker’s suggestion that the Office of Fair Trading should investigate housebuilders if customer satisfaction levels don’t improve. “We have undertaken in-depth surveys of our customers for the last four years and have evidence that customers satisfaction levels have improved considerably in this time,” he grumbled.
Other notable recommendations include a tax on the increase in land value once planning permission has been granted, Section 106 agreements to only apply to social housing and the creation of independent regional planning executives to manage regional housing markets.
Ernst & Young said that the tax proposal, described by Barker as a planning gain supplement, would most likely be absorbed by housebuilders rather than buyers. Martin Lambert, tax director at Ernst & Young said: “Barker contends that it is unlikely that the new planning tax would translate into higher housing prices, so it is likely that the cost will be borne by landowners and developers in the shape of reduced margins. This could mean that housebuilders with substantial land banks will be hit hard.”
The National House-Building Council noted that the report is extremely enthusiastic about off-site fabrication and “modern methods of construction” but chief executive Imtiaz Farookhi, had a few words of caution. “We advocate a balance of risk approach,” he said. “It is vital that homes are high quality and designed to last for a minimum of sixty years, particularly where the risk of ownership is fully borne by private individuals. In this country we do not want to repeat failures from our own past.”
The environmental lobby is encouraged by one aspect of Barker’s report. Barker said that the planning tax could be charged differently for brownfield and greenfield sites, in an attempt to encourage building on the former. Barker also proposed that non-viable developments in rundown areas be encouraged by creating a Community Infrastructure Fund of £100-200m to bring forward infrastructure schemes. Environmental consultant Green Issues approved, saying that it “welcomes moves to establish infrastructure funds to help unblock schemes being unnecessarily delayed by the need to upgrade facilities”.
Barker’s goal is ambitious. She wants to see housing supply in England increase from 135,000 new completions per year, to an additional 70-120,000 private completions and 17-23,000 social houses.
Gordon Brown outlined the next steps in his budget statement. He has accepted Barker’s recommendations for:
- one body in each region with responsibility for housing and planning
- extending the Contaminated Land Credit in brownfield areas
- releasing more public sector land.
A year-long consultation on the proposed land tax will now take place. Only then will we start to see if Barker’s great big plunger of a review has done anything to clear the housing supply blockage.
