HBF executive chairman Stewart Baseley says that the Housing White Paper is not as lightweight as some think and over time could make a big difference to supply
The intense media speculation in advance of the Housing White Paper meant that it was unlikely to live up to the expectation that surrounded it. The repeated delays in publication left a void that journalists leapt into with speculative pieces that created panic and optimism in varying degrees depending on the audience.
That it was not the radical document it had been unrealistically built up to be has thus resulted in a rather negative reaction. The fact that the government has tried to balance the cries of local authorities and backbench MPs against a “free-for- all” for housebuilders is hardly surprising.
As the dust settles and we start to consider the detail of the numerous policy areas it covers, I think people will come to realise it is not as lightweight as some have accused it of being and is a solid attempt to increase housing supply. (Though its success will largely be determined by the results of the consultations its publication has triggered which HBF will now look into.)Complex challenge
It reflects that ministers now realise that there is no single silver bullet and that increasing supply is a complex challenge. I think it also demonstrates that ministers recognise the need to work with a private sector housebuilding industry that currently is the primary vehicle to carry their ambitions of increased supply; and also of the significant progress that has already been made that has seen supply increase by 52% in the past three years.
In the lead up many had called on government to use it as a stick to beat the industry with – especially on landbanking - and so were subsequently disappointed. We will have to see what emerges on “use it or lose it” and the beefed up CPO powers, and ensure that measures to speed up build out rates do not deter investment in future supply, but my initial impression is that they have listened to our argument that genuine home builders do not landbank and, thus, it should not penalise those who want to build.
Some proposals will not have an impact overnight – planning change in particular takes time to be incorporated into new local plan policy- but addressing housing supply is a long term project. Whether the answer to solving the housing crisis is a radical overhaul is, in any case, debateable.
The current run rate for planning permissions granted is almost 300,000 per year. Converting these into homes is the real challenge, and one that government appears to have a genuine desire to tackle with this White Paper.
It includes a great deal that we can be positive about, indeed a lot of which HBF has been advocating in recent years. Many of the proposals are focused on the planning system, on ensuring local authorities abide by their responsibilities and put a realistic plan in place. As we have repeatedly stated, in a plan-led system it is a basic requirement to actually have plans and that those plans are kept up-to-date. How the Tory shires react to changes to the current system will be key.
Proposals for a new delivery test, if challenging enough, could ensure that plans are realistic and that local authorities work with the industry to ensure that housing needs in a particular area are met. Underperforming councils will be forced to allocate sites or, ultimately, be subjected to the presumption in favour of sustainable development. Strengthening the NPPF to support the progression of additional brownfield sites over and above those allocated in local plans could help to incentivise smaller firms in particular to identify potential schemes and bring them forward more quickly. However, we will be vigilant to avoid the new policies being used as a return to the “brownfield first” policy of the last Labour government. The Woking approach of local authority-wide licensing of protected species such as newts will reduce unnecessary delays caused by overly bureaucratic environmental legislation being applied on a site-by-site basis. Meanwhile, whilst the increase in planning fees will involve some technical issues in ensuring the rising costs are consolidated within planning departments, it does at least open the door to ringfenced fees which, until now, had been anathema.
Some have criticised the government for not tackling the green belt issue. But I think the White Paper marks a subtle shift so that local authorities who have used green belt as an excuse not to build might be under quite a bit more pressure. If they cannot agree to pass on housing to neighbouring authorities or increase density such that they meet their requirements, then as per Sajid Javid’s Birmingham decision, more local authorities will have to look at reviewing their green belt boundaries.
The Starter Homes policy has been significantly watered down – and with it the singular focus on home ownership. Moves to assist SME builders, as we suggested in our recent report that went to ministers, are also positive. The vast majority of the increase in output we have seen over the past three years has come from larger companies and we simply must enable more smaller companies to play a part. The requirement to allocate a proportion of smaller sites is one step in the right direction. The serious focus on Build to Rent, supported by a new affordable housing product to meet Build to Rent developers’ obligations on sites is another interesting approach.Investment and research
The MMC references reflect that ministers now appreciate current limitations and wish to see a boost in investment and research rather than identifying new forms of building as the short- term solution. The industry is totally committed to developing innovation and developing such proposals but we have to be realistic about what is possible in the short term.
Over the coming months we will look at each of these issues in more detail and get a better understanding of what they mean. Whilst maybe not the spectacular that some had built it up to be, the White Paper is a massive package of change. Each element of it could make a small difference and, building on the reforms of recent years, go on to make a fundamental difference. But it will probably not be possible to judge its ultimate success for some years.