Stop recycling Angela Rayner and reform planning instead
Angela Rayner is back as housing minister but still nothing substantial has changed in housing policy, says Duncan Kreeger
Angela Rayner has returned to the housing brief. Fine, I suppose – she’s paid her stamp duty bill now at least.
But if Andy Burnham wants us to have hope that the country might actually build some more homes, he’s going to have to do something different to achieve that goal. With Rayner’s return, what’s changed?
The latest S&P Global UK Construction PMI data shows, housebuilding activity fell to 35.9, its lowest reading of the year so far (any reading below 50 indicates that activity is contracting). We haven’t hit any housing targets since the 70s. The UK last built consistently more than 300,000 new homes a year in the 1960s. In England, fewer than 145,000 homes were completed between April last year and March this year – with the lowest level of new-build developments coming to the market since January 2017.
For the last two years we’ve heard the same promises. More homes. Planning reform. Faster delivery. Yet the people trying to build are still facing the same delays, uncertainty and bureaucracy.
Britain doesn’t have a shortage of ambition. It has a shortage of action at the highest levels of government.
Since February 2022, when Russia invaded Ukraine, the cost of building a home has risen, on average, by 17.5 per cent, while house prices have increased by just 4.5 per cent. Housebuilders are pushing out profit warnings at the same rate as they were during the height of the global financial crisis.
While they could consider making extra regulatory costs (such as the higher landfill tax) less onerous, there’s not a great deal the government can do about those higher build costs, now exacerbated by the war in Iran.
Faster, simpler, more predictable
But planning reform is well within their ambit. Planning needs to become faster, simpler and more predictable. Because every month of delay means fewer homes built, higher costs and more families priced out of the market. Planning is totally out of hand. The Lower Thames crossing planning application and associated responses run to 360,000 pages. The Tax Payers’ Alliance estimates that, if printed on A4, this document would weight almost two tonnes, more than a VW Golf. The planning application alone cost almost £300m to get to this point. The system is broken.
The problem is that, with Rayner’s return, what’s changed? Over the five years to the end of 2029, when Labour’s first term is due to end, researchers at Savills estimate 837,5000 new flats and houses will be built in England. That would be 45 per cent short of the 1.5m Labour has repeatedly promised to deliver in its first five years in power. We can’t carry on doing what we’ve always done and expect different results.
It would be far better to focus on getting a fresh face into reform planning.
Burnham should have tried appointing Chris Curtis. He’s been a vocal advocate for new towns, for major housing expansion and for hitting the 1.5m target. He’s the former chair of the Labour Growth Group. He writes and speaks extensively on planning barriers and solutions. He’s energetic and growth-oriented – a communicator. He represents the “build baby build” wing of the Labour party.
At TAB, we’re doing our bit, funding the conversion of unviable retail units into homes and helping to revitalise towns with higher-density residential developments. Now the housing minister needs to step up.
The housing crisis won’t be solved by recycling housing ministers. Changing the person in charge of housing without changing the planning system is like changing the captain of a ship with no engine.
This was a missed opportunity. Rayner’s appointment misses the mark.
Duncan Kreeger runs TAB, a commercial mortgage lender and bridging specialist