From promises to practice: Labour’s housing and planning agenda

A focus on real estate, specifically how to facilitate housebuilding, was writ large in most of the parties’ manifestos. A bidding war erupted: Labour promised 1.5 million more houses, Conservatives 1.6 million and Liberal Democrats 1.9 million. Now that Labour is in power, and the carefully chosen words of their manifesto come home to roost, what can we expect to see from them in practice?

Plans for planning

In its manifesto, Labour promised 300 more local planning officers to be funded by £20 million of revenue generated from increasing Stamp Duty Land Tax (SDLT) on purchases of non-residential property by non-UK residents by 1 per cent. It is generally agreed that the severe shortage of local planning officers needs addressing, but in reality, 300 new officers equates to less than one new officer per council area. The net effect, therefore, is likely to be plugging existing gaps, rather than actively increasing resources. Labour will presumably also need to make the changes to SDLT before it can fund the new hires. 

Identify grey areas

Angela Rayner said she would write to local planning authorities instructing them to review their green belt to identify potential grey-belt areas (“grey and ugly areas” like car parks) that could be developed. Development of grey-belt areas is the second of Labour’s five golden rules, after developing brownfield sites. More generally, Labour has indicated a more top-down approach to planning and talks about striking the right balance between enabling development and allowing local communities to shape housebuilding in their area. Labour has consistently promised to be the party of the builders, not the blockers. As part of this they, they promise a tougher approach on what they refer to as “nimby councils”. In practice, this may mean that the government will step in (despite the wishes of the local community) if local planning authorities decide against development on newly designated grey-belt land.  

It remains to be seen how much developable grey-belt land there actually is. Another potential problem is the availability of grid capacity and other infrastructure (like water and sewerage provision) for new developments.

Make a statement

Sir Keir Starmer has indicated that a Labour government would immediately update the National Policy Planning Framework (NPPF). It is quicker to change policy than legislation, but changes to the NPPF are still likely to take six to 12 months to come into effect because of the need to consult. Labour may choose, therefore, to use a written ministerial statement as a shortcut, giving developers and landowners a steer on the direction of travel.

Expected changes include strengthening the presumption in favour of sustainable development (good news for place-making type developments) and reintroducing mandatory housing targets for individual local planning authorities.

Compulsory purchase

CPO powers were updated by provisions brought in by the Levelling Up and Regeneration Act (LURA) in April this year (in England), meaning that in certain, very limited circumstances, hope value can be disapplied when assessing compensation for land acquisition. Labour proposes introducing new legislation “soon after entering government” allowing local development authorities to buy up land under CPOs without factoring in hope value. This could be a particular concern for rural landowners, who may be subject to a CPO, or who may be looking to develop their own land.  

Nutrient neutrality

Back in September, Labour led the charge against the Conservatives’ “reckless” proposed scrapping of nutrient neutrality rules. Labour is now stating that they will “implement solutions to unlock the building of homes affected by nutrient neutrality without weakening environmental protections”. A more relaxed nutrient neutrality framework would be welcomed by developers and should reduce costs and simplify the process for rural land. There is no detail yet of how Labour will try to implement this promise.

Labour has also committed to producing a land use framework. Although likely to focus on how land should be used for farming and the environment, it will also be of interest to rural landowners and developers. There is, however, no indication yet how such a framework could be used (or enforced). Watch this space.  

This publication is a general summary of the law. It should not replace legal advice tailored to your specific circumstances.

© Farrer & Co LLP, July 2024