Building Blocks - Assessing The Role Of Planning Reform In Meeting The Government's Housing Targets

13th September 2024

The UK Government has prioritised planning reform as its key policy lever to deliver an ambitious target of 1.5 million additional homes by the end of this Parliament. This note explores the extent to which the proposed reforms to the planning system will help reach this target, while also highlighting other constraints on housing supply that the Government should consider as part of its broader strategy to kickstart housing delivery.

Key findings
Achieving the Government's aim to deliver 1.5 million additional homes in England over this Parliament would be unprecedented in historical terms: we have not seen an additional 300,000 homes per year delivered in any year on record, even during the high housebuilding years of the 1970s.

There is evidence that England's planning system has some real problems. We find, for example, that approval rates for ‘large' developments (over 10 units) range from an average of under 60 per cent in the ten most restrictive local authorities, to over 90 per cent in the least restrictive.

While putting local authority housebuilding targets back on a ‘mandatory’, rather than ‘advisory’, footing is welcome, the new formula for calculating targets sees them increase by nearly 50 per cent on average in the most affordable half of local authorities, compared to just 10 per cent in the least affordable half.

We estimate that around a million homes could be built on brownfield land and low-quality Green Belt land, termed ‘grey belt’, under the current proposals. This leaves a gap in the required land needed to hit the Government’s 1.5 million target, requiring development on currently undeveloped land, or the building of ‘denser’ housing.

The Government’s approach relies heavily on the private sector to deliver against its ambitions. But historically, direct public investment has been key: at the post-war housebuilding peak in 1968, nearly two-in-five homes were built through the public sector, compared to just under one-quarter of homes in 2023.

Direct public investment will also be crucial to achieve the boost to social housing that the Government is targeting. Very little of the ‘affordable’ housing that has been built in recent years is for social rent: just 15 per cent of all affordable homes built in 2022-23 were for social rent, down from 87 per cent back in 1992-93.

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