Kemi Badenoch opened the Conservative Party conference with a promise to rip up rules that force private developers to build social housing and abandon strict net zero standards.
Her pledge to scrap regulations built up by successive governments includes abolishing Natural England – which has been blamed for holding up more than 160,000 homes – and removing new housing rules that require developers to cut carbon emissions from new homes by up to 75%.
The Conservatives say those changes could cut the price of a new home by as much as £50,000.
I believe them.
Actually, I think they could be underestimating the prize.
Research from the Home Builders Federation says regulation and inflation have added £76,000 to the cost of a new home since 2020. Berkeley Group’s executive chair has said new regulations, taxes and levies have added £150,000 to the cost of a typical two-bedroom flat in London since 2016.
On a side note, Badenoch is right to be tackling the supply-side problem associated with the housing crisis. The problem with Your First Home, the new scheme aiming to bridge the gap between what it costs developers to build a home and what first-time buyers can afford is that, while it might make some sites more viable – housebuilders can’t build what first-timers can’t afford to buy – it’s addressing a supply-side problem with a demand-side solution.
Over the coming months, the Bank of England will be trying to squeeze excess demand out of a supply-constrained UK economy. Your First Home will be trying to force it back in. We do not need another policy designed to manage the consequences. We need to remove the causes.
But this is not a Conservative Party broadcast. I want to see more property being built, faster and cheaper. The nature of the government delivering it does not matter.
In his first major speech as chancellor John Healey promised to cut through the “sludge” of red tape and slow government decision-making that holds back growth.
I agree with him. I agree with Badenoch, too.
There is a problem. The numbers prove it.
Savills forecasts that new home completions in England will fall to just 152,000 in 2026-27. That is roughly half the government’s target and the lowest level since 2015.
The forthcoming changes to England’s planning system offer us a glimpse of what a bonfire of red tape could deliver.
From 31st October, councillor-led planning committees will no longer decide some applications, including extensions, loft conversions and conservatories. while national and local planning policy still applies, council planning officers will take those decisions instead.
Those reforms might be modest but they are already set to drive an increase in building work.
A review of the cumulative regulatory burden on development could deliver much more. We have piled layer after layer of cost and delay onto the construction sector.
We should use brownfield land in town centres without unnecessary cost, impediment or delay.
We should stop making affordable housing compulsory where the requirement destroys a site’s viability. That would boost small builders, contractors and developers who lack the muscle to battle through regulations.
But we must also stop pretending that housing exists in isolation. The planning debate focuses almost entirely on homes: how many we build and what they cost.
That is only half the story.
The same planning delays and regulatory uncertainty affect the commercial property that sits underneath a functioning economy: shops, offices, warehouses, industrial units and mixed-use buildings.
Sorting out the planning system would also support other forms of building – such as warehouses, industrial units and the commercial property needed to underpin economic growth. The same layers of regulation, delays and uncertainty that make building places to live so expensive also wreck the delivery of places where people manufacture, trade and store goods.
This problem runs throughout our whole economy. Indeed, it takes two and a half years longer to finish big building projects in the UK than it did in other developed countries. We’re doing our bit, offering commercial mortgages at bridging speed. The government needs to do the same.
When it comes to planning, we can’t get myopic. The important part of the pledge to scrap Britains environmental quangos and end net zero regulations is the attempt to end the ‘doom loop’ of low economic growth. The right way to grow our economy is making it cheaper and faster to build and backing growth-enhancing infrastructure and cutting the taxes choking business.
