Housing, Planning and the Green Belt

David Drew Excerpts

Tuesday 6th February 2018 Commons Chamber

[Mr Laurence Robertson (Tewkesbury) (Con)]

I beg to move,

That this House has considered housing, planning and the green belt.

I thank the Backbench Business Committee for allocating time for this debate and the Minister for attending. He is a new Minister, so I absolve him of all blame, and I wish him well in his new role. I look forward to working with him constructively on the issues that I am about to raise. I also thank the 33 hon. Members who supported me in obtaining this debate. It demonstrates how much interest there is in the subject.

I have chosen three topics for debate: housing, planning and the green belt. I have long had an interest in these areas—protecting the countryside was one of my motivations for entering Parliament in the first place—but my interest and concern have been heightened by my constituency experiences, so although this debate is not about my area entirely, I will seek to offer examples from Tewkesbury to illustrate my points. I know that other hon. Members will feel free to do similarly.

As with most things in life, we must always seek to find a balance. In this instance, we must ensure that everyone has a decent home to live in, while also recognising that we are not the owners but merely the custodians of the countryside, who have a duty to pass it on intact so that future generations can enjoy all that it has to afford in the same way as past generations. I fear, however, that we are in danger of failing to achieve that balance.

Let me begin with housing. This Government, like previous Governments, have committed themselves to building more houses to address the so-called housing crisis, and, as reflected in the name of the most recent housing White Paper, to fix the “broken housing market”. I want to challenge, or at least put in context, the Government’s characterisation of this crisis. I also want to ask whether it is accepted that what is happening in London, and possibly in the wider south-east, is somewhat different from what is happening in many other parts of the country.

I am concerned about what seems to be a belief that supply is the sole answer to the so-called housing crisis. I believe that there are several factors at play, and I shall say more about that later. I would argue that the issue is not the availability of housing as such, but its affordability. Even with that in mind, however, I am not convinced that increasing supply will substantially drive down costs. I have done some research on the matter. According to evidence given to the Redfern review by Oxford Economics, supply is unlikely to bring house prices down except in the very long term. Even boosting UK housing supply to 310,000 homes per annum brings only a 5% fall in the baseline forecast of house prices.

I think that we need to look beyond the issue of building more houses to what sort of houses we are building. As I will explain later, the planning system is producing four and five-bedroom houses, which are often out of the price range of first-time buyers, when what we need are two-bedroom houses, bungalows for older people and housing that is accessible to people with disabilities.

There is no doubt that housing in London is very expensive, and London has that in common with major cities across the world. Hotels are also expensive in London, as they are in Paris, New York, Tokyo, Hong Kong and many other international cities. However, that is not necessarily because there is a shortage of houses or hotels. It could be said that the UK would be better served not by attracting more and more people to live and work in London, but by spreading the wealth-creating sector and financial opportunities across the country rather than allowing London to act as a magnet. Members should not get me wrong—London is a fantastic city, probably the greatest city in the world, and I want to do nothing to diminish its status—but we should not think that what is happening in London must automatically shape policies across the UK, because sometimes the problems are different.

The Government seem to be describing the housing situation as broken and in crisis on the basis of their analysis of the fall in property ownership among young people, and there has indeed been such a fall. Home ownership among 25 to 34-year-olds has fallen from 59% just over a decade ago to 37% today. Moreover, house building has fallen by 40% since the 1980s. I recognise that there are problems in the housing market, but, again, to reduce them to an issue of supply is an over-simplification.

My analysis suggests that the falls in ownership and house building have in large part been caused by the crash in 2007-08 and the financial fallout from it. Before 2007, we were living in an artificial financial boom. Personal debt was increasing, and some companies were offering applicants mortgages that were worth up to 125% of the value of the houses that they were seeking to buy. Self-certification of income also still existed. All that changed with the crash. Mortgage applicants then had to provide documentary evidence of income, and, while the fall in interest rates should have helped buyers, the affordability of a house was assessed not at the prevailing mortgage rate at the time, but at an assumed rate that would be reached should interest rates be increased.

For example, at the moment the standard mortgage rate is 4.5% and there are many better offers than that available, but applicants are assessed on the basis of whether they could afford to pay their mortgages if rates reached 6% or 6.5%. As was the case 40 years ago, significant deposits are now required by lenders before they will release the mortgage. That has brought about a very significant change.

I am not saying that the Government’s insistence on stronger capital bases for banks is a bad thing; nor is such a requirement a tightening up of lending practice. What I am saying is that it has had a significant impact on the ability of young people to buy their first houses. The fall in ownership, particularly among young people, and the fall in the number of new constructions did not come about because of a change in planning guidance in 2007-08, because there was no such change. These falls came about because of the change in the financial position of banks and building societies. We therefore have to be careful that we do not respond to a change in lending practice with an easing of planning regulation.

We also need to recognise that at the same time as describing the housing market as in crisis and broken, the Government have set up an inquiry into why developers land bank, which is something of a contradictory position. Estimates suggest that 320,000 homes granted planning permission over the past five years have not been built. In my constituency, I have seen developers having to obtain an extension to their planning permission because they have reached the end of the statutory five-year period before starting to build. Developers will not deny themselves the profits that would come from building on land for which they have planning permission without good reason, so perhaps we ought to consider that they might be failing to develop the land because there is not quite the demand for housing in some areas that is assumed.

The determination to build ever more houses has led to some councils being persuaded that they need to build on the green belt to meet what is assumed to be their assessed housing need. That points to a confusion and contradiction in green-belt policy. The Government’s planning guidance states that the green belt should not be developed other than in “exceptional circumstances”, yet it fails to describe what constitutes “exceptional circumstances”. The housing White Paper goes on to say:

“Green Belt boundaries should be amended only in exceptional circumstances when local authorities can demonstrate that they have fully examined all other reasonable options for meeting their identified housing requirements.”

However, crucially for the point I am making, planning guidance also says:

“Unmet housing need…is unlikely to outweigh the harm to the Green Belt and other harm to constitute the ‘very special circumstances’ justifying inappropriate development on a site within the Green Belt.”

Planning guidance is going around in circles, because in effect it says that the green belt should not be built on unless nowhere else can be found to build the houses, but that unmet housing need is unlikely to outweigh harm to the green belt in importance.

This confusion and contradiction in planning guidance, along with the assumption that we have a housing crisis across the whole country, has led to proposals to build around 10,000 houses in my constituency on green-belt land, including 1,000 on land which floods. Indeed, in 2014 the then Prime Minister David Cameron visited my area to look at those very fields that were flooded, as well as the roads and some houses. I can assure the House that he did not visit to look at dry, green fields, yet permission has been granted, on appeal, to build on that very land.

[Dr David Drew (Stroud) (Lab/Co-op)]

I apologise for arriving a little late for this debate; I was talking about the Cotswolds national park, which I know is close to the hon. Gentleman’s heart. He will be aware that, under the Government’s new methodology for housing needs, Tewkesbury is expected to take an additional 21% increase and Stroud a 39% increase. Does he share my concern? I do not know where this methodology has come from or what the implications are, but it will cause a lot more grief in the Stroud and Tewkesbury areas.

--- Later in debate ---

[Dr Roberta Blackman-Woods (City of Durham) (Lab)]

I start by thanking right hon. and hon. Members who have contributed today, not least the hon. Member for Tewkesbury (Mr Robertson), who secured this important debate. It is good to see the hon. Member for Grantham and Stamford (Nick Boles), a former Planning Minister, back in his place.

I am acutely aware that the subject of this debate is often contentious and that discussion of the green belt can be fraught with difficulty. It is very good that this afternoon there has pretty much been consensus across the House. I understand that Members may be concerned that the need to build more homes will lead to increased pressure to build on green-belt land, but we must recognise that that pressure would be ameliorated to an extent if so much of our development land was not subject to land banking. I know from experience that that is a growing problem that is hampering the ability of local authorities to deliver the homes we need.

Some of the figures are startling. Last year, Shelter estimated that more than 320,000 homes that have been given planning permission in the past five years have not been built. That alone represents much more than a year’s worth of the supply of new homes that we need. Numerous organisations have expressed concern about this issue, including Shelter and the National Trust, and The Guardian and other publications have investigated its extent. The results are alarming. The Guardian has suggested that the nine biggest house builders are sitting on 600,000 undeveloped plots of land.

That is why Labour has, for several years, called for “use it or lose it” powers to ensure that planning permissions are used and that sites are built out. There must be both incentives for developers to build sites out at a faster rate and greater enforcement on those that do not.

I am glad that the Government have finally announced a review of build-out rates, but I fear that it is sadly too late. In the meantime, thousands of families have missed out on the opportunity of getting a new home. I would be very grateful if the Minister told us whether the Letwin interim review of build out is likely to report in the spring and how soon he expects proposals to come to the House to tackle land banking. I would also like to know whether the review addresses the reason for stalling on a number of sites and the need for remediation funding, which was raised by my hon. Friend the Member for Halton (Derek Twigg).

Let me be clear about Labour’s green-belt policy. As was stated in our manifesto last year:

“We will prioritise brownfield sites and protect the green belt. We will start work on a new generation of New Towns to build the homes we need and avoid urban sprawl.”

That has been a consistent Labour policy. It was reiterated in the Lyons review in 2014, which stated that

“the policy of containing urban areas in England has been highly effective in its objective of preventing urban sprawl and stopping adjacent cities from merging together. There is clearly value in the preservation of areas of amenity land close to our urban areas for people to enjoy.”

It continued:

“Planning authorities seeking to meet local housing need should be reminded that current policy provides for both review of and change to green belt boundaries, including swaps of land, as long as that is in the context local plan preparation or review and is the subject of detailed local consultation.”

We want to protect the green belt, but to continue to give local authorities the flexibility they need to change it in line with local expectations and local plans.

The Government are letting communities down over the protection of green-belt land and are not giving local authorities the tools they need to protect high- quality green spaces around urban areas. Organisations such as the Campaign to Protect Rural England have expressed concern that the changes being made following last year’s housing White Paper to define the exceptional circumstances in which green belt development is acceptable are “insufficiently robust”.

[Dr Drew]

Does my hon. Friend understand the frustration in places like Stroud when the number of affordable housing units needed is ratcheted up, but we are completely unable to prevent the developers from building executive houses? Does she agree that that dilemma just makes us look hopeless in terms of general residents’ interests?

[Dr Blackman-Woods]

My hon. Friend makes a very good point, which has been much made this afternoon. The change signalled by the Government is what I think led my hon. Friend the Member for Coventry South (Mr Cunningham) to label the policy “green belt first”. My hon. Friends the Members for Ellesmere Port and Neston (Justin Madders) and for Bury North (James Frith) also clearly highlighted the difficulties of that approach.

Last year, the Government proposed a new method for calculating the housing need for local authority areas, but unfortunately the new formula does not take into account the amount of land that is protected in a given area. For example, in County Durham, 43% of the area is green belt, an area of outstanding natural beauty or under conservation area protection. Again, that causes problems for the local authority, and the Government need to address the issue urgently.

The National Housing Federation said that the Government’s target of 300,000 new homes a year will not be met unless we make better use of land. So far, as the Minister will know, we have not come close to reaching that target, with only—this was a huge improvement on previous years—183,000 homes built last year. The Government need to reach the target, and that point was made very effectively by my hon. Friends the Members for Mitcham and Morden (Siobhain McDonagh) and for Chesterfield (Toby Perkins).

The National Housing Federation has called for the Government to

“think innovatively about how best to use public, brownfield and greenbelt land to build the homes and communities”—

communities is a very important point—that

“we need”.

I agree that there must be more creative and collaborative solutions to the housing crisis. We need to see much more of local authorities working together, with much greater support from the Government, to set up new towns and garden cities.

The Government must do more to ensure that local residents and businesses feel in control of development in their areas. Too often, people are left feeling that planning is done to them, rather than it being a process in which they can participate. We know that the Department will prepare a new draft of the national planning policy framework for consultation soon, and the Government must take the opportunity to address some of these issues. That point was made excellently by my hon. Friend the Member for Bury North. The local plan process must be strengthened and proper consultation must be guaranteed. There must also be greater investment in planning departments, which have been starved of resources. They need additional resources to ensure that developments are correctly assessed and that local policies are properly implemented.

A survey of local councillors that was carried out last year by the Local Government Information Unit and the National Trust found that 50% of local councillors saw sites being approved for development that were not in line with local plans. However, it should be through the local and neighbourhood planning process that appropriate sites are allocated for development and that any changes to protected designations such as green belt are undertaken. In that way, communities can best plan for sustainable development and control future development in their area.