New Housing Supply

Matthew Pennycook Excerpts

Monday 5th June 2023 Commons Chamber

[Matthew Pennycook (Greenwich and Woolwich) (Lab)]

It is a pleasure to respond to this important and timely debate for the Opposition. I congratulate the right hon. Member for Haltemprice and Howden (Mr Davis) on securing it, and I thank the Backbench Business Committee for granting it. I also thank all the hon. Members who have participated this evening. In addition to the right hon. Gentleman’s thoughtful and compelling opening remarks, there has been a large number of extremely well-argued, informed and insightful contributions.

While there is good reason to treat sceptically the argument that boosting housing supply, in and of itself, will quickly and significantly improve house price affordability or address what are now essentially static levels of home ownership, there is no question but that a significant uplift in house building rates is an integral part of the solution to England’s chronic housing crisis. It is undeniable that, as a nation, we have clearly not built enough houses in recent decades to meet housing need, particularly in London and what might be termed the greater south-east, so it is imperative that we address this historical undersupply of homes.

To the best of my knowledge, no Conservative Minister has ever explained precisely why the number was chosen, but the Government made a manifesto commitment to build 300,000 homes a year by the middle of this decade. Even accounting for the additional supply facilitated by the progressive expansion of permitted development rights since 2013, many of them incredibly poor-quality office-to-residential conversions, the Government have never come close to approaching, let alone hitting, that annual target. In 2021-22, net additional dwellings stood at just 232,820. That level of output, respectable but ultimately insufficient, was, of course, achieved prior to the range of concessions the Government made, in their weakness, to the so-called “Planning Concern Group” of Conservative Back Benchers late last year.

In the aftermath of that abdication of responsibility, we have, predictably, seen scores of local plans across the country stalled, delayed or withdrawn. In the face of this alarming trend, Ministers contend that we need not worry because the proposed changes to the national planning policy framework will ultimately boost local plan coverage and, in turn, housing supply. Even if that is what ultimately transpires—there is good reason to doubt it—it would be a form of increased local plan coverage that is entirely disconnected from the Government’s purported aim of building 300,000 new homes per annum, because the intended effect of the proposed changes is to allow local planning authorities to develop and adopt local plans that fail to meet the needs of wider housing market areas in full. As such, the Government’s manifesto commitment to 300,000 homes a year remains alive but in name only; abandoned in practice but not formally abolished, in order that the Secretary of State and his Ministers can still insincerely cite it in a risible effort to convince this House and the British public that they did not agree, consciously and deliberately, to plan for less housing in England over the coming years in order to placate a disgruntled group of Back Benchers.

[Bob Seely]

I thank the hon. Gentleman for giving way to a disgruntled Back Bencher. If he reads the NPPF letter, the “Dear colleague” letter, he will find that although there is leeway on housing targets, there is set to be higher density and more liberalisation in many areas. A lot of what we tried to achieve was to free up the market to make it work better.

[Matthew Pennycook]

I fundamentally disagree with the hon. Gentleman on that. Whether it is by means of the emphasis in the proposed NPPF on locally prepared plans providing for “sufficient” housing only, the softening of land supply and delivery test provisions, the ability to include historical over-delivery in five year housing land supply calculations or the listing of various local characteristics that would justify a deviation from the standard method, the intended outcome of those changes is to allow local authorities to plan to meet less than the targets that nominally remain in place.

As I said, the choice the Government made entails a deliberate shift from a plan-led system focused on making at least some attempt to meet England’s housing need to one geared toward providing only what the politics of any given area will allow, with all the implications that the resulting suppressed rates of house building will have on those affected by the housing crisis and economic growth more widely. The next Labour Government will fix this mess. When it comes to housing and planning, our overriding objective will be to get house building rates up significantly from the nadir we will surely inherit, including, as part of that effort, markedly increasing the supply of affordable homes and, in particular, genuinely affordable social homes to rent. We do not intend to pluck an annual national target out of the air and ineptly contort the system to try to make the numbers across the country add up, as the Government have done by imposing an entirely arbitrary 35% uplift that most of the 20 cities and urban centres in England to which it applies are clear cannot possibly be accommodated.

[Bob Seely]

rose—

[Matthew Pennycook]

I will not give way.

But we will insist that the planning system is once again geared toward meeting housing need in full. To that end, if they are enacted as expected, a Labour Government will reverse the damaging changes the Government propose to make to the NPPF in relation to planning for housing. However, although reversing those damaging changes to national planning policy will be an essential first step, more far-reaching reform will be required if we are to overcome the limitations of a speculative house building model, a broken land market, and a planning system that is at once both too permissive and too restrictive. That will mean, among many other things, overhauling England’s dysfunctional planning structures so that the system more effectively facilitates strategic housing growth across those sub-regional areas with significant unmet need. That might be by way of extensions to existing urban settlements or entirely new settlements—I would argue that we need both in good measure. It will mean more proactive public sector involvement in housing delivery on large sites across the country, so that quality place making and long-term value creation become more than just the rare exception.

Let me make it clear, Madam Deputy Speaker, that Labour’s approach will not be premised on a drive for units at any cost. We appreciate that many local communities resist development because it entails poor-quality housing in inappropriate and often entirely car-dependent locations, without the necessary physical and social infrastructure for communities to thrive, or sufficient levels of affordable housing to meet local need. We would argue that that outcome is a direct consequence of the Government’s over-reliance on private house builders building homes for market sale to meet overall housing need. Yet when it comes to house building, there need not be an inherent trade-off between quantity and quality. A Labour Government will be determined to see increased rates of house building, but equally determined that much more supply comes via a long-term stewardship approach so that, if not removed entirely, public opposition to significant development in contested areas should at least be much reduced.

Similarly, we reject the notion that building more homes must come at the expense of wider national policy objectives. In addition to increasing housing supply in a way that prioritises quality of build and quality of place, we will act to ensure that the housing and planning systems play their full part in addressing other pressing national challenges such as the drive towards net zero, the need for urgent nature restoration and the need to improve public health.

To conclude, it is not the only way of solving England’s housing problems and it certainly will not be a panacea for them, but building more homes remains the most effective way that we have of tackling almost all of the housing-related problems with which our country is contending. The Government needed to build more homes before the so-called planning concern group extracted its damaging concessions late last year. As a result of the Government’s appeasement of that group, we now face the very real prospect that house building rates will plummet over the next 12 to 18 months.

We desperately need a change of approach, but it is a change that the present Government and the Ministers on the Front Bench are incapable of delivering. It is high time that we had a general election, so that they can make way for a Government who are serious about ensuring that we build to meet housing need in full and boost economic growth.

[Madam Deputy Speaker (Dame Rosie Winterton)]

Before I call the Minister to speak, I have to say that I am extremely disappointed that some colleagues were not present to hear the winding-up speech from the Opposition. It is as important to be here for the Opposition’s wind-up as it is to be here for the Minister’s wind-up. It is extremely discourteous not to be here.