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Budget targets planning in a bid to boost housing numbers

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Government has proposed further measures to boost the number of planning permissions granted – including new rules to make it more difficult for councils failing to meet their housing requirement to refuse planning applications.

Under proposals announced at the Budget today, councils could also be required to increase density of development in urban areas and ensure a fifth of their housing land supply is made up of small sites in a bid to make it easier for small and medium developers to build.

Plans for five “garden towns”, using a mixture of public and private funding, were also announced.

In his speech to Parliament this afternoon, chancellor Philip Hammond said solving the housing “challenge” would require “money, planning reform and intervention”.

He acknowledged there was a “significant gap” between the numbers of planning permissions granted and homes being built and announced he was setting up an “urgent review”, led by former cabinet office minister and MP Sir Oliver Letwin.

The Budget papers also announced the government will consult on “detailed proposals” for reform of developer contributions following its review of the Community Infrastructure Levy. However, most other measures proposed focused on reforms to the planning system.

Papers published alongside the Budget said the government would consult on strengthening the housing delivery test, first proposed in the housing white paper at the beginning of the year, so that the presumption in favour of development would kick-in if councils were failing to deliver at least 75% of the housing estimated that is required for their area.

The presumption, which is set out in the national planning policy framework, means planning authorities must have very strong reasons for refusing planning permission. The original white paper proposal suggested that would kick-in in November 2018 if a council was failing to ensure delivery of at least 25% of required homes, rising to 65% by November 2020. Today’s paper did not give details of the timing of the introduction of the test.

In his speech Mr Hammond said the government would focus on “making best use of our urban land, and continuing the strong protection of our green belt” and “building high quality, high density homes in city centres and around transport hubs”.

The papers said this could include introducing minimum densities in town centres, making it easier to convert retail and employment land into housing and an expansion of permitted development rights to allow commercial buildings to be demolished and replaced with homes.

Other measures designed to increase supply will include ‘first-time buyer led developments’ where councils will be expected to give permission to land outside their plan on the condition that a high-proportion of homes are offered for discounted sale to first time buyers or for affordable rent.

Mr Hammond said communities secretary Sajid Javid would set out more detail on the proposals, which are to be consulted on, “in due course”.

However, the Local Government Association rejected the implication that planning was preventing homes being built.

LGA housing spokesman Martin Tett (Con) said: “Planning is simply not a barrier to housing growth. Councils approve nine out of 10 applications and are doing all they can to deliver affordable homes with wider local services and infrastructure.”

He added: “We look forward to contributing to the forthcoming Letwin Review, and will make a vigorous case for councils to be given the strongest powers possible to make sure that developers are held to account.”

Liam Booth-Smith, chief executive of the Localis thintank also welcomed the Letwin review, which is due to make its final report by next year’s Budget.

He said: “An inquiry into land-banking is to be welcomed to the extent that it can effectively feed into greater transparency and shine a light into the near monopolistic behaviour among major developers that is not only stunting the amount of housebuilding nationwide, but also restricting choice and quality of housing as a consumer product like any other.”

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