Draft text of the speech - may differ from the delivered version.
Many thanks to Localis for hosting us today. Localis are a think-tank on local matters who have made national politicians sit up and pay attention on issues from town hall finance, to personalising public services, to cutting back regulation.
Your director Alex Thomson helped shape many of the ideas in “Open Source Planning” which have, in turn, influenced the proposals in the coalition agreement.
I’m delighted that Tom Shakespeare, the Localis director of policy, has kindly stepped in to give the response today.
Today, I want to talk about this government’s proposals for planning: how we can make the system straightforward and transparent: how we can restore democratic control, the better to respond to local need; and how we can unblock the system to make it more effective at fulfilling its essential role of enabling sustainable development.
In short, how we can reboot planning to meet the needs of the 21st century.
My starting point is an appreciation of the value of planning. TS Eliot said that “literary criticism is a distinctive activity of the civilised mind.” For me, planning is a distinctive activity of a civilised society.
I spoke about this when I met the Royal Town Planning Institute earlier this year:
[Planning] shapes the world in which new generations live and work - and makes it better than it would otherwise be. The places where children grow up, that will stay with them forever. The workplaces where thousands of people spend thousands of daylight hours. The places we look forward to going home to in the evening.
It is, when you think about it, an awesome responsibility.
Planning, at its best, makes places of which the people who live and work there can be truly proud.
I do not come to this role with a uniform view of what the built environment should look like. In fact I admire some things that are rather unfashionable at present.
On one on my walls is a print of Tunbridge Wells in 1719. You can see the first colonnaded shops and coffee shops that still draw tens of thousands of visitors each year.
On another is a photograph of Le Corbusier’s Unite d’Habitation going up in Marseille, one of the thrilling landmarks of modernism.
It is not central government’s role to stifle new ideas, but to allow for the exercise of imagination and creativity.
In other terms, there is space enough in planning for radicalism and continuity, and they won’t happen everywhere at the same time.
My other starting assumption is that is the role of the planning system to set standards that enable the right kind of growth - not to hamper all growth indiscriminately.
I don’t want to set the country in aspic. Nor do my colleagues in government. Britain is a growing country. There are already places where young people are simply unable to find a home in the towns where they grew up, families who need more room to grow. Projections suggest that a quarter of a million new households will be formed each year over the next two decades. The bottom line is simple: we need more homes.
At the same time, Britain faces unprecedented financial challenges. After a sharp recession, it is essential to reinvigorate the economy. Any successful business needs room to expand. And all businesses would benefit from the development of better national infrastructure to underpin fast and efficient transport, and reliable and affordable energy supplies.
In blunt terms, planning should enable, rather than impede, the right kind of development that our communities and businesses are crying out for.
The trouble is that in recent years we have seen too much of planning at its worst.
It’s tempting for politicians, when they first take office, to seize control - to centralise power - with a view to improve people’s lot and deliver the policies on which they were elected. That applies as much to health and education as it does to building new homes for a growing population, and creating space for new businesses and jobs.
But the law of unintended consequences applies. Over time, as the red tape has piled up, and the volume of central prescription and guidance has crept higher and higher, flawed policies have resulted in a planning system that is profoundly dysfunctional.
First, the current system is costly and bureaucratic. The desire to control from the centre has meant that guidance, planning policy statements and circulars have mushroomed. Currently, they total more than 7000 pages. Little wonder that non-experts struggle to orient themselves. The system costs applicants £750m per year in consultants and legal fees.
Second, the current planning system imposes on people in a way that breeds resentment. Regional spatial strategies imposed housing targets from above, with the result that many local communities felt disaffected. The consultation on the South West regional strategy alone generated 35,000 written objections. Research by IPSOS Mori uncovered simmering dissatisfaction:
I feel powerless - what can we do?
Frustration means that some people’s response is to resist development at all costs. Yet the paradox is that the same IPSOS Mori research reveals that people want to see more homes built, especially affordable homes and small developments.
This highlights the most fundamental failing of all in the current system: it doesn’t do the job it’s supposed to. As we all know, In 18th century Russia, Gregor Potyomkin, one of Catherine the Great’s advisors, took her on a boat tour of his estates. Catherine may have been fooled by the cardboard cut-outs of factories and schools and hospitals he had put up along the side of the river - but no-one else was. There’s a parallel to be drawn with regional spatial strategies. It would be a big mistake to confuse targets on paper with homes actually built. If anything, the evidence might suggest an inverse relationship between the two. We now have the lowest level of house-building in peacetime since 1924.
The evidence also suggests that commercial and industrial development have declined over the last 20 years. This is matched by concern among businesses - expressed by the CBI, the Engineering Employers Federation and the British Chambers of Commerce and others - that the shortcomings of the planning system are undermining our economic prospects and our ability to attract inward investment.
In sum, the current system doesn’t deliver for communities, it doesn’t deliver for business, and it doesn’t deliver for the country.
This government has a positive vision for the future of planning. We want to restore democratic control at every level. We want to make the system more straightforward, less costly, and easier to understand. And above all, we want an approach to local planning that is more genuinely local.
In essence, the challenge of local planning is to resolve the different interests of people who have homes - and those who need them; of the people who live next door to the business that wants to grow - and the people who might work there.
The last government resorted to imposition - this government believes in participation.
The last government used to take responsibility and assume control - we want to give people real choices, and enable them to see the real consequences of those choices.
When people know that they will get proper support to cope with the demands of new development; when they have a proper say over what new homes will look like; and when they can influence where those homes go, they have reasons to say “yes” to growth. Certainly more reasons than when a regional plan is thrust upon hem.
In other terms - decentralisation does not come at the cost of development. Our proposals make both possible.
In some cases, fulfilling this vision means sweeping away the old apparatus. In our election manifesto and in the coalition agreement, we made clear from the outset our intention to abolish regional housing targets, and that intention stands.
But this Government’s proposals are not restricted to removing failed structures. Equipping planning to meet the needs of 21st century Britain requires fundamental, wholesale change - and in some cases this will mean creating new rights and opportunities too.
In a parliamentary session full of devolutionary pieces of legislation, the Localism Bill is perhaps the most radical of all. It will lay many of the foundations for many necessary planning reforms.
With the Bill’s publication imminent, I want to explain in some more detail how it will achieve those aims - and how, in tandem with other, non-legislative changes, it will improve the planning system from top to toe.
The starting point of our reforms is that many more of the benefits of development should be felt at a very local level.
When people can take their own decisions, and see the benefits, it allows for a more mature debate at a local level about the arguments for and against new development.
We have already outlined one principal means of rewarding and supporting places who want to encourage development.
It’s called the new homes bonus, and we have begun consulting on proposals. We propose to match the additional council tax raised over the following six years for new homes and properties brought back into use. There will be an additional amount for affordable homes. This will let the communities most affected by new housing developments see the greatest benefits. Local authorities will need to lead the debate with their communities to determine how this money - which will come without strings attached - should best be spent to meet local priorities. It could support reductions in council tax charges; it could be invested in the redevelopment of the town centre; or it could pay for a new community centre.
Today I want to say a little more about a second means of recognising and rewarding development - the community infrastructure levy.
The Government sees the levy as an important tool. It is a means of ensuring that when developers build new homes or businesses, they make a proper contribution towards improving local infrastructure, reflecting the new demands created by that development - such as increased traffic, or rising demand for local services.
The levy offers four major advantages.
For developers, it gives greater certainty. Alongside the levy, government is tightening up the requests that local authorities can make of developers through planning agreements, or section 106 agreements, which, in future, will not refer to facilities and resources that bear no close relationship to the development in question. Instead, with the levy, developers will be able to propose projects knowing the rules of the game in advance, and with a much firmer idea of how much they will be asked to contribute.
The levy is an arrangement with proper local flexibility. Where sites are economically difficult to bring forward, authorities will be able to set the rate at a low level, to ensure new development can go ahead. Elsewhere, authorities will be able to set a higher rate, reflecting the existing higher demands on infrastructure. And our reforms will give local authorities significantly more flexibility to provide for payment by instalments and for payment in kind, to suit local circumstances and the needs of local developers. An independent assessor will check that rates are not set so unreasonably high that they deter all development.
Crucially, the levy will enable local communities to see the benefits of development. There will be a requirement in law that a meaningful proportion of money raised must go to people at a very local, neighbourhood level. Resistance to development is often fuelled by genuine concerns that the development will add extra pressure on local services. This proposal will ensure that people who live down the road from a new development, will not only see the additional infrastructure such as road improvements, new parks and play areas in their areas, but will also, as far as possible, put the decisions about what some of the money should go on into the hands of people in the neighbourhood themselves. In common with our proposals for the New Homes Bonus, this will help communities manage the impacts of development more effectively and give them more reason to accept development in the first place.
Finally, the levy will be much more transparent for local communities - both in terms of how much is raised and how much is spent. The existing system of developer contributions relies on private, and sometimes commercially confidential, contracts. The new system requires timely annual reporting of both income and expenditure, so local people and developers can see what levy money was spent on.
But we don’t just want people at a very local level to see the benefits of planning decisions: we want them to have a far greater opportunity to make or influence those decisions themselves.
We want to enable neighbourhoods to exert more influence in the planning system than is currently possible. We aim to create a means for people to formulate their own plans about what their area should look like in five, ten, twenty years’ time.
This is a rethinking of how planning operates - creating new pressures and powers that operate from the bottom up, rather than the top down.
The principle is simple. Local people come together and agree, “this is what we want our area to look like. Here is where we want the new homes to go and how we want them designed; here is where we want new shops and offices; here are the green spaces we want to protect.”
We will have more to say about neighbourhood planning when we publish the Localism Bill.
Of course not everyone will want to draw up a neighbourhood plan. This doesn’t mean that they don’t care about changes to their area. So where there is no neighbourhood plan, we are backing up the community’s right to be heard. When major developments are planned we are setting down in law that developers must consult local people before they make a planning application.
Responsible developers do this already - not just because it’s the right thing to do - but because they recognise that involving local people may help win local support, and, in turn, give a better chance of securing consent. Setting out the requirement in law will put things right where developers don’t.
With neighbourhood plans, we are defining a new basic building block of planning.
But not all planning can take place at that very local level. Neighbourhood plans don’t replace wider, local plans. Nor do they diminish the importance of those local plans.
In fact, if anything, it’s the opposite: neighbourhood planning is made easier where there is a good local plan in place, which sets out the priorities and development needs of a wider area in a coherent, consistent way.
That’s why, in the Localism Bill, we want to make it easier for local authorities, involving their communities, to draw up local plans - and to give them greater discretion to do it in the way they want, by cutting out excessive central prescription.
We also recognise a larger than local element to planning. In many cases sensible planning works best across the administrative boundaries of local authorities: where significant numbers of people work in one council, for example, but live in another: where the plans for housing in one are predicated on the plans for new offices in the other.
If local authorities want to come together to pool planning powers, share sovereignty, in a greater shared interest, they may already do so. Indeed, some of the local authorities who have come together in Local Enterprise Partnerships are already considering doing just that.
We want all local authorities think about the opportunities here in a considered way - a new “duty to cooperate” will require neighbouring authorities to be ready to join forces in the interests of the people they represent.
Finally, we want to improve the national policy and national processes for planning.
I mentioned the guidance and policy which planners must take into account. Currently there are more than 150 circulars, good practice guides and planning policy statements. Taken together, they contain more words than either the Bible of the Complete Works of Shakespeare. I would be the first to acknowledge that planning requires specialist skill and knowledge, but over-prescription has made the system too opaque. These documents set out planning policy and guidance in so much detail, with so many priorities and so many factors to consider, that the result is internal contradiction, no clear set of priorities, and a great deal of paper produced at local level which no-one actually uses.
We have plans for a clearer, crisper set of policy guidance, which shows respect for the expertise and specialist knowledge that planners bring.
It is our intention that at the heart of that revised policy there should be a presumption in favour of sustainable development. Applicants should expect to see their proposals approved provided they are in line with neighbourhood plans, local plans and national policies - including, of course, provisions on climate change and environmental protection.
I look forward to discussing these, and other proposals, in further detail in the months to come, when the Localism Bill is published and begins to make its way through parliament.
But I finish on that point because it brings me back to where I started.
The right kind of development is nothing to be afraid of. Our aim is that these reforms should help Britain break out of the current housebuilding trough; enable commercial development so that businesses see the planning system not as a drawback but as an advantage; and lay the foundations for the beautiful, successful, thriving communities of the future.
Think of the great successes of planning. Major projects such as Edinburgh in the 18th century, or Welwyn Garden City in the early 20th. Smaller-scale developments in almost every town or village you can imagine. Places that have been well loved for centuries, that people still live and work in today, and that speak of local identity. This is what great planning can achieve; this is what our reforms will enable people to choose for themselves.