Well, who would have thought it. Here we are, with a Labour Government possessing an historic majority and lots of fiery rhetoric about ripping up the planning system – and what do we get? The very housing policy Tory MPs always wanted: dumping targets on the North.
The details are really eye-popping: the North East will see its housebuilding target increased by 99 per cent, and the North West by 75 per cent. Overall, the total target for England will rise by just shy of 22 per cent. Every region will be asked to do its duty.
With the exception of one: Sadiq Khan’s London. His target has been cut from 100,000 to 80,000.
The excuse-makers are out, of course. The new government is in its pomp, so even the wisest housing wonks have to put their stakeholder engagement hats on when writing this up. The problem is that there should be more targets around London (“in true blue, Home County districts”), not a shortfall in the capital itself.
There’s some truth to that. We need a lot more housing in the London commuter belt, and a Labour government ought to be well-positioned drive it through whilst local Tory and Liberal Democrat MPs howl from the opposition benches. But the idea that London itself should have been de-emphasised is total nonsense.
The capital is where the housing crisis is most acute, and where housebuilding levels have been the most heavily deficient, with obvious results. Rents have spiralled, whilst would-be buyers without outside help face decades of saving just for a deposit.
In the face of this, the Mayor’s response has been abject. London saw the largest fall in housing delivery of any region in 2022/3 – just 35,300 new additions, well short of the London Plan’s target of 52,000 per annum and nowhere close to the 90,000 per annum Savill’s estimates are needed “meet housing need and improve affordability”.
This is in large part Khan’s fault: the fall in housing starts at the start of his tenure has been sustained, and are down 60 per cent from their peak in 2015/16, as Chris Philp noted in a 2017 paper for the Centre for Policy Studies. In February, he came under fire when it emerged his affordable housing programme has only saw 658 building starts last year, leaving the Mayor only 2.8 per cent of the way towards his target of 23,900 homes by March 2026.
So far, I have seen to broad arguments advanced in favour of Labour’s decision to shunt housing targets out of London (and other urban areas including Bristol, where it just lost a seat to the ultra-NIMBY Greens). Neither is good.
First, it is claimed that the previous target was unrealistic. As Ant Breach puts it: “getting rid of the probably unfeasible ‘urban uplift’ of 35 per cent in London and 19 very urban authorities outside with little land was sensible.”
What do we mean by “unfeasible”, though? Densifying inner cities is not unfeasible in any material or historical sense; it has been done throughout history, and is done overseas. No, this is simply dressing up a circular argument – it is unfeasible because Labour do not want to do it (and nor, despite their grand targets and even grander manifesto, did the Conservatives).
This is surely in part because Angela Rayner doesn’t want either to fight or to embarrass Labour-controlled urban local authorities, but also because unlocking densification would require a comprehensive overhaul of the building regulations, and the Housing Secretary has shown not the slightest interest in doing that.
(And lo, all Rayner’s talk of building beautiful – which would have required just such an overhaul – has been gutted. Create Streets has questions to answer.)
Second, and relatedly, it is suggested that lower targets are more realistic than higher ones. This is an example of the Seely Fallacy, first deployed on this site by the man himself:
“For sure, the UK has historically struggled, but last year we built a quarter of a million properties, the best for nearly 35 years. If Boris Johnson’s target – which, by the way, is completely arbitrary – had been 250,000 rather than 300,000 homes a year, we would already be on target.”
In short, taking a superficially sensible idea – that it is better to hit a lower target than to miss a higher one – and torturing it into the idea that the most important thing about a target is the mere act of hitting it. This is obviously not the case: if striving to hit a higher target delivers more homes than hitting a smaller one, that is the better outcome (at least if your priority is the homes and not the press release).
Perhaps Labour’s changes will deliver more urgently-needed housing in urban areas than the previous government’s policy of setting big targets and not enforcing them. That would be good. But it does not follow that there was ever a false choice between enforcing low targets and neglecting high ones – the vigorous enforcement of very ambitious targets in our cities is what we actually need.
(Nor should we let wonk-brain blind us completely to the broad political picture, which is a Labour government taking the pressure off Labour-controlled local authorities which are already woefully underperforming on housing. This might deliver more overall, but it isn’t hard to see how it might not.)
If there is one silver lining for all this – as for any area where the Government makes terrible decisions – it is that it opens up an opportunity for the Conservatives. As I have noted before, turbocharging urban housebuilding sits at a happy confluence of the Party’s interests and the nation’s; it was an unpardonable, historic mistake to allow a handful of MPs in suburban marginals (only one of whom clung on at the election anyway) to divert the previous government from doing just that.
Whilst in terms of Britain’s actual needs there is no getting away from the need to build millions of new homes across the South, Rayner’s decision shunt targets out of cities has opened up a sweet spot: a front on which the Conservatives can be messianically pro-housebuilding without antagonising those MPs who want to retreat to their comfort zone over the Green Belt.
Tom Tugendhat already argued, in his launch article, that “our planning system must allow cities to grow upwards, not outwards”, and other candidates are well-positioned to get on the front foot on this: Kemi Badenoch is shadow housing secretary, whilst Robert Jenrick was the housing secretary who tried to carry through Boris Johnson’s full-fat planning reforms. A surfeit of policy work from the right-wing ecosystem is available to any contender who wishes to pick it up.
Our party is in an existential position, reduced to an historically small rump in Parliament and with most of our MPs even then sitting on relatively narrow majorities. Worse still, one of the most decisive factors in any recovery – that Labour fail – is out of our hands.
Happily for the Conservatives, if not perhaps for the nation, the Government’s early decisions point towards failure: for all the initial excitement about wind farms and data centres, there was no evidence of any plan for proper planning reform in the manifesto or the King’s Speech, it has revived populist anti-landlord legislation which is making people homeless, and Rachel Reeves just gutted capital projects to create space for public-sector wage hikes.
It is in the pattern of the Government’s failures that the paths toward a Tory recovery will reveal themselves. Labour’s refusal to build in our cities is the clearest yet.