The house building sector has been crippled by the combination of the financial crisis and a major reduction in demand through the recessionary years. The response of the incoming Coalition government was the announcement by Eric Pickles to scrap regional spatial strategies without the alternative framework being put in place. The fact that Cala is now seeking to challenge that decision recognises the significant detrimental impact this change will have for the house building sector in the short to medium term.
Housing is a basic need, but we continue to struggle in most parts of the UK to deliver appropriate and sufficient housing. The failures of the planning system were identified by Barker in her review in 2004. The delivery of housing has been patchy and there is a continued failure to provide sufficient houses to meet ongoing demand, but at the same time very large numbers of the population remain excluded from the private sector.
It appears that the thrust of planning reform in England is going to be directed to increasing the powers of planning authorities at a local level both to set and deliver housing land. Recent announcements suggest that the Coalition is going to incentivise the building of new housing through the retention of tax revenues. It will be interesting to see whether Planning Authorities will be influenced by such matters.
In Scotland housing numbers have largely been set by groups of authorities or individual authorities for a number of years. The Scottish Government has intervened on occasion at the development plan level. Scotland has a very broad statement of housing policy at a National Policy level. It is recognised that there is a significant need in Scotland not only to meet ongoing demand, but also to replace inadequate housing. In Scotland planning reform is focused on streamlining the examination processes for plans and there is now very limited scope for house builders to challenge plan formation.
In some respects the current system in Scotland is reflective of the one which is emerging south of the border. The main difficulty with the approach is that there have been many larger housing sites which are failing to deliver. It is all too easy to avoid the challenges of dealing with expansion of existing settlements by promoting "a new settlement strategy". Even in the "good times" their financing was insecure given the level of upfront infrastructure cost. In addition, many parts of Scotland are struggling to attract investment from the private sector. Completions over the last couple of years have only been sustained by significant Scottish Government funding for affordable housing.
A successful house building industry requires a legal and policy framework which enables the sector to thrive. In planning circles house builders have often been perceived as having deep pockets, but at the same time those house builders listed on the stock exchange have struggled in comparison to many other sectors. Furthermore funding is likely to remain tight for some period. A key factor is the ability of the house building industry to access land at appropriate values. This has meant that the industry has engaged with the planning process at an early stage rather than buying its sites that come out at the end process.
It is likely that further planning reform in England will follow that in Scotland and reduce the level and scope of private sector challenge to the plan making process. This will increase the importance of local authority planners in providing the framework for the delivery of houses. This may well be against a political background which may be resistant to further development. The question that remains to be answered is whether financial incentives for house building will provide a sufficient political benefit to promote further house building.
It is against that background that companies such as Cala feel that they have to pursue matters through the Courts rather than through the planning process itself. For those who have been involved in the planning system over many years there must be a feeling of deja vu. We continue to struggle with the ongoing debate about regulatory structures and the value of targets, whilst the system continues to fail to deliver sufficient housing. As Barker identified in her review in 2004, that failure will have significant implications both for the economic growth and the quality and sustainability of homes that people live in. If a further Barker review is undertaken in 2015 will similar criticisms still be valid? This will be a key issue when coming to examine the planning reform which is likely to emerge from the Coalition government.