Anthony Breach: To solve the housing crisis, England needs a zoning system

Anthony Breach is an associate director at Centre for Cities, where he leads on housing, planning and devolution.

A few years ago, only lobbyists and hobbyists might have noticed when a new Planning and Infrastructure Bill was laid before Parliament.

Today, the planning reform agenda has assumed national political importance, with Labour’s economic strategy depending on building 1.5 million new homes in England over the Parliament. So – will Labour’s strategy work?

First, a quick recap of the quest for planning reform.

Both Labour and the Conservatives now recognise England’s planning system seriously restricts housing supply and so seriously increases the cost of housing. The idea that the planning system has nothing to do with our economic malaise has been pushed out to the fringes of political debate.

The core issue is that in England’s discretionary system is not normal. Ever since the Town and Country Planning Act 1947 was passed, even if you follow the rules of the local plan, you can still be denied planning permission by either planners or by the local councillors sitting on your council’s planning committee. In contrast, most other developed countries have rules-based zoning systems – where if you follow the rules of the zone, you are guaranteed planning permission.

The Conservatives have started to move towards rules-based planning through fits and starts. The ‘Planning for the Future’ White Paper initially proposed a move to a type of zoning system (without ever actually mentioning the ‘z-word’). After a lost by-election and a reshuffle, Conservative ambitions of the planning reform agenda were scaled back, but ended up in law as the Levelling Up and Regeneration Act.

The most important legacy of the previous Government’s efforts was the new rulebook known as the National Development Management Policies. The NDMPs will, for the first time, ensure national policy trumps local policy.

The powers to create NDMPs are already in law but have not yet been activated. A working paper published before Christmas indicates that the Government is thinking of using them with a particular focus in cities through “Brownfield Passports”. Any Government that is serious about solving the housing crisis needs the NDMPs, as we cannot have a rules-based system if the rules do not actually matter.

Despite (or perhaps because of) the fraught debates among Conservatives on planning reform, Labour has seized the issue and is making political hay from it. As a result the Planning Bill this week covers a wide range of topics, but one idea is particularly pertinent to increasing housebuilding – reform of planning committees. These are the committees of councillors that ultimately control planning permissions, including denying approvals to proposals that professional planners say comply with the local plan.

The Government set out some possible options for reform in another working paper before Christmas which will be set out in further regulations. Of these, Option 3 is by far the strongest, suggesting that all planning decisions will be ‘delegated’ to planning officers except in a list of circumstances decided by national Government when it would then go to committee.

What makes Option 3 so promising is it possesses an exceptional level of coherence with the NDMPs. The system will still be discretionary, but with national rules interpreted consistently by local planners there will be a much stronger connection between changes to policy and changes to outcomes – precisely the promise of a more rules-based system.

So does that mean that the housing crisis is about to be solved and there’s no longer anything to argue about? Not quite.

The central question is whether the discretionary planning system can ever achieve the Government’s 1.5 million target, and if so, where.

Centre for Cities research has shown that the discretionary planning system at its level of strong performance has previously met the Government’s targets – but only in the shires. The discretionary system has never come close in the big cities.

The choice for the Government is therefore simple.

Either we keep the current discretionary planning system, and we have to build even more in the shires than the current targets to compensate for urban underbuilding. Or, if we want to build more on brownfield sites in urban areas, then we need to shift from a discretionary system to a rules-based flexible zoning system.

The Government is hoping that the Brownfield Passports will resolve this problem increase building in cities. There is some potential here with the NDMPs, but the current discretionary system makes this challenging for two reasons.

The first is that discretionary system was created to stop new homes in cities. The intellectual genesis of the TCPA 1947 – the Barlow Report of 1940 – was very clear that the role of cities in the national economy should be suppressed through a reduction of property rights and state controls on the location of industry and housing. Although the ideas of the Barlow Report have since faded, the system it established still blocks urban change by design.

The second is that the discretionary system is not spatial enough to manage the politics of urban densification. As it thinks in terms of policies rather than maps, using arcane criteria to judge each application case by case, the discretionary system struggles to consistently apply different rules for development to different types of neighbourhood.

Clear distinctions in rules between urban neighbourhoods are critical for large amounts of brownfield development to occur, as without them voters will be left unsure about how much development they can expect in their backyard. This was a key reason the ‘Planning for the Future’ zoning reforms failed – just three zones, including a ‘growth’ zone with no rules, was too sweeping and prompted a backlash.

So does that mean really painful reforms are needed? Happily, no – Option 3 and the NDMPs would already provide the skeleton for a new English zoning system.

The NDMPs could be used to define distinct zones that each contained a bundle of rules on density and how land could be used. Local councillors and planners would then determine which zone is appropriate for each neighbourhood across urban England in their local plans.

For example, a suburban zone might allow buildings up to three storeys, and various neighbourhood commercial and office uses. A city centre zone would in contrast allow skyscrapers, along with more uses that create more nuisance such as betting shops and nightclubs. Industrial zones would provide land for employment space.

A flexible zoning code that includes 12 to 18 distinct zones with a mix of uses and densities between these examples would return property rights back to landowners to use land with more freedom than today, while still retaining a politically led process of planning by neighbourhood.

Option 3 would then mean applications which complied with a zone’s rules would be guaranteed planning permission, with special locations like Conservation Areas retaining the same discretionary processes as today. Such zoning systems are common across the rest of the Anglosphere, with Auckland in New Zealand a particularly promising model.

The Planning and Infrastructure Bill does not currently include these proposals. Option 3 could be implemented without also introducing a zoning system – the default would still be discretion. But just as the introduction of the NDMPs has unlocked a further step of the planning reform agenda, Option 3 is valuable partly because it pushes the debate on even further towards the international norm.

Conservatives will find other parts of the Planning and Infrastructure Bill controversial. But it will be difficult for Conservatives to oppose Option 3 without implicitly rejecting the progress they did make on planning reform after 2010, as it would be an example of Labour taking the work of the previous Government and going further.

If the Opposition are serious about tackling the housing crisis, reform of planning committees and Option 3 are a must-support.