There is increasing concern at the highest levels of the coalition that its own “localism” agenda has the potential to hamper economic growth in the coming months – just as the government is at its most vulnerable to any sign of downturn. Ministers at Eric Pickles’ communities department believe that many of their localist policies will help business to grow; but others suspect that the general theme – handing more power to communities – will instead empower “nimbies” who want to stop development.
Against this backdrop we revealed this morning that Vince Cable and George Osborne are drawing up plans for several planning changes which could be announced in the spring Budget. The proposals come as the new head of the CBI warned that the ”jury is still out” over whether Mr Pickles’ new planning system will “deliver”. Here are the ideas:
1] Reviving enterprise zones: A handful of these were championed by Margaret Thatcher in the 1980s to help stimulate redevelopment in some of the most rundown parts of the country. Canary Wharf is probably the most obvious example of how this kind of project – involving tax breaks and total relaxation of planning – can transform an area. But if the zones involved tax cuts would they be affordable in the current climate?
2] Allow new building in the “green belts” which surround major conurbations. Ministers are very keen to see homebuilding rise from its current paltry level, the lowest seen for half a century. One way to do this is to revisit the broad question of whether development has been limited to too small a proportion of Britain’s land mass for too long. Any changes to the current green belt policy is likely to be hugely controversial, however.
3] ”Land auctions” which would give councils a share of any uplift in land value resulting from their decision to grant planning permission. The idea is rather complex but for your handy guide to how it would work you should read this article, in the FT, written by academic Tim Leunig of the LSE and now business minister Ed Davey three years ago. I’m told that the current proposals are remarkably similar to this model.
4] Reforms to “change of use” rules. Developers often complain about the paperwork they have to endure to shift a building designated for one purpose (eg offices) to another (eg retail).