Rachel Reeves has confirmed plans to bring back compulsory housebuilding targets to help it meet an 1.5 million homes target and grow the UK economy, in her first speech as the new Chancellor of the Exchequer.
The former Bank of England economist was appointed chancellor on Friday following the Labour Party's election win.
Her government want to unlock tens of billions of pounds of investment in green industry and housebuilding.
Reeves said she had ordered an assessment of the state of the “spending inheritance” for the country and that she would present the results before parliament’s summer break. The pound strengthened against the dollar during the speech, edging up 0.14 per cent to $1.282.
Reeves said planning decisions for major infrastructure projects will be made at a national rather than local level and the government will recruit additional planning officers.
She said this was not a "green light" for any kind of housing development, and that the right mix of affordable housing and homes for social rent would be built.
Reeves added that she would overhaul planning restrictions and end the effective ban on onshore wind farms in England to speed up national infrastructure projects.
Reeves said: "The question is not whether we want growth, but how strong is our resolve? How prepared are we to make the hard choices and face down the vested interests?"
Colin Brown, Head of Planning & Development, Carter Jonas, said the change in tone and narrative from the new Labour Government is welcome and refreshing.
"However, it is early days for the administration, and we will need to see a lot more detail on how they intend to implement these changes so that delivery is realised on the ground. The scale of the challenge is huge – to achieve 1.5 million new homes in the new parliament will involve rates of housebuilding not seen for decades and one cannot simply “turn the tap on” and expect houses to magically appear.
"The government will need to pull multiple levers and act decisively to secure real transformative change. Central to this will be to grapple with the thorny issue of development in Green Belt locations and to also address the undoubted skills and labour shortages which have the potential to derail their programme.”
Melanie Leech, Chief Executive, British Property Federation, described it as being "very positive to see the new government hit the ground running on planning reform".
“Housebuilding targets are a clear statement of intent and will help accelerate delivery. We need to build more homes of all tenure and type and so we urge the government to also consider bold targets for build-to-rent and affordable housing specifically. Housebuilding targets need to be supported with extra capacity in the planning system, so it’s good to see Labour also restate their commitment to get more planners in.
“The government must also make sure the system supports employment uses as well as homes so that we create sustainable communities. The move to streamline infrastructure delivery is welcome and should include the logistics facilities that are vital for the movement of goods and are chronically undersupplied in key parts of the country.
“The government is right to look at all options to drive development for growth and the delivery of homes. Moves to fast-track brownfield development are critical to regeneration across the country and a review of the green belt will help to identify those sites which can be brought into use for homes whilst continuing to protect the green spaces which we all enjoy.”
James Dunne, Head of Operational Real Estate, abrdn, added: "It is universally accepted that planning reform is necessary, and changes to policy to ensure that the optimum number of quality and sustainable homes is delivered in the most appropriate locations should be at the forefront of proposals. Continuity and certainty are fundamental requirements for significant investment and, given the strength of the mandate that the new government has, we would hope that long term frameworks and plans are put in place.
"The government has ambitious targets to deliver 1.5 million homes over the life of this Parliament. These numbers have never been reached in annual terms without significant direct development by Government or Local Authorities. In the expected continued absence of this, the government needs to go beyond the planning system and work in partnership and financially support the private sector to deliver significant volumes of housing across all tenures.
"This extends beyond the bulk housebuilders to finding ways of enabling viable delivery of affordable and social housing. It should also embrace the growth of the professional rental sector that makes up a significant proportion of housing delivery in Europe and the US and channels new money from pension funds, insurers and retail investors in the UK housing system.”