New home sales and production have risen sharply since the Help to Buy Equity Loan scheme was introduced in April 2013, so that homebuilders have been completing sites more quickly.
However because planning remains as slow and uncertain as ever, the industry has not been able to increase the number of sales outlets.
And as any housebuilder will tell you, the key to increased sales is increased outlets. This must now be acting as a constraint on expanding production.
Out biggest hope for the Autumn Statement is action on a number of proposals we put to the government to improve the efficiency and speed of the end-to-end planning application process.
Because local authorities have monopoly power to grant planning permissions in their area, housebuilders have no option but to deal with them in order to stay in business.
Local authorities have little incentive to operate a speedy, efficient system, whereas time and delay are money for housebuilders. Simply raising planning fees, as advocated by local government, is not an answer unless linked to performance.
The lack of resources and skills in local authority planning and legal departments is a major obstacle to efficient processing of applications, a problem that long pre-dated the current fiscal austerity, although no doubt aggravated by funding cuts.
“The lack of resources and skills in local authority planning and legal departments is a major obstacle”
We have proposed ring fencing planning fees for planning purposes and called for financial carrots and sticks linked to local authority planning performance.
We have made the not unreasonable suggestion that the principle of residential development for a site should only have to be established once, and that subsequent application processing should be done by officers under delegated powers.
We have also encouraged the government to look at planning and legal outsourcing to introduce competition into the monopoly system and increase resources.
The old ‘red line’
A related request is to reintroduce the old ‘red line’ permission. A planning application today must be made with a lot of expensive accompanying material.
This is a burden for all homebuilders, but especially smaller companies, made worse by the uncertain outcome of planning committee decisions.
Finally we have called for a system of arbitration for planning disputes that do not warrant use of the expensive and time-consuming appeals system. This would cover areas such as S106 agreements and planning conditions and would benefit all home builders, large and small.
John Stewart is director of economic affairs at the Home Builders Federation