The Government’s Planning Reform Working Paper lays out a determined approach to speeding up the delivery of new homes, aiming to address what they view as a persistent problem of slow build out rates that frustrate both local authorities and communities. The paper recognises that while planning permissions have increased, the actual pace at which homes are built lags behind what is needed to achieve their ambitious targets.

To address these challenges, the paper proposes a five-part strategy. It prioritises planning system reforms to which we are now well familiar, such as mandatory housing targets and a modernised Green Belt policy, to streamline approvals and increase land supply. The government also aims to boost demand through measures like a permanent ‘Mortgage Guarantee Scheme’ to help first-time buyers. Supporting SME developers and small sites is another key focus, as these typically deliver homes more quickly. The strategy further encourages faster build out by promoting mixed-tenure developments and higher levels of affordable housing, whilst there is no doubt that diversity in tenure can be a positive for accelerated delivery, this is not an approach that can be realistically transposed in every locality. Finally, it strengthens Local Planning Authority (LPA) powers with reforms to the Compulsory Purchase Order process and introduces a ‘Delayed Homes Penalty’ for developers who fall significantly behind schedule, the most significant and controversial of the proposed measures.

The Delayed Homes Penalty has been designed to act as a last resort, to be imposed on developers, when sites fall significantly behind on agreed schedules. This punitive measure aims to unlock stalled sites caused by inaction, ensuring that planning permissions are translated into completed homes more efficiently. Our experience is that inaction in delivery deliberately caused by a developer is extremely rare.   There may be a small number of scenarios where these penalties may be justified, but how will responsibility for delays be reliably determined? Large-scale developments often face complex challenges and involve multiple stakeholders, meaning delays are not always within the developer’s control. If the Government choose to move forwards with a penalty, it will be imperative to ensure that there are procedures to ensure they are applied fairly with an independent challenge or review process being in place and consider the full range of potential causes for delay.

In terms of overcoming absorption constraints, the paper’s emphasis on mixed-tenure developments, higher proportions of affordable housing, and support for SMEs, directly addressing factors that slow build out. By encouraging models where homes are pre-sold to institutional landlords or housing associations, and by diversifying the types of developers active in the market, the strategy aims to reduce reliance on the traditional sales-driven approach that limits annual delivery. However, the effectiveness of these measures will depend on their implementation and the extent to which they can be balanced against scheme viability, particularly in lower-demand areas where market risks are higher.

Looking ahead, the paper signals further changes that could benefit the development industry and the planning system. The move towards more ‘rules-based’ national policies for development management, a more proportionate statutory consultee system, and the finalisation of a National Scheme of Delegation for planning committees are all intended to reduce bottlenecks and provide greater certainty for developers. The recent technical consultation on the reform of planning committees contains some proposed alterations including: