The test of first-rate intelligence, so F. Scott Fitzgerald said, is the ability to hold two opposed ideas in mind at the same time and still retain the ability to function. Mr Fitzgerald was probably not referring to low-tax areas to drive growth, but he perhaps could have been.
Unless you were lucky enough to be living under a rock during the Conservative Party’s summer-long leadership election, the investment zone concept, introduced as part of Kwarsi Kwartang’s’ ‘Growth Plan’ announcement on 23 September, will not have come as a surprise.
The Daily Express reported that Liz Truss would "rip up red tape that's holding back housebuilding and give more power to local communities". "As a former councillor”, she added, “I remember those painful hours sitting through planning committees. I'll put power back in local councillors' hands who know far better than Whitehall what their communities want."
She told the audience in one of the BBC TV debates that she wanted to introduce zones that would benefit from reduced regulations, including relaxed planning rules.
Subsequent to that in a Telegraph column she wrote that the zones would be "at the heart of my vision for levelling up". "We will work with local communities to identify sites ripe for transformation across the country through lower taxes, reduced planning restrictions and red tape. These zones would open the floodgates to new waves of investment. They will become new hubs for innovation and enterprise in the spirit of historic towns like Bournville and Saltaire."
From an industry point of view, this Investment Zone (IZ) episode is interesting both from a practical, impactful point of view, as well as what it says about policy-formulation and the politics of planning.
Setting aside the extent to which ‘enterprise zones’ do generate jobs and remove actual barriers to development, which the Centre for Cities raised doubts about when the concept was last revisited by George Osborne in 2011, for the residential sector there are two key factors to have in mind. Firstly, additionality. Will the IZ initiative result in more land being made available for the development industry to build on than is the case at present? Secondly, it remains vitally important that every housing market area (HMA) in every part of the country has it’s need met in full. IZs might facilitate more development more quickly in certain areas, but this should not result in the majority of a HMAs need being delivered by a limited type and tenure of home in a limited number of places.
Having regard to the detail that has emerged to date though it seems apparent that neither of these factors would impinge upon or be affected. IZ status is to apply, by dint of the requirement for ‘local consent’, within the parameters of the existing planning system, such that it may accelerate the delivery of priority sites or wider regeneration areas, but current obligations on local authorities to, for example, maintain an up-to-date local plan and a deliverable five year supply of housing land would appear to remain.
The additional information about IZs published on 24 September states that “there is a strong expectation that IZs will bring forward additional development”, which could be by way of either:
- Priority sites or wider regeneration areas (or visions for a new Bournville or Saltaire…) that have not come forward to date and that would be encouraged to so, via the current local plan and/or consenting regime, because of the inducements or incentives that could be conferred, post-planning, by IZ status; or
- Planning applications already “in flight”, but then there will be a reason why what is being applied for is being applied for and to add an extra, say, 35% more homes or 35% more floorspace seems a little arbitrary.
Beyond the practicalities, the fallout from the IZ announcement, layered on top as it is of doubts about the future of the Levelling Up & Regeneration Bill, reveals a lot about the current state of planning.
Firstly, IZs are to be chosen following a “rapid expression of interest process” conducted with mayoral combined authorities and upper tier local authorities, which, for the most part, have no planning powers themselves and will not be directly responsible for the local consent that has or may yet be conferred by way of planning permission. The fact that, for example, Oxfordshire County Council announced that it did want to be involved in the initiative, but that Oxford City Council, in response, immediately announced that it did, does not portray a robust, resilient framework for good public policy and planning outcomes.
Secondly, a narrative is emerging that conflates “disapplying legacy EU red tape” with ‘an attack on nature’. It seems highly unlikely that any planner with an application or local plan stalled because of nutrient neutrality would object to the principle of streamlining environmental regulations, or indeed adopting a more place-based rather than silo-based multi-agency consenting regime (indeed if such an approach can apply to IZs surely it can apply anywhere). It is not so long ago that most involved in the planning sector broadly welcomed a move from the current Environment Impact Assessment regime to a more outcomes-based one. There is nothing to suggest a fundamental departure from that broad direction of travel and nothing in the Growth Plan to undermine it.
The fact that planning has become a playing field on which sectoral interest groups seek to score their own points at the expense of the health and integrity of the wider system is regrettable, as is the immediate lack of ownership of the Growth Plan, such that these potentially fatal narratives are able to flicker persistently without anybody snuffing them out.
Thirdly, the additional information published on 24 September also stated that “the government will look to introduce primary legislation in order to enable the offer on tax and simplified regulations”. Whilst noting that clarity about much of the Government’s intention is required, this does perhaps speak to a reformist infatuation with new primary legislation at the expense of understanding the dusty old tools already in the planning system’s box. Here, for example, one thinks of Local Development Orders, Simplified Planning Zones or planning freedom schemes, legislative provision for which already exists.
Linked to this point is where the aspiration for IZs comes from. As with much of planning policy of late it would appear to emanate from the minds of think tank policy wonks rather than pragmatic practitioners with more of a feel for the nuts and bolts. To a degree it was ever thus, but IZs are the answer to a question, given operational pressures elsewhere, that nobody in the development industry is asking. Is planning itself really the obstacle to delivering the priority sites and wider regeneration areas that have been mooted for such status? Where there is the political will, and a functioning local authority planning department, there is usually a way already.
To return then to Mr Fitzgerald, if, on the one hand, IZs are to be the priority of the present administration, then it is beholden on the sector to engage with the idea and to mould it into something of substance. The fact that there is so much uncertainty about how IZs will operate could be seen as opportunity for promoters to write their own rules and prepare a ‘delivery plan’ so compelling that selection, amongst what is thought to be very high interest, is a shoe-in.
On the other hand, the Financial Times quoted Whitehall insiders at the time of the ‘Growth Plan’ announcement as saying that the radical nature of the investment zones had been ‘overhyped’ in terms of the scale of ambition. ‘We’ve gone from the OxCam Arc to an industrial estate in Cornwall’, somebody apparently said. This is before the ‘Growth Plan’ announcement started to unravel to the extent that by the time the Medium-Term Fiscal Plan comes around the incentives on offer and indeed the number of proposed IZs may be significantly different to what may have been imagined initially.
It is only eight months since the Levelling Up White Paper was published, a “flagship document” setting out how the government will spread opportunity more equally across the UK. It has barely been mentioned since. Will Investment Zones still be on the agenda in eight months? Who is to say, but hopefully the planning system retains the ability to function in the meantime.
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