UK Housebuilders Boosted By Government Plans To Speed Up Approvals

Thu, 18th Feb 2016 13:18

LONDON (Alliance News) - The UK government on Thursday put a series of proposals out to consultation designed to shake-up planning processes in the UK in an attempt to speed up the practice and boost housebuilding.

Under the plans, councils in the UK would compete to process planning applications and would be able to offer fast-track application services. The move is designed to put in place incentives for councils to improve their planning services, the slow pace of which in the past has led to "drawn out applications and local frustrations" for housebuilders and individual planning applicants, the Department for Communities & Local Government said.

Applicants will be given the choice to submit their plans to the local council, a competing council, or a government-approved organisation which would process the application up to the decision point.

Councils will be able to offer a fast-track planning application services, either through the competitive system or potentially through devolution deals, the department said.

In the past, councils have operated a 'closed market' in handling planning applications, but the government said research conducted over the past three decades in the UK and overseas has suggested cost savings can be made for competitively tendered or shared services.

The new proposals, in addition to adding competition to the planning process, would include future increases for councils' fees for processing applications, dependent on speed and the quality of the decisions made.

In situations where an alternative council wins the planning process work, the system would work under a 'permission in principle' approach, under which decision-making on applications would be separated into 'in principle' issues, such as land use, location and the amount of development, and matter of technical detail, including what the proposed buildings would look like. The alternative council would address only the 'in principle' issues, not the technical detail.

The consultation paper said the current system requires too much information to be produced upfront before there is any reliable certainty a development can go ahead in principle.

"These proposals will be a boost for housebuilders looking to build much-needed new homes for hard-working families and first-time buyers, and for local people looking to get a planning permission for home improvements through their local council quicker," said Communities Secretary Greg Clark.

The proposals boosted housebuilder shares on Thursday, with Berkeley Group Holdings PLC, Taylor Wimpey PLC, Barratt Developments PLC and Persimmon PLC all sitting among the best performers in the FTSE 100. In the FTSE 250, Bovis Homes Group PLC and estate agency Countrywide PLC were among the best performers, while shares in other mid-cap housebuilders like Bellway PLC and Crest Nicholson Holdings PLC were also trading higher.

"Whilst many local authorities perform well, there are those which struggle with resources and performance, causing significant delay to otherwise acceptable development," said Pete Redfern, Taylor Wimpey's chief executive.

Stephen Stone, the chief executive of Crest Nicholson, was similarly positive on the move. "The new fast-track application service is a progressive step towards securing future home delivery. Importantly, by ensuring decision-making authority remains with local councils, we will not lose the vital link between local decision makers and housebuilders," he said.

The British Property Federation was also welcoming of the proposal, saying the plans would boost local development.

"Both the public and private sectors alike have expressed deep dissatisfaction at the way in which the lack of resources in local authority planning departments is having a detrimental impact on development. The proposals announced today go some way in to address that dissatisfaction, and we are delighted to see that government has listened to the industry and is trying to tackle this," said Melanie Leech, the industry group's chief executive.

By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance