During the campaign in an interview with Keir Starmer and Rachel Reeves in the Sunday Times they suggested that several key announcements will be made within the first fortnight of the new Government, or included in the King’s speech on the 17th July. We know that their previous shadow team will remain, with Angela Rayner becoming the Secretary of State and Matthew Pennycook the Minister of State responsible for housing and planning. Rayner will be leading the new Ministry of Housing, Communities and Local Government (MHCLG).

Rachel Reeves provided, in her first speech yesterday, the Government’s initial policy proposals to ‘kickstart growth’, based on three pillars, Economic Stability, Investment and Reform. Reeves’ described Planning as currently a 'graveyard for economic ambition'. Whilst some of her announcements yesterday were already known (as these featured in the Labour Manifesto), the detail of the mechanisms to implement the proposals are starting to materialise, for example Angela Rayner will shortly write to all local authorities outlining her expectations, within which will feature mandatory housing targets and where relevant a requirement to undertake Green Belt reviews.

A new consultation draft version of the National Planning Policy Framework (NPPF) is now expected to be published in the next two weeks, which will reverse many of the changes introduced at the end of 2023. This might also be accompanied by a Written Ministerial Statement. For effective reform, the new Government needs to be able to establish a clear direction of travel quickly, as we have seen over the past four years how disruptive protected policy changes can be to the local plan process. In 2010, it took an average of 1.2 years to advance from a Regulation 19 plan to formal adoption. By 2023, that had risen to a high of 3.9 years.

The changes are expected to include making the standard method for calculating housing need mandatory rather than an “advisory starting point”. Currently, 94 LPAs have an adopted local plan with an annual housing target lower than the need identified under the standard method, and 20 LPAs with emerging plans have published lower draft annual targets. The consultation draft NPPF is expected to make clear any onward transition period whereby housing targets apply to new local plans, though it might be immediately for the purposes of deciding planning applications. It is not yet known whether Labour would seek to amend the Standard Method, which presently amounts to less than 300,000 dwellings per annum.

A new version of the NPPF would also likely remove the changes to the 5 year land supply requirements, which have made it easier for LPAs to pass. Since the December 2023 changes, 39% of LPAs are now either exempt from having to demonstrate a 5 year housing land supply requirement, as they have an up-to-date local plan, and or only have to demonstrate 4 years’ worth of land supply as they have made sufficient progress towards adopting a new plan. We estimate that around 90 LPAs, mainly in the West Midlands and the South East, would fail to be able to demonstrate a sufficient housing land supply if these relaxed requirements are reversed.

The industry awaits with interest Rayner’s letter to local authorities. 58% of LPAs have some Green Belt within their boundaries, and the size of the Green Belt increased by over 24,000 hectares between 2021-22. Over 60% of local authorities without a post-NPPF plan in place contain Green Belt; clear policies on how it should be reviewed could help improve local plan progress and the identification of enough land to meet housing requirements in these areas. The consultation draft NPPF might also update national Green Belt policy, introducing a new definition of Grey Belt – which would apply immediately for planning decisions. It also remains to be seen whether Labour will consult on National Development Management policies later this year.

Beyond planning policy, there are several areas which will have implications for residential development of all tenures, although they are unlikely to be delivered as quickly as the promised planning changes. Reform and regulation of the private rental sector is expected to be included in the King’s Speech as one of the priorities for the next parliamentary session. There is potential for this to move quickly if the new Government chooses to continue with the form of the Renters (Reform) Bill which had reached its second reading in the House of Lords.

For delivery of affordable housing, indications of policy will likely come in the first fiscal event, expected to be no earlier than mid-September. Key issues to be resolved include levels of grant funding available through the Affordable Homes Programme post-2026, and the settlement for social and affordable rents after 2026. Both of these issues will be key to restoring financial capacity for housing providers to deliver their own development or to buy Section 106 stock. Reeves’ announced yesterday that the Bank of England will lead a new task force concerning a National Wealth Fund, specifically to increase direct investment in housing and infrastructure.

To deliver quick wins, Reeves’ also announced the formation of a Growth Mission Board/Delivery Unit, which will target stalled major sites. Liverpool, Sutton Coldfield (Langley), Worcestershire Parkway and Northstowe (Cambridgeshire) were all mentioned. In addition, some key planning decisions have immediately been recovered by the Secretary of State for determination, including two data centres in Buckinghamshire and Hertfordshire. Time will tell whether more decisions are to be recovered by Angela Rayner, and it would seem that national economic considerations will now be provided greater weight in making planning decisions.

Savills has recently analysed how best to integrate housing and investment decisions to best stimulate economic growth in the 2024 planning research paper.

This also considered the potential consequences of further reform, which will no doubt be a consideration for the Government. Yesterday largely signalled policy rather than legislative reform.

Finally, there are high aspirations to boost development through a new wave of new towns. Angela Rayner pledged at UKREiiF in May that the Government would announce a list of new projects within their first 12 months. However, we expect this to be the area where progress to be slowest. While legislation is already in place to create development corporations to deliver these schemes, Labour’s ambitions to reform CPO to limit hope value would require further legislative change, and could be challenged for compliance with the European Convention on Human Rights. Any quick wins to increase house building will come from elsewhere.