Last Wednesday, the House of Lords voted 203 to 156 in favour of blocking an amendment to the Levelling Up & Regeneration Bill that would have removed current nutrient neutrality rules for new housing developments and deliver alternative forms of mitigation.
The Secretary of State, Michael Gove, had proposed a relaxation of this point on the basis that it had caused an estimated 100,000 houses to not be built due to the potential impact of development on watercourses. Many reasons for this defeat have been suggested, including back door planning policy making and a lack of evidence base to support it, but whatever the real reasons, it was clearly politically rather than economically or socially motivated.
As a result of the vote, no further proposals on this area can be reintroduced into the bill through the House of Commons. The King’s Speech in the autumn does present an opportunity for the plans to be revived; however, it remains to be seen what steps ministers will take next. Much clearer, though, is that this issue will not be resolved anytime soon.
This ongoing uncertainty will have a profound impact on the housebuilding sector, which is already stalling to what could be some of the lowest delivery levels we have seen for decades. Currently, 74 councils are affected by nutrient neutrality restrictions and minded to refuse planning permission for housing developments within these catchment areas unless sufficient and oftentimes costly measures to mitigate impacts are incorporated into proposals.
It is of course clear that this important environmental problem needs to be positively addressed. However, in our view the regulations do need amendment in order to strike a different balance between our somewhat competing environmental and housing crises. In our experience, the housebuilding industry can be very innovative when challenged to be so and would accept the challenge to find appropriate forms of mitigation until a more strategic infrastructure-led solution can be delivered.
In the absence of this, any wider initiatives to stimulate the housing market that the Government may look to introduce in the Autumn Budget are likely to be no more than politicking, with this essential part of the delivery process still up in the air. This problem should not be confused as part of the wider brownfield v greenfield debate that is so politically emotive.
The consequences of all this reach far beyond housing supply. There will be wider economic implications, including house price increases and reduced jobs across the construction industry, as large numbers of people continue to be priced out of home ownership. The economic value of this amendment had been estimated to be in the region of £18 billion to the economy up to 2030 had it been passed.
While housing remains high on the political agenda, this is an area that needs greater political alliance to resolve. However important the issue itself might be, we need to engender quicker, more imaginative and flexible decision-making, which in turn will deliver more certainty and help reignite housing delivery.