In last month's Budget, chancellor Philip Hammond offered significant backing to the Homes and Communities Agency (HCA), the government's housing and regeneration body.
As well as announcing £15 billion of additional funding for the agency for 2018-23, and confirming that it would be renamed Homes England, Hammond said that the HCA would "expand" to help support the delivery of new housing and infrastructure.
Shortly after the Budget, HCA chairman Sir Edward Lister spoke at the Institute of Economic Development annual conference in London, which is staged in association with Planning. In the speech, and a subsequent conversation with Planning, he said that:
- The agency is ready to take over plan-making, masterplanning and compulsory purchase from local authorities if and when invited, or when the government deems it necessary
- The agency now has the funds to take "an aggressive stance" on buying land where needed to advance garden towns
- A portion of the new £1.1 billion Land Assembly Fund and expanded £5 billion Housing Infrastructure Fund will be used to fund plan-making and masterplanning
- Authorities that have agreed cross-boundary structures will be well placed to access the new government financial support for housebuilding
- The agency will revive its specialist advisory service on large planning applications, and possibly its urban design function
- Further government planning "tweaks" may be on the way
Taking over councils’ plan-making, masterplanning and compulsory purchase
Lister told delegates at the IED conference that Homes England would effectively be "a new agency" with "a lot more power".
"The secretary of state has made absolutely clear that he wants a ‘muscular’ organisation," he said, quoting Sajid Javid’s Bristol speech from earlier in November. "The HCA has for a long time had a lot of planning, compulsory purchase and land assembly powers that it has never used. The secretary of state is making it pretty clear that he wants to see us use those powers where it is applicable and where it is the right thing to do."
Speaking to Planning later that day, Lister gave examples of circumstances in which the agency might use those powers. "We [as a country] cannot go on sitting on large tracts of land in prime development areas which are just not being brought forward," he said. Some authorities find plan-making, masterplanning or compulsory purchase difficult, he added, and might find it easier to let the HCA do it.
A week earlier, Javid had announced his intention to take control of plan-making at 15 local authorities that had been slow in bringing forward their local plans. Lister’s comments invited the question of whether the agency would take over plan-making in those places, but he declined to answer directly. "All I'm saying is that we certainly have got powers that could be utilised," he said. "We stand ready to get more involved in some of those places, particularly where we can be substantial landowners as well, and can really drive some of these schemes forward".
Although Lister had told delegates that Homes England would have more power than the HCA, it seems that he meant that in terms of the financial resources at its disposal. While there may be a case for extra powers, he told Planning, "we have got quite significant powers at the moment, which we have not used".
Following the Budget, however, the agency certainly will have more financial resources at its disposal. The additional £15 billion for 2018-2023 comes on top of £40 billion of government money that had already been allocated for that period. Lister said that, while the HCA previously had substantial funds (not least through the Help-to-Buy programmne) with which to foster housing demand, "we have now got much greater funding for getting involved in the supply side".
The additional resources will allow the agency to invest in more infrastructure and, "where we need to", acquire land, he said. One priority area for agency land purchases will be the garden towns programme, which the Budget revealed is to be accelerated by the creation of five locally-led development corporations in areas of "demand pressure". Lister said that the ability to "take a more aggressive stance" on land buying for garden towns would help tackle scepticism about their prospects. "Even before this announcement, we were busy buying land in one of the prospective garden towns," he said. "In my perfect world, I would be an insider trader, and I'd be buying the land before any of you thought about it, because that's the only way we get the land value uplift and then be able to pay for the infrastructure. The more the state can intervene, the better. We can to some extent do more in that space than we have done up to now".
New and additional funds for plan-making and masterplanning
A significant chunk of the new money will sit in the Housing Infrastructure Fund, which was more than doubled to £5billion in the Budget. After the HIF was launched in July, the DCLG tweeted that it was intended to "both support the delivery of infrastructure in existing up-to-date plans and to help local planning authorities get up-to-date plans in place". Lister confirms that some of the fund will be used for local plan-making, but speaks more passionately about its importance in bringing forward infrastructure that can unlock housebuilding.
"There are a lot of schemes out there where, if you could just get the infrastructure moving, you could make an enormous amount of difference," he says. "It's not necessarily about actually delivering [the infrastructure], it's about committing to it to the point where it has to be delivered. It is the commitment with a credible plan that is actually all-important".
By way of example, he cites the Vauxhall/Nine Elms regeneration area, which he says only really took off when the commitment was made to extend the Northern Line of the London Underground into it. "It isn't actually there yet, but it was committed to, and that was enough to get everybody building. People have got to be able to know [that the infrastructure is] coming, and then they can make sensible funding decisions".
Another slice of the the agency’s new money will come in the form of the £1.1 billion Land Assembly Fund, which is intended to allow it to work alongside developers to develop strategic sites, including new settlements and urban regeneration schemes. Lister describes the main purpose of the fund as being land assembly, whether pursued by the agency on its own, or with a developer or a public landowner such as a government department or local authority.
"This is about getting land into the marketplace which is not there at the moment, and getting it remediated and in a fit state to move forward," he says. "Probably in several cases we will need to do the planning, at least in masterplanning terms".
The benefit of cross-boundary structures
In the Budget documents, the government made it clear that authorities that have agreed cross-boundary planning structures would be well placed when it came to accessing the new financial support for housebuilding that it is making available through the agency. The government’s "housing deals", which offer tens of millions of pounds in return for the promise of extra housing delivery, will support "more strategic and zonal planning approaches", it said.
Not surprisingly, Lister backs this approach. "The goodies are going to go to those authorities that have their governance in order," he says. "Personally, I think this is great because it is going to be journey of the willing, and I think it's right to reward them".
The reinforcement of the agency’s planning and urban design capacity
The new funds will also allow to agency to reverse deep cuts to its workforce made in recent years, and to resuscitate its specialist consultancy service for big schemes, the Advisory Team on Large Applications (ATLAS). "We are obviously going to need more land people, more project people and planners to make some of these schemes work," said Lister. "Undoubtedly, as we grow this development capacity, we will have to grow the Atlas team".
He acknowledges that recruiting skilled planners is not easy at the moment. "I’m sure there's gonna be a capacity issue, and we will have to deal with that as we come to it," he said. "It's going to be very important that we use our resources wisely, and the same applies to local authorities. In my personal opinion, planners are a valuable asset, and need to be used properly".
Another area of agency activity that seems set to be revived is urban design work. "It's really important, as we try and accelerate delivery, that we have an eye on design," said Lister. "That used to be a function within the old HCA. It's something we moved away from. I think we have got to make sure we got that right as well - that needs thinking about".
Prospect of further government planning ‘tweaks’
The Budget flagged up the likelihood of further change to the planning system, including deallocation of stalled sites, off-plan releases for discounted homes, minimum density standards and permitted development rights to demolish commercial properties and replace them with new homes.
The government, like many before it, is accused of endless tinkering with a system that is never allowed to properly bed in. But Lister argues that the recent changes are necessary, and particularly welcomes the proposed new standard method of assessing housing need. "It's about time that that we really started to recognise the true numbers and needs of areas in a systematic way that we can all understand," he said.
Further planning "tweaks" may be on the way, he added. "We will have to watch this space," he told IED conference delegates.