Building Hopes
Whenever I’m asked which policy changes would best support entrepreneurship in the UK, planning liberalisation always features near the top (often to the surprise of the person asking the question). Up until last week, it’s an area where meaningful reform looked unlikely, but Housing Minister Robert Jenrick’s Planning for the Future White Paper offers reasons to be hopeful. It would involve councils being set higher requirements for new housing, especially in and around cities, while ensuring that new buildings are more beautiful.
The first person I turn to when trying to understand planning reform is John Myers (aka London YIMBY, which is a campaign group that aims to end the housing crisis). Planning is a policy area that attracts some wacky views (just take a look at nine that Sam Bowman skewers), and for my money Myers is the most knowledgeable and intelligible thinker on this policy area. While he is unashamedly pro-building, he is an honest broker of ideas. Myers describes Jenrick’s White Paper as an “ambitious new step”, in an article explaining the changes.
So why does this matter? In short, we haven't built enough homes in the right places to meet demand. Evidence suggests that if we solved the housing crisis GDP per capita could be as much as 30% higher in just 15 years if we built enough homes in the right places. That’s ￡10,000 extra on the average household income.
But what’s this got to do with entrepreneurship? Helpfully, Sam Dumitriu has an excellent article on our blog explaining why entrepreneurs should back planning reform. In essence: planning policy has driven up the cost of talent in places like London, Cambridge and Oxford; reduced the innovation we see in tech clusters; and pushed up the cost of office space. Sam calls on UK entrepreneurs to get involved in the debate in the same way that Patrick and John Collison (Stripe founders), Jack Dorsey (Twitter founder), Marc Benioff (Salesforce founder), and Reid Hoffman (Linkedin founder) have in Silicon Valley. If you’re the UK’s equivalent – get in touch.
A White Paper isn’t law. There is a consultation which may change things. And Myers sounds a note of caution about the need to ensure homeowners are on board with any reforms: “We will only have plentiful, high quality, affordable housing when building new homes is truly popular with the locals. To achieve the two percentage point boost to annual GDP growth that eminent economic historian Nicolas Crafts says better planning would deliver, we would need to go further than this White Paper and adopt bottom-up processes to unleash a popular wave of new building.” (Read Nicholas Crafts on housebuilding in The Guardian for more on this.)
Emma Duncan offers a louder note of caution in The Times. She thinks the Government's solution to nimbyism involves too much centralisation and would be better solved by allowing councils to keep more of their money. “If more houses and flourishing businesses brought revenues back to local communities, rather than just spoiling the view and clogging the roads, people would be more enthusiastic about economic growth happening near them.”
She may be right, but hopefully this is the new debate. Not whether we need to build more – that should be a given – but how to do it best. To build back better, first we must build.
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Designer, Commoner, Optimist ? FRSA
4 年Surely prioritising 'building' without doing it immediately 'better' is the very contradiction of what the phrase - and movement - is urgently trying to do. Those in construction have rarely demonstrated that they adequately provide for long-term community health and distributed wealth - look at the planning disasters in the 50s and 60s that have led to decades of entrenched social inequalities and complex problems. Social builders, like L&Q, have embedded democratising and social principles in their approach to developement, encouraged by Government interventions in the 90s and 00s, but too few take this seriously. The current proposals will largely erase that progress. You are right that we need a Herculaneum effort in building to support the growth of entrepreneurial communities, but washing away safeguards (as roughly proposed in the White Paper) - to support low-income families and individuals to be able to rent and buy, as well as communities' ability to shape developments - is likely to have the opposite effect.