That is a very reasonable question. I would need to look at the detail of the policy to see whether simply raising the cap further or scrapping it would be the best solution to the problem. Do I accept entirely that we need to make sure that councils are not cross-subsidising the cost of development, but are incentivised to welcome good development? Yes, I do.
Another important piece of the puzzle is leasehold reform, and I thought that the Minister for Housing, Planning and Building Safety spoke brilliantly on that issue in the House last week. Although nominally owners, the relationship between leaseholders and freeholders often resembles that of a landlord and tenant. There is
too little protection against drastically increased service charges and few incentives for freeholders to properly maintain a building.
Secure and fair property rights are a core Conservative principle. The Government are making great strides with the Leasehold and Freehold Reform Bill. It is absolutely right that we fix the balance and ensure that once people get on the property ladder, their home is truly theirs. I encourage the Government to go further, and I welcome the commonhold system whereby leaseholders all own a share of the common development, but we must address the fact that leasehold reform is vital.
We should also address the fact that new homes in Britain are too often of low quality. Poor-quality designs leave new and existing residents feeling that new homes are too often nothing more than ugly boxes, and we should look seriously at how design codes can ameliorate that. For example, we could allow individual streets or areas to vote on a design code for new housing. Establishing pre-set and pre-approved design rules ahead of time would allow everyone on the street to see a large share of the potential uplift, while significantly increasing the number of homes built. Design codes could also increase housing through densification, rather than relying on outward suburban sprawl, which would also reduce the potential dependence on cars and would allow more green space to be preserved.
As we have discussed, even if the public are on board, local authorities need to be as well. Councils are vulnerable to particularly vocal activism, even if it is a minority opinion among residents. Any reform will need to empower councils to take long-term decisions in the interests of their area, giving them the tools to get the right outcome from new development and incentivising them to say yes where appropriate, while ensuring that a few bad apples cannot shirk their responsibility to allow more homes. As you know, Mr Betts, our councils really matter.
I recently had reason to feel considerable frustration at my own planning authority in Redcar and Cleveland, when the chair of that authority made the baffling decision to delay the consideration of the proposed new British Steel electric arc furnace at Redcar. That reflects the power that councils can have for good or for ill, and we certainly want to ensure that their natural incentives are to welcome investment.
To do that, we need to ensure that development plans are brought up to date everywhere. These plans allow builders a measure of certainty when deciding where to construct new homes, but they are often not up to date. Unfortunately, the consequences under current law if an authority does not have an up-to-date plan are often trivial.
One possible remedy comes from California—the so-called “builder’s remedy”. Under that policy, if an area fails to plan for enough homes, it must approve any housing project that contains at least 20% low-income or 100% middle-income housing. That solution can be extremely effective. A few weeks of the builder’s remedy in Santa Monica resulted in more affordable housing being approved than there had been in the previous seven years. I certainly favour restoring a presumption in favour of development wherever an up-to-date local plan is not in place.