Britain faces a housing crisis in the wake of the pandemic as confusion about planning rules and shortages of staff undermine government targets to build 300,000 homes a year, according to a House of Lords committee.
A retreat from housebuilding by smaller companies must be tackled by ministers to reduce the shortage of homes, the cross-party group of peers said.
“Too many people currently live in expensive, unsuitable and poor-quality homes, and housing supply needs to be increased now to tackle the housing crisis,” the committee said in its report, titled Meeting Housing Demand.
The housing secretary, Michael Gove, is expected to set out the government’s plans to kickstart housebuilding after the industry suffered the twin blows of Brexit, which reduced the amount of skilled labour available, and the upheaval caused by the pandemic.
Gove has indicated he will encourage employment and housing in the regions as part of the government’s levelling up agenda, though this is likely to be a long-term project.
Baroness Neville-Rolfe, chair of the Lords’ built environment committee, said: “The government’s ambitious target of 300,000 new homes a year will only be met if it takes action to remove the barriers for housebuilders, particularly for SMEs, which 35 years ago built 39% of new homes but now build just 10%.”
The committee was critical of a U-turn over proposed reforms to planning rules that would have divided areas into zones, some of which are reserved for conservation and others that have few or no rules holding back developers.
Ministers abandoned the proposals after the Liberal Democrats overturned a 16,000 Tory majority in the Chesham and Amersham by-election, which local Conservative leaders blamed largely on a rejection of the planning scheme by local voters.
Uncertainty and delays to planning reforms have had a ‘“chilling effect” on housebuilding and created uncertainty for housebuilders and planners, Neville-Rolfe said. The former minister and Tesco board director said local authorities needed to adopt local plans to indicate where new developments could go ahead.
She said less than 50% of local authorities had adopted or updated their local plans in the last five years, leaving developers in the dark over what land was available for new building. But she warned that any reform of the planning system “will only work if local planning authorities have the resources and staff”.
Local authorities have complained that after 11 years of austerity measures, which has forced them to push through 40% cuts to day-to-day budgets, planning departments are only a fraction of the size needed to assess applications.
Nevertheless, they say, more than 1.1m applications have been agreed, but private developers have failed to begin building.
“It was probably what surprised me most during our investigation. Not so much the shortages of bricklayers and skilled construction workers, which is acute and well known, but the lack of skills in planning after years of not training people,” she said.
Neville-Rolfe urged ministers to take into account an ageing population that will mean that by 2050, one in four people in the UK will be aged over 65. “The country needs more specialist and mainstream housing suitable for the elderly,” she said.