Select Committee on Environmental Audit Minutes of Evidence


Memorandum from Friends of the Earth

  Friends of the Earth England, Wales and Northern Ireland welcomes the opportunity to provide evidence to the Committee on the implications of the Barker Report[1]. Friends of the Earth is an NGO with 200,000 supporters and local campaigning groups in 240 communities. We are also a member of Friends of the Earth International, which has member groups in 57 different countries. Friends of the Earth has worked on planning and housing for over 25 years, and we are convinced that the land use planning system is a key mechanism for delivering sustainable development.

SUMMARY

Friends of the Earth believes that current Government policy on regional development and housing provision is a major obstacle in achieving sustainable development in the UK and conflicts with the Government's own stated aims contained within the UK Sustainable Development Strategy[2]. Existing policy, exemplified by the Sustainable Communities Plan[3], is essentially a reflection of a market driven macro economic model which assumes that the growth should be concentrated in the broader South-East of England. Such a policy will reinforce significant regional inequalities resulting in the continued decline of some communities and the over-development of others.

  The Communities Plan[4] will also fail to deliver sustainable development because its proposals were based on a scant understanding of the environmental limits of those areas where the highest growth is to be delivered. It also failed to identify how vital strategic infrastructure, for example for public transport, would be funded so that in many cases housing development will precede such vital investment. In addition, while the technology exists to radically reduce the resource consumption of new homes, the Government has chosen to adopt a gradualist, voluntary approach to implementing such standards. This is a profound policy failure and loses the opportunity for a step change in the quality and long-term sustainability of our communities.

  The recommendations of the Barker Report would exacerbate these trends by deregulating control over built development and so remove vital mechanisms through which we might achieve a more balanced and sustainable development of the nation. The recommendations of the Barker Report would:

    —  exacerbate regional inequalities;

    —  result in widespread breaches of environmental limits;

    —  result in the marketisation of planning decisions; and

    —  remove vital democratic safeguards from the planning process.

  The Barker Report fails to recognise that it is not possible to make recommendations on the future of housing provision without understanding the environmental implications of such development. As a result the Barker Report is a significant barrier in achieving an integrated strategy for sustainable housing development in England.

  Overall the Barker Report is neither a helpful nor authoritative analysis of the current housing crisis. The report uses simplistic cost benefit economic analysis to approach a complex social and environmental problem. As a result the report is both divisive and distracts from the sensible debate we need to have on the smart growth of our nation. To achieve sustainable development regional and housing policy must seek to integrate the four pillars of the UK Sustainable Development Strategy[5] and not continually prejudice economic growth as the prime objective. In addition we urgently require a national framework for strategic planning which can give spatial expression to the UK Sustainable Development Strategy and combat growing regional inequalities. Such a project requires much greater inter departmental cooperation than has been evident in either the Communities Plan or the Barker Report.

INTRODUCTION

  This memorandum focuses primarily on the implications of the Barker Report and acknowledges the wide breadth of expertise in organisations such as Shelter, TCPA, CPRE and WWF on other vital issues such as housing need, sustainable housing layout and design and housing forecasting. The memorandum is structured in two parts. The first deals primarily with the policy implications of the Barker Report the second deals briefly with a number of specific concerns over existing housing delivery policy. The paper does not deal with the Barker Report proposals for fiscal policy which were addressed by an earlier submission[6] by Friends of the Earth.

PART 1

THE BARKER REPORT

Context

  1.1  The Barker Report reflects a long standing Treasury led policy agenda which seeks to question the core principles of democratic planning on the basis that such regulation is anti-competitive and a barrier to UK macro economic policy. (McKinsey[7] was the first of these reports, produced for the Treasury in 1998). It is significant that there is no empirical evidence to support this view, a conclusion reached by an ODPM report[8] in 2003.

  1.2  The Barker Report accepts uncritically the Treasury's macro economic idea of the "golden arc" of growth (that is the wider South East defined by a line from Bournemouth to Cambridge) which is essentially the economic driver of the UK. This model of unequal growth lies at the heart of the unsustainable nature of both Barker and the Communities Plan.

  1.3  It is also important to stress that the implications of the Barker Report go far beyond the provision of housing, implying fundamental changes to the way planning decisions are taken. The Barker Report's recommendations for deregulation are at least as important in the debate on sustainable development as the substantive recommendations for housing growth.

CORE MESSAGES OF THE BARKER REPORT

Market driven housing provision

  1.4  The premise of the Barker Report is to reduce high house price inflation by increasing supply. While this can be achieved in a variety of ways the report focuses on recommendations which would make the provision of housing through the planning system price sensitive. This is a radical shift to the planning system which is traditionally meant to integrate or at least "balance" market pressures with other public interest objectives such as sustainable development, and with a process that is both participative and democratic. The planning system has sought to provide for housing need based on demographic change rather than housing land price which is a purely market driven indicator.

  1.5  The radical nature of the Barker Report is illustrated by two specific recommendations:

      1.  LPA's should allocate up to 40% more housing land than forecast need to be released in response to local price volatility (Paragraph 2.36 and recommendation 9).

      2.  At box 2.1 the report recommends introducing "price premia". If the price of land for a particular use exceeds an established indicator, the price premia, then there should be a presumption in favour of the development of that type of land.

  1.6  These two recommendations would make land price the main material consideration in the planning process. The direct implication is that a market mechanism should determine the amount of land and its location. Paragraph 2.40 makes clear that the private sectors' view of the viability of an individual site should have a major influence on the location of development.

  1.7  The report is particularly unhelpful in analysing how these price mechanisms can be integrated with environmental protection and the democratic nature of planning. In fact the recommendations are not merely an adaptation of the planning system, they overturn its very rationale and purpose.

  1.8  Regulatory democratic land use planning was a reaction to the failure of the private sector to provide developments of sufficient quality in socially and economically desirable locations. If the needs of the market, as defined by land price, are to be taken as the prime indicator of what is socially desirable then the there is no logical case for planning regulation or its democratic basis. Economic considerations should remain a central concern but should not themselves be allowed to change the decision-making process.

  1.9  The nature of planning decisions in the UK is unique and based on the exercise of discretion by planning professionals and local politicians to judge the outcome of individual decisions using policy as key guidance. Any trigger mechanism such as price premia will overturn that structure, changing the nature and role of planning professionals and effectively removing local democratic control from Development Control decisions.

  1.10  The Barker model of decision-making would result in the following decision-making model:

      1.  Local authorities are forced to allocate a buffer of up to 40% more housing land than is needed in their Local Development Frameworks.

      2.  Land price volatility breaches the price premium for housing land in a particular area.

      3.  Local authorities must then release land held as a buffer.

      4.  Planning applications for this land would benefit from a presumption in favour of approval.

  1.11  The use of a presumption in favour would make it almost impossible for local authorities to reject an application which, for other important material considerations, might be unsuitable.

  1.12  Barker has argued that since all housing land is approved to the development plan process that these price trigger mechanisms and the land allocated would be subject to democratic scrutiny. This would only be true if local authorities have the freedom not to adopt the price premia model in the first place. Once having imposed a mechanism on local authorities they are forced to allocate more land than is needed and left with no real discretion to reject individual applications on that land.

  1.13  This model assumes that:

    —  It is possible to establish a sensible price premia.

    —  That local authorities can identify the over-provision of housing land in areas with significant environmental and social constraints.

    —  That the local population will accept large-scale development which goes beyond social need.

  1.14  A price sensitive planning system does not just change the nature of decision-making it seeks to replace the role of local politicians in safeguarding the public interest with a crude measure of economic welfare. This point is reinforced in the report by a number of references to removing democratic scrutiny of individual decisions by the use of greater delegation to officers (Paragraph 2.50). Indeed the report sates clearly that "Using price signals in this way would help distance land availability decisions from the political process" (Box 2.1). This statement, and by the recommendation for greater use of delivery vehicles such as UDCs (recommendation 23) which remove all democratic scrutiny from decisions, illustrates Barker's complete failure to understand the importance of public involvement in planning decisions. Throughout the report, Barker assumes, wrongly, that the planning system takes place in a simplistic economic vacuum, ignoring evidence as to the complex process and objectives of the planning system.

  1.15  Friends of the Earth is also extremely concerned that the notion of price sensitive land use regulation is an expression of a much wider Treasury view on how environmental decision-making should be reformed and would have a very negative impact on the Government's stated goal of achieving sustainable development. The existing planning system may be less than perfect but it embodies vital methodologies such as Environmental Impact Assessment, with public participation and representative democratic control.

Exacerbating regional Inequalities

  1.16  The Barker Report makes clear that to stabilise housing markets, increased housing provision should be made in areas of high demand. This would have huge and obvious implications for regional inequalities by concentrating unlimited growth in a limited geographic area to the detriment of all other regions and nations of the UK. Paragraph 1.54 explicitly acknowledges that some areas will decline and that "this might mean taking a much more active approach to demolitions and clearing stock that is no longer required." The social cost of such extreme free market urban policy would, particularly in areas already defined by poverty and racial tension, be incalculable.

  1.17  The report's implicit endorsement of the "golden arc" treasury model ignores the fact this model is now the most profound barrier to the sustainable development of the United Kingdom by enshrining a market-led growth model which shows inadequate regard for environmental limits and social justice.

Ignoring environmental costs

  1.18  While the report makes wide ranging recommendations on the planning system, it gives no consideration to the environmental costs of its key recommendations for a price sensitive system. It does not make clear that the environmental capacity of areas such as the South East is limited and that large-scale development would inevitably compromise these limits.

  1.19  DEFRA recently published an analysis[9] of the impact of three expansion scenarios including those recommended by Barker. The report concludes that this option, which amounts to 300,000 new dwellings per year being built in southern and central England between 2001 and 2016, would have very significant environmental consequences.

  1.20  In the year 2015-16 carbon dioxide (CO2) associated with construction could represent 5% of all current industry emissions. In the same year, CO2 associated with use of the new dwellings could equal 12% of the current domestic CO2 total. These extra CO2 emissions are identified as the biggest external cost of the plans.

  1.21  The amount of additional aggregates required in the year 2015-16 would equate to 10% of the construction industry's entire consumption in 1998. (It is important to note that there are already major environmental concerns over the impact of aggregate production in general and in particular marine dredged aggregates supply to the South-East, which currently accounts for 35% of consumption) Additional household waste would be equivalent to 25% of the current total. Water demand would be nearly 73 million litres higher (We note that Thames water has announced a plan to build the first desalination plant on the Thames which will be energy and land intensive). And up to 77,500 hectares of greenfield land would be built on between 2001 and 2016.

  1.22  The Barker Report does have the briefest acknowledgement that there might be environmental costs but there is no detailed analysis, no indication of the level of these costs or their severity. It is not sufficient for the authors of the report to claim that these issues were not in their terms of reference since they are factors which are profoundly important in making sensible recommendations on housing provision. It is also worth noting that the report exceed its remit in other respects such as making recommendations which question the democratic nature of planning.

Putting a price on the environment

  1.23  The Barker Report assumes (recommendation 10) that the environment is valued only in relation to its opportunity cost. This form of crude quantitative cost-benefit analysis, which permeates the whole report, was largely discredited in the 1960's in relation to strategic planning because costing long term environmental impacts were too uncertain and the process ignored the complex pattern of competing individual and community interest that surround planning decision-making.

Housing provision and the private sector

  1.24  The report lets the building industry "off the hook". There is a very substantial difference between the interim[10] and final Barker Reports. The interim report nailed the industry as one of the prime problems in housing supply. The final report largely focuses on the planning system and proposes a voluntary approach to encouraging the private sector to build more houses (recommendations 32 to 36).

Social Housing

  1.25  The Barker Report restates the longstanding analysis of the shortage of social housing (Paragraph 5.2). However, the report does not offer any detailed analysis or new solutions. Simply increasing the total supply of housing will not substantially impact on affordability. At best the report acknowledges it will stabilise house price inflation.

  1.26  Friends of the Earth's view is that there is an overwhelming social justice case for meeting the demand for social housing in every region in the most efficient manner possible. In practice this means moving away from a model based on the private sector provision of affordable homes through mechanisms such as planning obligations (essentially a form of cross-subsidy, so that higher value housing can subsidise low cost units). This is inefficient in terms of land use and has not always ensured the right tenure choice. Instead radical reform of the funding and delivery of social housing is necessary which recognises that it is a lack of public investment not the planning system which is the prime cause of the social housing crisis. This reform should be based on three principles:

    —  Significant increases in central government funding on social housing.

    —  A return to the direct delivery of housing by local authorities.

    —  Decentralised participative governance of housing management.

  1.27  Direct public sector provision allows for the efficient use of land and the greatest integration of housing provision with the planning process. Public sector control allows the rate of housing unit production and the quality of design to be effectively delivered.

Implementing Barker

  1.28  ODPM is in the process of considering how best to implement the Barker Report despite its obvious and profound flaws. While we understand there will be a period of consultation we also understand the Treasury is determined to uphold the recommendations for a price sensitive planning system. It is Friends of the Earth's view that, other than some recommendations on fiscal measures, none of the key recommendations of Barker should be implemented. Instead, if government is serious about sustainable development it should begin again to assess housing need on a national basis and along side indices of social deprivation, housing need and environmental limits to produce a comprehensive national spatial framework for sustainable development. Such a framework should be subject to rigorous strategic environmental appraisal and be the product of genuine cross departmental corporation to avoid the fragmented approach which has characterised the Communities Plan and the Barker Report.

PART 2

HOUSING PROVISION IN THE UK

The Communities Plan

  2.1  The Communities Plan is a fragmented and partial spatial response to housing shortages in the South-East. The plan itself has an uncertain status since this output will only have a real practical impact when incorporated into Regional Spatial Strategies (RSS) which themselves have their own adoption process. In addition the ideas of the Communities Plan have emerged over a period of 18 months so that there is now more focus on issues affecting northern cities. What is clear is that this ad hoc approach was not based at any time on an overview of how to deliver sustainable development in the UK as a whole. Unlike all other planning processes the Communities Plan proposes significant growth before it had any systematic measure of the suitability of those areas to accommodate such development.

  2.2  This illogical and unreasonable approach to a highest level of strategic planning inevitably leads to failures to directly consider infrastructure needs and environmental limits of particular localities. In addition to the environmental impacts identified by the DEFRA study[11] this can lead to the focusing of growth in areas such as the Thames Gateway where there is significant flood risk from climate change.

  2.3  There is an important policy conflict between the objectives of the Sustainable Communities Plan and the achievement of sustainable development. This tension is illustrated in the Draft PPS 1[12] where there is significant confusion as to which of these principles is meant to be the core objective of the planning system. What is clear is that the definition of sustainable communities as illustrated in Annex A of PPS 1 "Creating Sustainable Communities"[13] are significantly different from the accepted notions of sustainable development contained within the UK Sustainable Development Strategy[14]. Annex A for example, contains no reference to the importance of nature conservation.

Friends of the Earth's response on Housing

  2.4  Friends of the Earth recognises that the environment sector has not always fully and responsibly engaged in the policy debate on housing needs. Friends of the Earth accepts that housing poverty reflected through homelessness and poor conditions is a major contributor to social exclusion. The level of poor housing conditions for children and the elderly are of particular concern. We also recognise that demographics and particularly the growth in household formation has created a demand for new homes and new kinds of homes. We do not accept, however, that "predict and provide" in relation to new-build provides an effective or sustainable solution to these problems. We also strongly reject the assumption that increased housing provision will tackle house-price inflation. In order to achieve a lowering of house prices through market mechanisms it will be necessary to generate an oversupply of housing, which would breach the principles of sustainable development.

Design and Layout

  2.5  Friends of the Earth is extremely concerned by the Government policy on design and layout. Specifically we believe the Communities Plan approach to the implementation of sustainable housing is a major impediment to sustainable development by failing to provide sufficient regulation and incentives to affect the radical changes we need to make in housing design. A clear illustration of how the Government regards the implementation of sustainable housing standards can be gained from the recent publication[15] of proposals for a Code for Sustainable Building (CSB) which contains a range of excellent proposals on energy efficiency, floods resilience and water conservation. Unfortunately this code only has the status of best practice. This exemplifies the clear gulf between the available technology and design proposals (exemplified in the detailed work of WWF "One million sustainable homes"[16]) and the Government's unwillingness to identify effective delivery mechanisms.

  2.6  The solution to this problem is:

    —  Provide a greater degree of prescription in building regulations to ensure new build and conversions enshrine proven resource conservation technology including small-scale renewable technology and meet the Eco homes excellent standard.

    —  Provide much greater prescription in a new PPS 3 on housing in relation to master planning and the layout and service provision of new housing.

    —  Provide greater integration between the Environment Agency and planning authorities in relation to future flood risk and sea-level rise in order to provide strategic guidance based on best available modelling from the Met office.

    —  Specify in PPS 11[17] a CO2 reduction target for the delivery of new housing to be enshrined in Regional Spatial Strategy.

    —  Increased investment for the retrofit of existing houses with energy conservation technology.

    —  Underpin the new drive for sustainable housing by enshrining the above objectives in a new Public Service Agreement (PSA) target for ODPM.

  2.7  There is no doubt that such development will add cost to the delivery of new housing units. However, such upfront capital cost will result in long-term savings particularly in energy costs for users. Such savings will disproportionately benefit those on low and fixed incomes who spend a higher proportion of their income on energy. In the wider context, the contribution of sustainable housing to reducing the negative impacts of climate change is likely to be significant (These costs have been assessed in the recent DEFRA report[18]).

A National Spatial Framework for Housing

  2.8  A more detailed description of Friends of the Earth's policy on housing location and design is appended at Annex A. The most significant strategic element of this policy is Friends of the Earth's commitment to a national spatial framework which would address issues of the over-development of the South-East, housing abandonment, quality-of-life and negative inter-regional competition.

  2.9  This framework should have the prime objective of redistributing demand pressures from areas of growth in the South-East to areas of low demand in the North and West. Such a policy should also address the need to deal with the drivers of housing demand by restricting and decentralising public and private sector commercial growth from South to North. This policy should achieve the systematic redistribution of population and industry to areas of low demand. Failure to deal with this issue strategically will lead to the continued decline of some communities and to the overcrowding of others, with all the attendant political controversy and reduction of quality-of-life. The recent publication of census data reinforces the decline of regions such as the North East and North West while areas such as Milton Keynes have seen growth of around 60% in the last 20 years. Government must address the need to deal with the vacuum in policy left after the abandonment of comprehensive regional redistribution policies in the early 1980s. Friends of the Earth believes that housing policy should no longer attempt to meet general demand in all regions. While social housing needs must be delivered everywhere, the continued expansion of housing in the South East is not sustainable in the medium and longer term.

CONCLUSION

  If the Barker Report is successfully implemented in full then price sensitive decision-making will do irrevocable damage to the ability of the land-use planning system to deliver sustainable development. Friends of the Earth believes that the Government should carefully reconsider its regional economic and housing policy. This policy should have the prime objective of giving spatial expression to the UK Sustainable Development Strategy. It should be based on an integrated assessment of the social, environmental and economic circumstances of the nation.

REFERENCES

  Review of Housing Supply "Delivering stability: securing our future housing needs" Final Report, Kate Barker, March 2004.

  A Better Quality of Life: A Strategy for Sustainable Development for the United Kingdom, May 1999.

  Sustainable Communities Plan "Sustainable Communities: Building for the future" February 2003.

  Friends of the Earth's submission to the Environmental Audit Committee on the Budget, 24 March 2004.

  Driving Productivity and Growth in the UK Economy, McKinsey, Global Institute, October 1998.

  Fourth Report of the ODPM: Housing, Planning, Local government and Regions Committee, 2003.

  Study into the environmental impacts of increasing the supply of housing in the UK. DEFRA, April 2004.

  PPS 1 "Creating Sustainable Communities", May 2004.

  Sustainable Building Task Group Report, May 2004.

  One million sustainable homes: Moving best practice from the fringes to the mainstream of UK housing, WWF, January 2004.

June 2004



1   Review of Housing Supply "Delivering stability: securing our future housing needs" Final Report, Kate Barker, March 2004. Back

2   A Better Quality of Life: A Strategy for Sustainable Development for the United Kingdom, May 1999. Back

3   Sustainable Communities Plan "Sustainable Communities: Building for the future" February 2003. Back

4   ibid. Back

5   ibid. Back

6   Friends of the Earth's submission to the Environmental Audit Committee on the Budget, 24 March 2004. Back

7   Driving Productivity and Growth in the UK Economy, McKinsey, Global Institute, October 1998. Back

8   Fourth Report of the ODPM: Housing, Planning, Local government and Regions Committee, 2003. Back

9   Study into the environmental impacts of increasing the supply of housing in the UK. DEFRA, April 2004. Back

10   Review of Housing Supply "Delivering stability: securing our future housing needs" Interim Analysis, Kate Barker, December 2003. Back

11   Study into the environmental impacts of increasing the supply of housing in the UK. DEFRA, April 2004. Back

12   Draft Planning Policy Statement 1: Creating Sustainable Communities, ODPM. Back

13   Planning Policy Statement 1: Creating Sustainable Communities, ODPM, 2004. Back

14   ibid. Back

15   Report of the Sustainable Building Task Group, May 2004. Back

16   "One million sustainable homes": Moving best practice from the fringes to the mainstream of UK housing, WWF, January 2004. Back

17   Draft Consultation Paper on New Planning Policy Statement 11 (PPS11)-Regional Planning, ODPM, 2003. Back

18   Study into the environmental impacts of increasing the supply of housing in the UK. DEFRA, April 2004. Back


 
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