Jeremy Corbyn: What does the new Labour leader have in store for planning and development?
Jeremy Corbyn was last week elected leader of the Labour Party, knocking out rival candidates in a victory that saw him gain just shy of sixty per cent of first-preference votes.
And so as Jeremy Corbyn yesterday made his first appearance as Labour leader at Prime Ministers Questions (described by one reporter as a ‘revolution in beige’), we can see there is a clear demand for his policies (albeit nascent at this stage), but we question what Corbynomics may hold for us - if implemented - in the planning, development and related industries?
A brief introduction
Unless you’ve been living under the proverbial rock, you’ll have undoubtedly heard of Corbyn’s meteoric rise in the Labour leadership contest.
However, you could be forgiven for not previously knowing much about this wallflower of the back benches, given his lack of coverage and interaction with mainstream political currents.
As a bit of a refresher, Corbyn has been the MP for Islington North since 1983 and has spent the entirety of his political career as a rebellious backbencher, disobeying the prompts of the leadership in excess of 500 times.
An avowed democratic socialist, Corbyn has a strong history of activism and initially stood in the leadership race to offer more of a choice to its members - making his platform one of staunch anti-austerity.
His contentious rise to fame attracted claims of espionage, as people flocked to join the Labour party to register their vote and one Telegraph comment piece went so far as urging supporters of other parties to sign up and vote Corbyn as a means to 'doom' the Labour party.
While presenting one of the most concrete set of policies of all candidates, much of Corbyn's thoughts on policy have been restricted to fairly general principles. It's only in the coming months – and years – that we'll see a greater breadth of policies emerge.
The policies that have been set out, especially his thoughts on the economy, have been loosely dubbed 'Corbynomics'. In brief, these comprise a series of plans for the UK, some of which are more fleshed out than others.
Much of Corbyn’s economic policy was contributed by Richard Murphy, director of TaxResearch UK, and some of its highlights include:
The people's quantitative easing: A method by which the Bank of England would print money that would be directly funnelled into investment into public services.
Cutting out tax reliefs and subsidies for corporations: Billed to have the potential to save £93 billion a year, which would then be funnelled into public investment, which in turn aims to provide stimulus to supply chains in the private sector.
Cracking down on tax avoidance: Corbyn set out several proposals, including reversing cuts to HM Revenue & Customs and investing in more staff at the institution.
You can view more in the official policy document released in July, but for now, let's delve a little further into the areas that could impact those of us in the planning and development world.
Corbyn seeks to stamp out fracking, but in a move that's proved contentious with green campaigners, has expressed desires to re-open the coal pits of south Wales.
Private-driven initiatives in this area also came under fire – with Corbyn warning that such an important issue couldn't be left in the hands of corporations interest only in short-term profit.
In his Protecting Our Planet manifesto, he also set out lofty aims for Britain to provide international leadership on climate change and stimulating a modern, green economy with a view to creating one million new climate-related jobs.
As with many commentators, we are a bit thrown by the reopening of coal mines, especially given Corbyn's strong history of environmental advocacy. Overall, we question how they would be delivered.
There's no denying the UK's in the midst of a growing housing crisis, but there can be plenty of debate about the probable causes and solutions.
Prior to the publication of his economics manifesto, Corbyn released a policy outline on housing in August, with some of the key points including:
Councils and Public Investment to Build the Homes we need
- It is essential for councils to build if we’re going to achieve the number of homes we need.
- A National Investment Bank could support new build housing projects by councils and developers with low interest rates, both by councils and developers as long as tough new conditions were met on the proportion of genuinely affordable housing built. For every £1 spent on housing construction an extra £2.09 is generated in the economy.
- Lifting the borrowing cap in the Housing Revenue Account would mean local authorities could borrow up to the prudential limits and thereby build more homes. Building the homes to meet need would create thousands of skilled jobs across the country, and offer thousands of young people high quality apprenticeships.
- Return to having regional home building targets to ensure homes are built in every area, so that rural areas benefit from building council homes as well as urban centres.
A Private Rented Sector that’s fit for purpose
- Alongside building the thousands of new homes needed. Rents need to be decreased in the private rented sector. The UK could have national minimum standards of longer tenancies and limits of rent rises – but in places where the housing crisis is most acute, more needs to be done.
- Regulation of private rents should be linked to what determines whether something is affordable. We should consider average earnings and in particular their rate of increase, not the market rate for housing.
- Reference is made to Berlin now having powers to limit how far landlords raise rents for all new contracts – and early evidence suggests that this is bringing rents down.
- To help people caught in the trap of saving for a deposit, particularly in high-value areas, with an approach that incorporates some of the principles applied in schemes like rent-to-own or shared equity, where the government helps with a deposit and in the latter case, retains a share in the property.
Right to Buy
- Instead of extending the right to buy, Corbyn believes we should be reducing what he believes is the harm it causes to the affordable housing stock. Local authorities in areas of high housing stress should be given the power to suspend right to buy to protect depleting social housing assets. He also states it is essential we make sure receipts from right –to-buy remain in a local area and that genuine replacements are built – an aim the government has sorely missed and that the discount should be reduced.
- Corbyn also states that £14 billion of tax reliefs received by private landlords should be re-directed to help struggling private tenants and that new council homes would be built. Investigation would also be made into whether some of this money could be used to fund a form of right-to-buy shared equity scheme to private tenants in cases when they are renting from large-scale landlords.
Landbanking and Speculative Planning Applications
- Corbyn states that even in areas of acute housing shortage there is land that has planning permission but is not being developed. He continues to state that we should consider introducing a Land Value Tax on undeveloped land that has planning permission, and ‘use it or lose it’ measures on other brownfield sites. Councils should also be allowed to compulsory purchase sites at a fair value if their owners are not developing them.
Public Land Used for Affordable Homes
- Corbyn says there is a danger that the government sees land disposals of public land as a way to raise as much money as possible, and with no provision made for genuinely affordable housing. He continues to say this public land should be developed but should be transferred to councils to build council housing to meet local need.
- Corbyn states the government’s extended permitted development rights are problematic and must be reserved. By not needing planning permission, he states, there cannot be an assessment of the provision for the wider facilities and infrastructure that communities need.
While the need for councils to produce more social housing is clear, what isn't highlighted is the specifics of how these will be delivered and how necessary planning hurdles will be jumped over. Similarly, we'd urge for more focus on encouraging delivery from the private sector, which will continue to play an important role in this area.
Our initial thoughts on the aims expressed for the private rented sector are fairly positive, with the potential to support tenants and hopefully enabling people to remain in the areas they want to live in.
As mentioned in our pre-election post, Corbyn was arguably the most vocal of all the candidates in terms of planning. He floated plans to levy taxes on undeveloped land with planning permission, alongside the introduction of a 'use it or lose it' scheme on brownfield sites, with the aim of hastening the pace of development.
We've set out our scepticism of the land-banking trend in a previous posts and don't believe the proposed tax on undeveloped sites would encourage development. In fact, since the unviability of many of these sites is the issue preventing them from being built on, placing a further levy could actually serve as a further hindrance to development.
If you've got any thoughts on Corbyn's policies, or what the future might hold for the Labour party, we'd love to hear from you. Simply leave us a comment below or get in touch via Twitter.
And if you're looking for advice on how forthcoming policy changes might affect your development plans, be sure to get in touch today.
Images courtesy of: David Holt, JD Hancock, Enid Martindale, Images Money