Brownfield costs hit green belt

Only compulsory purchase and regulation can keep developers out of the
countryside, reports Nick Mathiason

Nick Mathiason

Sunday July 23, 2000

Nowhere is the debate over the massive increase in the number of new homes
planned more keenly felt than in the Langley Valley.

Today, this unspoilt two-and-a-half square mile swathe of picturesque
North Hertfordshire countryside is home to just 200 people. Mostly, it is
farmland. But in 10 years, it is feared, 10,000 homes will be built here,
all on green-belt land to the west of Stevenage.

The settlement, if it goes ahead, will result in a seamless urban sprawl
between Stevenage and Hitchin. Environmentalists are in uproar.

Last week, in what could be a watershed for the fate of the Langley
Valley, lawyers representing North Hertfordshire District Council advised
that the plan, to be developed by housebuilders Persimmon and Bryant
Homes, contravenes government planning guidance and should be rejected.

Despite Deputy Prime Minister John Prescott backing the scheme, the scene
could soon be set for one of the biggest planning law scraps of recent
times.

There is a huge amount at stake. Friends of the Earth claims the
development would involve the biggest use of green-belt land ever.

Housebuilders stand to make a fortune, as do the group of Langley Valley
private landowners who have conditionally agreed to sell to the
housebuilding consortium should the scheme be rubber-stamped.

Critics of the Langley plan say the proposed new homes will not be aimed
at those most in need: low-income families and older people.

But at the heart of the battle for this valley lies one of the thorniest
questions faced by governments, local authorities and housebuilders today:
where to put the estimated 800,000 new homes that are desperately needed
in the South-east.

In the three years since Labour came to power, there has been a
discernible shift in government planning policy.

New Labour, driven by Prescott and Lord Rogers' metropolitan zeal, has
declared that it wants to tackle dereliction and encourage the building of
more homes on brownfield sites.

As a statement of intent, as soon as it came to power in 1997 the
Government raised the target for new homes to be built on brownfield sites
to 60 per cent - 10 per cent up on the previous figure.

In 1998, government circulars reminded councils to prevent dereliction of
the built environment. Last year, Lord Rogers' Urban Taskforce published
hundreds of recommendations that were widely acknowledged as the most
progressive diagnosis of Britain's urban malaise to be made in modern
times.

Meanwhile, a new Planning Policy Guidance (PPG) note on housing published
last March asked local authorities to release land previously reserved for
employment purposes for housing, to pack higher housing densities into
developments and reduce land earmarked for cars.

The PPG contains the strongest weapon for preventing countryside being
gobbled up for housing so far issued by Labour: the announcement of a
sequential test for developments. This means that all brownfield sites
have to be used for housing before greenfield sites will be considered.

It is on this point that North Hertfordshire was advised by lawyers that
its massive housing plan did not conform to government policy.

The Government has largely set the planning framework by which brownfield
development can smoothly proceed in a bid to create a sustainable
environment.

The trouble is, the biggest housebuilders still prefer to build on
greenfield sites, because brownfield sites are much more expensive to
develop. They are often contaminated, or owned by several parties.
Assembling sites - preparing them for housebuilding to proceed - is
therefore time-consuming and costly.

In his Urban Taskforce report, Lord Rogers called for the Government to
give regional development agencies and local authorities souped-up powers
to compulsorily purchase land in order to speed up the assembly process.

The Government is currently studying ways of doing this but, more than a
year later, it has failed to act.

However, Anthony Dunnett, chief executive of the South-east of England
Development Agency and a member of Rogers' Urban Taskforce, warns that
without strong compulsory purchase order powers, the Government target of
building 60 per cent of new homes on previously developed land will fail.

'The [housing] debate has been hijacked by "Nimby" fears and pre-election
politics rather than focusing on the fundamental problem,' Dunnett says.
'The real issue is not one of numbers; rather it is one of market failure
in a free-market economy. The structure of the UK housing market is
one where housebuilders have no long-term interest and are driven by
return on capital, which calls for minimising inventories and maximising
planning gain so as to maximise short-term profit.'

Dunnett believes that only by allowing RDAs and councils to knock heads
together to 'marry' sites will government brownfield targets be met.

Compulsory purchase powers are vital, he argues, because most of the vast
brownfield sites in the South- east have already been developed. The
solution to meeting the massive housing need in the region is to build on
'infill' sites - smaller parcels of land within town and city centres.

Housebuilders, meanwhile, are upset because they never know how many
socially affordable homes to build within a housing development. New laws
on the provision of affordable homes set minimum targets, but councils can
order as many affordable homes as they can get away with.

But the biggest disincentive for builders to develop brownfield sites is
VAT, which is charged at 17.5 per cent on refurbishing or redeveloping
existing buildings, while greenfield housebuilding is exempt.

If the Government wanted to send out a signal that brownfield development
is at the heart of its housing policy, it could start by addressing this
anomaly.

But with the Treasury recently indicating opposition to reform, those at
the sharp end of regenerating Britain's towns and cities face an uphill
struggle.

Government lifts roof on housing budget

Tomorrow the Government will give details on how it will spend the 12 per
cent average annual increase on the housing budget over the next three
years. It has been greeted by housing experts as the most significant
investment in the sector for more than 25 years.

The Observer can reveal that the Government has earmarked 2.5 billion for
capital investment on housing - double the current figure. A spokesman
added that there would be 'substantial funds' for building new homes.

Labour will also announce plans to fund an unprecedented stock transfer of
council homes to registered social landlords, effectively sounding the
death knell for direct council involvement in housing.

This will enable rundown estates to tap into private finance for
renovation. But transfers will go ahead only if tenants vote for them.

Money available for new affordable housing, to rent and to buy, will be
channelled through Housing Associations.

The Government will also reveal how much money it will spend on its
Starter Home Initiative, the device, outlined in the Housing Green Paper
published last March, through which key workers can buy a home.

Other measures will include help for poor homeowners to maintain and
improve their homes, plus more money to help disabled people adapt their
homes.

Another scheme to be unveiled tomorrow is called Supporting People; it
aims to improve support services to those in need. The scheme will allow
local authorities to fund probation, housing benefit and other social
services from a single pot, thereby allowing services to run more
efficiently.