Government to boost construction sector

Published:  03 September, 2012

Parliament returns from its summer break today, with the coalition government vowing to take steps to boost the construction sector.

Proposals from Chancellor George Osborne will relax what he described as "ludicrous" planning rules, to make the process of obtaining planning permission for building work faster. The changes will also make it harder for residents to object to new developments, giving them less time to object, and will encourage councils to allow housebuilding projects on greenbelt land by reclassifying other land.

Osborne said: "I think we can speed up planning – it is absolutely ludicrous that it takes years to get planning decisions in this country. You can get much faster decisions on the continent, let alone in countries like China. This country, in the current economic environment, cannot afford to wait years for development."

These latest proposals come just a few months after the government's National Planning Policy Framework was approved, which encouraged development on brownfield land and aimed to move the industry towards sustainable development.

Speaking on the BBC's Andrew Marr show, Osborne highlighted moves by councils in Cambridge, among others, which approved building on greenbelt land and then replaced it with other land newly classified as part of the green belt.

In a newspaper article, Prime Minister David Cameron wrote: "A key part of recovery is building the houses our people need, but a familiar cry goes up: 'Yes, we want more housing; but no to every development – and not in my back yard.’ The nations we’re competing against don’t stand for this kind of paralysis and neither must we.”

The new planning rules will be introduced next month as part of the Economic Development Bill.

The Treasury is also expected to underwrite up to £50 billion of private sector building projects which need finance, in an effort to boost growth in the construction industry and the wider economy. This figure will include £10 billion of investment underwritten for housing associations and other developers, and £40 billion of private investment in infrastructure.

The Infrastructure (Financial Assistance) Bill will underwrite the various projects using the government's low interest rates, but the government said it would only apply the investment to "nationally significant" projects which are financially credible and offer good value for taxpayers.