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Economic case for planning reforms debunked

Last modified: 13 February 2012

Minsmere RSPB reserve at dawn

Image: Mike Read

A new study into the costs and benefits of the planning system finds that the Government's proposed reforms are likely to have little or no effect on growth and could even undermine public wellbeing.

The new report 'Inexpensive Progress?' commissioned jointly by the Campaign to Protect Rural England (CPRE), the National Trust and the RSPB, examines the fundamental question at the heart of the planning reform debate – 'Is the planning system holding back economic growth?'

The report, prepared by Vivid Economics, finds that although there have been a few studies of the costs of the planning system, the claims made on the back on them have been overstated - and very little has been done to measure the benefits that good planning delivers.

It concludes that while there are costs in some sectors, there is no evidence that planning has large, economy-wide effects on productivity or employment and that the draft National Planning Policy Framework (NPPF) is unlikely therefore to have much effect on growth.

Martin Harper, Conservation Director for RSPB, says: 'This report clearly shows that the decision makers behind these reforms do not properly understand the benefits that the planning system brings our society

'The Government's own groundbreaking work as part of last year's National Ecosystems Assessment revealed that our green spaces provide economic, social and health benefits. This kind of enlightened thinking must be reflected in the final NPPF.

'The Government has a big challenge in steering us out of the economic difficulties we find ourselves in, but this can and must be achieved without sacrificing the countryside and coast that many of us hold so dear.'

Neil Sinden, Director of Policy for CPRE, says: 'To many of us the benefits of the planning system seem obvious. It allows us to take account of the needs of the whole community, while facilitating necessary development that protects and enhances the environment. Sadly, these manifest benefits are often ignored by those who can only see the red tape standing in the way of their bulldozers.

'Effective planning should not be seen as a choice between growth or the environment. As this report argues the aim of planning should be to secure long term wellbeing. It should give pause to all those who care deeply about the countryside and the role the planning system plays in improving our quality of life through shaping the places we live. We urge Ministers to heed its finding before finalising their planning reforms.'

Ben Cowell, Assistant Director of External Affairs for the National Trust, says: 'Planning imposes costs but it also produces significant benefits. Without a strong planning system, our landscape would look very different today. Government needs properly to understand both sides of the equation before it reaches conclusions about the impact that planning has on the economy.

'This report is a vital contribution to the debate about how we deliver good development in the future, and prevent bad decisions from being made in the pursuit of short-term gain.'

The main conclusions from the report include:

  • the NPPF is unlikely to have any positive effect on growth or employment in the short run. Given the importance of the planning system, it is desirable the NPPF's impact is closely monitored after it is implemented;
  • it is difficult to quantify the costs of planning system and rigorously isolate the effects of planning versus other influences, but for particular impacts of the planning system robust estimates of gross costs of the planning system are available;
  • the value of the 'benefits' of the planning system are less well understood. Much more research needs to take place to quantify the social, distributional and environmental benefits of the planning system;
  • information on market prices could play a valuable role in plan-making, but only if there is a feasible way of complementing this with information on the 'nonmarket values' of land (which include the value of the environmental services provided);
  • it is particularly important to ensure that cross boundary issues continue to be addressed following the abolition of Regional Spatial Strategies.

Comments on the report:

Professor Dieter Helm, University of Oxford, says: 'In such a contentious area as planning, there is a clear need for an integrated economic framework, bringing together both the economic costs and benefits of planning. The Government's reforms give a presumption in favour of sustainable development, and it is vital that there is a clear analysis of what is - and what is not - sustainable. Economics has a key role to play. This report is a great start.'

Stephen Joseph, Executive Director, Campaign for Better Transport, says: 'This report shows clearly that cutting back on the planning system won't help the economy in the way the Government has been claiming. Planning reforms should be based on evidence rather than assertions, promoting genuinely sustainable development rather than a vain dash for growth at any cost. Apart from anything else, out of centre development creates more road congestion, and so hurts the economy.'

Tom Burke CBE, Environmental Policy Adviser to Rio Tinto and a Visiting Professor at Imperial and University Colleges, London, says: 'This report is a timely antidote to the government's planning policy which is a toxic conjunction of incompetence and ideology.

'Turning 1,000 pages of detailed planning guidance into 50 pages of ambiguous text is licence for planning lawyers to print money. Instead of the current speedy and predictable passage through the planning system developers will be faced with the uncertainty and cost of the courts. This will slow rather than accelerate growth. Since there is no evidence to support it, it is clear that the real driver for this foolish policy is simply de-regulatory mania of the nastier parts of the Conservative party.'

Liz Peace, Chief Executive of the British Property Federation, says: 'The media has been very quick to paint the development world as being against sound planning and truly sustainable development. That is absolutely not the case. Developers want to see plans put together and decisions made against a sound, well constructed evidence base.

'This report argues that such an evidence base needs to be wide-ranging and take into account not just traditional and easily measured economic impacts but also more amorphous concepts such as the availability of brown field land and the costs and benefits of green belts. We welcome this contribution to the debate and look forward to a continuing constructive dialogue on it with CPRE, the National Trust and the RSPB.'

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Inexpensive Progress? (1.2Mb)
A framework for assessing the costs and benefits of planning reform. Report prepared for the Campaign to Protect Rural England, National Trust, and the Royal Society for the Protection of Birds by Vivid Economics.

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