CMA calls for planning reform

The planning system needs reform with its deficiencies disproportionately affecting SME housebuilders. This is according to the Competition and Markets Authority (CMA) which has published its final two working papers on planning and landbanks as part of its housebuilding market study.

The CMA’s analysis on landbanks also finds that 11 housebuilders collectively own or control around 1.17 million plots across England, Scotland and Wales. Around 658,000 of these are long-term landbanks – land without planning permission – and approximately 522,000 are short term landbanks with some form of permission.

On the planning system, the CMA highlights three key areas of concern in its working paper: a lack of predictability; cost, length and complexity of the planning process and insufficient clarity of incentives to meet housing need.

With the current arrangements particularly affecting SMEs, the CMA calls for more support, including more local planning authority (LPA) resource dedicated to smaller builders. This extra cost would either need to be funded by the LPA, by central government in each nation or through a combination of both.

CMA’s analysis reveals that per-plot direct costs for sites of fewer than 50 plots are around £3,500 on average, against £1,500 …