Chancellor Rachel Reeves is set to announce a series of planning changes before the budget, aiming to stimulate economic growth by making it easier for developers to build houses and infrastructure projects. The reforms are intended to help fill an estimated £3bn of the government's £30bn fiscal black hole and bolster fragile private sector confidence, which fell to a record low last month according to the Institute of Directors.
However, ministers are divided over the scope of the reforms. Some senior government members argue the changes will be merely technical adjustments to existing announcements, while others push for a new planning bill, which Prime Minister Keir Starmer has said is 'almost certainly' needed. A government source said: 'The Treasury is desperate to make announcements on planning, but the truth is we are already doing most of the stuff we wanted to, and trying to reopen all of that is not a good idea.'
Reeves and Starmer have placed planning reform at the heart of their growth agenda, having already introduced a bill earlier this year to reduce costs for wildlife protection. However, the bill was watered down after backlash from developers and Labour MPs, leading to stricter rules for nature mitigation. Reeves is now exploring amendments in the Lords, including a proposal by Labour peer Philip Hunt to ease building for projects with minimal environmental impact, and a Conservative amendment by Charles Banner to simplify post-approval project changes.
Additional potential changes include further restrictions on judicial reviews for infrastructure projects and preventing judges from quashing planning approvals during ongoing legal cases. Reeves hopes to secure support for these amendments before the budget, with officials believing the Office for Budget Responsibility could judge the reforms to add about £3bn annually to the economy in the long term.
Environment Secretary Emma Reynolds is also drafting a separate nature bill, which officials say would help speed up the planning system. However, critics like Alexa Culver, a planning lawyer at RSK Wilding, accuse the government of presiding over a 'chaotic slew of destructive new bills, with no strategy, vision, due process, consultation or democratic mandate.' A government spokesperson defended the approach, stating that the chancellor and housing secretary are working together to reform the 'outdated planning system' to build 1.5 million homes and drive growth.
