Why Britain cannot build enough of anything

 The problem is bad rules, not bad people opines The Economist

Sep 1st 2022

Duncan sandys, a Conservative minister in the 1950s and 1960s, has two reasons to be remembered. The first is that he was the “headless man” being fellated by the Duchess of Argyll in a Polaroid photo, which emerged in divorce proceedings so vicious that they were turned into a bbc One drama earlier this year.

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The second reason is less salacious. In 1955 Sandys issued a circular that fundamentally changed Britain. It implored local councils to forbid building on the edge of cities in order “a) to check the further growth of a large built-up area; b) to prevent neighbouring towns from merging into one another; or c) to preserve the special character of a town”. The authorities had tried to restrict urban growth since the reign of Elizabeth I. Now they could.

Today all four nations of the United Kingdom have green belts. About 13% of England is so designated, including the surroundings of every major city. The girdle that encloses London is three times the size of the capital. A stroll through it takes in scrubland, pony paddocks and petrol stations. In “The Blunders of our Governments”, a book by Anthony King and Ivor Crewe, the policy is held up as a rare example of legislation achieving exactly what was intended.

The green belts do their jobs well, pushing development into the rural areas between them (see maps). Indeed, most parts of the planning system work as intended. Councillors retain democratic control over the planning system. Environmental watchdogs enforce their mandates fiercely. Stringent rules protect bats, squirrels and rare fungi. Courts ensure that procedures are followed to the letter. But the system as a whole is a failure. Britain cannot build.

In total, about 10% of gdp is spent on building, compared with a g7 average of 12%. England has 434 dwellings per 1,000 people, whereas France has 590, according to the oecd, a club of mostly rich countries. There is little slack in the market. In France, about 8% of dwellings are vacant at any one time. In England, the rate is barely 1%. Britain also struggles to build reservoirs and (despite boasts from successive prime ministers) nuclear power stations. With almost 500,000 people, Leeds is the largest city in Europe without a mass transit system. What has gone wrong?

The problem starts with the Town and Country Planning Act, which nationalised the right to build on land. Where once owners could do almost as they pleased, after its passage in 1947, local councils controlled what was built where. They have never relinquished that power. The planning system has more in common with an old eastern European command economy than a functioning market, argues Anthony Breach of Centre for Cities, a think-tank. “We do not have a planning system, we have a rationing system,” he says.

Even when councils approve development, other outfits can stop it. Natural England was created in 2006 with the aim of protecting flora and fauna. After a European Court of Justice ruling in 2018, it was tasked with ensuring “nutrient neutrality”, meaning any development could not increase phosphate or nitrate pollution in rivers. Natural England came up with a blunt solution: building could not go ahead unless developers could prove it would not lead to an increase in nutrient levels, a stipulation that few could provide.

The result was a near total freeze on house-building. Local politicians and developers, who had spent years in painful negotiations, were caught out. In total, about 14% of England’s land faced extra restrictions. One industry group argues that 120,000 houses were affected, or 40% of Britain’s annual housing target. Liz Truss, the likely next prime minister, has promised to scrap the requirement, but details are scant.

Newts present as many problems as nutrients. Anyone who harms a great crested newt while building can be jailed for up to six months. Bats are a nightmare for anyone renovating or developing (enterprising nimbys sometimes install bat boxes in order to attract them to a potential site). Protected under law, it is a crime to harm a bat or destroy its roost. A full report, which involves ecologists scouring a property with bat-hunting microphones plugged into iPhones, can cost £5,000 ($5,800).

If a roost must be destroyed, a like-for-like replacement must be installed. hs2, a railway line, was forced to build a £40m bat tunnel to stop the creatures being squished; its route is lined with bat-houses, which are large enough for humans. For developers, the rules are an expensive annoyance. For bats, however, the legislation has been a success. Numbers of the common pipistrelle have almost doubled since records began in 1999.

Some schemes do not survive contact with environmental objections. A planned nuclear power station in north Wales was rejected by the planning inspectorate in 2019 partly on the ground that it might affect a local population of terns. Inspectors ruled that “it cannot be demonstrated beyond reasonable scientific doubt that the tern colony would not abandon Cemlyn Bay”. That the terns had existed next to a previous nuclear power station was little defence. Inspectors also worried about the effect construction would have on the dominance of the Welsh language.

Even small housing estates now require reams of impact assessments and consultations. A planning application used to involve a single thick folder, says Paul Smith, the managing director of Strategic Land Group, which helps customers win planning permission. Now it is a thicket of pdfs, often running to thousands of pages.

For a development of 350 houses in Staffordshire, a developer had to provide a statement of community involvement, a topographical survey, an archaeological report, an ecology appraisal, a newt survey, a bat survey, a barn owl survey, a geotechnical investigation to determine if the ground was contaminated, a landscape and visual impact assessment, a tree survey, a development framework plan, a transport statement, a design and access statement, a noise assessment, an air quality assessment, a flood risk assessment, a health impact assessment and an education impacts report. These are individually justifiable, yet collectively intolerable.

See you in court

Make an error, however, and a legal challenge will follow. Anyone affected by a decision and able to afford a judicial review can challenge a planning decision. For a group of motivated, well-off nimbys, whipping together £20,000 for a review is easy enough. In Bethnal Green, in east London, a mulberry tree blocked the conversion of a Victorian hospital into 291 flats. Dame Judi Dench, an actor, was roped in to support the tree, which was so frail it required support from a post haphazardly nailed onto one of its branches.

After a campaign, the mulberry was in 2018 designated a veteran tree, which gives it special legal rights. (The number of signatories to save the tree matched the then population of Bethnal Green.) Although the developer had proposed moving the plant, a judge ruled that the council had not properly considered the danger that it might not survive: “A policy was misinterpreted; a material consideration was ignored.” The site sits derelict today.

Councils behave rationally when it comes to development. They levy no income tax or sales tax, and cannot even fund all their operations from property taxes, known as council tax. In all, local government imposes taxes worth less than 2% of gdp, according to the oecd. So more development does not equal much more money for better services. But it does equal more complaints. Councillors often enjoy majorities of just a few dozen votes. A well-organised campaign can replace an entire council, as happened in Uttlesford, in Essex. The result is that local councils are “a bottleneck on national economic growth”, argues a joint paper by the Centre for Cities and the Resolution Foundation.

The government in Westminster can usually override local objections. “When the state decides to act, it has unlimited power,” says Andrew Adonis, a Labour peer, who oversaw the introduction of hs2. Projects such as hybrid bills allow the government to bypass the planning system, turning Parliament into a kind of planning committee. The process is so arduous that sitting on the committee is often a form of punishment from the whips who enforce party discipline. But the benefit is that courts do not challenge primary legislation. Judicial review claims bounced off hs2 like stones off a tank.

Even when the government acts, it is often cautious. A plan to turn a quarry in Kent into a settlement of 15,000 homes was one of the most ambitious schemes, when announced by George Osborne, the then-chancellor, in 2014. Yet it is around a seventh of the size of Milton Keynes, a maligned but highly successful new town begun in the 1960s.

Larger schemes, such as a push for a million homes stretching between Oxford and Cambridge, with a new railway and motorway linking them, have been ditched due to local opposition. “We were a bit out of puff,” admits a cabinet minister. Greg Smith, a Tory mp, had already put up with hs2 slicing through his constituency, and it seemed unfair to subject him to more building. In Britain, pork barrel politics works in reverse, with mps keen to keep things out of their constituencies.

As a result, Britain’s most productive region is shackled. Burgeoning life-sciences firms fight for scarce lab and office space while world-class researchers live in cramped, expensive homes. The average house price in Oxford, £474,000, is about 12 times average incomes. Given the opposition of local councils and local mps to housebuilding, though, it can hardly be said to be against voters’ will.

Britain is rare in that the Treasury functions as both a finance ministry, keeping a close eye on spending, and an economic ministry, investing for the future. Thriftiness tends to trump investment. “[The Treasury] can add up but they can’t multiply” as Diane Coyle, an economist, puts it. It shackles big infrastructure projects, balking at upfront costs even if there are large returns later on.

The result is false economies. hs2, a £100bn project to connect London to Birmingham and then Manchester, Sheffield and Leeds, was intended mostly to add capacity to Britain’s crowded railways, not (despite the name) to speed journeys up. The government recently cut the eastern leg of the scheme to save money. That it was the most beneficial part of the scheme—the eastern leg to Leeds and Sheffield had a benefit-to-cost ratio of nearly 5.6:1, compared with 2.6:1 on the western leg between London, Birmingham and Manchester—was overlooked. Joseph Bazalgette, the Victorian responsible for London’s sewer system, is said to have argued that: “We’re only going to do this once and there’s always the unforeseen”. Now, the opposite principle applies.

Political capital is less fungible than the financial kind. When it comes to building things in Britain, there is usually no alternative scheme ready to go. If a big project is scrapped, the political capital spent on forcing through its approval cannot be instantly reallocated. The slow process of winning support at a local and national level must start anew. In the meantime, nothing is built.

And Westminster can be capricious. In 2022, after years of argument, Transport for London won permission to build 351 flats on land it owned at Cockfosters Underground station. Grant Shapps, the transport secretary, blocked the development because it removed too many car parking spaces. The Leeds Supertram Act was passed in 1993. Three decades later, Leeds possesses no tram, super or not, as a series of governments refused to fund the project. In 2016 the government rejected a proposal for a trolleybus, in part because it did not think the route would reduce inequality within the city.

Scepticism among nimbys is often justified. Post-war town planners botched city centres, bulldozing through objections. Birmingham’s Victorian centre was carved up to make way for ring roads that still throttle the city. London narrowly avoided a similar fate. New developments, such as Nine Elms, manage to be expensive while looking cheap. Outside big cities, development is often limited to boxy housing estates, which are notorious for poor building quality. A Welsh property surveyor has amassed 560,000 followers on TikTok by angrily taking viewers through snags in newbuilds. (“Check out what this absolute melt has done with this hinge,” he almost screams in one video. “That is absolutely ridiculous.”)

In Oxfordshire a group of residents have spent almost a quarter of a century fighting attempts to build a reservoir. The Environment Agency and a public inquiry sided with the residents over Thames Water. The objectors are shrewd, motivated and well-versed in water regulation. The chairman of the Group Against Reservoir Development (gard) is a retired nuclear scientist; his predecessor was a brigadier. But after a summer of drought, in which Thames Water had to implement a hosepipe ban, the victory rings a little hollow.

Efforts are being made to convert the unbelievers. New planning legislation offers residents the chance to propose their own development and, in effect, approve it themselves via street votes. The government is trying to improve design standards, hoping that beautiful buildings will attract less opposition. Those who put up with infrastructure, whether wind turbines or a reservoir, may benefit from free energy or water bills under one scheme floated by ministers.

Officials are also toying with a net-zero trump card. Projects deemed crucial to making Britain emissions neutral by 2050 would be able to ride roughshod over many obstacles. At the moment policy aimed at protecting the environment hinders projects that should help the climate. The government protects flora and fauna because voters want it; circumventing such rules can only be done in the name of the environment, runs the logic.

Building is binary, however. If something is built, those who oppose it will be unhappy; if it is scrapped they will be delighted. There is little incentive to meet halfway, or to accept a payoff. “This is not some sort of poker game where we demand huge compensation,” said Derek Stork, who chairs the reservoir-killing gard. Britain cannot build. But that is just the way voters want it.

UK Floods: What have we done to make the flooding worse?

By Camila Ruz and Jon Kelly in BBC News Magazine


Image copyrightGetty Images


Floods have caused havoc across much of the UK. Have decisions made by the public and politicians alike made things worse?

Thousands of homes are without power after Storm Frank as people brace themselves for more flooding.

Dozens of flood warnings remain in place with north-east Scotland at risk of heavy rainfall on Sunday and Monday.

Here are some of the things that it has been suggested have contributed to the problem.

Building on flood plains

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Some four million residential properties in England currently sit on places with a one in 1,000 risk of flooding each year.

After floods in 2007 that affected 55,000 homes, the government commissioned a review chaired by Sir Michael Pitt to ensure it didn't happen again. The review said it wasn't possible to prevent all building on floodplains but recommended that there should be a strong presumption against it. It also said buildings should avoid creating flood problems for themselves or their neighbours.

But large-scale building on floodplains has continued. In fact, according to the Committee on Climate Change (CCC), housing in areas where flooding is likely has grown at a rate of 1.2% per year since 2011, while the building of residential properties in areas of low risk has risen by just 0.7% over the same period.

Policy-makers are often keen to see brownfield land used for residential development, but these areas are often most vulnerable to flooding. Demand from buyers has fuelled this growth, too.

You might assume that there would be huge drops in property prices after highly publicised floods. But in places like Tewkesbury, Gloucestershire, and Cockermouth, Cumbria, which experienced heavy flooding in 2007 and 2009 respectively, prices have remained largely unaffected in the long run.

Dredging

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The argument over dredging has been going strong since floods in Somerset in 2013-14. At the time, farmers claimed that lack of river dredging had been making the problem worse. "Somerset is suffering from the impacts of two decades of underinvestment with the cessation of dredging along the lowland rivers Parrett and Tone," said the National Farmers Union in their Flooding Manifesto.

Dredging removes the silt that builds up at the bottom of rivers and deepens the channel. Some people say that it helps prevent flooding by making the water flow faster and more efficiently. Supporters of dredging have complained that the European Water Framework Directive prevents it being carried out.

But others have argued that it's not a good idea because the river can still be overwhelmed. When this happens it can cause faster and more dangerous floods downstream. "We've tended to straighten rivers, to canalise them, to embank them and all that rushes the water down to the nearby urban pinch point," explains environmentalist and writer George Monbiot, adding that the flow of water should be slowed down and the rivers lengthened instead.

River straightening

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One way of encouraging a river to take its time in getting to its destination - and therefore reduce the risk of flooding - is to allow it to make large bends called meanders or to braid itself into a network of smaller channels. These twists and turns can help prevent flash floods from racing their way down at full force.

"There still has to be somewhere for that rain to go, you are not going to be able to hold it all back in the hills," explains Monbiot.

Reconnecting a river with its flood plain can also help prevent extreme events downstream. This allows the river to flood in certain areas, storing water in fields until it can be released slowly once the danger has passed. But this has to be controlled.

"If it's not managed carefully, obviously that flooding can have a serious impact on the farming business," says Rob Howells, the NFU's Water Quality Adviser. "The protection of the urban area has to be planned in conjunction with the protection of rural areas to make sure that everything is joined up and to make sure that you are not having unintended consequences elsewhere," he adds.

Destruction of upland habitats

Image copyrightScience Photo Library

Trees can act as a natural flood defence. They have roots that reach deep into the soil, loosening it and allowing water to drain down more easily. A hillside covered in thick vegetation tends to release water more slowly than a bare hill. The compacted soil of farmland can also make the problem worse by reducing the ground's ability to hold water.

This is especially important upstream. Planting woodlands at a stream's upper reaches could help delay the water from reaching the main river. Trees can also end up providing small dams, although this needs to be managed with care.

Beavers would do this work for free, adds Monbiot. "They could be a very useful tool in preventing floods."

The Environment Agency has said that large areas of trees would need to be replanted for them to really make a difference. Flood defences on farmlands upstream might also not have had much effect in preventing the current flooding. "The levels of rainfall in the North West on already saturated ground were unprecedented," says a spokesman from the Department for the Environment, Food and Rural Affairs (Defra). "It is unlikely flood protection on farmland would have made a material difference in such an exceptional flood."

Blanket bogs also play a key role in soaking up rainfall upstream. The peaty soil of a bog can be up to 90% water. Sphagnum mosses growing there can also hold water like a sponge. But many blanket bogs have been drained and their peat cut out which can increase the risk of flooding downstream.

Some people argue that there is not much incentive for farmers to keep land covered in thick vegetation because of EU rules. Land covered with "permanent ineligible features" such as ponds, dense scrub and some woodland can be disqualified from farm subsidies.

Woodland cover has increased in the UK since its lowest point during World War One but the UK is still one of the least wooded countries in Europe. "Planting trees can help to slow the flow of rivers and has an important role to play in reducing flood risk but they need to be located carefully to make sure that they are actually being beneficial," adds Howells.

Flood defences

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Critics have focused on the effectiveness of existing barriers. Carlisle's £38m flood-defence scheme was breached despite having been constructed only five years before, with an additional half-metre (1ft 8in) added on top to allow for the effects of climate change. There was anger at the decision to lift York's Foss Barrier, a key part of the city's flood defence system, because its pumps were at risk of electrical failure.

During its first year in office, the Conservative-Liberal Democrat coalition announced it was cutting spending on flood defences by 8% compared with previous yearly spend - though the Environment Agency said at the time that the budget had actually been reduced by 27% in cash terms.

Critics have said reductions in maintenance budgets have worsened the problem. Judith Blake, the leader of Leeds City Council said there was a "north-south divide" in efforts to prevent flooding. She said the north of England had not seen "anywhere near the support that we saw going into Somerset", which flooded in 2014, and pointed out that the government had cut funding for a flood defence project in Leeds in 2011. She said there was now a "real anger growing across the North".

However, the prime minister said the government had spent more per head of the population on flood defences in the north than in the south and that £2.3bn would be spent on flood defences by 2020. The government has ordered a major review of flood prevention strategy.

A Defra spokeswoman said £1.7bn of investment into new or expanded flood defences in the previous parliament was an increase on spending from the previous administration. The spokeswoman added that a new six-year spending programme - replacing an annual bidding process for flood defence schemes - has allowed the government to make a long term commitment to protect the £171m spent each year on maintaining defences in real terms.

The concentration of Britons in urban areas - 82% live in towns and cities - has made them especially vulnerable to flooding because concrete surfaces, unlike soil, are almost completely impenetrable to water.

And even when new flood defences are built to protect homes in one area, there are complaints that they often simply cause flooding elsewhere. When the Berkshire town of Wraysbury flooded in 2014, residents said they were being used as "sacrificial lambs" to prevent Maidenhead from being flooded.
Climate change

Cameron has made a link between the floods and climate change. The government anticipates trends which have seen drier summers and wetter winters in the UK to continue. The UK Climate Projections of 2009 estimated a sea-level rise of between 13cm and 76cm for the UK by 2095.

The prime minister has said climate change is one of the biggest challenges the country faces and the government has announced plans for the UK's coal plants to be phased out within 10 years. The Environment Secretary recently announced a National Flood Resilience Review that would look again at flood risk, including the future impact of climate change.

Labour have said climate change should be treated as a national security issue and urged the government to do more. Environmental campaigners have criticisedministers for cutting support for green energy sources.

The climate change summit in Paris agreed a deal to attempt to limit the rise in global temperatures to less than 2C. However, Monbiot says "we have to take urgent action on climate change and go a lot further than the Paris agreement proposed".

Skyscrapers 'linked with impending financial crashes'

There is an "unhealthy correlation" between the building of skyscrapers and subsequent financial crashes, according to Barclays Capital.

Examples include the Empire State building, built as the Great Depression was underway, and the current world's tallest, the Burj Khalifa, built just before Dubai almost went bust.

China is currently the biggest builder of skyscrapers, the bank said.
India also has 14 skyscrapers under construction.

"Often the world's tallest buildings are simply the edifice of a broader skyscraper building boom, reflecting a widespread misallocation of capital and an impending economic correction," Barclays Capital analysts said.

The bank noted that the world's first skyscraper, the Equitable Life building in New York, was completed in 1873 and coincided with a five-year recession. It was demolished in 1912.

Other examples include Chicago's Willis Tower (which was formerly known as the Sears Tower) in 1974, just as there was an oil shock and the US dollar's peg to gold was abandoned.

And Malaysia's Petronas Towers in 1997, which coincided with the Asian financial crisis.

The findings might be a concern for Londoners, who are currently seeing the construction of what will be Western Europe's tallest building, the Shard.

That will be 1,017ft (310m) tall on completion.

China bubble?

Investors should be most concerned about China, which is currently building 53% of all the tall buildings in the world, the bank said.

A lending boom following the global financial crisis in 2008 pushed prices higher in the world's second largest economy.

In a separate report, JPMorgan Chase said that the Chinese property market could drop by as much as 20% in value in the country's major cities within the next 12 to 18 months.

In India, billionaire Mukesh Ambani built his own skyscraper in Mumbai - a 27-storey residence believed to be the world's most expensive home.

Local newspapers said the house required 600 members of staff to maintain it. Reports suggest the residence is worth more than $1bn (£630m).

"Today India has only two of the world's 276 skyscrapers over 240m in height, yet over the next five years it intends to complete 14 new skyscrapers," according to Barclays Capital.

Barclays Capital's Skyscraper Index has been published every year since 1999.