Reuters Government critics argue the NAO findings should act as a 'wake-up call' for ministers

The planning system for housing is "not working well" casting doubt on the government's goal for 300,000 new homes a year by the mid-2020s, a watchdog has found.

A series of concerns have been raised by the National Audit Office (NAO), including the "flawed" method used to assess the number of homes needed.

It also found the system used to get developers to contribute to infrastructure costs is not working properly, with the amount of cash being stumped up falling despite soaring house prices and increased profits.

Getty The NAO report said: "The government's planning system is under-performing and cannot demonstrate that it is meeting housing demand effectively.

"Given these problems, we cannot conclude that the planning system currently provides value for money in terms of delivering new homes effectively."

Despite the Government's plans for 300,000 new homes a year by the middle of the next decade, the NAO noted that on average only 177,000 had been built annually between 2005-2018 and the number has never exceeded 224,000.

a person riding a horse in front of a brick building: Governments 'of all stripes' have built too few homes in recent decades , say ministers Reuters Governments 'of all stripes' have built too few homes in recent decades , say ministers The watchdog found that a government change to the way local authorities assess the number of new homes required in their areas had "weaknesses" and is to be revised.

This method reduced the need for new homes in five out of nine regions, which was warned could hamper local authorities' regeneration plans.

The NAO pointed out that by last December, only 44% of local authorities had an up-to-date blueprint for meeting future housing needs, despite it being a legal requirement.

Getty The organisation also underlined the importance of infrastructure such as transport, healthcare, schools and utilities, to support new homes.

But it said: "The systems to get developers to contribute to infrastructure costs are not working effectively, with developers successfully renegotiating initially agreed contributions on the basis they will be unable to maintain profit margins.

"Contributions agreed with developers slightly decreased between 2011-12 and 2016-17, despite house prices in England increasing by 31% and profit margins of top developers increasing."

a man sitting at a table: NAO chief Sir Amyas Morse says the government needs to take the issue much more seriously PA NAO chief Sir Amyas Morse says the government needs to take the issue much more seriously Criticism was also levelled at the Planning Inspectorate over the time taken to hear appeals.

Spending by local authorities on planning fell by 15% between 2010-11 to 2017-18, the report noted.

NAO chief Sir Amyas Morse said: "For many years, the supply of new homes has failed to meet demand.

"From the flawed method for assessing the number of homes required, to the failure to ensure developers contribute fairly for infrastructure, it is clear the planning system is not working well.

"The government needs to take this much more seriously and ensure its new planning policies bring about the change that is needed."

Housing minister Kit Malthouse Getty Housing minister Kit Malthouse Housing minister Kit Malthouse said: "I recognise the challenges identified by the NAO, and the simple truth is over the last three decades, governments of all stripes have built too few homes of all types."

But he pointed out more than 222,000 homes were built in 2017-18, the highest level in all but one of the last 31 years.

A spokesman for the Local Government Association (LGA) said: "Councils are committed to ensuring homes are built where they are needed, are affordable, of high-quality and supported by adequate infrastructure and services, but it is vital that they have an oversight of local developments."

Labour's shadow housing secretary John Healey said the NAO report should be "a wake-up call" for ministers.

 

He said: "It shows that deep cuts and poor planning changes are stopping us building the homes the country needs."