Housing and Planning

Privatise Land-Use Planning, Says IEA Author

Britain’s system of land-use planning is fundamentally misguided’, says Dr Mark Pennington of Queen Mary College, University of London in a new IEA paper.* It needs radical reform so that market forces play a much bigger role.

According to Dr Pennington, the British system is ‘…one of the most comprehensive systems of government land-use regulation anywhere in the industrialised world.’ (p24). Moreover, regulation has become tighter, partly because of the environmental agenda, so that ‘…the ownership and use of land in the United Kingdom is subject to a greater array of statutory controls than at any time since the introduction of the 1947 Town and Country Planning Act.’ (p22).

This regulatory regime suffers from over-centralisation, absence of experimentation, lack of information and inappropriate incentives – in other words, the problems which always and everywhere have been associated with centralised planning. It also redistributes wealth to the middle class, who know how to work the system, from the poor.

Decentralisation of planning powers to local authorities might help, as might the auctioning of development rights, but more fundamental reform is required.

Development rights should be denationalised, leading to a private system of land-use control. Private covenants and deed restrictions could be used to preserve open spaces, to avoid nuisances and to maintain scenic views. The establishment of proprietary communities would allow the state to divest itself of development rights, which would be held instead by ‘recreation and amenity companies’ holding development rights collectively for the local community. Profits from development would be shared by the community, thus decreasing ‘nimbyist’ opposition to development proposals.

Read the paper here.