Article by JAMES FORSYTH and originally published on The Times Online.
Before Covid shut down politics, Boris Johnson was determined to push through planning reform and create more homes — and more homeowners. There was to be a particular focus on getting more homes built where property was least affordable. In other words, the southeast. Now that aim has been abandoned.
The Tory conference was bookended by reassurances to the party faithful that the government has given up on this idea. The new party chairman Oliver Dowden communicated the message as he opened the conference on Sunday and Johnson rammed it home as he closed it on Wednesday.
It is a quite spectacular volte-face. Back in the spring, Johnson was privately lambasting “not in my backyard” Tory backbenchers. Couldn’t they see, he fumed, that their very survival depends on more people owning homes? Surely it’s obvious that the Tory party’s survival is at stake?
Now he is doing everything he can to assuage southern Tory voters that their views will not be “desecrated by ugly new homes”. In one of those Johnsonian contradictions, he did so while extolling the joys of home ownership. A joy which, without the new houses, will be strictly rationed for those in the southeast.
This is the after-effect of the Chesham & Amersham by-election, in which the Liberal Democrats attacked the planning reforms relentlessly and took the seat from the Tories on a 25 per cent swing. Other Tory MPs looked on in horror, thinking: we’ll be next for the chop.
There were easily enough Tory rebels to force ministers to dilute their original proposals for cutting councils out of some planning decisions. In a precursor to this week’s shift, the cabinet reshuffle saw the pro-reform Robert Jenrick sacked. He’s been replaced by Michael Gove, a Surrey MP and therefore very aware of how disgruntled some part of the Tory base had become. (The May elections saw the Tory majority on Surrey county council slashed from 40 to 12.)
The Tories will pay little electoral price for this U-turn. Indeed, at the next general election they will probably benefit from it. The “blue wall” will be a bit more secure if the Tories’ opponents can’t use planning to chip away at it. Johnson has no desire to court unpopularity. One cabinet minister jokes that the prime minister “counts out his opinion poll lead every morning like a miser”.
In a sign of how Chesham & Amersham spooked the Tories, they are now going out of their way to explain how “levelling up” will benefit the south. If more northerners are in good jobs and paying lots of tax, runs the argument, southern taxpayers won’t have to take up such a large part of burden. And fewer northerners will come south looking for work. A few senior Tories have come perilously close to suggesting that southerners should be in favour of levelling up as it will keep northerners in the north.
Planning was one problem too many. There are, after all, a slew of others with no easy fix. Ministers are anxiously poring over long-range weather forecasts trying to work out if La Nina will hit this year, causing a cold snap here that might further exacerbate the gas crisis. Some factories may have to down tools if energy prices make production unprofitable. The effect on the UK, which is largely a services economy, would not be as bad as in countries with more manufacturing. But it would still hit an already weakening recovery.
Then, there is inflation. Johnson has been dismissive but other members of the cabinet are increasingly worried. One secretary of state predicts it will be at 6 per cent by the end of the year, three times the Bank of England’s target. In these circumstances one can see why the government has been so inclined to drop a policy that could have harmed them at the polls in 2023 or 2024.
But it is still a mistake. The capricious and unpredictable planning system is a significant constraint on economic growth. With money too tight for tax cuts, planning reform would have given a free stimulus to the economy. The government may now blanche at the idea of developing the south, but such development is needed no matter how well “levelling up” goes.
Of the best dozen universities in the world, three are in the golden triangle of London, Oxford and Cambridge. The government is set to increase research funding and economic output around Oxford and Cambridge could double between now and 2050 to over £200 billion. But this won’t happen unless the necessary infrastructure is in place. House prices in Cambridge are 16 times the average salary — up from four and a half times in 1997. It is hard to believe there won’t have to be significantly more development in rural Cambridgeshire.
This is particularly the case given the government’s dismissal of remote working. Johnson is right to think that office time is key to young people’s professional development, but he must accept that they will need to live near their work.
In political terms, the Tories’ new approach is a mistake too. It might not hurt them at the next election, or even the one after that. But ultimately the Tories are the party of the property-owning democracy, and live and die by this. Just look at what has happened in London. When Margaret Thatcher left office, home ownership for households headed by a 35 to 44-year-old in the capital was over two-thirds, and the Tories held two-thirds of the seats. Now, less than half of that age group owns a home and the Tories have only just over a quarter of the seats.
Owning a home is one of the things that makes people more likely to vote Tory. It is no coincidence that home ownership in the “red wall” seats is above the national average. If the age of the first-time buyer continues to rise that will exacerbate the Tories’ demographic problems. And if house prices in the southeast rise ever higher, pushing home ownership further beyond the reach of more and more people, the popularity of a mansion tax will only grow. If you have no hope of living in a mansion, why shouldn’t you want them taxed till the floorboards squeak?
By abandoning any serious attempt to significantly increase the number of homes being built in the southeast the Tories are alienating their future electorate for an easier time with their current voters. It is the ultimate in political short termism.