Planning reform ‘at the very centre’ of Labour economic vision, says Reeves

A Labour government would put planning reform “at the very centre” of its economic policy, the shadow chancellor has announced. 

In a major speech to business leaders yesterday (Tuesday), Rachel Reeves set out the three pillars of an economic strategy which she said would usher in “a new chapter in Britain’s economic history”. 

Delivering the annual Mais Lecture in the City of London, Reeves said the UK was standing at an “inflection point” as it had at the end of the 1970s. 

She described how her vision for growth would be underpinned by the three pillars of “stability”, achieved through monetary policy and financial regulation, “investment”, largely into infrastructure and the green economy, and “reform” of planning and the labour market. 

Reeves described the planning system as “the single greatest obstacle to our economic success”, making land “costly and inefficiently utilised” and raising the cost of building infrastructure. 

“And it prevents housing from being built where it is most needed – contributing to ever-higher prices and falling rates of home ownership and constricting the growth of our most productive places,” she continued.  

She said that planning reform had “become a byword for political timidity in the face of vested interests and a graveyard of economic ambition” but said it was “time to put an end to prevarication and political short-termism on this question”.

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“There is no other choice. This Labour Party will put planning reform at the very centre of our economic and our political argument,” she added. 

Reeves promised a Labour government would deliver a “once-in-a-generation” overhaul of the nationally significant infrastructure regime, updating all National Policy Statements within six months of coming into office. 

She also re-iterated Labour’s plans to reintroduce mandatary local housing targets, recruit hundreds of new planners to tackle backlogs, and bring forward a new generation of New Towns. 

Regarding the second pillar, Reeves described the “stop-go cycle of capital investment” as the “new ‘British disease’,” an allusion to the term used to describe the low rates of capital investment and labour productivity experienced by the UK in the 1970s.

“Short-term instability inhibits investment and drives up infrastructure costs, resulting in fewer, and smaller, new capital projects,” she said. 

She said a Labour government would create a new British Infrastructure Council, which she has already established in shadow form with representatives of large UK and global investment funds.