Public-private initiatives will work best with market distortions removed

Architects’ Journal May 2002 Practical planning advice # 67 by Brian Waters

Attempts at deregulation are most likely to be effective when they deal with the underlying problems rather than their symptoms. As an antidote to the highly regulated planning system the Planning Green Paper proposes to introduce the BPZ (Business Planning Zone). The idea is to allow local authorities to create a zone where no planning consent will be necessary provided that the building accords with tightly defined parameters. This is the norm for American run-of-the mill development. Whilst superficially attractive, in particular for the presently-fashionable knowledge-based industries, it is unclear how this idea will add to the unsuccessful existing statutory arrangements for Simplified Planning Zones. Unlike the very successful Enterprise Zones which launched the London Docklands at a time of recession, neither of these comes with any fiscal incentives and so they look unlikely either to proceed or to succeed. There is a greater prospect of success for BIDs (Business Improvement Districts).
The model is American and the pressure and the initiative for them comes from commerce. The Government response is last December’s local government White Paper (Strong Local Leadership – Quality Public Services Cm 5237). The aim of a BID is to provide business funding for improvements to the public realm: such things as extra policing, CCTV cameras, street furniture and enhancement of the public realm both physically and in its management. In London six such schemes are already in the pipeline. Under the Government’s proposals, businesses in an area to be covered by a BID would vote on whether or not it should be introduced.
The rules for the vote will be covered by legislation but most other aspects are to be settled between local authorities and the local businesses affected. They may even extend their scope to the provision of local training and employment schemes or to funding a better rural bus service.
A BID may focus on a very small area such as a high street or might cover a whole district council. In an obvious way the British BID is a response to the nationalisation of the local business rate and the removal from local business of any local democratic influence. This contrasts greatly with the way in which business in America influences, funds and identifies with local community needs.
The British version might be billed as a Ôpublic-private partnership initiativeÕ but in reality it is being facilitated by a government which sees it as a vehicle for voluntary additional taxation. It would be much enhanced if a proportion of the local business rate for the area were to be returned to the BID and if the local businesses involved were to be given a vote alongside council tax payers. In this away a BID would retrace some of the retrograde steps taken by governments in their imperative to centralise controls and would as a result be more widely supported and so provide even more resources for the public realm. The need to address the cause rather than the symptom has a parallel in housing.
Many architects today find themselves and their clients struggling inordinately with processes relating to affordable housing as they affect individual planning applications. The present ever-shifting basis of policy, the inconsistency of its application by different authorities and the national shortage of housing corporation funds to allow registered social landlords to hold up their end of any deal and pay for the construction of the subsidised housing are all causing uncertainty from conception to brief to viability of many housing and mixed-use schemes.
The Green PaperÕs proposals for tariff payments which will extend the burden of affordable housing contributions to commercial developments will make these complexities even more pervasive. It is not surprising then that last year, a year of boom in the housing market, the construction of the smallest number of new homes since 1924 was achieved. The constraints of the planning system are of course part of the story, but the way in which the planning system is now distorting the housing market is equally significant in inhibiting supply.
Bernard Hunt of HTA Architects and chairman of the RIBA Housing Group has often suggested that the seed of the problem is the attempt to subsidise the houses rather than the people who need them. Interestingly in Spain, where home ownership is enjoyed by an even higher proportion of the population that it is in the UK, they do what he implies. If a family needs assistance they are provided with a subsidised mortgage so as to make the property they need affordable for them. Conditions attaching to the loan result in some of the subsidy being reimbursed when the property is eventually sold at a profit.
As a result families in need can afford a home where they need it, they get onto the housing ÔladderÕ, the subsidy by the taxpayer is often returned and recycled and, above all, the market which provides the homes is not distorted or the subject of social engineering. Is this really too simple an approach for us to adopt? Housebuilders could then get on with the job of building new homes and we architects the job of designing them.

Brian Waters is principal of The Boisot Waters Cohen Partnership, brian@bwcp.co.uk/ www.bwcp.co.uk