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Planning-gain Supplement (Preparations) Bill

My Lords, I am grateful to all noble Lords who have spoken in the debate. I was a little surprised that the noble Lord, Lord Stewartby, was reluctant to take his position as number two in the batting order, after he and I opened the batting for the parliamentary side in Australasia on several occasions. I welcomed the chance of a fresh partnership today. He spoke, as we would expect, with his usual force. The noble Lord conceded the important point that an intellectual case could be made for PGS. We seek to make more than an intellectual case; he asked us to. He said that the issue is its practicalities. That is why this is a paving Bill, and why we need the resources and opportunity to set up systems and investigations which give us real insight into the complex, challenging issues involved. We do not intend to introduce any legislation before 2009 because we recognise how much work is to be done. In the mean time, this paving Bill provides for what ought to be done: a structure enabling us to be effective if there is a parliamentary decision that the planning supplement should go forward. That is the basis of this planning Bill. I was asked about the nature of the Bill in the more distant future. I cannot go into much detail about that for obvious reasons: we are at a preparatory stage. I give the House my, and the department’s, working assumption that the Bill that will eventually emerge, if we decide to go ahead, will not be a money Bill, with the restrictions that that would impose, but open to both Houses for full scrutiny. I give reassurance on that. I cannot go into greater detail; I am sure that the House will recognise how limited I am in talking about such a distant prospect. The noble Lord, Lord Stewartby, opened the debate with a criticism of the Government. He spoke of the great danger if we get things wrong, that there would be a disincentive to sell land rather than encouraging it to become available. We all know the current demands upon land availability. The noble Baroness, Lady Miller, expressed particular concerns about small rural communities; I shall come on to that in a moment. She was merely identifying one dimension of the development issue. We bear the law of unintended consequences in mind. Given the history of development tax and issues of this kind, surely what is being enjoined upon the Government today—to take care, to make preparations, to consult widely and to look at all the dimensions of the issue to ensure delivery of successful policy—is exactly our reason for having this paving Bill. If we were not mindful of those considerations, were not responsive to those needs, were unimpressed by history and did not recognise the challenge before us, we would not have a paving Bill at this stage. That is its raison d’être. There was a broad base of criticism, first articulated by the noble Lord, Lord Stewartby, but it ran through several other contributions, although other noble Lords accepted the principle that development should produce some advantage to the public good. The noble Lord, Lord Newby, to be fair to him, said that he started out accepting that principle and that he disagreed with us about the strategy for realising it. I recognise those points. At least we have a consensus in the House that it is desirable that progress be made broadly in these terms but that it is a difficult target to hit. That is why we have this Bill. I reassure the noble Lord, Lord Stewartby, that the planning gain supplement is only part of a package of reforms designed to increase the supply of land brought forward. We do not regard it as the engine of development. Our recent planning policy statement identified a range of ways in which we expect to see land availability increase. The noble Baroness, Lady Miller, concentrated particularly on affordable housing in rural areas. I emphasise that the document to which I have just referred keeps rural exceptions for affordable housing. I recognise what the noble Baroness says: it is one of the critical features of village and rural life and we would not be making effective progress on planning if we did not recognise that feature, to which many noble Lords will attest. The noble Lord, Lord Newby, suggests that history is against us because there have been difficulties. He quoted a list of critics. It would be very odd if the Government did not come along with a list of supporters, too. As the noble Lord listed four or five critics, I will list four or five supporters. I list others, but I do not wish to detain the House further. Paul Bevan, the chief executive of the South East England Regional Assembly, indicated the Assembly’s support in principle for these proposals. The Town and Country Planning Association and English Partnerships also support them. I could go on to list others. That is not gainsaying that several of the institutions mentioned by the noble Lord, Lord Newby, and the noble Baroness, Lady Hanham, as being critical of the measure are to be taken seriously. That is why we are involved in this long-drawn-out consultation and why we intend to proceed with care. The noble Lord, Lord Newby, reiterated the usual issues. Valuation is a difficult exercise; it is an art not a science, and the issue is much disputed. This Bill will not introduce valuations; they go on all the time. This difficult art form is practised very widely by many wholly professional organisations and individuals—and some less professional ones, we can also attest, on occasions. Of course valuation is an important part of the Bill but it is not credible to say that we ought not to make progress because of the extreme difficulty of effective valuation. The noble Lord placed great emphasis on the present Section 106 and that strategy for realising value and assets from development. The noble Baroness, Lady Hanham, also emphasised the point. We should all recognise the limitations of Section 106. If it were a panacea, there would not be widespread concern—even dismay—at the very limited realisation to the public advantage of a great deal of development. I respect what both of them say about the virtues of Section 106 but I do not agree with them that all is going swimmingly at present. That is not the point of view of this Government or a wide section of this country that thinks that, with rising land values there is a proper public concern, because many such values reflect public investment. We have many illustrations, but the one that is oft quoted and which stands up to public scrutiny is the fact that there is no doubt that the growth in land values along the whole extension of the Jubilee Line is not incidental or accidental because it follows that substantial investment in public transport. We all know the vast costs of that extension and the attendant land values that resulted. It is not the sole factor; other beneficial developments—I almost introduced the Dome at that point, but I do not wish to be too controversial—have enhanced these areas, providing facilities that have no doubt increased land values, but a critical factor is transport and the Jubilee Line. Both noble Lords speaking from the opposition Front Benches placed much emphasis on the present Section 106 structures. We do not accept that as the basis on which we should go forward. The noble Baroness, Lady Hanham, was concerned at the costs incurred by this paving Bill. We acknowledge that it incurred costs. The basis of our argument is quite straightforward: if as a Government we are convinced, and are able to convince Parliament, of the value of the process that will potentially be introduced in 2009, we would be criticised if we did not engage in substantial preparation for that time, because past failures have been the result of inadequate preparation and support systems. Success in this difficult area will be achieved only if there is an infrastructure to the legislation that guarantees its works. That is why we will need IT systems and to spend money to guarantee that any such Bill has an infrastructure to make it work. It is the whole rationale behind this paving Bill.