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Two penn'orth invited: the London emergency housing measures consultations

Two penn'orth invited: the London emergency housing measures consultations

Jennie Baker 28 Nov 2025
The Government is running a two-part consultation on measures designed to support housing delivery in London:
  1. the design and administration of a proposed time-limited or ‘emergency’ relief from Borough Community Infrastructure Levy (CIL) for certain developments in Greater London, which deliver a minimum level of affordable housing; and
     
  2. extending the London Mayor’s development management call-in powers by
    1. adding applications for development of over 1,000 sqm, within Green Belt or Metropolitan Open Land, to applications of potential strategic importance (PSI); and
       
    2. creating a new application of potential strategic importance category, for development of 50 or more homes where boroughs are minded to refuse.
These would be legislative changes.
Simultaneously, the Mayor of London is consulting on draft ‘Support for Housebuilding’ London Plan Guidance, which proposes to comprise:
  1. Time-limited changes to cycle parking requirements
  2. Withdrawal of some housing design guidance
  3.  A ‘time-limited planning route’ for the delivery of affordable housing
These would be policy changes.
Both consultations close on 22nd January 2026.
The GLA has also published updated Accelerated Funding Guidance[1].
The consultations follow the Government’s 23rd October 2025 ‘Support for housebuilding in London’ policy paper and Housing Delivery Written Ministerial Statement, which were trailers for these consultations. That joint Government and Mayoral announcement was analysed by Amy Jones and Ben Kelway in our Emergency measures to unlock housebuilding in The Capital blog, where they also explained the rationale for the (then) proposals. The proposals are essentially unchanged, so the context for the proposals, as trailed, and our analysis of them remain relevant. The Government and the Mayor have detailed their reasoning behind the proposed package of support measures for housebuilding, particularly in the Mayor’s Background Information for London Plan Guidance, which are not set out or scrutinised here.
While the proposals are badged as emergency measures they have been much trailed and are still not expected soon, with the CIL Regulations, which are a key part of these proposals simply due in the “first part of 2026”.
This blog focuses on the proposed legislative changes to CIL in London and on the new time limited planning route, aiming to draw together the various pre-requisites for CIL relief and to summarise the other wide-ranging proposals, which are spread across 74 pages of consultations and a background information note.
The Government invites comment and alternative approaches on most if not all elements of the consultation, but for simplicity, I have assumed all elements of the revised regulations as proposed will emerge as currently intended.
 
The time-limited planning route for affordable housing delivery  – part of the Mayor’s consultation
Currently, the London Plan has a Threshold Approach to establishing which route a planning application for major residential development takes for viability assessment. The fast track route (no viability assessment at application stage) and viability tested route would continue to apply (see policy H5[2]), with a ‘time limited planning route’ introduced to operate in parallel. The time-limited planning route would allow certain residential development applications to not include an upfront viability assessment. Schemes eligible for the time limited planning route would be eligible for grant funding (excluding the first 10% of homes).
This new, temporary route would be relevant to CIL relief, because a pre-requisite of CIL relief is that developers have sought, where eligible, grant funding “to maintain or increase affordable housing in existing s106 agreements where needed, via the time-limited planning route being consulted on by the Mayor of London”.
 
Eligibility for the time-limited planning route
The draft LPG says that to be eligible for the time-limited planning route “Residential developments must meet or exceed the following time limited adjusted affordable housing thresholds”:
 

Nature of site

Affordable housing by habitable room

Private land

20%

Public land

35%

Industrial land where industrial floorspace capacity has not been re-provided

35%

Industrial land where industrial floorspace capacity has been re-provided

20%

Utilities sites where evidence of substantial decontamination, enabling and remediation costs is provided

20%
The affordable housing must consist of 60% social rent and 40% intermediate tenure. Build to Rent schemes can provide at least 30 per cent at or below London Living Rent levels or Key Worker Living Rent and 70% genuinely affordable rent.
Sites on or released from Green Belt (including grey belt sites), estate regeneration schemes and other schemes demolishing affordable housing, Purpose Built Student Accommodation (PBSA) or Co-living schemes comprising more than 50% or more of the total scheme’s residential floorspace would not be eligible for the time limited route. PBSA and Co-living schemes comprising less than 50% of a residential scheme will be eligible only if they meet PBSA and Co-living thresholds and requirements[3].
For outline planning proposals the gross external area (GEA) of the PBSA and/or Co-living shown on the parameter plan will be used to assess whether these elements are 50% of the residential part of the scheme or not..
The time-limited planning route will end on the earlier of 31st March 2028 or the publication of the revised London Plan; planning applications on this route will need to have been approved – i.e. the decision notice issued - by the deadline. The consultation says that LPAs should consider granting permissions that would expire in less than three years, to encourage delivery.
As announced in October, if eligible housing schemes progress to completion of their first floor level by the end of March 2030, the requirements for a late stage review will be waived. For larger housing schemes 200 units must have been built by that date, unless it is demonstrated that the delay was caused by the Building Safety Regulator.
A gain-share review mechanism will be applicable where construction on the scheme has not reached that point by 31 March 2030. If this is triggered, it would allow for a review of scheme viability to determine whether any additional affordable housing can be provided if viability improves.
 
Borough CIL relief – part of the Government’s consultation
The Government’s intention is “to make qualifying residential development viable and so be built-out, which would not otherwise occur but for the relief”. Emergency relief from Mayoral CIL is not proposed.
Changes to the CIL legislation would be introduced by the agreement of both Houses of Parliament (as is the case for CIL and the Fee Regulations), in 2026. Therefore, change is not imminent – the Government is aiming for as soon as possible in the first half of 2026.
 
The proposed level of relief
The starting point is that at least 20% of the housing proposed should be affordable housing, which reflects the proposed time-limited planning route. The Government proposes that where 20% affordable housing is to be delivered and all other qualifying criteria are met, LPAs must grant CIL relief of 50 per cent.
The Government also proposes higher relief where additional affordable housing is delivered over and above 20 per cent, rising “linearly up to 80 per cent relief for 35 per cent affordable housing delivery”. See Figure 1

     
 
Borough CIL relief criteria
  
     
     
 
To obtain Borough CIL relief all of the following criteria must be met:
  • The development is for residential development other than student and co-living accommodation

  • The site is not on “excluded land”, i.e. Green Belt, Metropolitan Open Land (MOL) or land which is a park, recreation ground, allotment, golf course or other locally designated open space, so that the emergency relief is targeted “predominantly” on previously developed land (the consultation does not mention sites that comprise some excluded land)

  • Borough CIL liability exceeds £500,000 for the whole development within the red line boundary, after relief - i.e. the Borough CIL liability of an unphased planning permission or the sum of any phases within a phased permission must amount to more than £500,000 after any permanently available relief has been taken into account

  • The section 106 agreement secures at least 20 per cent affordable housing measured by habitable room, with a minimum of 60 per cent Social Rent

  • Applicants with unimplemented planning permissions will be expected, where eligible, to seek grant to maintain or increase affordable housing in existing s106 agreements where needed, via the time-limited planning route being consulted on by the Mayor of London. The new emergency CIL relief should then be applied for which would reflect the level of affordable housing set out in the s106 agreement

  • Emergency CIL relief application fee of £25,000 to be paid

  • Applicant to give GLA consent to share information on the project which was used to determine the grant provision with the LPA considering the CIL relief request

  • The financial impact that paying CIL in full would have on the viability of the development must be evidenced – this is not open book, rather a summary appraisal of a residual valuation of the proposed scheme. Borough CIL would be reduced based on the amount of relief being applied for. What the summary should include, and the appraisal process that would follow, is described in the consultation

  • If the appraisal demonstrates that granting the CIL relief would make the development viable, and is accompanied by a statutory declaration (and/or other required statement/information under the CIL regs), relief should be granted by the LPA

  • Developer is to make a statutory declaration that the information underpinning the valuation is a true and fair assessment of the proposed development’s viability[4]

  • The chargeable development - each phase for a phased permission, the permission for unphased permissions - must commence after the relief is in place and before the end of 2028. For phased development this criterion applies on phase basis, so some phases of a development might not be eligible, as they have already commenced, while others would be eligible
  
     
 
Regarding the last criterion above, the Government says:
“To support this, additional limits may be introduced to ensure the targeted and time-limited nature of the emergency relief cannot be undermined through certain forms of structuring and phasing, particularly where related to part outline or fully outline applications. These limits would be designed to provide a sufficient level of protection against boundary-pushing”.
The emergency CIL Relief will be granted on the residual amount once other reliefs (e.g. social housing relief) are taken into account.
 
Clawback
The Government proposes “clawback provisions tied to:
  1. build-out, so a scheme could not benefit from relief by doing nothing more than nominally commencing; and
  2. affordable homes, so a scheme cannot qualify for a level of relief based on delivering an amount of affordable housing which is subsequently reduced”.
Unintended consequences and potential omissions
As is often the case, the questions posed in the consultation identify where the Government has concerns about unforeseen circumstances or potential failure to meet policy intent.
For example, question 6 asks whether the application and level of the proposed borough-level CIL liability threshold, would have, among other things, significant negative implications for SME builders.
And question 7 asks whether applying the threshold to a development as a whole would present challenges for phased developments where each phase is a separate chargeable development for CIL purposes and whether a lower threshold should apply for phased developments.

 

Proposed changes to the Mayor’s call in powers – part of the Government’s consultation
The consultation proposes these changes to the Mayor’s powers:
  1. a new PSI category (PSI being applications for planning permission of potential strategic importance for London) and streamlined procedure for residential development of 50 or more homes if the development is not included in other PSI categories, where the Mayor will have the power to call in the application if the local planning authority is minded to refuse development; and
     
  2. a new power for the Mayor to call in applications for development of a building of more than 1,000 square metres on Green Belt or Metropolitan Open Land.
The Mayor does not want the 50+ home schemes to be subject to the Stage 1 referral process, which is why PSI category 1A, for 150 homes plus, is not being extended. Instead, a new referral category is proposed to be introduced.
The Mayor would be notified that the LPA has a 50+ home application, but does not have a duty to respond, so no Stage 1 referral process.
If the LPA is minded to approve, there is no further action.
If the LPA intends to refuse the application, a modified version of the Stage 2 referral process is proposed as  follows:
  1. The LPA provides the Mayor with the reasons for refusal, representations received and a copy of the officer report, including details of proposed conditions and obligations if the application had been recommended for approval by Members; and
     
  2. Mayor has 21 days from receipt of the above to decide whether to call in or not. The Mayor must only call-in if the Mayor considers that the development (or any of the issues raised by it) would have an impact on the implementation of the spatial development strategy (the London Plan); and there are sound planning reasons for the intervention
The consultation says that, since 2021, 207 more applications would have been PSI applications under the proposed 50 homes category, of which 33 were refused and 19 were appealed, “some of which” were upheld.
Landstack data indicates that, in the year to October 2025, 30 additional applications would have been capable of call-in, but only if the LPA had been minded to refuse them and only if they met the tests at 2. above.
The Mayor only intervenes in a very small proportion of applications, and it remains to be seen whether alongside these expanded powers the Mayor would become more interventionist - and whether the justification would exist should he want to be.
 
‘Support for Housebuilding’ London Plan Guidance – part of the Mayor’s consultation
The Mayor of London is consulting on draft ‘Support for Housebuilding’ London Plan Guidance[5], which proposes:
  1. Time-limited changes to cycle parking requirements
     
  2. Withdrawal of some housing design guidance
     
  3.  A ‘time-limited planning route’ for the delivery of affordable housing (addressed earlier in this blog)
 
Temporary cycle parking standards
The short term changes to long-stay cycle parking standards are set out at section 2 of the draft guidance. The Background Information to the draft LPG is discusses the context for change and provides the existing standards, which will be reverted to. In essence, the draft standards place each LPA in a cycle standards band and provide guidance on the required provision of long-stay cycle parking per bedroom within each band. Guidance on the quality of cycle parking is also provided. The temporary guidance on cycle parking applies until the earlier of 31 March 2028 or the publication of the revised London Plan.
Withdrawal of housing design standards
Three housing design standards set out in the Housing Design Standards London Plan Guidance 2023 are proposed to be permanently withdrawn:
  1. The standard requiring that new homes be dual aspect unless exceptional circumstances make it impractical or undesirable;
     
  2. The standard required that the number of homes accessed by a core should not exceed eight per floor; and
     
  3. A standard that repeats the cycle parking requirements in the London Plan
Commentary
The commitment by the new Secretary of State - made in October just 6 weeks from his appointment - to a set of unprecedented and considered interventions remains good news. It has already been discussed in detail and soft tested with stakeholders.
My colleagues’ observations regarding whether the proposals will have the desired effect and how the Government could go further remain largely valid now that we know the detail. In particular:
“The elephant in the room is clearly the challenge of demand and the fact that a factor undermining viability of many schemes is the challenge of selling units in the market since the end of Help to Buy and with no alternative Government support for first time buyers. Absent that demand-side support, it must remain doubtful that the Government’s proposals are sufficient to bring housing delivery back to previous levels, let alone the more ambitious targets for which the next London Plan must aim”.
The need to amend the Housing Standards LPG reflect highly detailed, non-strategic policy and guidance that the Mayor issues. October’s policy note and trailer for these consultations made welcome reference to the significant policy layering in London. It said that the Mayor “is clear” that, in the next London Plan, “there should be a streamlining of requirements on developers and a reduction in the layering of policy across the London Plan and borough-level local plans” – reflecting the approach anticipated in the forthcoming national decision making policies, to be consulted at the end of 2025 and into 2026.
The very welcome proposed CIL relief appears to be a potentially onerous process – reflected in the high assessment fee - and applicable to only a limited number of major residential schemes. The £25,000 CIL relief application fee will be made to local planning authorities which are likely to scrutinise compliance with regulations and guidance, as they will not wish to part with anticipated CIL funding easily. They will be dealing with Regulations, so in theory there wouldn’t be grey areas, but the need for sworn statements and use of the time limited route for affordable housing viability assessment adds an instant greyness. 
LPA CIL teams have busy and complex caseloads in the same way that development management officers do, so the fee may not be able to fund an officer, in the same way that pre-application requests and PPAs are not always easy to resource. 
In October’s Written Ministerial Statement regarding these proposals, the Government said it intends to clarify the use of Section 73 applications so they can no longer be used to reconsider a scheme’s viability or planning obligations, which will be done through an update to Planning Practice Guidance “in due course” and through national decision making policies, which are due to be consulted on by the end of the year. This seems to me  another potential opportunity blocked as another one opens. 

However, the pro-growth message from Government remains clear, and a some potential stumbling blocks should not and are unlikely to dissuade the residential development sector from engaging with these significant proposed changes. As mentioned above, the Government is seeking input and potential alternatives on most elements of the proposals. Consultation responses that encourage the amendments scrutinise consequences and recommend where the Mayor and Government could go further should be advanced, to help ensure a significant increase in market and affordable housing delivery across London.

 

 
 
Footnotes

 

[1] Accelerated Funding Guidance

[2]  The consultation notes “The new time-limited planning route is a departure from Policy H4 Part A, Policy H5 and Policy H6 of the London Plan and has been introduced as an emergency measure to help address the current significant downturn in housing delivery in London”

[3] Policies H15 and H16 of the London Plan

[4] The Government is also considering “whether the CIL Regs should be amended to require specified, key information relating to viability as described above to form part of the application for relief. Requirements to provide information under the CIL Regs are already subject to the enforcement mechanism set out in CIL regulation 110”

[5] Draft Support for Housebuilding LPG

 

 

 

CONTINUE READING

The end of the line for the Duty and the future of local plan making are both nigh

Edward Clarke & Sean Farrissey 28 Nov 2025
The Government has confirmed that it will shortly lay the regulations for the new plan making system alongside updated guidance on creating a local plan under the new system. Additionally, a Written Ministerial Statement has been issued to remove the duty to cooperate.
 
 
Duty to cooperate will not be saved
The 'Reforming Local Plan-Making' Written Ministerial Statement (WMS)[1] published 27th November states the anticipated Regulations for the new plan-making system “will ‘save’ the current plan-making system for a period to allow emerging plans to progress to examination by 31 December 2026”.
However, the Government has "decided not to ‘save’ the Duty [to Cooperate][2], thereby removing this requirement for plans in the current system".
Removing the statutory duty is described as a move to “help drive local plans to adoption as quickly as possible and progress towards [the Government’s] objective of universal local plan coverage”.
Although the wording of the WMS suggests that the Duty to Cooperate has already been withdrawn, it hasn’t, but the motivation to comply with it will be limited. The Housing Minister has written to the Planning Inspectorate to provide clarity as to how the Duty to Cooperate land lies. His letter of 27 November 2025 includes some of the policy from the WMS:
“The Duty will therefore cease to apply when the Regulations come into force early next year, including for plans at examination at that point. On the basis of the government’s firm intention to abolish the Duty for the current system, examining Inspectors may wish to begin any necessary dialogue with LPAs in advance of the Regulations coming into effect, with reference to this letter. Of course, LPAs should continue to collaborate across their boundaries, including on unmet development needs from neighbouring areas and Inspectors should continue to examine plans in line with the policies in the NPPF on ‘maintaining effective co-operation’”.
This will, quite deliberately, lead to a number of local plans moving forward without the Duty to Cooperate prior to spatial development strategies being in place to distribute housing need across housing market areas. This could result in difficulties in cases where a local authority is unable to meet its identified housing need within its existing boundaries and therefore risks planning for fewer homes than is needed at a wider area.
 
Further details on the future of local plan making to be laid out.
The Government has published a ‘Plan-making regulations explainer’ setting out its proposals for the new plan-making system[3]. The regulations emanate from the proposals set out under the previous administration for a plan-making process that focusses on simpler plans, prepared quickly, updated frequently and reflective of local needs.[4]
The Reforming Local Plan-Making WMS outlining the measures says:
“This government was elected on a manifesto that included a clear commitment to build 1.5 million new homes in this Parliament, and all areas are required to play their part. In order to deliver the homes and growth the country needs, we expect all local planning authorities to make every effort to get up-to-date local plans in place as soon as possible.
The Minister also stated that the Government will “shortly” lay the regulations that will underpin the new plan making measures with the new plan making process “coming into force early next year”. Matthew Pennycook MP also said, “The regulations will set out a new process for producing plans with clear steps that a local planning authority will need to take”.
Both the existing and new plan making systems will run in parallel throughout 2026, with local planning authorities being able to submit plans under the existing system until 31 December 2026.
As noted above, the regulations for the new local plan system will also ‘save’ the current plan making system for a period to allow emerging plans to progress to examination by 31 December 2026 plans that do not meet this deadline would need to progress under the new plan making system.
We outline the key announcements regarding the new plan-making system below.
 
Plan-making ‘waves’ ditched
The Government is not taking forward the proposals that would have seen the system being rolled out in a series of ‘waves’. Instead, local planning authorities (LPAs) are encouraged to bring plans forward as soon as possible following the commencement of the regulations which will provide ‘backstop’ dates for when plan-making must legally have commenced. The Minister explained:
“This is to help local planning authorities get ambitious plans in place as soon as possible and to support those starting work on a new plan early in the new plan-making system. Further details will be published shortly”.
LPAs will have a 30-month timeline for plans to be produced. During that “30 month” timeline, there may be a pause of up to six months in order for the LPA to carry any additional work on the plan that the Inspector considers necessary, and/or to make any proposed modifications necessary for the plan to be found sound.
Three formal Gateway Assessments at the beginning, middle and end of the plan preparation process are being taken forward to support plan preparation and help identify issues in the evidence base before examination. These are:
 
  1. Gateway 1 (scope and strategic priorities);
  2. Gateway 2 (draft plan); and,
  3. Gateway 3 (readiness for examination).
For LPAs covered by the NPPF transitional arrangements, they will have to commence formal plan making (Gateway 1) by 31 October 2026. For all other local plans more than five years old i.e. those which do not intend to use the old system, they must commence by 30 April 2027.
The Government will provide a minimum of £14 million of funding this financial year to LPAs to support local plan-making.
 
New guidance and tools
In addition to the ‘Plan-making regulations explainer’, a series of dedicated guidance and tools to support plan-makers bring forward a local plan in the new system have also been published in draft. This builds on the new dedicated plan making guidance page 'create or update a local plan' which was published in February 2025. This includes updates to:
Additional practical tools and templates to support plan making will be provided by the Planning Advisory Service in due course.
As set out in the revised NPPF published in December 2024, plans that have reached Regulation 19 stage on or before 12 March and needed updating as they were meeting less than 80% of local housing need, are still expected to be updated and submitted by 12 June 2026, unless updating the plan required the authority to return to Regulation 18 stage. If this was the case, authorities have until 31 December 2026 to reach submission.
 
Closing thoughts
The Government’s announcements this week, combined with its push for planning reform more broadly, suggest it remains focussed on delivering more of the homes and infrastructure required in order to achieve the consequent benefits to economic growth. As with the previous administration, the Government’s aim is to deliver a more streamlined and standardised approach to plan making. It has been clear for some time that despite what is a purported plan-led system, plan making has stalled across much of the country, with local plan coverage[5] in dire straits.
The Government will hope that the new 30-month timeline for plans to be produced, and the clear reporting on timelines, milestones and outcomes will encourage local plan-making. And that this, combined with future changes to simplify nationally consistent policies through the new NPPF and forthcoming national decision-making policies, will avoid a plan-making hiatus – particularly where LPAs argue that they are awaiting a strategic development strategy and/or local government reorganisation to proceed. Whether the removal of the Duty to Cooperate assists housing delivery over both the medium and longer terms will be hard to decipher given that there are so many factors at play. Is it surprising that it is to be removed from a system that is in its twilight months? Perhaps not. Many in the system will have already met the requirement and those that have not might be helped over the line, where they were not going to meet the duty in any event and the plan might have failed altogether. It therefore remains to be seen what this will mean for the delivery of housing most acutely in constrained areas and areas of particularly high need. There remains a risk that the aim to stimulate local plan preparation might be achieved at the expense of housing delivery.
 

Footnotes

 

[1] https://questions-statements.parliament.uk/written-statements/detail/2025-11-27/hcws1104

[2] The duty to cooperate was introduced into the Planning and Compulsory Purchase Act 2004 by the Localism Act 2011 and places a legal duty on LPAs to work together on strategic matters that have cross-boundary impact such as local plan preparation.

[3] The new plan-making system covers plans prepared and adopted under the Planning and Compulsory Purchase Act 2004, as amended by the Levelling-Up and Regeneration Act 2023. The previous Conservative Government published a consultation in July 2023 covering proposals to streamline the plan making system. More detail on the proposals can be found here.

[4] The current Labour Government previously published their response to the consultation in February 2025. The latest updates represent the next stage of planning reform the Government is moving forward with that will coincide with further expected announcements in the coming weeks to stimulate housebuilding and help drive economic growth.

[5] See our analysis from 2023 projecting local plan coverage https://lichfields.uk/media/sfepoymv/timed-out_a-projection-of-future-local-plan-coverage-in-2025-under-prevailing-policy-conditions_jul-23.pdf

CONTINUE READING

The demand-side problem: could the Government bring back equity support for first time buyers?

The demand-side problem: could the Government bring back equity support for first time buyers?

Matthew Spry & Edward Clarke 25 Nov 2025
In the weeks ahead of a much-awaited Budget, the clarion calls from the home building sector for Government to reintroduce some form of substantive equity loan assistance for first time buyers (FTBs) have been increasing in volume (e.g. from the big builders,[1] industry bodies,[2] and other commentators[3]). In recent weeks, the rumour mill has been spinning with speculation as to whether a new scheme is on the way: in the 2025 Budget? Perhaps in the 2026 Spring Statement? Or perhaps not at all….
Whatever the truth, this blog considers the factors behind the current pressure and speculation, what lessons can be learned from previous rounds of equivalent assistance (notably Help to Buy) and what the evidence says about whether this might unlock more homes.
As any Econ 101 graduate will remember, markets are defined by the forces of supply and demand. Although fiendishly nuanced, this principle is as true when applied to housing markets as it is to commodities or indeed anything.
Up until this point, the Government has put supply side policies at the heart of the manifesto and its growth ambitions for housing.[4] Almost immediately on election, it instigated a reform of the NPPF and a new Standard Method which crystallised in December 2024. The impact of planning reform on house building and the economy was positively costed in to the OBR’s March 2025 forecasts for the economy – an additional 170,000 homes by 2029/30, a £6.8 billion economic boost, while also increasing tax revenues and reducing public debt interest by £3.4 billion. This confirmed what was self-evidently true: the supply of new homes is a critical part of the Government’s mission for sustained economic growth. But economic growth does not come principally from consenting new homes[5]; it comes from building them.
After a busy year of progressing Bills, publishing consultations and issuing policies (and notwithstanding the Planning and Infrastructure Bill, non-statutory National Development Management Policies and a new NPPF expected before the end of the year)[6] the Minister for Housing stated at the October Labour Conference, that the “bulk of the Labour government’s planned housing reforms has been done…[now] we’ve got to make the existing system work”.[7]  
However, while the Government’s supply-side changes to the NPPF, Standard Method, and the concept of Grey Belt, have been welcomed by many in the industry, the North Star ambition of delivering 1.5million homes within the parliament – or giving full force to the Secretary of State’s "build, baby, build" mantra[8] - remains distant, as last week’s housebuilding[9] and housing supply figures[10] showed. Just 208,600 net additional homes were delivered in 2024/25, 16% below their 2019/20 peak of 248,590, and down 6% on the previous year.
Some of this is down to the inevitable lag effect of policy change: it now takes an  average of two years to get an outline permission for residential development from the time an application is submitted, plus the time beforehand to prepare a scheme, and the period after to open up a site and start building. The pipeline of land for homes that are being built now will, to a large extent, be the product of the systemic hiatus that afflicted planning in the aftermath of the 2020 White Paper, and which culminated in the nadir for homebuilding of the December 2023 NPPF, which was forecast to have a calamitous impact on housing land availability. In London, the compounding of policy and regulatory layering with viability pressures that led to recent “emergency measures”[11] was clearly pointing to a downward trend in 2023/2024 (see London Plan Review). In simple terms, the planning inheritance of the new Government was never auspicious for its home building plans – as we postulated back in July 2024. 
But, the evidence points to the demand-side remaining a challenge. Housing unaffordability is acute: In 2024, the median average home in England, at £290,000, cost 7.7 times the median average earnings of a full-time employee (£37,600) and in London the ratio is 11.06.[12]  Raising a deposit to buy a home on these ratios is impossible for many desirous FTBs, and since 1990, home ownership rates among 19 to 29-year-olds have more than halved.[13]
Helping people onto the housing ladder has been part of Government policy going back to mortgage interest tax relief (MIRAS)[14], the subsidies of Right to Buy (not without adverse consequences for social housing supply)[15] and the various schemes like HomeBuy, First Buy and, most recently, Help to Buy, which was abolished in 2023[16]. The two years since are arguably the first time in the modern era of housing unaffordability that a Government has not had a serious programme in place for FTB support. Towards the end of 2022, many expected the lack of a replacement scheme for Help to Buy would lead to a drop in the number of homes being built.[17] And so it proved.
Of course, one might simply say that if there is a lack of demand from FTBs, then home builders should simply adapt their schemes and build larger homes for which there is demand. There is some evidence that doing so would improve affordability across the market.[18]  However, under policies introduced by the first NPPF in 2012, local planning authorities increasingly control what type and size of market homes can be built based on Strategic Housing Market Assessments (SHMAs). These reports use (often rather simplistic) analysis of demographic trends to observe the increase in smaller households (due to an ageing population) and then project a housing mix based on an assumed relationship with the number of bedrooms they notionally require. Policies are then produced that require sites to provide proportionately more (smaller) one and two-bed homes rather than (larger) family accommodation. Once the mix is set in a local plan, planning applications are expected to comply with its provisions.  Applications not complying face greater risk of delay or even refusal.
The situation is particularly acute in London, given the focus on apartment schemes and density standards. Yet research in 2024 suggested first time buyers made up only 27% of the new build market in the capital, down from 45% in 2021.[19]
So, if the planning system imposes expectations on building smaller homes for which realisable demand is lower, this will in turn reduce the sales rates and home build rates, and dampen the number of new homes that are built.[20]
Some house builders (Barratt Redrow and Persimmon) have responded by introducing their own “privately funded replacement for Help to Buy” known as Rezide, with home buyers requiring just 5% deposit but receiving an equity loan to 15% of the property’s value, and leaving 80% of the purchase price to be financed through a mortgage.[21]  Others offer deposit top ups.[22] But of course, these measures are offered by the largest volume home builders, and it is much more difficult for smaller and regional home builders on whom the Government relies to boost supply.[23] 
With this in mind, the industry calls for Government to revisit the idea of equity support for first time buyers – and capitalise on its planning changes - is unsurprising. So far, the Government has resisted.

 

Why now?
And yet, speculation suggests, just perhaps, that resistance is softening. Why? 
Firstly, public budgetary accounting now allows the Government to support the scheme without it weighing as heavily on the balance sheet. 
Accounting changes introduced by the Chancellor in October 2024 mean that the Government now measure debt and equity in a different way. The headline target for Government debt (a target the Chancellor has chosen as a golden rule to be assessed against) is now measured as Public Sector Net Financial Liabilities (PSNFL).[24] The relevance is that, previously, the debt target would be imperilled by an equity loan scheme, whereas now the asset value can be considered. When the Government provides the loan, it incurs a liability (i.e. the capital provided to the housebuilder), but it also gains a corresponding financial asset (i.e. the returns on the loan itself from the home owner). This means the net effect on debt as measured by the PSNFL calculation is different from how it would have been under the previous (Public Sector Net Debt (PSND) rules.
Recent HBF research shows that the value of the assets are such that through a combination of positive returns on equity loans and interest income, the government has now received £1.38 billion in profit from the original Help to Buy scheme.[25] Far from being a drain on public finances, it will support them. The report also assesses that the 387,000 Help to Buy purchases supported £86 billion generated in economic activity, more than 130,000 jobs supported each year at its peak, and over £10 billion in tax receipts.
Secondly, it is perhaps becoming more clear in the Government’s mind that there are inevitable limitations to supply-side planning reforms, at least in terms of securing a more immediate uptick on supply. Although the number of applications for residential development has surged by 68% in Q3 2025,[26] (a positive reflection of the NPPF reforms), the lag effect of a two year determination period means the best way to boost house building in the short term is to support the pace of build out by home builders on sites that already have permission, and – crucially – reinforcing this with the confidence they can give - via planning reform - that homebuilder land pipelines will be replenished (and indeed increased) by a future flow of consents.[27]
What might be different for any new scheme?
A strength of the uptake and impact of Help to Buy was its simplicity and efficiency. In underwriting loans the Government reduced some of the key sales-risks facing builders by propping up real demand for new homes over time, allowing developers to go through the development pathway of investing in new sites, planning, building and selling new homes. 
Criticism of Help to Buy suggested that the uptake had inflationary effects on house prices and the impact on volume home builder profits.[28] However, that critique has been contested, not least in recent analysis by the HBF’s David O’Leary.[29] 
Of course, any new scheme of support could be designed differently.  The largest volume home builders already use their heft to provide some direct support for FTBs, so any new scheme could be designed to make Government support proportionate to the size of home builder, so that SMEs receive more support in terms of how much of the deposit is backed by Government.
The market context for any new equity support scheme would also be different from when Help to Buy was introduced. Changes introduced followed the mortgage market review,[30] required significantly higher deposits for mortgages and held back first time buyers from accessing the historically low and stable interest rates available.  Help to Buy addressed this but at a time when housing affordability ratios were rising again following the great financial crisis and amid comparatively steady macro economic conditions (at least between 2013 and 2020).
Moreover, the supply-side environment is different. Whilst the 2012 NPPF (and its 2017 iteration) was largely a positive force for boosting the supply of housing, its effects were limited to areas not subject to national-level constraints, notably Green Belt. Further, through the life of the Help to Buy programme, the planning system did not in aggregate plan for more than around 230,000 new homes a year.[31] This meant that supply was not responsive to demand: of the 55 local authorities that failed their Housing Delivery Test in 2020, there was an overwhelmingly strong correlation with the Green Belt where restrictions made it difficult to bring forward new land via ‘speculative’ planning applications; and plan making in those areas was also very slow.
By contrast, the ‘grey belt’ concept, introduced in the 2024 NPPF – plus the higher standard method need figures and complementary requirements for green belt reviews - should mean that future supply can be much more responsive to demand.
The research by Carozzi, Hilber and Yu[32] which is often cited as supporting the idea that Help to Buy was inflationary, is actually more nuanced. It showed that Help to Buy had differing impacts in different areas of the country depending on the supply constraints of the region – effectively pinpointing planning as a key reason for the inflationary impact. In areas with higher level of planning restriction (its analysis focused on the fringe of Greater London, dominated by Green Belt constraints), it concluded Help to Buy was inflationary: the paper found that housebuilding rates stayed the same while their prices rose, as effective demand was increased. However, crucially, it also showed that in areas with lower levels of planning constraints (it focused on the English/Welsh border), Help to Buy worked "as intended" with higher effective demand supporting increased rates of housebuilding and house prices remaining stable.
Will a new scheme to support FTBs impact different places in different ways?
Advocates for the return of some form of FTB assistance will point to the potential for it to complement the Government’s supply-side reform agenda, in which we estimate around 65-80% of the country is now operating under the ‘presumption in favour of sustainable development’ due to out of date local plans (including no five year land supply, or failure to pass the housing delivery test). The next generation of local plans – and strategic planning (if the emerging model proves resilient to political volatility) – will be working towards achieving a level of housing provision across all parts of England that is well in excess of what has been planned for in recent decades. In theory, this should significantly improve the elasticity of supply in response to the increased demand.
The principle challenges arise from:

 

  • The speed of responsiveness of the planning system. A system in which strategic and local plans take years to produce and applications are held up for an average of two years means a lag of years before a flow of new permissions catches up. Government must use its reform agenda, including new NPPF revisions to provide the much promised ‘default yes’ that is needed to unlock faster permissions;
     
  • The effectiveness of the Government’s emergency reforms for London. FTB affordability problems are most acute in the capital. Analysis of home building data suggests that, across London as a whole (i.e. not just the Green Belt constrained areas analysed by Carozzi, Hilber and Yu), home building increased during the period of Help to Buy, at least up to the point when the London Plan was formally adopted in 2021, but was still significantly less than was ultimately needed.[33] The emergency reform measures jointly launched by Government and the GLA are due out for consultation. They will need to intersect with a new FTB support scheme to genuinely overcome the viability crunch that is so dramatically hitting home building in London. Whilst much of what is proposed is welcome, there remain some doubts it is going far enough.
Whether or not Government introduces some new form of assistance for FTBs on 26th November, or in Spring next year, some other time, or not at all, we can expect the debate over its impact on housing supply to continue.

Footnotes

[4] This article from the Economist suggests a pervading influence of the Resolution Foundation Think Tank’s supply-side agenda (£)
[5] Positive though that it is for the vital part of the economy occupied by the planning consultancy sector….
[7] Reported by Housing Today here
[11] As announced here
[13] Source: HM Government, Plan for Change: Kickstarting Economic Growth, 2024
[14] See this briefing here
[15] For example, explained in this evidence review by Sheffield Hallam University
[16] The scheme is explained here
[17] See this article in Building here
[19] See Research by Savills here
[20] The theoretical alternative of simply reducing prices to the extent first time buyers can afford them is implausible, largely because the prices are in part a function of high fixed costs, including build costs, s.106 obligations and the residual land value (what the housebuilder paid for the site). Reducing land value below what was paid damages the balance sheet. If the constraint to affordability is to a large extent the ability to save for a deposit (a function of the mortgage LTV), total prices would have to reduce significantly to have an impact on deposit requirements. The rational action for a home builder is to slow construction. Future access to land relies on willing landowners releasing their land to the market. Recent Zoopla research found housebuilding was not viable across 48% of the country and challenging across 64% .
[21] Another scheme, known as New Build boost offers similar terms.
[22] See Taylor Wimpey’s package here
[23] See "Government backs SME builders to get Britain building", 28th May 2025 here
[24] A full explanation for the changes is provided by ONS here
[27] See the CMA Report for a full explanation of the role of land pipelines
[28] This article in the Guardian is a typical example of this critique
[31] See this analysis by Strategic Land Group, using Lichfields data on Local Plan targets
[33] See Appendix 2 of the London Plan Review

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Does the Wales Infrastructure Act Risk Slowing Battery Storage Delivery?

Does the Wales Infrastructure Act Risk Slowing Battery Storage Delivery?

Arwel Evans 24 Nov 2025
The infrastructure consenting process will take effect on 15 December 2025 (subject to transitionary arrangements), introducing a new consenting framework for nationally significant infrastructure projects (SIP) in Wales, replacing a number of existing consenting regimes including DNS. While the legislation aims to streamline the consenting of complex projects, its treatment of Battery Energy Storage Systems (BESS) raises important questions about proportionality, efficiency, and Wales’ ability to deliver the flexible energy infrastructure required to achieve its climate ambitions.
Under the Act, BESS schemes between 50MW and 350MW will fall within the new Infrastructure Consent regime, determined by Welsh Ministers and requiring an Infrastructure Consent Order. Smaller and larger schemes will remain with the Local Planning Authority (LPA) under the existing Town and Country Planning Act (TCPA) process. This banded approach has created an unexpected anomaly, with implications for both developers and decision-makers.

 

A New Consenting Threshold – and an Anomaly
Unlike the NSIP framework in England and the DNS regime in Wales (that is to be replaced) - the Infrastructure Act does not carve out BESS from national-level consenting. Welsh Government has confirmed that BESS is captured as a “generating station” under Section 2 of the Act.
 
This results in the following consenting structure:
 
Scale of BESS
  
Consenting Regime
  
 Determining Authority
  
  < 50 MW   TCPA   Local Planning Authority  
  50-350 MW   Infrastructure Consent    Welsh Ministers  
  >350 MW   TCPA   Local Planning Authority  
 
It is unclear if the above consenting structure is intentional or whether it is a drafting anomaly that does not reflect wider policy intent.
 
Implications for Delivery
Placing 50–350MW BESS projects into a national consenting framework will likely introduce longer determination times, higher preparation costs, and increased pressure on PEDW and Welsh Minister’s consenting capacity.
 
Given that many BESS schemes fall within this capacity range, the shift could influence the number and pace of applications coming forward. Wales may find itself at a competitive disadvantage compared with England, where all BESS—regardless of scale—are determined by LPAs. It may be that developers will choose to apply for schemes greater than 350MW in order to bypass the SIP process.
 
With Senedd Cymru elections scheduled for May 2026, the window for legislative amendment before commencement is extremely narrow, even if the administration were minded to revise the approach.
 
Context: A Divergent UK Policy Landscape
The consenting of BESS projects differs across the UK:
 
Country
  
Consenting approach for BESS
  
  England   Since 2020, all BESS (except pumped storage hydro) has been removed from the NSIP regime regardless of size. The UK Government concluded that the time and cost associated with NSIPs was not proportionate to the planning impacts of modern storage technologies.  
  Scotland   BESS over 50MW requires consent from Scottish Ministers, reflecting a more centralised approach.  
  Wales   From 15th December onwards the consenting of BESS between 50MW and 350MW will be determined via the SIP process.  
Such divergence risks creating uncertainty for developers operating across borders and may undermine wider public understanding of how these projects are assessed.
 
 
BESS and the Energy Transition
Battery storage plays a central role in achieving a low-carbon, resilient electricity system. By storing electricity when renewable generation is plentiful and releasing it during periods of high demand, BESS provides:
  • essential grid balancing,
  • frequency response and stability, and
  • support for the wider transition away from fossil fuels. 
National Grid has described BESS as “essential to speeding up the replacement of fossil fuels with renewable energy”. Any consenting approach that delays deployment risks limiting Wales’ ability to transition to net zero by 2035[1].
 
 
Should BESS Be Treated Like Large-Scale Generation?
BESS is critical infrastructure necessary in the move to net zero, but its impacts differ significantly from large-scale renewable generation such as wind or solar. BESS projects do not normally require associated consents or CPO powers which the Infrastructure Consent process is geared up to provide and, in some cases, do not require EIA. While issues such as fire safety have been raised in certain contexts, these matters are well-established within the TCPA process and are routinely managed through appropriate assessment and conditions. For example, in October 2024 Cardiff Council granted permission for a 1GW BESS project in Splott[2].
 
Given recent efforts by both UK and Welsh Governments to simplify consenting for energy storage, its re-inclusion in a national regime represents a notable policy shift. This appears misaligned with established planning policy.
 
 
Planning Policy Position
Wales’ national planning framework strongly supports the deployment of energy storage:
  • Future Wales: The National Plan 2040 notes the need to integrate large-scale energy storage to ensure grid balancing (supporting text to policy 18).
  • Planning Policy Wales emphasises the role of storage in managing the intermittency of renewable generation and states that proposals should be supported wherever possible (paragraph 5.7.12).
These statements underline the strategic importance of BESS—yet the Infrastructure Act may introduce barriers that could slow delivery.

 

The Pros and Cons of each route
     
Pros
  
 Cons
  
 
TCPA
  
  • Local control over the sitting and design of proposals. 
  • Retention of planning fees at a local level, supporting stretched planning budgets.
  • Quicker decisions
  
  • Potential for lack of consistency between different authorities. 
  • Resource pressure of large workloads. 
  
 
Infrastructure Consent
  
  • Process and outcome should be more certain. 
  • Removes local politics from the decision-making process. 
  • Decision made having regard to Future Wales and any infrastructure policy statement that has an effect.  
  
  • Larger application costs including application fees and consultant/legal costs involved in examination and drafting of the order. 
  • Longer determination timescales. 
  • Disproportinate for this type of project. 
  
 
Part 5 of The Act notes that decisions by Welsh Ministers can have regard to infrastructure policy statements and in our view that could give more certainty to developers pursuing BESS applications via SIP. However, we understand that Welsh Government are unlikely to bring forward such infrastructure policy statements and will rely on Future Wales for the time being, potentially undermining the benefit of the national consenting regime.
 
 
Conclusion
The Wales Infrastructure Act offers an opportunity to modernise and streamline the consenting of major infrastructure and for complex projects it will probably be successful in doing so. However, the inclusion of BESS schemes between 50MW and 350MW within the new Infrastructure Consent regime raises concerns about proportionality and deliverability. Whilst there are clear merits to the new regime for more complex projects,  a more balanced approach—mirroring recent steps taken in England—may better support Welsh Government’s own policy objectives around flexibility, resilience, and decarbonisation. As the Act moves towards implementation, clarification or refinement of BESS thresholds could help ensure that Wales remains an attractive and efficient location for the deployment of this essential technology.
 
Lichfields has secured planning permission for numerous BESS projects across the UK including several in Wales. Feel free to contact Arwel Evans to discuss any future projects that may be affected by the new consenting regime.
 
 
Footnotes
[1] This is one of the commitments in the Cooperation Agreement between the Welsh Government and Plaid Cymru following the elections in May 2021.

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