First of all, I give my sincere apologises to the noble Baroness, Lady Harris of Richmond. I am so pleased that she is not retiring, and I look forward to her further contributions well into the future. I hope that she can hear me.
I am grateful to all noble Lords who have spoken today and am encouraged by the level of interest prompted by the Bill. As we have heard from noble Lords across the House, the Bill offers a genuine opportunity to empower local leadership to tackle issues on which they are the experts. Local power, exercised accountably, is the only way we will extend opportunity throughout our country. Too often, Governments have erroneously thought that centralising power will make them more effective. The lessons of the past 70 years are clear: that approach does not work. We must trust local areas and provide them with the tools to build their own futures.
This has been a substantial and valuable debate with significant contributions from across the House. I will respond to as many points as I can within the time I have, but, with over 65 speakers listed, it will be challenging, to say the least. I hope noble Lords will excuse me if I do not list a number of Peers; I appreciate everything they have said and ask for their forgiveness if I do not mention everyone by name. I also hope that they will forgive me if I do not address every point raised. Where I do not address a point, I will follow up with an extensive letter which I will copy to all Members who have spoken; I will also put a copy in the Library. I also repeat my offer to all noble Lords across the House to meet to discuss any of these matters in greater detail. I will put together briefings on some of the themes that have come out of the debate. I implore noble Lords to get in touch with my private office, and I assure them that I have written every question in my little book and will ensure that we get them answered.
Before I start discussing the Bill, I congratulate my noble friend Lord Jackson of Peterborough and the noble Baroness, Lady Anderson of Stoke-on-Trent, on their maiden speeches today. They both made excellent contributions to our debate, and I look forward to working with them both in future, not only on this Bill but on other Bills in the years ahead—if I am still standing here at the Dispatch Box.
I turn now to the matters raised in the debate. First, we will work with the Delegated Powers and Regulatory Reform Committee and consider any recommendations
on narrowing the powers in the Bill, where appropriate. I know that that issue is of keen interest to this House, as we have heard in many contributions, and I am committed to working through any issues raised by the Select Committee.
I turn now to the levelling-up missions. This Government’s defining mission is to level up our country to close the gap in productivity, health, incomes and opportunities between much of the south-east and the rest of the country. That is made all the more urgent given the current economic context, with places across the country affected in different ways by these headwinds.
As the levelling up White Paper sets out:
“Levelling up is a moral, social and economic programme for the whole of government”
to spread opportunity and prosperity more equally across the country. The Bill sets out the framework for delivering on that levelling-up mission and places a statutory duty on the Government to publish an annual report on our progress on those missions. The Bill is an enabling Bill; it creates the foundations for action to be taken to address entrenched geographical disparities and to level up the country.
The Government recognise that scrutiny and seeking expert advice will be important to ensuring that we deliver on our missions and level up the country. That is why we have established the levelling-up advisory council, chaired by Andy Haldane, who will provide the Government with expert advice to inform the design and delivery of all these missions.
The levelling-up missions are intended to anchor government policy and decision-making necessary to level up the UK. However, these missions should not be set in stone: as the economy adapts, so too might the missions, to reflect the changing environment and lessons learned from past interventions. As we become more ambitious, or as better metrics become available, we should be able to update missions to reflect that. Importantly, the Bill sets out that any changes to missions should be fully and transparently explained and justified through a Statement to Parliament when they occur.
Our approach to the missions is the same as the approach taken with fiscal rules: they are subject to debate in Parliament but are not in law. His Majesty’s Treasury publishes its fiscal rules in a non-legislative policy document, but that is laid in Parliament. This does not prevent the Government from being held to account for keeping to their fiscal targets. The missions will be published in a policy document laid before, and debated in, Parliament. The first example of this document will be based on the levelling up White Paper, and future iterations will include the headline and supporting metrics used to define the missions and measure progress towards them.
The 12 levelling-up missions are a tool to break down silos and encourage co-operation across the public, private and voluntary sectors. To ensure that missions deliver these benefits, we are improving the way in which departments work together across central government, with clear accountability through named individuals taking responsibility for progress on each mission and with structures to enable joint working on each mission. To facilitate the cross-departmental co-ordination of
levelling up at the ministerial level, a dedicated inter-ministerial group on levelling up has been established, chaired by the DLUHC Secretary of State.
I turn to devolution. The Bill sets out the procedure for the Secretary of State to devolve local authority and public authority functions to a combined county authority. This is similar to the procedure conferring these functions on a combined authority and individual local authorities in the 2009 and 2016 Acts. In each case, this might follow the agreement of a devolution deal.
The Bill will also align the processes for establishing and amending mayoral combined authorities to the proposed combined county authority processes, which will simplify devolution for areas, enabling more rapid expansion. By amending the current statutory consent requirements around the expansion of combined authorities and the conferral of powers, the Bill will enable more local authority areas to join combined authorities, expanding devolution, and to gain greater powers, deepening devolution, while ensuring that combined authorities are able to remunerate constituent authority councillors for their role on overview and scrutiny committees, ensuring stronger accountability.
In line with our focus on supporting local leaders to drive better outcomes and levelling up, the Secretary of State may make such regulations only if they consider that doing so would be
“likely to improve the economic, social and environmental well-being of some or all of the people who live or work in the area”.
The Secretary of State must have such discretion to implement deals that they have agreed with areas based on a robust assessment of whether all parts of this statutory test have been met. It is essential that a statutory test is considered and met in all cases: there may be instances where the area concerned has demonstrated that conferral of functions would meet one criterion of the test but not another. As we say in the levelling up White Paper, devolution must reflect local areas’ differences; there cannot be a one-size-fits-all approach. Devolution is informed by the devolution framework, but this is not a standard offer of powers, and there is scope to agree further powers on a case-by-case basis.
There have been calls for greater fiscal devolution, down to parish and town council level. This Government trust local government and its strong and accountable local leaders. We are exploring further fiscal devolution, initially through the trailblazer devolution deals. We will consider putting power back in the hands of local people through greater fiscal freedoms. I thank the noble Baroness, Lady Scott of Needham Market, for her contribution; I know she works very closely with town and parish councils. We want to make sure that parish and town councils can protect the assets and amenities which matter to them locally. The Government have enabled this to happen through their £150 million community ownership fund, which was launched last year to support communities to save assets at risk. I know of a number of pubs and local shops for which investment has been used for this purpose. As part of the levelling up White Paper, we also look at the existing community asset frameworks and how they might be strengthened.
On national planning policy, this Bill reforms decision-making to strengthen the role of the development plan in practice. Decisions will be able to depart from the development plan and any national development planning policies only where
“material considerations strongly indicate otherwise.”
It will no longer be enough for those other considerations to merely “indicate otherwise”.
Giving national development management policies statutory weight will give greater clarity to the role of national planning policies in planning decisions. This is crucial to reducing the number of planning appeals local authorities currently face, therefore reducing the number of unanticipated developments communities face on their doorstep as a result. I think I can safely say this is an outcome that we all want to deliver.
National development management policies are intended to cover general planning considerations that apply regularly in decision-making, of the sort already found in the national planning policy. Giving these statutory recognition will promote greater consistency and certainty across the planning system and allow local plans to be shorter and more locally focused.
National development management policies will provide greater assurance that important safeguards such as protections for areas at risk of flooding, policy on climate change and policies to protect the green belt will continue to enjoy the strongest levels of protection, underpinning key national policy protections with statutory weight when the local plan policies go out of date. They will not impinge on local policies for shaping development, nor direct what land should be allocated for particular uses during the plan-making process. These will remain matters for locally produced plans.
Some local plans are woefully out of date. For example, some date from the 1990s. It would be wrong to say that these must supersede national policy in the event of conflict between a national development management policy and the development plan, when a planning decision must be made in accordance with both. This point is particularly crucial, because we wish to use national policy to drive higher standards, especially on good design, the environment and tackling climate change. It is important that these can take precedence in the event of conflict with out-of-date policies in certain plans. Nevertheless, I would expect such conflicts to be limited in future, both because we are making it easier to produce plans and keep them up to date, and because the Bill makes sure that new plans will be drawn up consistent with national policies, including the national development management policies.
The need to level up urban and rural areas has rightly received substantial attention in this debate, and we have considered the impact on rural areas. The Bill will benefit rural areas by giving communities more of a say on local plans by way of a new infrastructure levy that can deliver as much, if not more, affordable housing than at present, and a new requirement for infrastructure providers and other bodies to provide assistance to local authorities in drafting their local plans.
Through a discretionary council tax premium for second homes and the infrastructure levy, LPAs will be empowered with more money to address issues that matter to the people living in rural areas, such as infrastructure,
housing supply and affordability and the sustainability of local communities. Our second rural-proofing report, Delivering for Rural England, published last September, showed what levelling up might look like in a rural area and set out what the Government were doing. The independent Levelling Up Advisory Council is also exploring how it can offer specific insights into the design and delivery of levelling up in rural areas.
On rural funding, we launched the £110 million rural England prosperity fund on 3 September 2022 to enable local authorities to provide small capital grants to support rural businesses and community infrastructure. This is replacing funding previously provided by the EU through the LEADER and growth elements of the rural development programme for England and is a rural top-up to the UK’s shared prosperity fund.
On housing, I have a list here of many, if not the majority, of noble Lords who spoke today on this issue, but I will not read it out. Noble Lords will be aware of our consultation, launched last December, which sets out in more detail our proposed approach to planning for housing in Chapter 4. We are retaining a method for calculating local housing need figures, but these will be an advisory starting point; it will be up to local authorities, working with their communities, to determine how many houses can actually be built, taking into account the needs and nature of their local area, such as green belt, the existence of a national park or a coast, and recognising that building should not wholly change the character of an area. We propose to make changes to the rolling five-year land supply, ending this obligation where planned strategic housing policies are up to date. Communities will have a powerful incentive to get involved in their local plan.
The new infrastructure levy has received a considerable amount of debate this evening. The levy, set and raised by local authorities, will seek to deliver at least as much affordable housing. The Bill ensures that local authorities take the desirability of delivering at least as much affordable housing into account when they set their rates; this will be achieved in part through the right to require, which will enable local authorities to require developers to build on-site affordable housing. We will shortly consult on the levy on how the right to require will operate.
The noble Lord, Lord Best, as well as speaking knowledgably on affordable housing, referenced the Letwin review. While that review found no evidence of systematic land banking, it found substantial scope to accelerate build-out rates, particularly through diversification. The Government are clear that new homes should be built out as soon as possible when build-out is delayed. It is for councils and developers to work closely together to overcome any barriers. Our robust package of build-out measures seeks to encourage this.
It was questioned whether the infrastructure levy would be able to mitigate the impact of specific development. The levy is proposed largely to replace the complex and discretionary Section 106 regime. Under the infrastructure levy, we intend that in all cases local planning authorities will be able to require developers on all sites to provide infrastructure integral to that site. That includes infrastructure crucial to that
site to function, such as access roads or connections to drainage networks. These items of infrastructure will continue to be delivered by developers.
This Government’s commitment to building 300,000 homes a year has been a significant topic of discussion. Our planning reforms will help to deliver enough of the right homes in the right places, and we will do that by promoting development that is beautiful, that comes with the right infrastructure, that is done democratically with local communities rather than done to them, that protects and improves our environment, and that leaves us with better neighbourhoods than we had before. The Government remain committed to continuing to work towards our ambition of delivering 300,000 homes a year in England, as set out in the 2019 Conservative manifesto. We are making strong progress in this area. Since 2010, over 2.2 million additional homes have been delivered in England, including more than 632,600 affordable homes.
Finally, I come to the environment. The Government recognise the challenge of climate change. It is critical that the planning system must address this effectively. Through the Climate Change Act 2008 the Government have committed to reduce emissions by at least 100% of 1990 levels by 2050 and to produce national adaptation programmes every five years that respond to economy-wide climate change risk assessments. The Bill sets out that local plans
“must be designed to secure that the development and use of land in”—
the local planning authority area—
“contribute to the mitigation of, and adaptation to, climate change.”
Our new outcomes-based approach to environmental assessment will ensure that the ambitions of the Environment Act and the 25-year environment plan are reflected in the planning process, placing the Government’s environmental commitments at the centre of decision-making.
The National Planning Policy Framework is already clear that plans should take a proactive approach to mitigating and adapting to climate change, taking into account the long-term implications for flood risk, coastal change, water supply, biodiversity and landscapes, and the risk of overheating from rising temperatures, in line with the objectives and provisions of the Climate Change Act 2008. The National Planning Policy Framework must be taken into account in preparing the development plan and is a material consideration in planning decisions. This includes the framework’s current policies related to climate change mitigation and adaptation. Furthermore, as committed to in the net-zero strategy, we will carry out a full review of the National Planning Policy Framework to ensure it contributes to climate change mitigation and adaptation as fully as possible. This will be consulted on as part of wider changes to the National Planning Policy Framework to support the ambitions in the Levelling-up and Regeneration Bill.
I thank noble Lords for their continued assistance with and support of the Bill and I look forward to progressing our discussions in Committee. I single out the noble Lord, Lord Heseltine, for his contribution this evening, for the foundations he laid through his
trail-blazing work on devolution, and for the wealth of knowledge he brings to this debate. I hope he will continue to take part as the Bill moves through this House.
I have not been able to respond to each point raised, and I apologise, but I think I am already over time. Given the hour at which we are wrapping up this Second Reading, I hope that noble Lords understand the approach I have taken. I reiterate my commitment to meeting any Member of this House who wishes to discuss the Bill further. I have noted the missions, housing numbers, environment issues and devolution as issues on which I shall try to put together some meetings very quickly—certainly before we get to Committee. I have noted each request for a meeting that has been made this evening and I will instruct my private office to reach out to noble Lords to get these meetings set up. I hope that is acceptable to the House. I commend the Bill to the House.