Labour unveils plan to give councils new powers to buy land cheaply

Labour is planning to give local authorities new powers to buy land at lower prices to boost housebuilding if it wins the 2024 general election
Labour is planning to give local authorities new powers to buy land at lower prices to boost housebuilding if it wins the 2024 general election

Landowners have criticised a policy proposal by Labour which seeks to give local authorities new powers to buy land cheaply and develop on it.

If the party gains governance after next year's election, a law would be passed to give councils the power to buy up land at a fraction of its potential cost if they want to build on it.

According to a report by The Guardian, councils in England would be able to buy land under compulsory purchase orders without having to factor in the value of potential planning permissions - called the "hope value".

One party source told the paper that Labour wanted to "rebalance the power between landowners and local communities."

"We want local areas to capture a lot more of the value that is created when you build on land nearby," the source added.

"The principal is to tilt the balance of power, which right now is tilted towards landowners and not communities.”

However, Mark Tufnell, president of the Country Land and Business Association (CLA), has raised concerns over the impact it could have on farmers and rural communities.

He said: "Forcing hard-pressed farmers to sell their land for a fraction of its potential value, only to then put it in the hands of developers who make hundreds of millions of pounds profit every year, is a strange way to level up the country.

“We desperately need sensible housing development in rural areas, where a small number of homes are built in a large number of villages."

Mr Tufnell said this was necessary to recruit workers for rural businesses and to strengthen England's rural communities.

The "failure" of politicians at a local and national level to provide a planning system that worked for rural towns and villages was "at the heart of the problem".

He added: "There are many reasons why there is a housing crisis in this country, but Labour’s attempt to ask farmers to shoulder the financial burden of fixing it is frankly baffling.”

A Department for Levelling Up, Housing and Communities spokesperson added: "We want councils to be able to unlock more land for affordable housing, which is why we are reforming compensation for compulsory purchase orders.

"The current rules can significantly increase costs for councils and our reforms will ensure the taxpayer gets best value for money, by removing 'hope value' where justified and in the public interest.

"It will ultimately be for the Secretary of State to decide whether a compulsory purchase order can be approved and if the removal of hope value is appropriate."