The year ahead for parliament and propertyDigital Manager
In the latter part of 2011 we saw the property sector take real pertinence and precedence in the Government’s agenda, as the Coalition sought avenues to create economic growth. The NPPF was proposed, the Localism Act was ushered through, the Housing Strategy was introduced and public funds were released for national infrastructure and large residential developments. But what can we expect in 2012?
One of the most significant developments this year will be the progress of the NPPF. The framework is currently being rewritten after months of consultation in 2011. But the planning reform does not require parliamentary approval as it is not a new legislation, but instead it is replacing existing policy and guidance issued by previous Governments. So the Coalition will have no real statutory block in implementing the reform before their imposed deadline of the end of the current parliamentary year, April 2012. There remains considerable opposition to the NPPF though. We should expect significant concessions in the wording of the framework in the final document, but there will be no Government u-turn on the principles of the reform.
In January, Transport Secretary Justine Greening will, after 9 months of consultation and deliberation, announce whether the High Speed Two London to Birmingham rail link will go ahead. The decision, whichever way it goes, will cause a headache for the Coalition; either upsetting Conservative voters in Buckinghamshire, or businesses and voters in big cities in the North and the Midlands.
Early this year we will also see the Government Finance Bill put in front of Parliament. The Bill is significant because it will enable local authorities to retain a proportion of the business rates generated in their area, incentivising and rewarding progrowth policies from local authorities. The Bill is not guaranteed to ease through both Houses as it has considerable cross party opposition. Critics argue the reforms will harm councils in the north who will not be able to attract enough growth to receive a fair reallocation.
As the parliamentary year draws to an end at the beginning of April, we will see the Government concentrate on pushing through their remaining Bills – without giving too many concession to the Lords or the opposition. The next Parliamentary year will then open with the Queen’s Speech, where she will outline the Government Bills that will be tabled in Parliament over the next 12 months. Without knowing the content of the speech it is difficult to predict which policies will dominate the Coalition’s agenda for rest of 2012 – but it is unlikely that we will have as many ‘major’ Bills as in the last session. This is because the Coalition set out to front load its programme of legislation in order to ensure voters can see their positive impacts before the next general election.
On May 3rd there will be local elections in London, for the Mayor and Assembly, 36 English metropolitan councils and 18 English unitary authorities, as well as in the 32 Scottish and 22 Welsh local councils. There will also be referendums held in 11 major English cities on whether they should swap to government by a mayoral system. ‘Housing’ is likely to be an important issue in the ‘Boris vs Ken rematch’, as Ken Livingston has pledged to introduce a London ‘living rent ’, build 5,000 new homes, and cut VAT on home improvements by 5% for 12 months.
Outside of Westminster and London, the Eurozone crisis will of course have a major impact on the property industry. The immediate implication of the crisis is that it is causing banks to decrease their property lending. Furthermore the property industry’s debt is increasing due to the lenders lack of liquidity. As the crisis continues or deepens we will also see real estate market prices fall – in November 2011, house prices fell over 3%, an average of £7,528 – the largest monetary fall since December 2007 and third largest percentage fall on record.
With the Olympics also set to take over the nation’s attention, invigorating and showcasing one of the largest regeneration projects in modern British history – all in all 2012 guarantees to be an interesting, eventful and important year for the property industry. Innesco looks forward to following and shaping all of its developments.
Andrew Todd, Account Executive