The inspiration for this post was an article in this week’s Economist, Why Britain cannot build enough of anything: The problem is bad rules, not bad people. To quote:
Today about 13% of England is [designated as Green Belts], including the surroundings of every major city…The green belts do their jobs well, pushing development into the rural areas between them. Indeed, most parts of the planning system work as intended. Councillors [elected officials who represent their own local community] retain democratic control over the planning system. Environmental watchdogs enforce their mandates fiercely. Stringent rules protect bats, squirrels and rare fungi. Courts ensure that procedures are followed to the letter. But the system as a whole is a failure. Britain cannot build.
As a result of this system failure, Britain has a severe housing shortage: barely 1% of dwelling are vacant at any one time. In contrast, the vacancy rate in France is about 8%.
Let’s break this system failure into a few of its components:
Local elected officials control what is built where.
Local government imposes taxes worth less than 2% of GDP. So more development does not equal much more money for better services. But it does equal complaints, likely legal action and the very real possibility of getting kicked out of office.
Local officials will not approve a project without appeasing potential adversaries. As a result, developers must submit an insane number of studies and documents to get a pass. For example,
“For a development of 350 houses in Staffordshire, a developer had to provide a statement of community involvement, a topographical survey, an archaeological report, an ecology appraisal, a newt survey, a bat survey, a barn owl survey, a geotechnical investigation to determine if the ground was contaminated, a landscape and visual impact assessment, a tree survey, a development framework plan, a transport statement, a design and access statement, a noise assessment, an air quality assessment, a flood risk assessment, a health impact assessment and an education impacts report.” The Economist
Make an error in any of these studies or documents, however, and a legal challenge is bound to follow.
These barriers to development are “individually justifiable, yet collectively intolerable”, as is often the case with systemic barriers to progress. Yet because they are individually justifiable, they are individually resistant to reform. There will always be anti-development groups willing to fight tooth-and-nail for their cause, which is often a good cause.
Systems may be institutional, economic, political, legal, or cultural. That a problem is systemic doesn’t mean the whole system has to be overturned; sometimes a tweak here and there is all that’s needed. In the case of Britain not building, local control and tax systems are a big part of the problem. Give the national government more control over the development process and the problem will become more manageable.