What’s to stop local councils from profiting from their own planning decisions?

[whitemice]

Excuse my naivety, but (in these times of austerity) local councils always seem to be needing more money for social care, pensions, etc. What is stopping them from buying some scrap land, granting planning permission and then selling the land at a huge profit? Profits would go to reducing the council tax bills for everyone.

My rough calculations (yours may differ) indicate that this would knock of somewhere in the order of £100 per new house. This would be more in areas with higher housing need.

More houses + lower tax, surely a vote winner?

[knock out johnny]

41 minutes ago, whitemice said:

Profits would go to reducing the council tax bills for everyone.

 

[chronyx]

1 hour ago, knock out johnny said:

[The Knimbies who say No]

2 hours ago, whitemice said:

Excuse my naivety, but (in these times of austerity) local councils always seem to be needing more money for social care, pensions, etc. What is stopping them from buying some scrap land, granting planning permission and then selling the land at a huge profit? Profits would go to reducing the council tax bills for everyone.

My rough calculations (yours may differ) indicate that this would knock of somewhere in the order of £100 per new house. This would be more in areas with higher housing need.

More houses + lower tax, surely a vote winner?

Nothing, in principle. In fact it is a way that councils can print their own money, assuming they own the land. They are in charge of a near flawless money printing machine, if they decide to use it. 

But, strangely, they seem happy to allow developers to buy up land instead and give the printed money away without any guarantee of getting the houses or whatever was in the planning application built.

I think this is separate from concerns about the merits or otherwise of a particular development; the Local Plan tells the council how much stuff is needed; they ought to be granting themselves permission on land they own or have acquired at rock bottom rates to fulfill this need and sending the construction out to tender, even if there is no intention of holding on to the houses as social stock.

It is crackers to continue to grant planning to companies with a track record in not honouring previous understandings about completion timescales. Can sort that with sunset clauses on planning permission too.

[dgul]

The job of councils is to spend all the money they can, whilst moaning about how little money they've got.  This function is independent of how much money they've got and how much strain there is on their funds.

[honkydonkey]

Councils are generally staffed by morons, managed by morons, with a mandate from even bigger morons. The collective moronity that results from this is akin to a retarded child, with corresponding results.

 

[whitemice]

On 3/11/2017 at 7:46 PM, chronyx said:

I'm here all week, try the veal.

 

 

This question was based on this much better plan proposed by Shelter (probably discussed elsewhere) called New Civic Housebuilding.

 

However my plan ticks more boxes:

• Captures planning gain and spends it locally (services or tax cuts: I don’t care).
• Discourages NIMBYs (how many would turn up to protest a tax cut).
• Establishes a link between housebuilding & public good (vs private profit).
• Doesn't need any action from central Government (don’t mention LVT).

Is this a policy we should be promoting?

[chronyx]

Don't worry I really was laughing at the one smiley reply with quoted text

[knock out johnny]

5 minutes ago, whitemice said:

I'm here all week, try the veal.

 

 

This question was based on this much better plan proposed by Shelter (probably discussed elsewhere) called New Civic Housebuilding.

 

However my plan ticks more boxes:

• Captures planning gain and spends it locally (services or tax cuts: I don’t care).
• Discourages NIMBYs (how many would turn up to protest a tax cut).
• Establishes a link between housebuilding & public good (vs private profit).
• Doesn't need any action from central Government (don’t mention LVT).

Is this a policy we should be promoting?

Sorry whitemice - i wasn't laughing at your proposal per se. It's the notion that councils give a fck about keeping their bills down. They will try and extract as much as possible to spend as much as possible. Every last penny of extra revenue they can garner goes on services or pensions. 

[whitemice]

21 hours ago, knock out johnny said:

Sorry whitemice - i wasn't laughing at your proposal per se. It's the notion that councils give a fck about keeping their bills down. They will try and extract as much as possible to spend as much as possible. Every last penny of extra revenue they can garner goes on services or pensions. 

Agreed, but this is more about incentivizing housebuilding than making councils honest. Actual tax reductions will be proportional to NIMBY opposition, housing need, uplift profits, etc, which should trail off over time.

 

20 hours ago, hotairmail said:

Personally I think the money should go primarily into national coffers and not local councils. The gain is from all of our monetary system and the way it interacts with land. Places under pressure get most gains and people living there get first use of inflation of the money supply which creates localised credit bubbles. It would just make London richer at the expense of everywhere else. Trouble is, Shelter itself is obsessively London centric so can't see past their VI.

We already have an overly centralized system, so I'm not sure why you'd argue to make it more so? This would not make London richer, as all this would do is move money from landowners to councils.

Who's up for tweeting this at their local councilors?