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June 2021
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Government is holding the industrial sector back with ineffective planning policy, says Turley

“Ineffective” national planning policy, which “has no teeth” is holding the industrial sector back from supporting the UK’s economic recovery from COVID-19, according to planning and development consultancy Turley.

Despite the radical reforms promised in the 2020 Planning White Paper, there is scant regard to the role of industry and logistics, in spite of the sector contributing £5.33 billion Gross Value Added (GVA) to the UK economy in 2020.

These claims come from Turley’s newly released report, ‘Playing to our industrial strengths’, which looks at the contribution of the sector and the planning challenges it faces. It includes eight recommendations to help it play a bigger role in boosting economic recovery.

Following the unexpected abandoning of the Industrial Strategy in March this year, the planning and development consultancy argues that stronger policy and guidance is needed.

Turley says the current National Planning Policy Framework (NPPF) – a 76-page document that sets out Government’s planning policies for England – includes only five paragraphs on “building a strong, competitive economy”. Meanwhile logistics, which is now recognised as an essential part of our economy following successive lockdowns, features in only one sentence in the entire NPPF publication.

Research by Turley found that the additional industrial floorspace delivered in 2020 alone supported 56,000 direct jobs on site and a further 42,000 jobs indirectly through the supply chain.

Yet despite the risk of continued rising unemployment as a result of the pandemic, the consultancy claims that the Government’s planning focus remains firmly on housing. In addition, it says that minimal consideration is given to the intrinsic link between new housing and warehousing.

Turley found that if the Government met its target of building 300,000 new homes a year, an additional 22 million sq ft of warehouse floorspace could be required each year throughout England; at the start of 2021 the supply pipeline was 32 million sq ft.

However, a lack of focus on delivering industrial space means the sector currently faces a chronic shortage of supply, especially for ‘big-box’ logistics (units larger than 100,000 sq ft), where there has been a surge in take-up following the pandemic.

Turley’s recommendations highlight that a more joined-up approach to planning for economic growth alongside infrastructure and housing is needed.

It also suggests that an ‘Industrial Delivery Test’ which mirrors the Housing Delivery Test should be introduced to ensure local authorities are held accountable for failing to deliver adequate industrial land supply.

Matthew Fox, Director at Turley, said: “The UK is at a pivotal point with the Bank of England forecasting a strong economic recovery in 2021 following the vaccine rollout and loosening of restrictions. The focus should now be on how we sustain growth beyond 2021.

“The industrial sector has the ability to play a key role in a green economic recovery but national planning policy has for too long disregarded its importance, instead focusing on the housing crisis.

“There is no denying that housing delivery is vital for the future of our society and economy, but it must be in balance with economic growth and infrastructure. Our research points towards a crisis in the supply of industrial land which could constrain the recovery.

“We hope the recommendations laid out in our report provide valuable insight for Government, combined and local authorities and economic delivery agencies, as they continue to plan for our economic recovery.”

The eight recommendations set out in the report are:

  • In light of the demise of the Industrial Strategy, urge Government to adopt a joined-up approach to planning for industrial and logistics development.
  • Strengthen national planning policy to support industrial and logistics growth and provide explicit guidance on how the spatial needs (e.g. for clustering) and land requirements for key sectors should be determined and delivered.
  • In replacing the Duty to Co-operate, give equal status to strategic employment land as the distribution of housing needs across local authority boundaries.
  • Encourage greater co-ordination of infrastructure planning with spatial frameworks for delivering local industrial strategies or their successors.
  • Ensure that local plans maintain an adequate future supply of land in the right locations for all key sectors, including consideration of a Delivery Test similar to that for housing.
  • Consider the wider use of the Nationally Significant Infrastructure Project (NSIP) regime for large scale industrial and logistics development, particularly a new wave of Gigafactories, and how Local Development Orders (LDOs) might give greater flexibility for industrial development not just in Freeports.
  • The sector must build a stronger narrative around the economic, social and environmental contribution (particularly to net zero) it makes towards Government objectives and global challenges.
  • The sector must also develop its dialogue with strategic economic bodies, combined and local authorities, and local communities to win policy backing and popular support for well-considered proposals.

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