The draft new London Plan must do more to prioritise economic growth and housing delivery, with a clearer assessment of the cumulative costs of its policies to ensure development is viable.
That’s according to the consultation response from London’s leading business campaign group, BusinessLDN, which represents more than 170 major employers in the capital.
BusinessLDN welcomes several aspects of the draft London Plan, the Mayor’s spatial development strategy, including its streamlined structure compared to the previous iteration, the managed release of Green Belt land for new homes and industrial development, and the introduction of a dedicated policy for data centres.
The consultation response warns, however, that the Plan’s current approach risks placing additional burdens on development at a time when market conditions remain extremely challenging. A central concern is whether it can deliver its strategic target of 558,000 net new homes over 10 years. According to a separate report published alongside the draft Plan, 77% of almost 1,000 development scenarios tested would not be viable under its base case despite some assumptions that are considerably more optimistic than developers and the wider market.
Sarah Bevan, Director of Planning and Development at BusinessLDN, said: “The new London Plan is an important opportunity to set a clear, ambitious vision for the capital’s future. City Hall has made progress on turning that ambition into action including through a clear hierarchy of locations prioritised for growth, support for more homes in central London and town centres, and the protection and intensification of industrial sites to support London’s economy. But the Plan must now go further to ensure that its policies translate into homes, jobs and investment on the ground.
“The development industry is facing a hugely challenging outlook, particularly in London, so more needs to be done to tackle the cumulative costs of policy, unblock development and prioritise growth.
“Getting this right and making better use of limited land across the city is key to unlocking London’s full potential.”
Alongside viability, BusinessLDN is calling for a number of changes to improve the Plan’s effectiveness and support development across the capital, including:
- Putting growth first – giving greater weight to economic growth and housing delivery, including affordable housing, when planning policies compete;
- Act urgently to boost housing delivery – including by temporarily pausing mid and late-stage viability reviews of applications, which are the single biggest barrier to investment and delivery in London. At the same time, boroughs should be discouraged from setting their own, higher affordable housing targets as this would ultimately constrain, rather than increase, supply;
- Making better use of land: reinstating a design-led approach to density, particularly on strategic and small sites, so that development can maximise housing capacity rather than being constrained by rigid density and building-height limits;
- Supporting investment and development: ensuring additional requirements, including those relating to affordable workspace, energy efficiency and carbon, are proportionate, properly assessed and consistent with the Plan’s wider growth and delivery objectives; and
- Planning infrastructure strategically: recognising that the infrastructure needed to support London’s growth must be funded through a combination of public investment, developer contributions and innovative financing, rather than placing disproportionate costs on individual developments.
BusinessLDN will take part in the Plan’s Examination in Public in 2027, where the evidence underpinning its targets and policies will be scrutinised.
The full consultation response is available here.