With the country struggling to meet its ambitious housing targets, will the Government’s recent devolution announcements help get it back on track?

Luke Brafield, Partner in Fisher German’s development agency team, examines where further devolution could help, and why local powers will not remove the need for national funding and a workable development pipeline.

Only a few weeks into an Andy Burnham-led Government, the early signals on devolution suggest it is serious about getting England building again.

In July, the Cabinet published ‘Rewiring the State’, setting out a wider programme to change how central and local government work together. Among its more significant proposals is greater devolution of housing powers, including more control for mayors over the Social and Affordable Homes Programme. That direction was reinforced, when the Government confirmed nearly £10 billion of initial funding to support more than 70,000 homes, with over £2 billion expected to be spent in mayoral areas outside London.

There is a clear logic to that. Housing need is experienced locally, and the barriers holding schemes back are rarely the same from one place to the next. Decisions are often better made by those who understand the market and the pressures on the ground.

National targets still matter. But targets do not pour foundations, secure planning consent, agree section 106 terms or finance infrastructure.

Devolution could help make those steps more joined up. Combined authorities with oversight of housing, regeneration and transport investment should be better placed to understand what a site needs to progress, and where intervention could make the difference.

That role could soon become more direct. Under proposals announced this week, mayors outside London would gain powers to call in strategically important planning applications, including schemes of more than 150 homes, and take over the decision or direct a council to accept or refuse it. If mayors are to be held more accountable for housing delivery across a region, it makes sense for them to have meaningful tools to intervene where major developments are at stake.

But greater control over planning decisions only solves part of the problem. It cannot make an unviable scheme viable or pay for the infrastructure needed to unlock it.

The latest National Planning Policy Framework points in a similar direction, with greater emphasis on strategic planning and aligning housing growth with infrastructure and transport. It also states that registered providers should be involved in pre-application engagement where affordable housing is proposed. Bringing housebuilders, local authorities and social housing providers together earlier should help ensure local housing needs are understood from the outset and potential delivery issues are identified sooner.

The direction of travel is encouraging. The harder question is whether responsibility will be matched by the resources to deliver.

From April 2027, mayors are expected to retain a share of business rates, followed by a share of local income tax from April 2028. That may create stronger incentives to invest in growth, but the opportunity will not be evenly spread.

Regions with weaker tax bases can also have more difficult housing markets and less ability to absorb development costs. Social Rent, in particular, needs subsidy because its value is not captured through market rents or an immediate increase in tax receipts.

The Government has acknowledged the need to balance incentives for growth with fairness between places. For affordable housing, that cannot be a secondary detail. National grant funding will still matter if every region is to have a realistic chance of meeting its housing need.

Planning policy can set expectations for affordable housing, but it cannot fill a viability gap. Requiring affordable homes does not, by itself, provide the funding needed to deliver them.

Without that support, devolution risks giving stronger markets more freedom to move while leaving mayors in weaker markets accountable for numbers they cannot realistically deliver.

The real opportunity is to use devolved powers to identify the intervention that turns a difficult scheme into a deliverable one. That might mean additional grant, earlier land acquisition, infrastructure funding or a more practical partnership between a council, housing association and developer.

This is particularly important on larger and more complex sites, where infrastructure costs, fragmented ownership and long delivery timescales can leave even consented schemes stuck on paper.

Identifying land and setting housing targets is only the start. The real test is whether viability, infrastructure and delivery can keep pace with planning ambition.

Devolution should therefore be judged by whether regional leaders can turn difficult sites into finished projects. Whitehall must still fund national housing priorities and ensure places with weaker tax bases are not left behind. Mayors, meanwhile, need enough flexibility, expertise and financial firepower to tackle local barriers that national targets cannot see.

The latest NPPF gives strategic authorities a stronger role in shaping where growth should happen. Devolution could give them more of the tools to make it happen. But neither changes the fundamentals: homes are delivered when land is available, infrastructure is funded, schemes are viable and the right partners have the confidence to invest.

If fiscal devolution simply moves responsibility for missed affordable housing numbers from central government to regional leaders, very little will have changed. Its real value will lie in whether it gives those leaders a better chance of getting land released, infrastructure delivered and, ultimately, homes built.