Why the 'proceeds of growth' from backing the builders must be felt by people on the ground

One of the few bright spots in Rachel Reeves's bleak spring statement was the economic boost the forecasters expect to result from planning changes.

- Heather Stewart

Reeves was so delighted to announce some upbeat news, she pinched a phrase from Gordon Brown, calling the resulting extra £3.4bn for public services, "the proceeds of growth".

The £3.4bn is imaginary; it's the Office for Budget Responsibility's best estimate of the benefits to the exchequer of the slightly larger economy (by 0.2%) it reckons will follow from all that extra housebuilding. There is no guarantee of success for an approach that relies on rewriting regulation from the centre and exhorting the private sector to deliver.

But the OBR's verdict will have real political impact: not just because Reeves can now factor that money into future spending plans; but because it will strengthen the hand of those inside government, pushing for more radical change.

In the longer term, the watchdog suggested, the boost to growth would be larger, at 0.4% - including because workers will be better able to move to more productive jobs, if housing is available nearby.