Chancellor seeks £3bn budget lift through planning shake-up

Rachel Reeves is set to announce a round of planning changes before the budget as a way to kickstart economic growth, with ministers at odds over how radical they should be.

- Kiran Stacey Helena Horton

The chancellor will try to make it easier to build houses and develop infrastructure in the hope that the extra activity will fill about £3bn of an estimated £30bn deficit.

The package is designed to lift private sector confidence, which fell to a record low last month, according to figures from the Institute of Directors.

The government is also planning a bill to rewrite environmental rules it believes hold up development.

But senior members of the government are warning the latest attempts to encourage construction are only technical adjustments to changes they have already announced.

And they are at odds over whether to push ahead with an entirely new planning bill that Keir Starmer, the prime minister, says is needed but which some of his colleagues believe would be a distraction.

A government source said: "The Treasury is desperate to make announcements on planning but the truth is we are already doing most of the stuff we wanted to and trying to reopen all of that is not a good idea."

Alexa Culver, a planning lawyer at RSK Wilding, said the government was presiding over a 'chaotic slew of destructive new bills, with no strategy, vision, due process, consultation or democratic mandate'.