Spencer McCarthy says current administration is ‘anti-housebuilder’ and ‘anti-development’

The boss of retirement housebuilder Churchill has hit out at the government for “anti-development” planning policies and branded as “blackmail” its attempts to strongarm funding from the industry to pay to fix the fire safety crisis.

Spencer J McCarthy, Chairman & CEO, Churchill Retirement Living

Spencer McCarthy said he was ‘astonished at the ’anti-development’ policies being brought forward by the government

Spencer McCarthy, chief executive of £200m turnover Churchill Retirement Plc, told Housing Today that he was “astonished” at the policies being brought forward by a Conservative government, which he would normally expect to support growth.

His comments follow concern from the industry over plans to impose a £3bn building safety levy on new planning applications to pay for fire safety repairs, on top of the £2.5bn cladding pledge and the £2-3bn Residential Property Developer Tax (RPDT) already introduced.

The government has said that developers that do not play ball will be stopped from trading via the use of a “Responsible Actors Scheme”, under which it will bar uncooperative developers from carrying out planning permissions or receiving building control sign-off.

The concerns follow separate fears raised over the direction of travel on government policy on planning reform, after a backroom deal between housing secretary Michael Gove and Tory MPs saw the government publish proposals to significantly water down the application of housing targets before Christmas.

>> See also The unanswered questions about the £3bn building safety levy

>> See also Gove’s retreat into nimbyism spells political trouble for the Tories

Spencer McCarthy, son of McCarthy & Stone founder John McCarthy, said that Churchill was already paying the Residential Property Developer Tax and had signed up to the cladding pledge, and was about to sign the final contract recently published.

However, given that Churchill had only built six buildings over 11m in height in the last 30 years, with none of these suffering from cladding issues, he said: “We won’t be happy to sign up to any more taxes to pay for this, in terms of the next stage they’re proposing [the Building Safety Levy]. Bear in mind we’ve also not had a single penny from Help to Buy over the years.

“It’s like blackmail. The government is saying ‘if you don’t sign up, we’ll stop you trading’. It’s astonishing, from a Conservative government you’d think would support growth.”

He added his concern was underlined by Gove’s recent admission that building regulations were faulty prior to Grenfell, thereby giving developers and building control staff the impression that certain forms of cladding were permitted. McCarthy said: “Companies were just following guidance, these were homes built according to the regs at the time.”

Churchill Retirement Living Owners at Fitzford Lodge, Tavistock

Churchill Retirement Living owners at Fitzford Lodge in Tavistock

McCarthy said the firm, which saw pre-tax profit fall by 11% on rising turnover in the year to June 22, was also having “amazing” problems achieving planning consents “particularly in Conservative-led councils”, despite all of its schemes being on brownfield land.

He said: “It’s very much an anti-development government we have. It’s anti-housebuilding. It’s bowing down to the backbenchers and appeasing them, just bashing housebuilders.”

McCarthy’s comments follow the government proposing to amend national planning policy to remove the requirement for councils with up-to-date plans to demonstrate a five year supply of housing land, and allow them to get out of meeting local housing need if doing so would require reviewing green belt boundaries or permitting development that is out of character with existing urban areas.

McCarthy said the company, which built 513 homes last year, remained on a medium-term growth trajectory despite the current downturn in the housing market, which he said had given the business a “challenging” half year running up to Christmas. Churchill has set out plans to expand the business to deliver 1,000 homes per year, something McCarthy said he had hoped to deliver by 2025, but might now be delayed by a year due to the market conditions.

“We didn’t quite hit our [completions] targets before Christmas. Growth drive ’25 may be pushed back a year.

“But since coming back in January there has been a good bounce. I think it [the market] will be a challenge up until spring but then I think we’ll see a good upturn,” he said.

A Department for Levelling Up, Housing and Communities spokesperson said in response to McCarthy’s comments that the government made “no apologies” for expecting developers, rather than leaseholders, to “foot the bill for fixing unsafe buildings.”

The spokesperson said: “In signing the contract, developers will be taking a big step towards restoring confidence in the sector and providing much needed certainty to all concerned.

“There will be nowhere to hide for those who fail to step up to their responsibilities and [we] will not accept any backsliding on their commitments.”