Tuesday, 27 March 2012

Red tape - a legitimate target for supply side policy?


Today the new Planning regulations for England are published. They are to be 50 pages, not 1000, pages long.

What prompts this move is the desire to speed up development plans. At present it can take two years to get permission for even a moderate development and while the planners and councils consider their opinions and check against the regulations labour stays idle and growth is stalled.

Good supply side policy allows the Long Run AS curve shift to the right more quickly. This cutting of red tape seems to fit that bill. It should give a one-off boost to growth, at least in construction, but also in the faster building of private and public infrastructure and may allow improved growth in the future.

However it is worth asking why there were 1000 pages in the first place? Often it is to prevent environmental damage and to protect the sustainability of development. Do we really want no gaps between urban areas?

In reality 1000 pages was certainly too much. Petty rules to preserve old fashioned and outdated ideas, but 50 may be far too few and we may have endless appeals as planners have to make personal judgements.

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