The Labour Government must build at least one new town by 2029, or it will have failed the next generation, a new House of Lords report has warned.
More than two years after Labour took office and pledged to build seven new towns by the end of this Parliament, construction has not yet begun on a single new town.
Speaking to The i Paper, Lord Gascoigne, who chairs the Built Environment Select Committee, called the lack of progress a “doom loop”, warning that the Government must get “spades in the ground” or risk missing a once-in-a-generation opportunity to drive economic growth and turbocharge housebuilding.
He told The i Paper that he was concerned by the lack of progress on new towns, which are supposed to deliver 10,000 to 40,000 homes per town, as well as new jobs for young people.
Gascoigne acknowledged that Housing and Planning minister Matthew Pennycook – who oversees the Government’s New Towns Taskforce – has made strides in planning reform since 2024, but added: “Frankly, it is time to act.”
‘Time to act’
In 2025, Labour said it hoped to see construction begin for new towns at three “promising locations” by the end of this Parliament: Tempsford in Bedfordshire, Leeds South Bank, and Crews Hill in Enfield, north London.
Britain currently has 1.3 million households awaiting social housing in England and many first-time buyers struggling to get on the housing ladder. This prompted Labour to promise to build 1.5 million new homes, which new towns are supposed to help deliver.
If the new-towns plan is delayed, Labour “risks further weakening the confidence” of developers and the construction industry “that the Government is willing and able to deliver megaprojects,” Gascoigne said.
Skills shortage – and an opportunity for Neets
A serious construction skills shortage and questions about funding appeared to be holding up progress, the report said.
The Construction Industry Training Board has highlighted this issue: fewer than 19 per cent of workers in the sector are under 25, while 35 per cent are over 50. With around 750,000 construction workers expected to retire by 2036 – taking critical expertise with them – there is concern that more than 100,000 jobs will be left vacant, with a lack of new trainees to take them.
As Britain grapples with a youth employment crisis which has seen almost one million 16-24 year olds not in education, employment or training (Neet), developers say they are struggling to recruit new talent.
The report called on Labour to make sure that the delivery body for each new town “must include a requirement to establish strong and effective working arrangements with employers and training providers” and establish accredited apprenticeships.
“This is a real opportunity for [people of] all ages, not just younger people, to find new jobs and to be trained,” Gascoigne said.
He called on the Government to give the construction sector “clarity” backed up with “strong action which shows that the new towns programme will come to fruition.”
The Committee also warned that the organisations that will deliver new towns – from construction materials companies to builders – “were clear that without firm financial commitments and delivery timetables, they would not be able to justify committing their resources to building new towns.”
‘A shot in the arm’
Gascoigne said that housebuilding and infrastructure construction needed “to be blown a shot in the arm” and that with more momentum that new towns programme could be an “opportunity to inspire confidence, kickstart the sector” and get out of a “doom loop”.
Pennycook has made it clear that he favours setting up development corporations to deliver new towns. These are independent public bodies created in the 1940s to deliver post-war housing and new towns, including Telford and Milton Keynes. The regeneration of Statford in the run-up to the 2012 Olympics was also delivered by one of these organisations.
Gascoigne said he wanted to see these bodies set up quickly, within three months of the final locations for Labour’s new towns being chosen.
“There needs to be an entity, a body, that can bring in and harness sort of local views but also able to deliver,” he said.
Challenges ahead
There are currently questions – which have persisted since Rachel Reeves was Chancellor – about what, if any, public funding Labour’s new towns programme will get.
Another issue Labour faces is that, even after their simplification of the planning system, an intense legal process must take place before new towns can be built.
A Ministry of Housing, Communities & Local Government spokesperson told The i Paper that “the next generation of new towns will get tens of thousands of well-designed homes built so we have the homes we need, where we need them.”
They said they were “assessing the options for each proposed new town location – including [via] development corporations where appropriate – to make sure they are well placed to drive delivery. We will set out further details – including a construction jobs plan to make sure we have the skilled workers we need – in due course.”
But opposition in some of the chosen locations for new towns has been severe. As The i Paper reported this year, locals at Crews Hill in Enfield have campaigned against the Government’s plan to build a new town there and were unhappy with the way the community had been engaged in the process.
The Government’s public consultation on the proposed New Towns Programme and its environmental implications closed on 19 May. The i Paper understands it is now analysing the feedback and will publish a response in due course.
But, as Gascoigne and his scrutiny committee have made it clear, the clock is ticking.