Policy change in the UK

Planning, a building-fabric-based energy standard, floor measurement conventions, VAT, Energy Performance Certificates, property tax, change in the construction sector, self-build, home-grown Passivhaus products, culture and policy-making


The UK planning system was established following the 1909 Housing and Town Planning Act and subsequent legislation, particularly the 1947 Town and Country Planning Act. Conceived to address the growing problems arising from the increasing density of settlement in parts of the UK, it was a key milestone and it has had a profound impact on the nature of settlement here, as well as on the look of our towns and cities. One of the main purposes of planning at local and national level is to control building development – clearly an essential role, given the scale of development over the last century. However, there are problems with the way the system currently works that makes delivering ultra-low-energy buildings harder.

Planning decision-making

The UK is unusual in the extent to which case-by-case planning decisions are made at the discretion of the local planning authority. The effect of this is to discourage smaller developers and self-builders, because most are unable to spend more than the minimum on design until after planning permission has been secured, owing to the uncertainty inherent in such a system. This impacts particularly on Passivhaus, because in order to deliver the standard as cost-effectively as possible, it is necessary to undertake more detailed design work than this minimum before submitting a planning application. Not doing so adds risk and potential cost for the house builder. Even larger developers may be unwilling to commit more than the minimum financial outlay to a potential project before it gets past the planning hurdle.

Significantly, there is a democratic role played in planning authority decisions, in that they are intended, in part, to take account of the views of local residents, as expressed in the responses to individual planning applications. And there is a conservative cultural tendency for people – whether residents, councillors or planners – to ‘vote’ for what they are used to. Furthermore, the planning process can inadvertently encourage verbose planning application responses that may focus on matters unrelated to the planning issues raised by the application. Indeed, some planning authorities carry warnings to the public to desist from abusing planning applicants in their responses to applications, and some choose not to publish application responses on their websites! All this consumes time and energy non-productively and feeds unpredictability and arbitrariness into planning application decision-making, despite the best efforts of those who work with integrity. It also adds to the risk that an innovative proposal will be refused planning permission, even if the applicant has sought pre-planning advice. As we saw in Chapter 4 (page 50), the planning system tends to inhibit innovative design in general.

Another problem with the current system is that planning decisions can completely undermine the objectives of what are, or should be, key national (and international) imperatives in areas as urgent and serious as climate change and energy policy. UK legislation from 1990 onwards has required local planning authorities to produce local and regional development plans. However, in practice they still seem to use their discretion in deciding to what extent the contents of these plans are taken as ‘material considerations’ in individual planning applications. It is possible for the plans to carry much greater weight in determining the outcome of individual planning applications than is generally the case. However, if the authorities’ discretion were limited, the risk is that the planning system would become inflexible. To counter this, plans would need to be much more detailed and more frequently updated. While such development plans might cost more to maintain, public and private money would be saved by greatly streamlining the decision-making process for individual applications.

More prescriptive and detailed development plans would allow clients and architects to work within known boundaries and rules, making the undertaking of design work prior to gaining planning consent less financially risky than it is today. This change would not mean that listed buildings have to be treated the same as buildings in general – any development plan could set out exceptions for those few special buildings that are listed. However, there is an argument that too many buildings now find themselves listed or in conservation areas (or are treated by planners as though they were in conservation areas) – 5 per cent of UK housing is now in a conservation area. A review of the criteria used in determining listed or conservation status should be considered, to halt ‘conservation creep’.

Planning would still be a local or regional process and as such could conflict with priorities expressed in national planning policy. However, a less discretionary planning process, more strongly driven by development plans, could link better with other government policies – and development plans could be scrutinised in the round, via a democratic process, rather than interpreted on the current application-by-application basis, where emotions can run high and personality issues can risk clouding rational decision-making. A less discretionary planning system should also be less susceptible to the risk of potential corrupt practices.

While it may be true that developing and maintaining more detailed and frequently updated development plans would potentially add to costs incurred by the State, the current planning system burdens the economy tremendously. Its capricious nature consumes a great deal of energy, time and money for planning officers, planning authority members, developers, architects, builders and clients. This takes many forms: self-censoring of designs, submission of speculative and over-sized plans as negotiating ploys, and money spent resubmitting plans following a change of heart by planners. If the cost of even some of this unproductive work could be avoided, it is unlikely that the change would represent a net cost to the economy. Clearly the cost of running the system is an important consideration, particularly given the current state of public finances.


The current UK government is promoting a policy it calls ‘localism’. As with zero carbon, announced by the previous government a few years ago (see Chapter 5), it has announced a new policy goal without thinking through its implications or even providing a workable, practical definition of the objective. The stated aim of localism is to repatriate decision-making to local bodies. This means that national planning policy is being scaled back and development plans are being slimmed down. Opposition parties say that localism is a cover for public spending cuts. While this may be true, with regard to planning it is of equal concern that the localism agenda is driving a move towards an even more discretionary planning system – exactly in the opposite direction to that required. Rather than arguments emerging once in the production of a development plan, they will be repeated again and again in multiple applications. The additional costs and risks involved could act as a greater deterrent to self-builder applicants than occurs in the current system.

While some discretion will always be needed, what is required is a rebalancing, to limit the scope for discretion in relation to individual applications so that the risk to house builders can be reduced. This change would put the UK planning system more in line with many other planning systems internationally.1 In some countries, constitutional rights further constrain arbitrariness in planning decision-making. Further streamlining could be achieved by encouraging brevity and a focus on planning criteria in application responses; this could be encouraged by the use of simple measures such as mandatory use of pro forma documents for respondents.

Planning criteria and low-energy design

In many areas, planning applications for buildings are frequently judged according to traditional material considerations:

•  impact on neighbourhood or neighbours’ ‘amenity’

•  loss of privacy or right to light

•  density of development

•  access, highways and similar infrastructural issues

•  visual impact of materials, appearance, scale, character, setting – are they ‘in keeping’ with the surroundings?

This last point militates strongly against creative new ideas about the appearance, style or form of new design proposals. In the pecking order of planning criteria, a design’s energy performance does not generally trump these traditional material considerations. If a design is deemed not to be ‘in keeping’ (a subjective determination by any reckoning), its energy performance credentials seem to gain little traction in support of an application. For example, the current weighting given to material planning considerations makes the case for external insulation on a retrofit much harder to argue successfully, because it would usually result in a significant change in the appearance of the building. While it is possible for external insulation to be faced with virtually any finish to match what was previously there, in practice it is arguable whether this improves a building’s aesthetics. Also, for example, requiring a brick finish to be replicated with a false brick façade (or a genuine one) may well make it practically or financially unfeasible. The photo below shows a residential side street in Brussels. A planning system less focused on ensuring that new developments are in keeping with what already exists may result in a more higgledy-piggledy street scene such as this one. Would the world really cave in if we allowed such ‘untidiness’? Indeed, should the State be the sole arbiter of what constitutes an aesthetically pleasing street scene?

Most house builders will naturally tend to act to minimise the risks associated with an uncertain planning process. They want to see the project realised, and therefore often tend to self-censor their designs to avoid challenging the planning system unduly and increasing the risk that planning permission is refused. Most will also want to commission only the minimum design work needed to get through planning. This typically involves preparation of a Design and Access Statement (DAS) as well as 1:1250 block plans, 1:200 site plans and 1:100 elevations that focus on ridge heights, window positions, glazing types, building position relative to neighbouring structures, materials to be used, and wall and roof finishes.

A street view in Brussels.

In a Passivhaus project, factors such as the position and size of windows, and the location of fixed shading devices such as roof overhangs, have an important bearing on the building’s annual heat demand, heating load and overheating risk. The design therefore needs to be entered into the PHPP, which in itself necessitates deciding on the internal floor layout (in order to determine the treated floor area); this in turn means some work on the duct layout of the MVHR system. All this is necessary in order to get meaningful energy-performance information, and means that more design work must be undertaken and costs incurred at risk before planning permission is gained – even more so in a retrofit project or with an unusual design, or where the architect or Passivhaus Designer are new to Passivhaus methodology. Unless the client is strongly committed to the goals of the project and financially able to take the risk, the planning process will act as a deterrent factor, slowing growth in the self-build sector and in Passivhaus and ultra-low-energy construction in particular. Conversely, if a planning application for a Passivhaus project is submitted without sufficient design and energy modelling work, you will be locking yourself into a design that is potentially a lot less efficient. This will probably result in more expense than is necessary to achieve the Passivhaus standard. Even where the planning system doesn’t deter to the extent that a ‘difficult’ project fails to get off the ground, design choices will still be influenced by the wish to minimise planning risk.

In the Totnes Passivhaus project, more east–west glazing was used than is ideal in a Passivhaus, mostly to make up for restricted solar gain on the south façade, as well as client preference for good daylighting in key living areas. Unlike south façades, where fixed overhang shading devices provide effective summertime shading because the sun is high in the sky in the middle of the day, east–west windows need shading in front of the window (often external blinds) to keep out morning and late-afternoon solar gain when the sun is low in the sky. In many parts of Europe, external shading using Venetian blinds or roller shutters is quite common. However, this is not part of the UK’s architectural tradition, and so to avoid prejudicing the planning application, windows with integral blinds, such as the one pictured opposite, were chosen: the external blinds are contained within an additional pane of glass, giving the windows a conventional appearance that was less likely to ‘offend’ the planners.

In a planning system with strengthened development plans, although local planning authorities would produce these plans, central government could establish a binding framework of national policy objectives that the regional or local plans had to address (or at least not conflict with). While some of these may relate to broad standards, it could also stipulate specific matters and how these should be weighted. In relation to low-energy design, these would need to include the following:

•  Impact of form factor on energy performance and cost. House builders should not be pressurised by the planning system to design buildings with an inefficient form factor.

A window with integral blinds (external and internal views).

•  Acceptance of the use of external shading devices (e.g. blinds, shutters and overhang eaves).

•  Acceptance of external insulation by default (e.g. in retrofits, greater flexibility about brick or stone finishes being replaced with insulated, rendered finishes), unless a listed building. A more flexible approach should be used in conservation areas.

•  External insulation (projecting beyond the wall and roof lines of neighbouring buildings)

•   Window design (performance versus traditional window aesthetics, e.g. use of mullions). While ultra-low-energy windows with mullions and muntins exist, they cost significantly more; the circumstances in which these are required by the planning system should be more limited.

•  Significance of having openable windows. Adequate natural ventilation is vital in a Passivhaus.

•  Roof orientation and use of projecting angled frames for solar panels to allow better optimisation of renewable energy generation. While not a Passivhaus-specific issue, this type of change would make planning decisions align with national energy policy.

Planning professionals need a properly coordinated and adequately funded programme of ‘continuing professional development’ training to help them gain a better understanding of how their decisions impact on the energy performance and construction costs of buildings.

Currently, these factors, in so far as they are understood at all, are seen by some in the planning system as falling within the rubric of ‘sustainability’ and, as such, represent merely the demands of one of a number of competing sectional and (in their own terms) equally valid interests. In other European countries, there is a broader recognition across society that there is a common interest (economic, social and environmental) in cost-effective low-energy building. This partly explains why in Frankfurt in Germany, for example, all new public housing developments must be built to Passivhaus standards.

The bigger picture

While we all have our opinions of what is architecturally ‘in keeping’, our energy and climate predicaments must surely be treated as overriding collective concerns. If we fail to address these most profound challenges intelligently, other issues that we care about will be subsumed by multiple crises on a far greater scale. Reducing fossil-fuel energy consumption in our housing stock is one of the easier ways to reduce energy use and carbon emissions without impacting on ‘lifestyle’. By comparison, reducing fossil-fuel use in transport is much harder without big changes in societies dominated by private transport. If we are unable to reduce the demand for energy in our housing stock, we will be forced to save it in other more difficult areas.

In facing those challenges, our planning system will continue to have a vital role; not just in ensuring that it does not put unnecessary obstacles in the way of delivering ultra-low-energy buildings. Even more fundamental is its role in protecting our agricultural land so that we will be able to feed ourselves on a much leaner-energy diet. Planning is one of many policy areas that need to adapt to reflect our changing energy and environmental reality.

A building-fabric-based energy standard

As has been observed elsewhere in this book (see Chapter 5), within the UK there is currently no statutory, ultra-low-energy whole-building energy standard based on how much energy a building uses before taking account of any add-on technology such as solar panels. The result is that we are constructing buildings that are comparatively inefficient. Only with the help of expensive technology with a short lifespan relative to the building itself (e.g. wood burners or boilers, or solar photovoltaic systems) is it possible to reduce or offset the carbon emissions from their still-considerable energy use, in order to be defined as low carbon or zero carbon. This relatively complex technology needs to be maintained and correctly operated, and any energy assessment of the building that relies on it is valid only for the working life of the technology. There is nothing to stop a wood-chip boiler, for example, being replaced with a natural gas or multi-fuel one at a later date, thereby undermining the original low-carbon design intent.

kWh versus carbon emissions

If we are to respond rationally to the ‘bigger picture’ challenges (see box, left), we need meaningful, effective indicators (measures) of progress towards our goals. As consumers of energy, our primary goal must be to reduce our burden on the energy generating system by demanding much less energy and using it to much greater effect. This will help those responsible for generating energy to ‘decarbonise’ energy production by giving them a less onerous task. We receive energy bills that use kWh (kilowatt hours) as energy units. Any meaningful measure of how efficient a building is should, therefore, be based on these units rather than on the more remote (in everyday terms) concept of carbon emissions.

An energy-efficiency standard based on the performance of the building fabric, together with other measures to help the construction sector to adapt, would allow the UK to reduce energy demand arising from its building stock. The latest version of the Code for Sustainable Homes (CSH) has started to address this by the introduction of a Fabric Energy Efficiency Standard (FEES) – an encouraging sign that Passivhaus and zero carbon are becoming more closely aligned (see Chapter 5).

While the Passivhaus standard is very demanding, Passivhaus methodology could form the basis of a set of building-fabric energy standards. (This approach has been developed by the AECB with its CarbonLite programme.2) A suggested set of energy-performance standards for typical residential and non-residential buildings is given in Table 14.1 below.

A convention for measuring floor area

The unit of measure for the above suggested standards – kWh/m².a (kilowatt hours per square metre per annum) – is based on floor area. A prerequisite for such standards, therefore, is an agreed statutory convention for measuring floor area, used by all relevant professional groups. Without this, there is no way to compare one building with another accurately. However, such a single convention does not yet exist in the UK. As we saw in Chapter 7 (page 94), Passivhaus uses a very specific definition of what constitutes treated floor area (TFA). For obvious reasons, the Passivhaus Institut chose to use the pre-existing German regulation as the basis for this definition. Ideally, we in the UK would adopt a common standard with other European countries, or (more challenging still) an international standard, allowing the UK to accurately compare its performance with those of other countries. This would help drive improvements globally.

VAT as a lever for best building practice

Currently in the UK, a lower 5 per cent VAT rate is applied to certain items – e.g. some insulation and solar installations – as long as they are fitted by a builder or installer with the correct registration (e.g. MCS for solar). Otherwise, UK law currently allows developers and self-builders on new builds to claim back all the VAT paid on the construction costs, but not professional fees. Retrofits and extensions are subject to full VAT, currently 20 per cent. This represents a massive financial disincentive to retrofitting existing properties.

Table 14.1 Suggested energy standards for the UK

* Adjusted to reflect Passivhaus floor area measuring convention.

This skewed policy could be replaced by a new VAT regime that is neutral in its treatment of new builds and retrofits while being revenue-neutral in tax terms. Even better, why not use the VAT system to encourage an improved FEES? All that would be needed is a reasonably accurate system of assessing the energy performance of buildings.

Energy Performance Certificates (EPCs)

Within the EU, buildings are being assessed for their energy performance – every property is required to be assessed once every ten years. Under the UK’s interpretation of the EU Directive,3 properties have to be assessed much more frequently: when new, between tenancies and every time the property changes hands. The assessments are known as Energy Performance Certificates (EPCs), an example of which is shown on the right. Perhaps in order to cut the cost of these overly frequent assessments, or perhaps because the UK left it too late to put timely and well-considered arrangements in place, EPCs are based on a simplified form or ‘reduced data set’ version of the Standard Assessment Procedure (SAP). Unfortunately, this has meant that EPCs have been of very limited success in providing a meaningful measure of a building’s energy performance.

An Energy Performance Certificate.

A reformed EPC, focused on the building-fabric performance, could provide the information needed to determine the applicable rate of VAT on all retrofits and new builds. The VAT regime should be designed to make it a disincentive for house builders to construct energy-hungry structures. Where recent building work has been completed, the EPC could encompass broader measures, such as the environmental impact of the building materials used – provided, of course, that a well-thought-out system of measuring these additional criteria had been formulated.

Property tax

With its housing stock in such poor general condition, particularly in relation to energy performance, the UK has a challenge to protect poorer people from fuel poverty. The ongoing squeeze on credit since 2008, and low levels of personal saving in the UK, have restricted access to the ‘property ladder’ for many would-be homeowners. The result has been a big increase in the number of people renting. The problem of fuel poverty is made worse for people renting in the private sector, as they are not able to make any but the lowest-cost, least-invasive energy performance improvements to their homes. In a climate where demand for rented property outstrips supply in many areas, the tenant has even less power; if tenants complain too much, there are always plenty more to replace them.

Until 1990 (1989 in Scotland), residential properties were subject to a property tax – rates – based on the rateable value of the building in question. Local rates were chargeable to the property owner, even if the property was rented out to tenants. After rates were replaced first by the poll tax (‘community charge’) and swiftly thereafter by council tax, property tax became payable by residential tenants in rented properties, not by their landlords. Business premises are still subject to rates, which are payable by the tenant.

There has not been much success in reforming local property tax in the UK. Perhaps the trauma of the poll tax experience has contributed to policy paralysis. However, a reformed property tax, weighted according to a building’s EPC rating as well as or instead of its value, and payable by the owner, not the tenant, could be used as a lever to send an unambiguous signal that makes owning energy-guzzling buildings economically unattractive. This area of policy would need careful consideration, as many rental properties are in communal buildings, e.g. a flat in a block of flats, and landlords are therefore not always in a position to make energy-performance improvements.

Supporting change in the construction sector

The UK government has not yet chosen to invest in retraining the construction sector so that it is properly equipped to deliver successful, cost-effective low-energy builds. The experience of the last few years has shown that driving change solely via regulation has taken the UK down the path of techno-fix solutions and a box-ticking approach rather than an effective focus on getting the building fabric right. Regulatory change needs to be accompanied by practical training support, as was the case in Canada’s implementation of their ‘Super E’ standard (see Chapter 4, page 49).

As has been discussed elsewhere in this book, construction workers on an ultra-low-energy build need to understand the role that airtightness, thermal bridging and ventilation play in achieving very low energy use. Vocational training for the building trades needs to include an overview of building physics, including moisture management, and cover the wider social and economic effects of poor building energy performance. It is not enough that students learn how to achieve good airtightness or to avoid thermal bridging; they need to know why they are being asked to pay such close attention to what ‘common sense’ might suggest is unimportant. As noted in Chapter 4, the UK’s education system has not been good at combining academic study and vocational training, and opinions differ about how much weight should be given to academic education versus vocational training. But it seems daft to assume that, just because an individual is not achieving enough academically, he or she should be encouraged to direct their efforts solely to vocational training. A relatively immobile class structure and old-fashioned attitudes to class still fuels a tendency to pigeonhole people as ‘blue collar’ or ‘white collar’. There are benefits to a more holistic education and training system that encourages us to develop both vocationally and academically.

From outsourcing to ‘insourcing’!

Outsourcing came into fashion in political and management thinking during the 1980s. Companies were encouraged to focus on ‘core competence’, shedding workers whose roles fell outside their core business. Flexible working practices were encouraged to make companies more nimble; more able to adapt to fluctuating requirements. The construction sector is more subject to the cyclical swings in the economy than most, so outsourcing helps construction firms big and small to cope.

The boom-and-bust swings in the construction sector have been made worse in some countries because they have become so dependent on property speculation to fuel their economies. Post-2008, the ongoing squeeze on credit and energy supplies is making a return to pre-2008 levels of speculative building much less likely. This means that the UK’s construction sector is likely to continue to be dominated by the practice of outsourcing.

Building any structure with multiple services and a weather-proof envelope requires good communication and cooperation between all the operatives on-site; in the case of a Passivhaus build, good communication is essential. On so many projects, however, with atomised groups of outsourced workers, sometimes complete strangers, the vital communication and cooperation needed often does not take place. Contractors are tasked and motivated to deliver only their package of work in isolation, without reference to the potential knock-on effects their work could have on others. Many outsourced workers never even see the completed building and therefore have no investment in the overall goals of the project. As we have seen throughout this book, this way of working is quite antithetical to what is needed in a Passivhaus build.

A reduction in the use of outsourcing would not only put into place a framework that encourages less transient teams of site operatives but also bring wider benefits: construction workers would enjoy greater job security and satisfaction, and there would be a shift away from the corrosive blame culture that permeates so much of the construction sector. It is demotivating to work in an environment where so much personal energy is consumed in working defensively to avoid being blamed for errors and omissions. This generally arises from gaps and overlaps in the responsibilities of different trades. Most construction workers (indeed most workers in any sector) dislike this type of working environment, and this in itself is reason enough to encourage long-term multidisciplinary teams within the construction sector.

Clearly, moving away from today’s extreme levels of outsourcing will be a challenging task, and will require State intervention in some form – we have to find a way to make ultra-lowenergy building cost-effective and widespread. Other countries are managing to do this; are we to say that our best response is defeatist hand-wringing? Perhaps moving back to smaller, ‘human-scale’ construction companies would facilitate stronger team working, even if some outsourcing continues.

Promoting self-build

‘Self-build’ refers to any building project that is commissioned by the people who are going to live in the property. The majority of self-builds are constructed by professional contractors, but some are built partly or mostly by the prospective owners. Although self-build has enjoyed growth in recent years, it still represents only about 12 per cent of all new housing in the UK. This contrasts with upwards of 50 per cent across Europe. In countries such as Austria, self-builders are responsible for up to 80 per cent of new houses. The self-build sector is also stronger in the USA. The predominance of PLCs (public limited companies) in UK house building has encouraged unadventurous building to minimum energy-performance standards: as discussed in Chapter 4, large housing development firms have evolved building methods or formulae that deliver saleable homes for a reliable cost; they have no interest in building to reduce their purchasers’ running costs. Where customers express an interest in lower bills, the housing developers have to manage this market expectation in ways that do not threaten their shareholders’ interest in a reliable return on their investment. Unless the status quo is losing them money or made illegal, they will be loath to change, as to do so brings cost risks.

Self-builders have an incentive to invest up-front in order to make their home cheaper to run. They also tend to be more willing to innovate, perhaps because they are less averse to risk (or less aware of the financial implications of some of their choices). Or it may simply be that the demands of their mortgage providers are less burdensome than those of the large housing developers’ shareholders. The biggest obstacle self-builders face is lack of access to building plots. Britain is unusual in the extent to which land ownership is concentrated in the hands of the very wealthy few families, corporations and State agencies: the Royal Family, the Ministry of Defence, the Forestry Commission, local authorities, the aristocracy and, more recently, ultra-rich overseas purchasers. According to Kevin Cahill, writing in 2001,4 less than one per cent of the population owned more than two-thirds of land in Britain, although clearly not all of this is suitable or appropriate for housing development. The Scottish Parliament passed a Land Reform Act in 2003 that gave Scots defined rights to buy limited land without the owner’s consent. However, when land is released by the planning system for building development, it still almost invariably goes to the large housing developers. The problem of access to land is made even worse by the practice of ‘land banking’ by developers and specialist land banking companies: land on the edge of towns is bought up and held in anticipation of a future change in planning status or higher future house prices. This state of affairs limits self-builder innovators to the relatively wealthy, who can afford to buy the few expensive available plots. Even the more affluent self-builders are often forced to buy an existing property for retrofitting or for demolition and rebuild; itself not a cheap option.

A modest land tax would provide a disincentive to unproductive hoarding of land. Provision is also needed to ensure that much more of the land released by planning authorities for building is given over to self-builders and small-scale developers. In this respect, an encouraging development is to be found in the latest draft National Planning Policy Framework (July 2011), which includes the proposal that an obligation should be placed on local councils to meet the self-build demand (see Chapter 4, page 48).

Encouraging home-grown Passivhaus products

Currently, the countries that lead the world with Passivhaus, Austria and Germany, also lead the world with the manufacture of products that help you build to Passivhaus standards. The UK needs to make the capital costs of building a Passivhaus as competitive as possible. We also have to address the need to reduce supply chains so that a greater proportion of building materials is produced nearer to their point of use, particularly those that are heavy or bulky to transport and that are not complex to make. In a region the size of the UK, there is also no reason why more specialist products, such as Passivhaus-certified triple-glazed windows or heat recovery ventilation systems, could not be made domestically. The aim should be to make these products mainstream, just as double glazing is now.

The UK government does not have a track record of providing incentives to this sort of productive sector, which, if it were as healthy as its German or Austrian counterparts, would make a significant contribution to the economy and to achieving the country’s social and environmental goals. The Austrian province of Vorarlberg has been very successful in bringing together all the policy levers necessary to reduce energy demand from housing and promote the development of suitable domestically manufactured products. The UK government expresses reluctance to interfere in the ‘free market’ economy, but this stance is very selective, as its frequent interventions in its favoured sectors – car building or, most spectacularly in recent years, the finance sector – have demonstrated. In contrast to this position, there is an economic argument that in capitalist economies new sectors will not grow without initial support from the State until they reach self-sufficiency.

Culture, politics and the policy-making process

Since 1979, when neoliberal economics took hold of government thinking in the UK, the arguments have been that ‘the State shouldn’t intervene’ or ‘the State isn’t competent to intervene’. These ideas have become embedded in much of the UK’s mainstream political discourse in a way that is not the case for most of our Continental neighbours. Even during the Labour years of 1997-2010, the nature and extent of State intervention was constrained by the pervasiveness of this notion.

In parallel with, or perhaps pre-dating, this loss of belief in the efficacy of the State has been the growth of a culture of short-termism – both in policy-making circles and more broadly. It has had many impacts: as discussed in this book, house building is subject to its effects. From the late 1980s until recently, both Conservative and Labour governments embraced the private finance initiative (PFI) as a means of funding new capital projects in the public sector without adding to the public sector borrowing requirement – real something-for-nothing financing. We also see this tendency in retailing: subscription-based products, such as home phone or Internet services, are marketed with the first few months at half price; bubble-jet printers are sold very cheaply but the ink supplies are very expensive. These marketing strategies work because their customers are solely focused on up-front costs. Even PLCs, by focusing relentlessly on maximising shareholder value to the exclusion of almost all other objectives, have created incredible short-termism in the corporate culture. Similarly, the finance sector, which used to have a role supporting the long-term growth of the small- and medium-sized enterprise (SME) sector, has given this up in favour of ultra-short-termism – ‘casino capitalism’.

Added to this, in more and more areas, the government’s role in policy-making is being pared down to that of a cipher for lobbyists representing the interests of large corporate groupings. An example is role of the Home Builders’ Federation (HBF) in co-chairing the government’s ‘2016 Taskforce’,5 which is addressing barriers to achieving the zero carbon standard. While it is makes sense for the HBF to have an input, the government needs to be the one in the driving seat, setting the framework and critically appraising the submissions of the HBF and other interested parties, such as the National House Building Council (NHBC). As we have seen in this chapter, moving towards a Passivhaus future, whether or not it includes zero carbon, will require difficult changes, and HBF members may not regard these as being in their (short-term) interest.

In a world of Twitter and non-stop rolling news, the media has fed the culture of short-termism. In the compressed timescales of today’s news-gathering, it has become virtually impossible to convey complex issues, particularly when understanding them requires an explanation of the science and the numbers. The demands of the media for catchy headlines and instant diagnoses of problems, swiftly followed by ‘solutions’, have reduced the quality of debate and encouraged governments to pass poorly thought-out legislation in haste.

In the face of all these trends, it is not surprising that the process for developing policy has been so undermined. Making Passivhaus happen on a large scale in the UK requires a sea change in the way we create and implement policy, and a renewed belief in the ability of State agencies to pull together all the elements of policy needed to achieve a desired objective. That change will not happen unless we have the courage and imagination to do things differently, at all levels.


There is much scope in the UK for changes in public policy – and, crucially, in the public-policy-making process – that would help the UK realise its ambition to construct all new housing to a very high energy-performance standard, and to do so cost-effectively. The areas where such changes are required range from planning to the provision of training and support to develop new skills and knowledge in the construction sector. Of course, it will take time for such changes to be conceived and implemented properly, and before the benefits become apparent. The key areas where change is needed are as follows.

•  Planning – a reform of the system, strengthening the role of development plans and putting limits on the scope of discretionary application-by-application decision-making.

•  Development of a fabric-based energy standard.

•  Development of an agreed convention for measuring floor area.

•  Changes to the VAT regime as it applies to construction.

•  Changes to property and land tax, and land disposal.

•  State-supported training to help the construction sector adapt to low-energy building.

•  Promotion of self-build.

•  Encouragement to promote homegrown Passivhaus products.

The policy-making process needs to avoid the pursuit of short-term political gains and must be driven by government without the undue influence of corporate lobbyists.