A fourth generation of New Towns – focusing on delivery 

John Walker is the former chief executive of the Commission for New Towns in the 1990s and deputy general manager of the Milton Keynes Development Corporation. In this guest blog, he reflects on what government must do next to get the next New Towns built (this article is based on a lecture delivered on 14 October 2025 at a TCPA event).

I welcome the New Towns Taskforce report and the government’s initial response as an important step forward. But it now needs urgent and important further work to make its aspirations achievable. The focus now needs to be on delivery.

Based on my experience, which includes over 25 years in New Towns development, mostly at director and chief executive officer level, but a long time ago. And another 20 years involvement in later attempts to address the same issue – Sustainable Communities, Ecotowns, Garden Communities – none of which delivered the pace and scale that was promised. None of which used the New Towns Act. 

The New Towns legislation enabled the delivery of rapid, large-scale, joined-up development, and paid back the loans that paid for most of its development. This needs to be better understood, and quickly. It is strange, don’t you think that no government ever made any serious attempt to evaluate or learn lessons from the New Towns programme.

I believe there are seven core matters that need attention to make the fourth generation of the New Towns programme successful.

I believe there are seven core matters that need attention to make the fourth generation of the New Towns programme successful, all of which relate directly to use of the New Towns Act or similar, for delivery.  

1. Enhance durability 

2. Excellent planning with fast and predictable approval processes 

3. Full public control of development land 

4. Patient funding 

5. Clear and appropriate compensation law 

6. Community involvement throughout 

7. Clear accountability  

Durability 

The fourth generation of New Towns programme needs to run for 20-30 years to deliver successful communities. This is acknowledged by the Taskforce. The New Towns programme survived for around 50 years, through 17 general elections and five changes of governing party. Individual development corporations lasted a minimum of 20 years, sometimes more than 30.  

We must give our new New Towns the best possible chance of survival for long enough to prosper, in what look likely to be far more volatile times.  

Our post-war predecessors had a wisdom and clarity of purpose that was remarkable. They passed legislation creating delivery bodies that were almost perfectly fit for purpose. They put the most important powers and accountability in one place. How often do we hear of delivery failures in which everyone blames someone else? New Town development corporations had no one else to blame.  

The New Towns Act was passed in 1946. The last updates were incorporated in the 1981 version. It is still on the books, but could do with a tidy up!  

The 1946 New Towns Act states: 

‘The objects of a development corporation established for the purposes of a new town shall be to secure the laying out and development of the new town in accordance with proposals approved in that behalf under the following provisions of this Act, and for that purpose every such corporation shall have power to acquire, hold, manage and dispose of land and other property, to carry out building and other operations, to provide water, electricity, gas, sewerage and other services, to carry on any business or undertaking in or for the purposes of the new town, and generally to do anything necessary or expedient for the purposes of the new town or for purposes incidental thereto.’
  

That last bit is extraordinary. There could be no excuses for failure, unless ministers deliberately clipped their wings. New Town development corporations were equipped and expected to do what was necessary, to act as problem-solving machines in order to deliver the vision described in their plans, regardless of the obstacles they encountered on the way. They were ‘can-do’ organisations.  

These development corporations had powers to buy all development land in their area and were expected to do so quickly. Landowners knew Compulsory Purchase Orders (CPOs) would be granted because government made their support for this well known. As a result, the majority of land in Milton Keynes, for example, was bought without the need for CPO. This confidence does not exist today and will have to be created.  

Within a short time of being established, New Towns development corporations had acquired vast land holdings and were heavily in debt, which could only be repaid through successful delivery of their plans. They were therefore difficult to close down without major financial loss. Also, the Act requires that the government must be satisfied that they have ‘substantially completed their task of securing the laying out and development of the town in accordance with the approved plan’. So, the development corporations were in a good position from which to resist early closure from indifferent or hostile governments. 

The Taskforce clearly favours the use of development corporations, which I applaud. But it is surprisingly ambiguous and inconsistent in its reference to which types of development corporations. Given this ambiguity it is important to understand the different types of development corporation. 

First, the urban development corporations, created by Michael Heseltine from within the most market led, anti-intervention, anti-public ownership government we have seen in any of our lifetimes.  

They were deliberately created in a different form from New Town development corporations and for a different purpose. They were not to deliver planned communities but rather to enable quick intervention where it was necessary because of ‘market failure’. They were located in depressed urban areas where private investment was being frustrated either by bureaucracy or the large upfront costs of development, or both. They were a tool to help kick-start the engine of private investment and raise values. And they got a lot of public sector grants and were never expected to repay all their public funding.   

They were a great initiative and enjoyed a lot of success, but their powers and objectives were designed for a different purpose. So, while urban development corporations could be used to deliver new towns, they were not designed for, and are not ideal for, that purpose.  

Mayoral development corporations have many of the same qualities, plus being locally led, they will always suffer from government hesitation to trust them with lots of money, especially if run by ‘the wrong party’.  

Locally-led new town development corporations have been on the books since 2018 but are still untested. In my opinion they would need much stronger funding arrangements and a better designation process to be effective at large scale. They might, perhaps be used to oversee the later stages of growth in New Towns, when risk and public capital expenditure are reduced. 

More recent attempts by government to promote larger scale accelerated development include Sustainable Communities, Ecotowns and Garden Communities. Most relied on a mixture of locally led, non-statutory bodies for delivery; none used a new town development corporation, although one used an urban development corporation. All three initiatives fell short of their ambitions, and most delivery agencies were dismantled within a few years. Their delivery arrangements were too easy to shut down when the political climate and local priorities changed, as they always do and always will.  

My first plea to government and local authorities is, therefore, to truly understand why the New Towns Act was key to the durable success of the earlier New Towns. The legislation to be used now must be at least as good, preferably an update of the original.  

Excellent planning with fast and predictable approval processes 

A New Towns development corporation could be set up when the government was convinced of the need for substantial additional development in a particular location. It then prepared a master plan, which became the ‘prospectus’ for investors, whether they be companies, institutions, or families choosing where to make their future home. It represented a serious commitment.  

Today we would certainly expect the plan to contain a full set of development standards as well, set out up front, and preferably reviewed/upgraded every few years. But the master plan was not required before the development corporation was set up. This sequence is very important. 

Once the plan was ‘accepted’ by the minister, an implementation strategy, looking seven years ahead, was created as a basis for outline planning applications for infrastructure and liaison with utilities.  

Next came outline planning applications to the minister for specific development areas of, perhaps 2,000 homes plus all associated facilities such as parks, meeting halls, shops, schools, and so on. If the application was in line with the master plan these applications were usually agreed within one or two months. If they conflicted with the master plan and prompted objections there would be further discussion and there could even be a public inquiry.  

Then, more detailed plans for areas to be developed came next. And site briefs, issued to the market for private development. The best response for each site was selected using pre-determined criteria including price and quality, and a development licence was issued. The development could now go ahead, but freehold ownership would be held back until it was completed in accordance with the detailed proposals that had been accepted.  

Importantly, the whole consenting process was tied to land ownership, with the planning approval process in the background. This meant that lots of positive planning could take place, with consistent progression from master plan to district plans and into detailed placemaking; delivered mainly through private developers, with control through land ownership. It wasn’t easy but nor was it rocket science. Compared to today’s normal planning and development processes it moved at the speed of light! 

All made possible by the New Towns Act.  

And it worked! Housebuilders and commercial developers loved it.  

The Taskforce report talks in some detail about wanting a fast-consenting processes but ignores the option of an updated New Towns Act.  

So, my second plea is that the fourth generation of New Towns should use planning and consenting procedures based on those in previous generations, to ensure holistic planning, speed up consenting, control development quality and encourage innovation. 

Full public control of development land 

The Taskforce gave welcome, strong support for land acquisition, but fudged whether the development corporations should have absolute control of all development land. In my view this is unwise. The report also talks about public-private partnerships, with shared control and accountability. In my experience full control of land is fundamental, but that may not always mean full ownership. Full control enables infrastructure delivery, phasing of development, consistency of standards and access to the planning processes described above. It is also the best way to complete new communities quickly.  

In the 12 locations recommended by the Taskforce lots of land is already owned or optioned to developers. Hopefully, they will want to take advantage of the greater certainty and speed attached to the New Town development corporation development process and will be prepared to give up enough control and value in partnership with the development corporations. But if not, the government will need to stand firm on acquisition.  

My third plea, therefore, is that the corporations must be empowered and actively supported by government to control all the development land, sufficient to determine the content of site briefs, the quality standards, the pace of development and on larger sites, the selection of developers who will build the housing.  

Patient finance 

Patient finance has to be provided, initially by government.  

All the earlier New Town development corporations were financed principally through fixed-rate loans from HM Treasury over 60 years. This was great in the ‘50s when interest rates were 2-3%. But too inflexible when interest rates rose; later development corporations were borrowing at up to 18%, fixed, for 60 years! 

After a sensible settlement with the Treasury in the 1980s all the outstanding loans were subsequently paid back, with interest, by 1997 (nearly 40 years before they were due). Additionally, the Exchequer has continued to benefit from the sale of New Town assets since that time, to the tune of at least £2bn.  

That is not to say that future New Towns could repay all the costs of development – they are being developed in a changed world with different rules. However, it demonstrates the potential power of the New Towns Act to generate financial value and repay very large amounts of public investment- and create great places to live. So, I welcome the Taskforce’s support for up-front funding outside the annual budget round.  

Corporations focused on early land acquisition and major infrastructure. Their biggest financial ask was in their early years, and this should be the case again. I recognise there is never a good time to pitch for public cash. But, these would be repayable loans, and there should surely be a way of accounting for ‘loans’ that distinguishes them from ‘normal expenditure’? After a few years, with land acquired and major infrastructure committed, risk will be lower and it should be possible to replace government loans with private sector investment, possibly with some Treasury guarantees.

In the past, the upper limit for New Town loan finance was approved by Parliament, at designation. Given this, the annual budget allocation usually hinged on having a credible delivery plan rather than any form of competitive bidding. This gave everyone involved, including the private sector, greater confidence in delivery, avoiding the stop/go, that damages investor credibility, leads to delayed programmes, leaves residents waiting for key infrastructure.  

There were also some cross-departmental funding agreements in place. These really helped with specific aspects, avoiding the need for protracted case by case negotiation. Examples include schools, external road links, utility connections.  

My fourth plea is therefore that the government must confirm that initial patient finance will be made available to the New Town development corporations in a way that is flexible, reasonably predictable to ‘draw down’ year-to-year and coordinated across all relevant departments and regulators.  

Clear and appropriate compensation law 

The New Towns development corporations must capture the maximum possible increase in land value if they are to repay patient loans from the Treasury and/or pension funds. Otherwise, they will fail to get Treasury support and will never get off the ground. Or they will need much more grant aid and we will all end up paying more as taxpayers.  

The Taskforce and the government’s response highlights the need to acquire land needed for the New Town at ‘no-scheme world’ values. This is welcome, but a key question remains. For many of these locations, local authorities have already indicated that development would be welcomed. Hope value already exists. If the corporation intends to acquire this land, owners/private developers would expect to receive a share of this ‘hope value.’ On the other hand, the social infrastructure and design standards envisioned by the Taskforce may significantly reduce the residual value of this land. Clear guidance, and maybe legislation, is urgently required in what has become an extremely complex area of law that could cause endless problems of delay and cost. Doubt about outcomes could well scupper some of the proposed New Towns before they even get started.  

The extent to which each New Town development corporation can capture the increase in land value will obviously have a big impact their ability to repay loans, and therefore the ratio of loan-to-grant funding each will require. This, in turn, will begin to affect how these bodies are seen by future governments.  

Other rules needing definition include the ability to carry out direct development and hold it until its value matures, which increases loans but delivers additional added net value longer term.  

If these rules change part way through, so will the financial outcomes that can be expected. So, my fifth plea for government is to issue clear guidance and, if necessary, pass legislation, to ensure that the New Town development corporations have the power to capture the maximum possible increase in land value and repay loans. Failure to do this could be a deal-breaker. 

Community involvement throughout 

Community involvement, community development and stewardship are all rightly recognised by the Taskforce as important. This is welcome but further clarification now required on four key matters.  

1. How local communities must work with the corporations to define the nature of the master plan for each new town.  

2. As development proceeds, corporations must establish ways of working with incoming communities to review and refine detailed plans, learning on the job.  

3. Support for further community development will be needed, in terms of dedicated personnel and early availability of local facilities.  

4. The expanded community must be involved in the formation and management of longer-term stewardship bodies, supported by the corporation but becoming self-financing in the longer term. The Taskforce is right to say these should be formed, with identified funding, at an early stage, rather than left until the end stages of development as happened in the earlier New Towns. Just how this happens requires careful consideration and guidance.  

My sixth plea is, therefore, before development begins, clarify the processes and resources needed for community involvement and community development, then require regular and transparent consultation during development, and create locally based stewardship arrangements early on.  

Clear accountability 

Finally, create clear lines of accountability with proper delegation to each development corporation. But don’t micro-manage, a bad habit that seems far more prevalent today than it was 40 years ago and simply serves to undermine performance and obscure accountability.  

My last plea to government is, assuming you’ve agreed to all the things I’ve asked for so far, to hold New Town development corporations fully accountable for their performance, and do not attempt to micro-manage them. 

Conclusions 

There is a lot to welcome in the Taskforce report, especially after such a long gap since building New Towns. Clearly there is a lot more work to do and I’m sure those involved will share my sense that it is urgent.  

My fundamental concern is the durability of delivery arrangements and the need for clearer definitions of the means of delivery.  

Policies can be scrapped in a moment.  

Real progress on site, funded by public debt, with land fully acquired and overall planning approval in place, creates much more robust prospects of survival and success in a world that will become indifferent or hostile to these projects long before they are fully secured.