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UK urged to relax green belt planning restrictions to tackle housing crisis

Britain should relax planning restrictions in green belt areas to help deal with its housing crisis, an international economic think tank has recommended.

Shortage of housing was one of a number of factors identified by the Organisation for Economic Co-operation and Development (OECD) as holding back UK growth, alongside poor skills and a lack of investment in infrastructure and research.

Among its other recommendations were more toll roads, an expansion in vocational education and lifelong learning and better provision of social housing.

The OECD's Going For Growth 2017 report found that low productivity growth was a problem across the industrialised world and warned that the pace of the structural reforms needed to address it has slowed over the past two years to return to levels seen ahead of the 2008 financial crisis.

"Governments cannot afford to let up on reform if they want to escape the low-growth trap many of them are facing and to ensure that the gains of economic growth benefit the vast majority of citizens," the report warned.

But "stagnating incomes" as a result of low productivity growth have eroded popular support for reform, at a time when governments around the world are facing "major policy challenges" requiring structural change.

The report found that income inequality had "fallen somewhat" in the UK but remain above the average of the 35 developed countries which make up the OECD.

And it said that efficiency in public sector administration had improved since it was raised as an issue in the last such report in 2015.

Setting out the OECD's recommendations for reform in the UK, the report said: " Greater spending on education and training would raise skills and enhance productivity, allowing for higher wages.

"Higher housing supply would improve labour mobility and reduce skill mismatches, resulting in additional income gains.

"More investment in research and development and higher infrastructure provision would support technical progress and boost the capital stock, also enhancing progress in living standards."

Detailed recommendations for boosting housing supply included: "Further relax regulatory constraints to release more land for housing, in particular by thoroughly reviewing the boundaries of protected areas of the green belt and by easing skyline restrictions.

"Enhance the provision of social housing where private sector activity is insufficient to promote greater equity in housing access."

On transport, it said Britain should "move towards user pricing, especially in areas where negative environmental externalities exist, such as road transport".

The report also called for the UK Government to use grants, loans and procurement to leverage private sector innovation in "disruptive" technologies.

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