The government has announced plans to reform housebuilding in the UK, including the launch of a consultation on Biodiversity Net Gain (BNG) rules for small site developments.
BNG was designed as a way of creating and improving natural habitats by making sure developments have a measurably positive impact on biodiversity, with developers required to deliver at least a 10% uplift in biodiversity via onsite and/or offsite projects, or the purchase of biodiversity credits from the government.
Also read: EAC urges UK government to reiterate its support for Biodiversity Net Gain
As part of the latest plans, minor developments of up to nine homes “will benefit from streamlined planning and eased BNG requirements”, with decisions being taken by expert planning officers rather than planning committees.
Additionally, a new ‘medium site’ category would be created for sites between 10 and 49 homes, which will face simpler BNG rules and a proposed exemption from the Building Safety Levy. According to the government, this will make it easier to deliver biodiverse habitats on these sites – “a win-win for nature and development”.
The government also announced that it will consult on how it applies BNG for Nationally Significant Infrastructure Projects to provide consistent regulations for developers. Measures are expected to be in place from May 2026.
“Smaller housebuilders must be the bedrock of our Plan for Change to build 1.5 million homes and fix the housing crisis we’ve inherited – and get working people on the housing ladder”, Deputy prime minister and housing secretary, Angela Rayner, said in a statement.
“For decades, the status quo has failed them and it’s time to level the playing field. We’re taking urgent action to make the system simpler, fairer and more cost-effective, so smaller housebuilders can play a crucial role in our journey to get Britain building.”
Private investment in nature requires certainty
Oliver Lewis, CEO of BNG start-up Joe’s Blooms, agreed that small site developments are central to the success of sustainable housing developments.
“Making up 80% of residential planning applications, they not only drive the majority of development but actively bring nature recovery into local communities – where people can see and feel the benefits on their doorsteps.”
But the government’s policy rollback risks fundamentally destabilising the planning system, he argued.
“BNG is a world-leading policy already delivering clear, measurable results. In just one year, it’s restored ecosystems, created new habitats and fundamentally transformed how developers think about nature and housebuilding. It’s one of the UK’s most powerful tools for tackling the biodiversity crisis while unlocking the sustainable housing revolution that we so urgently need.
“Ambitious development can drive national growth, and environmental stewardship must go hand in hand with it. Any attempt to roll back or weaken BNG would undo hard-won progress, destabilise the planning system, shake investor confidence and put both the UK’s natural environment and future growth at risk.”
Catherine Spitzer, CEO of Environment Bank, was more positive: “We welcome this government consultation to support greater housebuilding. It is important to recognise that the government’s BNG policy is already delivering in this respect and helping housebuilders get planning permission faster, while also driving nature recovery, boosting rural economies and supporting farmers and local government. In England, BNG is already generating £454.6m in annual economic value, supporting nearly 4,500 jobs and restoring over 17,000 acres of land each year.
“The BNG market is working across all levels, and we are already supporting major infrastructure developers, the likes of National Grid and Network Rail, major housebuilders such as Miller Homes and Barratt Redrow, as well as unlocking small housing sites with SME developers across the country. We can see that this arrangement is working well.
“However, private investment in nature requires certainty. It is crucial for government to set out a clear, unwavering commitment to the BNG policy. We hope this consultation process will provide that certainty, which will allow the market to thrive and continue delivering the wide-ranging benefits the policy offers.”
Asked whether these potential changes could mean investors have spent money on BNG projects that would no longer be necessary, Spitzer commented: “We expect any changes to give certainty to project investors. The government has reiterated its commitment to BNG, and we fully expect a robust offsite market to remain in place.
“The consultation itself stated ‘this new market is an important lever to drive private investment into nature, including meeting the goal for at least £500m of private investment to flow into nature recovery every year by 2027, rising to more than £1bn by 2030’. In that context, we see no suggestion that current investors have backed projects that will no longer be needed. Investors in existing BNG projects should feel reassured that demand continues to grow across housing, infrastructure, and local authority-led projects, and the fundamentals of the market remain strong.”
