Manufacturers are warning that planning delays and complex regulations are slowing investment in new industrial developments and reducing opportunities for the UK construction sector, according to a new industry report.

The report, Unblocking Growth, published by Make UK, found that almost half of British manufacturers believe the planning system is limiting economic growth and restricting business expansion.

Industry leaders say the issue is not only affecting manufacturers but also reducing construction opportunities linked to factories, industrial facilities and regional supply chain investment.

National Federation of Builders chief executive Richard Beresford said non-housing developments are often overlooked in planning reform discussions despite their importance to local economies and regional construction pipelines.

He said: “Non-housing projects do not get enough focus when we talk about planning reform, but they are key to placemaking because they provide the jobs, experiences and services that a healthy community needs.

“This is particularly important in manufacturing, as businesses that make things often bring their supply chain with them, in turn creating jobs for all and a pipeline of work for the regional construction industry.”

The report found that planning delays are increasing costs and creating “structural barriers” to manufacturing growth, with companies citing inconsistent decision-making by Local Planning Authorities (LPAs), costly application processes and complex regulations as major obstacles.

More than half of manufacturers surveyed also said environmental regulations linked to species protection, including newts and bats, had affected planning proposals.

Manufacturing projects facing years of delay before construction begins

The report warned that lengthy planning procedures can significantly delay the start of construction work on industrial projects.

Rico Wojtulewicz, Director of Policy and Market Insight at the National Federation of Builders, said planning complexity extends far beyond obtaining basic approval.

He said: “Many people think of planning as just getting permission for a project, but it is far broader than that.

“Planning conditions, environmental regulation, local policies, legal sign off, levy payments, reports, committee hearings, to name a few, are all part of the planning process.

“This can turn a two-year application into five or more years before a shovel goes into the ground, which for manufacturers may spell the end of growth plans because wasted time has diminished their competitive edge or their investment funds have drained away.”

Industry calls for faster planning reform and simplified regulation

Among the report’s recommendations is the introduction of a “Manufacturing Growth Test” to measure whether planning reforms are improving economic outcomes for industrial development.

Other proposals include national planning guidance to reduce inconsistent decisions between local authorities, simplified application processes and a more proportionate approach to environmental regulation.

Wojtulewicz added: “We need the Government to speed up their planning reforms and ensure every policy has a pro-growth test.

“In the short term this means ensuring the recently consulted NPPF reforms are implemented as quickly as possible, that updated water and energy policies outside a permissions control are proportionate or not applicable and, for upcoming Biodiversity Net Gain (BNG) reforms, make projects more viable when they focus on supporting species, rather than merely rewarding habitat creation.”