Rishi Sunak was on Tuesday night forced to delay long-awaited planning reforms after dozens of Tory MPs threatened to rebel.
The Prime Minister was facing the first major test of his authority next Monday when MPs were set to vote on his plans for mandatory, centrally-set targets to build 300,000 homes a year.
But a total of 50 Conservative MPs - including eight former Cabinet ministers - signed an amendment to the Levelling-Up and Regeneration Bill which would have abolished the targets.
On Tuesday night, the Government said the vote would be pulled, claiming the decision had been taken due to a packed parliamentary timetable.
Opposition parties said the real reason for the “shambles” was that Mr Sunak was “scared” of his own backbenchers.
‘We cannot go on as we are’
The climbdown came after lead rebel Theresa Villiers, the former Northern Ireland Secretary, said the plans would encourage “development which damages the environment and quality of life”.
On Tuesday, Ms Villiers said: “This is a significant victory for the backbenches. It shows that ministers know that they need to listen to us and they need more time to come up with a solution.
“We cannot go on as we are with these top-down excessive targets. We must have change. The 50 names on NC21 showed the strength of feeling there is on this issue.”
Sir Iain Duncan-Smith, former Tory leader, said: “These top-down targets have to go, and if the Government does not back down we will vote for this amendment.”
‘Congested parliamentary timetable’
The bill, introduced by Michael Gove, will still be debated in the Commons on Wednesday.
The controversial sections were due to be debated next Monday, but that debate will now be delayed by several weeks to allow further debate with Tory backbenchers.
A government source said the debate “may slip a bit due to a congested parliamentary timetable with the Finance Bill votes next week”.
“We will continue to engage constructively with colleagues over the next few weeks to ensure we build more of the right homes in the right places,” the source said, adding that he expected the debate to come “before Christmas”.
But Labour’s Lisa Nandy, the shadow levelling-up secretary, said: “This is a complete shambles. The Government cannot govern, the levelling-up agenda is collapsing and the housing market is broken.”
Ms Nandy added: “There is a case for reviewing how housing targets are calculated and how they can be challenged when disputed, but it is completely irresponsible to propose scrapping them without a viable alternative in the middle of a housing crisis.
“Labour will step up to keep this legislation moving. There is too much at stake for communities that have already been victims of Tory chaos and of a Prime Minister too weak to stand up to his own party."
Labour had already said it would not be supporting the rebel amendment - meaning there was no chance of the Government being defeated. But a vote would have been a huge test of the Prime Minister’s authority just a month after he took office.
The MPs who have signed the amendment - “new clause 21” - are from all wings of the party.
As well as Sir Iain and Ms Villiers, former Cabinet ministers include John Redwood, Dame Maria Miller, Damian Green, Chris Grayling, Priti Patel and Esther McVey.
The amendment would have meant that house-building targets “may only be advisory and not mandatory” and so “accordingly such targets should not be taken into account in determining planning applications”.
It added that the national planning rulebook “must not impose an obligation on local planning authorities to ensure that sufficient housing development sites are available over five years or any other given period”.
‘Targets undermining local planning’
A briefing note circulated among the rebels says that the MPs’ big concern was clauses which over-rule “local development management policies”.
“This would mean a major centralisation of planning policy, undermining the longstanding principle which gives primacy to the local development plan,” the note states. “If all these were set nationally, rather than locally, that could open the way for many dense developments which are currently prevented.”
Ms Villiers, who laid the amendment, said: “There is very serious concern on the backbenches that top-down housing targets are undermining local decision-making in planning and pushing through development which damages the environment and quality of life.
“That is why so many MPs are backing my amendment to scrap these targets. Ministers say they understand our concerns. But we want action to tackle this. We’ve been raising these points for two years.
“We need change. There are better ways to deliver new homes, for example by tackling land banking and stemming the flood of property owners switching away from residential use to short term holiday lets.”
Sir Iain said: “What these rules do is encourage the construction too often of the wrong buildings in the wrong places, and destroy communities.”
Bob Seely, the Tory MP for the Isle of Wight, said opposition to the planning proposals had no connection with the election of Mr Sunak following the resignation of Liz Truss.
He said: “This was going to be an issue for whoever had been in power. I believe Rishi Sunak is going to be a great Prime Minister, but these issues have to be debated.”