Rishi Sunak is to drop compulsory housebuilding targets to see off an embarrassing backbench rebellion, prompting criticism he is putting party unity over the national interest.
The capitulation, which comes in the middle of a national housing crisis, will spark fresh concerns that the prime minister is too weak to take on unruly Conservative backbenchers. It followed up to 100 Tory MPs threatening to back an amendment that would in effect force the government to abolish the target of building 300,000 homes a year in England.
Instead, the target will be “advisory” and councils will be allowed to build fewer homes if they can show hitting it would significantly change the character of an area, an exemption expected to particularly apply to rural and suburban communities.
The move was described as “extremely worrying” by housing campaigners but saves Sunak and the housing secretary, Michael Gove, a humiliating showdown in the Commons. They were forced to pull a vote on the levelling up and regeneration bill last month when the rebellion first came to light.
For weeks, No 10, Gove and rebel ringleaders Theresa Villiers and Bob Seely have been holding meetings to find a “landing zone” that could satisfy both sides and avoid another blue-on-blue feud over planning.
Sources suggested the government initially hoped to buy off Tory opponents by offering to add amendments to the bill.
These included further restrictions on “landbanking” – the practice of buying land for investment without any active plans for its development – and a crackdown on second homes, an issue in some tourist hotspots in Cornwall and Devon.
But the rebels refused to cave in, and the Guardian understands the demand for the mandatory housing target to be axed was accepted by Sunak and Gove at the end of last week.
In a letter to Tory MPs on Monday, Gove said he recognised “there is no truly objective way of calculating how many new homes are needed in an area” but the “plan-making process for housing has to start with a number”.