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Quite by chance, as if on order to make the local elections more exciting in my ward, two local planning issues have suddenly popped up (not entirely unexpectedly it has to be said) that are likely to cause a deal of controversy when they get to decision-making time. I don't want to talk about their planning merits or otherwise on here. But I do want to use them because they are very good examples of why I am so passionate about land reform.

The first, in the ward in which I am standing is an application for new student residences adjacent to the site on which I am a warden proposed by my employers, Oxford Brookes University. To be fair it will make more of an impact on residents in the neighbouring ward, but it is the economics of it all I want to look at not the planning, to show why land value tax would be such a benefit to the community.

The second, just over the main road in the neighbouring ward but which will make a significant impact on neighbours in both wards one way or another is the news today that Tesco have bought up a local former pub building from a local bar/restaurant entrepreneur who had seemingly been knocked back in the early stages of planning such that he no longer felt it worth fighting for his ideas for the site. Here I want to look at how the planning system seems to favour the bigger developer with the financial clout and how this affects the fairness of land law.

But first, the new proposed halls of residence. This site is approximately quarter remaining of a site the university acquired from the Department of Social Security about seven years ago now. When I was last on the council, just at the end, they had owned the site for about six months, if I remember correctly having bought the whole thing for either eight or eleven million pounds through a charitable trust set up for the purpose and were just getting outline planning consent.

The entire site had been only about a quarter used for several years since most parts of the DSS had moved out. And even when at "full capacity" it had been an egregiously inefficient use of a piece of prime inner suburban land - even for offices - since it was half car park and half single storey nissan hut type buildings.

Since it had been government owned, effectively there was no income to the public purse from this land. Once it was owned by a charity the empty land has generated no receipts to the public purse in the form of business rates. The charitable trust sold off about a quarter of the land to the adjacent Oxford International Centre for Islamic Studies, first for use as a contractors car park and now it lies more or less empty. A hectare of prime city centre building land. The university built nearly seven hundred student rooms in new halls on half of the original land and these were opened five years ago now. But it is the effect of this last quarter of of the site I want to examine and show how failing to encourage optimal use of land where it is available is a disaster for the rest of us.

The site is about a hectare. So if the original purchase price for the entire site was the higher of the two figures I remember hearing at the time - eleven million pounds, its share would be two and three-quarters million. The current application is for 335 study bedrooms and since the student halls market has changed out of all recognition in those seven years, commercial firms are willing to pay it is rumoured up to £45,000 per room for suitable land, as a site alone it would be worth more like fifteen million pounds.

Point one: whilst the local authority has received virtually nothing for this land in rates, the owners, either the university or the charitable trust, have effectively got a book profit of £12 million - a four hundred per cent return in seven years.

335 study bedrooms would, if theory, allow some 83 four bedroomed family homes to be freed up from the current student private rented market somewhere in the city assuming student numbers overall remained static. That's 83 largeish families who have been otherwise excluded from the housing market in Oxford for seven years because these halls did not exist. At its worst, that means that the tax-payer, through housing benefit, has spent upwards of ten million a decade supporting those households in private rented accommodation while they wait for "affordable housing".

Point two: the cost to the tax-payer of that piece of land laid idle and not producing any local taxation has been at least ten million in housing benefits to private landlords while the owners have made that massive book profit.

Now imagine if that land were taxed on its value at its most productive use - that's currently the £15 million or so a commercial halls of residence developer would pay for it. A ten percent land tax would now be yielding the public purse £1.5 million a year, and more importantly would have been liable for that tax all the while it has been so underused. No owner with any financial sense would have kept that land out of productive use with a tax bill like that. The land would have been brought into its best use long ago, either as housing itself or freeing up those equivalent 83 units for family use instead of student private lets, and the tax-payer would not have had to support 83 families to the tune of that £10 million pounds a decade in supported housing.

Now, don't get me wrong, I am neither criticising my employer nor demanding ten storey blocks of flats on every vacant site. But I am illustrating the cost to society of holding land out of use, and the unfairness where, in doing so, the owners have made a vast profit at the direct expense of the tax-payer. It's the system that causes this, not the participants in that system who are only following the rules everyone else plays by.

Now to the "Tesco pub". Some time ago this down at heel local pub was closed, its future uncertain. A well known local restaurant and property entrepreneur bought it up and a few months ago publicized his idea for turning it into a row of three shops and some flats above in a "landmark" new building. But with an ambivalent local reaction and, it seems, less than enthusiastic reception from the city's planners to the idea, this chap pulled his plans and decided to look around for a buyer. The land registry records show that the property had cost him £400,000 and that it was mortgaged so he had financed it empty for seven or eight months developing his ideas and the prospect of a long uphill struggle into the unforeseeable future in the planning system means he would be financing it empty for many months, if not a couple of years to come.

It is opposite a long established and not so long ago refurbished and extended local Co-op store (where I joined as a member of the Co-operative and where I shop several times a week in preference to all the other supermarkets around I could potentially choose from) and a less long established Costcutter store that houses the local Post Office and a similarly aged Chemist shop that replaced a locally owned and well patronized cycle and fishing tackle shop and an electrical retailer. It is, to put it mildly, on an awkward site, at a very odd junction just at the point the Marston Road becomes a dual carriage-way "boulevard" and buses turn right against the traffic whilst the off-road cycle lane comes to an end, the road splits into two lanes prior to a busy and slightly awkward double roundabout junction. There is just enough parking in the lay-by outside the existing shops for their customers and nowhere else for cars to park.

The site might have been viewed as ideal for shopping or catering uses complimentary to the existing neighbouring shops. Extending the range of goods and services people could get in a single visit to the local shops. All very sustainable. And contributing to the local economy and the success of local entrepreneurs - all of which tends to keep more money in circulation more locally in Oxford, making us all better off.

But now Tesco have the site. Obviously, they are in competition with two of the existing local stores. For many, they will do a better job of supplying their grocery needs and at lower prices. That too is good for peoples' pockets and therefore local wealth retention. But since, if they've borrowed to buy it at all, as opposed to taking the purchase price out of the weekend's take from the nearby Tesco out of town superstore, it's probably a tiny dent in their current income rather than a major liability as it would have been to the local entrepreneur who had borrowed to buy it as a significant chunk of his portfolio. And they can afford to sit on it until the planners give in, until attrition of any opposition to the idea gives them an easier ride in the planning process.

At the moment I wouldn't dare to have made up my mind about the idea of Tesco Express there. On the one hand, competition is good for the consumer. On the other, Tesco has such financial clout that it could send its competition to the wall and leave it eventually and open field to increase prices because of its local monopoly. And there again, whilst as a member I would be very sad to see either of the two existing competing stores fail, they would almost certainly then be occupied by some other, and probably local, entrepreneur with another great idea that would compliment rather than compete in its turn with the Tesco store. Again, this increases the range of goods and services a person can get in one trip to the local shops.

But all I am highlighting is that because the planning system causes a proportionately greater opportunity cost to fall on the smaller businessman it actually favours the big financial muscle of large corporates who can afford to take the risk for longer. It is not a level playing field. But, as in the previous story, it's the playing field on which all would be developers have to play. On the other hand again, it would be quite wrong for the planning system to become a tool of protectionism, benefitting one business or businessperson over another by preventing competition. Perhaps in an LVT based system the tax payable on a site should be suspended for the time during which the planning bureaucracy was deciding on a proposal to concentrate the minds of planners on getting the best deal for all parties in the minimum time possible and enabling people to get on with running their businesses, extending their homes, or whatever the application was for.

Anyway - all that was a bit of a marathon use of two local and serendipitously current issues illustrate quite well some of my hot button issues on land reform, free trade and anti-protectionism and localism.

ConservativeHome highlights a speech at the LSE in which (despite what I assume to be an error in the first sentence) Cameron today says that whilst they will want to increase environmental behaviour modifying taxes, they will want to use this to cut taxes elsewhere.

Of course they already know that the Lib Dems have specific and costed taxation proposals that use green taxes to cut four pence off the basic rate of income tax and take many low income earners out of income tax completely. We also have a long standing commitment to replace the Council Tax (though of course you know I don't agree personally with our replacement Local Income Tax) which deals nicely with what turns out to be the most hated tax in today's annual Tax Payers Alliance survey, again highlighted yesterday by ConservativeHome. And our "Green Mortgage" proposals will help households deal with their most worrying expense - their fuel bills.

So Cameron, what are you and Osborne going to cook up to beat that? And when? You can't go on just blathering and blustering indefinitely with vague and vacuous platitudes to your CH readership. You're certainly not ready for government if you can't even tell us what you're going to do on taxes.

Speaking at the LSE David Cameron has crushed any idea that the balance of green tax measures under a Conservative government will be cuts to encourage good environmental behaviour rather than tax rises to discourage 'brown behaviours':

"By using green taxes as extra stealth taxes, Gordon Brown has given them a bad name.  I’m determined that the Conservative approach will be different. With my Government, any new green taxes will be replacement taxes, not new stealth taxes.

In a few days, our Quality of Life Policy Group will publish its report. It will contain many recommendations on tackling climate change, at home and abroad, including recommendations on green taxes.  As with all the reports in our Policy Review, we will study its proposals carefully.

But let me be clear.  We will raise green taxes, and use the proceeds to reduce taxes elsewhere.That is the right direction for the environment and it’s the right direction for our economy. It is the best way to deliver the green growth that must be our aim."

I know - it's a week late. But I picked up a snippet the other day that tells you why Labour lost in Glasgow East...

Apparently voter contact had been absolutely zero for years. David Marshall had done virtually nothing for years (apart from perhaps collecting money from us for his carefully chosen constituency staff). He supposedly didn't even venture into the constituency much and held few if any surgeries. When they started the by-election campaign they were starting voter identification from scratch with no reliable previous data at all.

Utter bonkers. They absolutely deserve to have lost with the level of contempt towards the constituents that smug inactivity over the years demonstrates.

On the other hand, it puts the SNP victory in some context - were they any better than, say, the IWCA in Oxford whose only reason for existing as a force on the council was Labour's contemptuous attitude in their "safest" wards.

UPDATE: And I see from Dan Paskins that there is a motion in to conference saying much the same .

Anyone who's read any of my blog will know of the work I do on affordable housing through Oxfordshire Community Land Trust in my spare time. After five years of work, persuasion, lobbying, all for nothing, we have the opportunity, thanks to a very generous elderly lady who has settled all she wants to on her children is willing to swap us her house and its plot in return for about half its value and a smaller home carved out of half her existing cottage so we can at last get a site on which to develop a few affordable houses and prove the concept to the communities of Oxfordshire who would like to be able to do similar.

The trouble is that to be viable we have had to buy about half each of the two neighbouring gardens and are likely to try and get another adjacent one. And so, with the efforts of a very energetic fellow board member's contacts in the Society of Friends we have raised a decent chunk of this. Nevertheless we still have to fund the borrowing on about £170,000 worth of loans starting from the end of May when we are due to complete on the first two slices of adjoining land.

Anyway, it works out that in the worst case we probably need to fund interest payments of around £1000 per month until we either get planning consent and can realistically borrow against the land to develop or till we can raise the remainder as gifts and pay off the loan that way, whichever is the sooner.

So we have a variety of ideas about how to scrape together this sum, one of which is a commitment by me that, if in May I were to find myself in receipt of a small additional income, say from a councillor's allowance, the 90% of that I am not already committed to giving to the party to help me pay for Focus leaflets and campaigning in the ward will go to the charitable associate of OCLT, the Stonesfield Community Trust that is fronting our land purchase, to help pay that interest bill.

So, not only do I now have to win for Headington Hill and Northway, its residents, this and next year's new students, freedom and the Liberal Democrats, but also for OCLT and affordable housing in Oxfordshire!

Mad eh? We'll, we've got to pay for it somehow to prove the whole idea to skeptical councillors, the media and bureaucrats? What better a way if it works out right? I am standing in this election at least partly to promote my ideas for innovative financing of things like affordable housing. I'm sure there's not a household in the ward doesn't feel or understand the effects of the gross deficiency we have in Oxford and Oxfordshire of that.