A development corporation is an independent body created by government to regenerate or develop a defined area. In England, they include urban development corporations established under the Local Government, Planning and Land Act 1980; new towns development corporations set up under the New Towns Act 1981; mayoral development corporations created under the Localism Act 2011; and locally led development corporations formed under the Levelling-up and Regeneration Act 2023. Prime Minister Andy Burnham’s government has committed to strengthening the framework for public development corporations as part of a new ‘local first’ approach to devolution. Against this backdrop, what opportunities and challenges do development corporations present for rural areas? Jessica Sellick investigates.
In brief:
- Development corporations are expanding – analysis from the University of Birmingham suggests 10-15 new ones could be created in the next 2 years, the biggest wave since urban development corporations in the 1980s.
- Every development corporation established or proposed so far has been designed to deliver urban development, whether regenerating towns and cities or building new towns. None has been established to serve rural communities.
- Defra’s Future of Rural England Report (July 2026) commits government to rural-proofing devolution – but delivery depends on rural priorities being built into Local Growth Plans and Spatial Development Strategies from the outset.
- Is there a workable case for a rural-specific development corporation model, and how could it be financed?
The origins of development corporations can be traced back to the post-war planning reforms that followed the recommendations of Lord Reith’s New Towns Committee in 1945. The resulting legislation — including the New Towns Act 1946, the Town and Country Planning Act 1947 and the Town Development Act 1952 – established a framework for accommodating population growth through planned development and created development corporations to deliver it. Development corporations were initially established to plan, develop and manage new settlements to accommodate population growth and urban overspill from London. Since then, successive governments have continued to use development corporations as a mechanism for delivering large-scale development and regeneration projects across England, Scotland and Wales. The Royal Town Planning Institute describes them as ‘time-bound, geographically-specific executive agencies, established when the state wants to firmly incentivise and guide the location of development activity’. What forms of development corporation exist today, and what do they mean for rural areas?
What are Development Corporations and why do they matter now? In Great Britain, there are four main types of development corporations:
- Mayoral development corporations (MDCs), established by strategic authority mayors under the Localism Act 2011.
- Urban development corporations (UDCs), established under the Local Government, Planning and Land Act 1980.
- New towns development corporations (NTDCs), established under the New Towns Act 1981 – and previously under the New Towns Act 1946.
- Locally led development corporations (LLDCs), established under the New Towns Act 1981 and subsequent Levelling-up and Regeneration Act 2023.
MDCs, UDCs and NTDCs are established under secondary legislation – with the Levelling-up and Regeneration Act 2023 permitting the government to establish UDCs and permitting local authorities to propose NTDCs. UDC and NTDC powers apply to England and Wales only – with the New Towns Act 1946 making provisions to Scotland to establish development corporations, and the New Towns Act (Northern Ireland) 1956 act making provisions for Northern Ireland.
MDCs are established by powers granted to combined authority mayors and the Mayor of London: there are currently 3 in London (Olympic park legacy, Old Oak & Park Royal, and Oxford Street), 3 in the Tees Valley (Hartlepool, Middlesbrough, South Tees), and 3 in Greater Manchester (Atom Valley, Old Trafford, Stockport, which became the first MDC to treble its boundary to cover an entire town centre in 2026). There is also one in Northern Ireland (Maze Long Kesh), although it was created under Northern Ireland legislation rather than by a mayor. More MDCs are being proposed in England: in March 2026, the West Midlands Combined Authority, supported by Birmingham City Council, agreed to submit a proposal to Government to establish the Birmingham East Mayoral Development Corporation, which Budget 2026 says ‘aims to deliver 50,000 jobs and 20,000 homes; between May and July 2026, Greater Manchester Combined Authority consulted on creating a MDC for Middleton; and Liverpool City Region Combined Authority and Liverpool City Council also consulted in July and August 2026 to establish a MDC in the North Docks.
There are currently two UDCs: Ebbsfleet Development Corporation (established in 2015), with a new UDC in Greater Cambridge whose Establishment Order came into effect on 23 July 2026. Previous UDCs, formed in the 1980s and 1990s, included London Docklands, Merseyside, the Black Country, Teesside, Cardiff Bay, Trafford Park, Tyne & Wear, Sheffield, Bristol, Central Manchester, Birmingham Heartlands, Plymouth, London Thames Gateway and West Northamptonshire.
Back in October 2019, the government announced a development corporations competition, making £10 million available between 2019 and 2022 for local authorities to develop business-backed development corporations or similar delivery models. This led, in September 2021, to Milton Keynes being awarded £665,000 to explore how a LLDC could support the delivery of 60,000 homes by 2050 and 50,000-90,000 jobs over the following 30-years. Sheffield received £763,000 to explore a delivery model for 8,000 homes and up to 4,000 jobs by 2040. Other recipients included Carlisle, Exeter, Tewkesbury and Wirral which shared in the £2.8 million.
More recently, the Planning and Infrastructure Act 2025, which received Royal Assent on 18 December 2025, gave development corporations extra powers to speed up the delivery of large-scale projects, including the next generation of new towns. There are currently no NTDCs in existence but the government has made it clear that it may establish them to deliver its New Towns Programme. In September 2025, the New Towns Taskforce recommended that development corporations should be used to construct new towns in 12 locations across England. Subsequently, in March 2026, the government proposed 7 locations in its draft New Towns Programme: Tempsford, Crews Hill and Chase Park, Leeds South Bank, Manchester Victoria North, Thamesmead, Brabazon and the West Innovation Arc, and Milton Keynes. The consultation closed on 18 May 2026, with final locations expected by the end of 2026. Within this approach, development corporations have been described as having “significant powers to coordinate investment, develop expertise, assemble land and facilitate faster delivery, ensuring joined-up infrastructure and amenities are in place from the outset, as well as providing more certainty about the future path of delivery…development corporations can overcome institutional barriers, accelerate delivery, and ensure that development meets both local needs and national policy objectives”.
Outside of this statutory framework, between 2021 and 2024, an East Midlands Development Corporation (DevCo) operated and was owned by 5 Local Authorities before it was absorbed into the East Midlands combined county authority.
Taken together, every development corporation established or proposed to date, MDCs, UDCs, NTDCs and DevCo alike, has been designed to deliver urban development, whether regenerating towns and cities or building new towns. Some, such as the Greater Cambridge Development Corporation and the proposed new town at Tempsford, include rural land, but none has been specifically established to serve rural communities.
Development corporations matter now because devolution, local government changes, and the return of strategic planning are creating a new delivery environment focused on growth, regeneration and infrastructure investment. The English Devolution White Paper, published back in December 2024, set out government proposals to reshape England’s governance through mayoral devolution and streamlined council structures. Nearly one-third of England’s population currently lives in areas with two-tier local government, with services and functions split across county and district councils. Central government is in the process of ending the two-tier system and establishing new single-tier unitary councils. Known as local government reorganisation (LGR), affected councils submitted their proposals to reorganise their areas with decisions initially announced on 19 of the 21 affected areas. On 7 September 2026, following legal advice, the government announced a review of these LGR arrangements, with the proposed new arrangements for Essex, Hampshire, Norfolk and Suffolk withdrawn and 16 other areas paused. Reorganisation in Surrey is unaffected, and local elections in May 2027 will go ahead on existing council boundaries. The government published its ‘Rewiring the State’ Cabinet statement in July 2026, and Budget 2026 confirms that a delivery plan will be published before the end of 2026, setting out further details on devolution and local government.
In January 2026, the Planning Officers Society (POS) published a paper on the impact of LGR and devolution for planning and place-making services. It describes how the combination of a new strategic planning tier, changes to local plans, digitisation and planning committee reform offers an opportunity to introduce innovative practices and rebuild skills and capacity around service improvement. In July 2026, the Ministry of Housing, Communities and Local Government (MHCLG) published guidance about how plan-making should happen in authorities in two-tier areas that are moving towards single-tier unitary authorities. The government wants every area to have, or be establishing, a strategic authority by the end of 2027, with strategic authorities up and running in all areas by the end of 2028. In July 2026, the Local Policy Innovation Partnership Hub (LPIP) at the University of Birmingham published a paper on development corporations, suggesting 10-15 new development corporations could be established over the next 2-years depending on the extent of demand for LLDCs, MDCs and new towns, describing how this “represents the biggest expansion of new development corporations since the introduction of UDCs in the 1980s, though in a much more accelerated timeframe, and with a much greater variety of institutional forms, strategic objectives, and scales of delivery, as well as the biggest UK development corporation area ever created” (page 15).
On 30 July 2026, the Prime Minister, Andy Burnham, announced he was launching ‘a new era of devolution – taking power and decision-making ‘out of SW1 and putting it closer to people’s lives’. The announcement included proposals to grant English mayors additional powers, including greater control over transport provision and technical education provision for 16-19 year olds; and that mayors will be able to retain a share of locally raised income tax (from 2028) and business rates (from April 2027). These will replace existing grants rather than being additional money, and are intended to reduce reliance on central government grant funding. Under a ‘local first’ principle, government ministers will be asked to justify why powers should remain in Whitehall rather than be devolved. Budget 2026 sets out a fiscal devolution roadmap – confirming income tax assignment for all mayors from 2028 and mayors retaining a 20% share of locally retained business rates from 2027, with local government retaining 100% of business rates income by the end of the decade.
As devolution deals become more ambitious and development corporations more numerous, the stakes rise for any place not explicitly written into these new arrangements from the outset — a category that, on the evidence so far, includes most of rural England.
What have they achieved? Evidence from both historic and more recent development corporations suggests that they can be effective vehicles for driving regeneration, unlocking private investment and accelerating physical developments at scale.
Back in 1998, the then Department of the Environment, Transport and the Regions (DETR) published evaluations of the Leeds, Bristol, central Manchester and London Docklands Urban Development Corporations (UDCs). Evaluators found for every £1.00 of public sector money invested in these UDCs, £3.45 of private sector investment was leveraged. In the case of London Docklands, the development corporation delivered 24,000 housing units, generated over 80,000 gross jobs and delivered a higher proportion of social housing than would have occurred in its absence. The evaluation estimated that every £1 million of public sector expenditure generated net additional benefits equivalent to 23 jobs, 8,500 sq. m of office floorspace and 7.8 housing units. Academic research also covering the Leeds, Bristol and central Manchester UDCs found them to have been successful at bringing derelict land back into use and assembling fragmented sites through acquisition, preparation, infrastructure and support for private sector development. However, researchers also noted that UDCs were primarily focused on property-led regeneration and economic development, raising questions about the extent to which housing and employment benefits were generated for existing residents.
Recent evidence suggests policymakers and practitioners view development corporations as delivery vehicles for housing growth and regeneration. In 2024, a report from Public First for the Royal Town Planning Institute (RTPI) argued that development corporations which place town planners at the heart of the development process can, under the right conditions, deliver significantly more housing than the status quo – because they can take a proactive approach that many planning departments lack the resources and powers to undertake. Through a series of case studies, they found development corporations offer high value-for-money, with benefit cost ratios [monetisable social benefits] ranging from 3.7 up to 6.7. Similarly, Onward argues that England’s housing shortage is caused in large part by a planning system that is too slow, unpredictable and vulnerable to local opposition. The report cited the Central Manchester Development Corporation, which determined 88% of major housing applications within 8 weeks, compared with around 20% of applications handled by local planning authorities over the same period. From a housing perspective, development corporations move planners from regulating development to creating and coordinating it; and while the number of units and volume of delivery are important, location and scale matter too.
Also in 2024, the Institute for Government (IfG) and Balfour Beatty published a report examining the use of regeneration powers by metro mayors. Based on research, interviews and 6 case studies, they concluded that Mayoral Development Corporations (MDCs) are particularly effective where regeneration spans multiple sites, involves fragmented land ownership, crosses multiple local authority boundaries, and requires coordinated public sector intervention to unlock private investment. In this context, development corporations are framed as delivery institutions rather than planning bodies. The authors highlight the work of the London Docklands Development Corporation in the redevelopment of Canary Wharf; South Tees Development Corporation in developing the Redcar steelworks site; the London Legacy Development Corporation in the regeneration of the Olympic Park area in Stratford into Queen Elizabeth Olympic Park; and the Stockport MDC in regenerating the town through Stockport Interchange. In all of these case studies, development corporations have physically transformed large, complex sites that conventional local authority structures and approaches may have struggled to deliver. Interestingly, the IfG acknowledges that development corporations benefit from budgets that are ringfenced, meaning that they are not subject to the same short-term financial pressures faced by local authorities. However, this in turn means they may also take some powers and assets away from local authorities.
More recently, the experience of South Tees highlights the importance of governance. In May 2023, the Secretary of State for Levelling Up, Housing and Communities commissioned an independent review of the South Tees Development Corporation and the Teesworks Joint Venture following allegations of corruption, wrongdoing and illegality around the operations of Teesworks. As Teesworks Ltd is a joint venture company, 90% owned by private partners since 2021, it is not required to undergo an inspection or review and the local mayor and government had no legal powers to compel witnesses or documents to be produced. Teesworks is one of the largest brownfield remediation projects in Europe. As of August 2026, it had received £246 million in government grants and £257 million in prudential borrowing, with a further £238 million including £40 million for Net Zero Teesside to be incurred by the development corporation through more prudential borrowing. The review, published in January 2024, found no evidence to support the allegations, however, it did identify governance and transparency issues, including a number of decisions taken which did not meet the standards expected when managing public funds, resulting in 28 recommendations. In April 2025, MHCLG issued Tees Valley Combined Authority (TVCA) with a best value notice requiring the authority to draw up an improvement plan to address all of the recommendations contained in the review. In April 2026, MHCLG wrote to TVCA confirming that this notice would remain in place ‘until the Department confirms next steps’. In October 2026, the government appointed a Best Value Inspector to carry out a formal inspection of TVCA under the Local Government Act 1999.
The policy context for development corporations now appears to be shifting again. Recent debates have increasingly linked development corporations to wider ambitions around devolution, housing growth and the regeneration of left-behind places. In July 2026, for example, the government committed to strengthening the framework for public development corporations alongside a new ‘local first’ approach to devolution, under which ministers would be expected to justify why powers should remain in Whitehall rather than be transferred to local areas. At the same time, further mayoral development corporations and development zones are being expanded or proposed across England. Ebbsfleet UDC, for example, was established in 2015 and is currently tasked with delivering Ebbsfleet Garden City by 2035. By December 2025, it had delivered its 5,000th home, around one-third of the 15,000 planned, and had plans for up to 150,000 sq. m of future employment floorspace across 3 sites. Budget 2026 adds a new financing dimension – with the government piloting a new model giving Greater Cambridge Development Corporation “direct access to government finance for land assembly and to invest alongside private partners”, worth £95 million in 2027/28 and £10 million in 2028/29. HM Treasury describes the pilot as a ‘first step’ towards wider reforms enabling development corporations to access long-term, flexible government funding. Alongside this, the government is also consulting on a development corporation in Oxford by the end of 2026, with view to extending the financing model there. Taken as a collective, this suggests development corporations will feature as a prominent part of the government’s place-based agenda. Yet every case examined above – Docklands, Central Manchester, Redcar, Stockport, Ebbsfleet – is urban or brownfield in character, and none offers a ready template for rural areas.
What do they mean for rural areas? If development corporations become one of the government’s preferred regeneration delivery bodies, this raises risks and opportunities for rural places. Transferring powers from Westminster to local leaders will only benefit rural areas if rural needs are built into these new arrangements from the outset.
In July 2026, the Department for Environment, Food & Rural Affairs (Defra) published its Future of Rural England Report. This commits the government to rural proofing devolution, ensuring that rural priorities are reflected in Local Growth Plans and Spatial Development Strategies as the English Devolution and Community Empowerment Act 2026 is implemented. Defra has tasked itself with strengthening the devolution framework so that strategic authorities can deliver for rural communities – and the report explicitly references MDCs as one delivery mechanism available. However, it also acknowledges that there is ‘no requirement to reference rural areas’ in Local Growth Plans. Budget 2026 goes a step further: the government is developing, for the first time, non-statutory guidance with strategic authorities and rural stakeholders “to set out expectations for rural proofing at strategic authority level in England”. The guidance is expected in early 2027.
In a previous Rural Insights briefing tracking devolution deals, many rural areas became ‘white space’ and were entirely omitted from the arrangements. Development corporations typically focus on large brownfield sites, housing growth corridors, city centre renewal and urban extensions. Without deliberate effort, rural areas don’t fit this profile and risk exclusion in the same way. Even where there is interest in rural areas, it remains unclear how far they fit central government’s vision and ambitions, and how far current development corporation approaches can realistically be adapted to fit rural circumstances. For rural communities and businesses, the key question is whether, and how, they can have meaningful influence over which regeneration priorities are pursued and how investment is distributed.
This points to a bigger question: is there a case for a new generation of rural development corporations, designed specifically to drive growth and deliver across planning, transport, infrastructure, skills, business and energy? Rather than replicating existing development corporation models, rural approaches may need different governance, spatial and engagement approaches altogether.
International examples offer some insights. Australia has 15 rural Research and Development Corporations (RDCs), established in 1989, each one focuses on a different industry or sector, working to deliver productivity, profitability, sustainability and community outcomes. An analysis of RDC investment found it not only contributes to productivity gains but to jobs, economic growth and regional resilience – for example, A$98 million of research investment supported around 489 full-time equivalent jobs. In Trinidad, the Rural Development Company of Trinidad and Tobago Limited (RDC) is a Special Purpose State Enterprise established in 2005 to deliver infrastructure, utilities and social facilities to rural communities. Current projects include bridges, roads, health facilities and tourist attractions. While these models are sector or project specific, they do provide learning for how a rural focused UK model might be designed. Neither model is financed in the way UK development corporations are. UDCs and MDCs typically fund delivery by borrowing against, or recycling, the land value uplift that development itself creates – the mechanism behind Central Manchester’s and Stockport’s success, and the basis of Teesworks’ prudential borrowing. That depends on land values rising enough, once serviced and developed, to cover the upfront investment. In most rural locations, land value uplift may be lower than on a brownfield urban site, so a rural development corporation could not simply replicate the financing approach that makes its urban counterparts viable – it may require a different funding base. The Greater Cambridge pilot is the first sign that direct government finance for land assembly could sit alongside land value capture. Whether such a model could be extended to rural places, where uplift is lower, remains an open question. More broadly, not everyone would agree that development corporations are the right vehicle for rural areas – which already have delivery mechanisms for which a case could be made to better resource and coordinate them rather than create a new delivery body. Could a rural development corporation demonstrably do something existing rural funding vehicles cannot?
Finally, regeneration is shifting from individual projects to long-term place stewardship. Urban areas have mayors, combined authorities, regional investment banks, and rural areas have few or none of these directly. Instead, stewardship in rural areas often rests with a patchwork of other organisations. The Land Trust has called on government to “make some firm decisions on stewardship” in new towns, arguing that clear models for managing green spaces should be in place before development begins. Plunkett UK works with housebuilders to embed community-owned businesses into new developments from the outset. At Pease Pottage in West Sussex, for example, developers built and gifted a community shop to residents. With 869 community-owned businesses trading across the UK and a 98% five-year survival rate, community ownership offers a proven model of local stewardship. The question is how development corporations can work with, rather than around, these organisations to ensure rural places benefit over the long term.
Scale matters here: while combined authorities cover rural areas, do rural communities and businesses have sufficient influence within these structures? As development corporations increasingly blur the line between regeneration and place governance, rural areas need a clearer means of engaging with this evolving landscape.
Where next? Decisions over the coming months will show whether rural areas can shape this new landscape: local government reorganisation, the Rewiring the State delivery plan, the new rural proofing guidance for strategic authorities, the Greater Cambridge financing pilot, the next round of New Towns and housebuilding and ambitions for growth in every postcode, the pipeline of MDC proposals will indicate whether this new generation of development corporations extends into rural geographies or continues to bypass them. Will Defra’s rural-proofing commitment translate into rural priorities visibly shaping these plans, will rural places become ‘white space’, unable to influence the operation and outcomes, or will we see the emergence of ‘rural first’ development corporations? Watch this space.
