On 11 May 2016, the Court of Appeal gave a welcome decision for small site developers in relation to their affordable housing obligations, by allowing the secretary of state’s appeal in R (on the application of West Berkshire District Council and Reading Borough Council) v Secretary of State for Communities and Local Government [2016] EWCA Civ 441.
The case involved a challenge to the government’s policy on the provision of affordable housing on small sites of fewer than 10 units, and the vacant building credit, both of which were set out in a written ministerial statement issued by the government on 28 November 2014. It meant that, no matter what planning policies had been adopted by a local authority: (1) developments of 10 units or less did not need to make contributions to affordable housing or tariff-based contributions; and (2) developers were given credit for existing floorspace in any calculation of affordable housing contributions.
The High Court ruled that the government’s guidance was unlawful. The claim succeeded on four grounds: inconsistency with the statutory scheme, failure to have regard to material considerations, unlawful consultation and breach of the public sector equality duty (“PSED”).
The secretary of state appealed to the Court of Appeal on all grounds. The Court of Appeal has disagreed with the High Court and has said that the guidance is indeed lawful. The Court of Appeal allowed the secretary of state’s appeal on all grounds. The Court of Appeal found no issue with the mandatory language used in the statement, emphasising that under planning legislation, decision makers must consider development plan policies against other material considerations, including national policy, but that no primacy or absolute priority need be afforded to a development plan.
The Court of Appeal’s judgment is an important analysis of the role of central government in promulgating policy, the nature of such policy and its interaction with the underlying statutory scheme in the planning field. It also contains an important analysis of the scope of the obligations on decision-makers to carry out a lawful consultation, as well as the scope and application of the PSED.
The Planning Practice Guidance has now been reintroduced, so this is good news for developers of small sites as they can once again enjoy the small-site exemption. These contributions were prohibitive for many smaller developers, so now they can bring forward small-scale sustainable developments, which will be of benefit to everyone. It will be interesting to see whether this case is challenged in the Supreme Court.
Martha Grekos is a partner and head of planning at Irwin Mitchell
