Green Belt Policy: Will It Change?

In all the noise and spin ahead of the Autumn budget on 22 November, I would be wary of reading anything substantive into stories such as these:
Telegraph 4 November 2017 Philip Hammond risks Tory backlash with gamble on opening up the green belt 

Times 30 October 2017 Hammond rebuffed over budget plan for green belt housing
 I don’t believe that there will be anything to change the current policy direction. This Government surely does not have the strength, the resolve or the thinking space. The existing tests in the NPPF for reviewing green belt boundaries and for determining applications for planning permission in the green belt will be retained, with the minor changes that have previously been announced. In my view the real action isn’t around what the policies say, but how they are applied. 

Local plans
At present, green belt boundaries may be reviewed as part of local plan processes. Established green belt boundaries should only be changed in “exceptional circumstances”. Boundaries are intended to be long term, capable of enduring beyond the plan period. 
The Government’s February 2017 Housing White Paper proposes, at paragraph 1.39, embellishing that “exceptional circumstances” test:
“Therefore we propose to amend and add to national policy to make clear that: 

* authorities should amend Green Belt boundaries only when they can demonstrate that they have examined fully all other reasonable options for meeting their identified development requirements, including: 

    * making effective use of suitable brownfield sites and the opportunities offered by estate regeneration; 


    * the potential offered by land which is currently underused, including surplus public sector land where appropriate; 


    * optimising the proposed density of development; and 


    * exploring whether other authorities can help to meet some of the identified development requirement.”


* and where land is removed from the Green Belt, local policies should require the impact to be offset by compensatory improvements to the environmental quality or accessibility of remaining Green Belt land. We will also explore whether higher contributions can be collected from development as a consequence of land being released from the Green Belt. ”

Wording along these lines is likely to be added to the draft revised NPPF, promised early in 2018, but will make no material difference in practice – the additional guidance may look like tough talk but is largely a statement of the present position. 
Statistics can be used in various ways. At one end of the spectrum there is concerted lobbying by CPRE (see for instance their paper Green Belt Under Siege 2017). But the Government’s own figures DCLG statistical release Local Planning Authority Green Belt: England 2016/17 7 September 2017 sets the issue in context:
Overall there was a decrease of 790 hectares (less than 0.05%) in the area of Green Belt between 31 March 2016 and 31 March 2017. In 2016/17, eight local planning authorities adopted new plans which resulted in a decrease in the overall area of Green Belt compared to 31 March 2016.”


Regardless of how “exceptional circumstances” are defined, it is presently too easy either for local planning authorities to delay their plan making or to seek to justify not meeting their objectively assessed housing needs on the basis of green belt constraints. Threats of intervention on the part of the DCLG have come to nothing and the duty to cooperate (even when elevated to a duty to provide statements of common ground) is still too far too uncertain as to its effect, allowing local politicians to justify to themselves not assisting with adjoining authorities’ unmet requirements. Furthermore, the Government’s previous politically driven interventions such as in delaying for some time the Birmingham Development Plan at the request of local Conservative MP Andrew Mitchell hardly promote a positive approach. 
The problem isn’t so much specifically about green belt policy but more generally about how effectively to penalising authorities that do not properly plan – and surely about how positively to encourage authorities on every local plan review to consider whether boundaries should be reviewed – possibly even ahead of looking outside their boundaries where adjoining authorities are not readily in a position to pick up their unmet needs? The prolonged delays to plan making in green belt areas such as parts of Hertfordshire and Bedfordshire are a serious indictment of the present system. 
If the imminent draft London Plan as expected fails to encourage the boroughs to review their green belt boundaries, will that not be an opportunity missed? By all means require exceptional circumstances, but rigid adherence to the status quo for political reasons has social, environmental and economic costs. 

(map from LSE paper A 21st Century Metropolitan Green Belt 2016)

Planning applications and appeals
Green belt designation has never been an absolute bar to development. There are two main routes to consent:
First, is the proposal not “inappropriate development” within the meaning of paragraph 89 and 90 of the NPPF? For residential and commercial development the most main potential exemptions are:
* “the extension or alteration of a building provided that it does not result in disproportionate additions over and above the size of the original building;

* the replacement of a building, provided the new building is in the same use and not materially larger than the one it replaces; 


* limited infilling in villages, and limited affordable housing for local community needs under policies set out in the Local Plan; 


* limited infilling or the partial or complete redevelopment of previously developed sites (brownfield land), whether redundant or in continuing use (excluding temporary buildings), which would not have a greater impact on the openness of the Green Belt and the purpose of including land within it than the existing development.

Secondly, even if the proposal is for “inappropriate development”, can the applicant demonstrate “very special circumstances”? The guidance is unspecific as to what will amount to very special circumstances: “Very special circumstances’ will not exist unless the potential harm to the Green Belt by reason of inappropriateness, and any other harm, is clearly outweighed by other considerations.” The balancing of considerations is left to the decision maker. 

By way of recent example, the Secretary of State allowed an appeal on 1 November 2017 for a proposed development by Oaklands College and Taylor Wimpey comprising “new and refurbished college buildings, enabling residential development of 348 dwellings, car parking, associated access and landscaping.” His decision letter concluded as follows:
“35. The Secretary of State agrees with the Inspector (IR 248) that the proposal is inappropriate development in the Green Belt, which is harmful by definition. He further agrees there would be additional harm by reason of a reduction in openness and by virtue of encroachment into the countryside. Therefore he attributes substantial weight to the harm to the Green Belt caused by the proposed development. 

36. The Secretary of State agrees with the Inspector that there would be some limited harm to the character and appearance of the area (IR249) and he gives limited weight to this harm. 

37. The Secretary of State agrees with the Inspector that the delivery of significant improvements to the College weighs very heavily in favour of the proposal (IR 251). The Secretary of State gives the educational benefits significant weight in favour of the proposal. He also agrees with the Inspector that in light of the lack of a five year housing land supply, the proposed market and affordable housing is a significant benefit (IR 252) that carries significant weight in favour of the proposal. Additionally, the Secretary of State agrees that the enhancement of beneficial Green Belt uses carry moderate weight in favour of the proposal. The Secretary of State gives limited weight to improvements to the non- designated heritage assets (IR 253). 

38. The Secretary of State shares the Inspector’s view that the effect on protected trees in Beaumont Wood, the relationship with the policies related to the Watling Chase Community Forest, and the effect on traffic and flooding in the Sandpit Lane area are neutral factors in the planning balance (IR 254). 
39. Overall, the Secretary of State agrees with the Inspector that the considerations summarised above clearly outweigh the harm to the Green Belt, justifying the proposal on the basis of very special circumstances (IR 255). He therefore concludes that relevant policies relating to development in the Green Belt do not indicate that the proposed development should be restricted. The Secretary of State also concludes that the adverse impacts of the proposed development would not significantly and demonstrably outweigh the benefits.

40. Overall, the Secretary of State agrees with the Inspector that there are persuasive material considerations which warrant a decision other than in accordance with the development plan (IR255).”
The application of the NPPF’s tests in relation to plan making and decision taking inevitably gives rise to disputes both as to interpretation (see the many court rulings listed by Landmark Chambers in relation to each of the relevant paragraphs of the NPPF) and as to the weight to be applied to the various material considerations (meaning unpredictability, together with many speculative applications). But with even greater inflexibility (after all the policy hurdles are already extremely high) there would be another set of problems. 

Any politician is going to be cautious about a major policy shift. It is an open question as to whether the public understands the policy basis for green belt – the way in which, often vast, swathes of land around our cities have been identified as an ad hoc series of urban containment zones:
“- to check the unrestricted sprawl of large built-up areas;

– to prevent neighbouring towns merging into one another; 


– to assist in safeguarding the countryside from encroachment; 


– to preserve the setting and special character of historic towns; and 


– to assist in urban regeneration, by encouraging the recycling of derelict and other urban land

However, free market solutions advocated by the likes of the IEA and the Adam Smith Institute are wide of the mark. The idea of the green belt, albeit largely abstract, albeit largely restrictive and not driven by specific landscape, environmental or conservation attributions, has captured the public imagination like no other planning invention – perhaps, in a very British way, because it simply carries the expectation of being left alone. The challenge is how, without watering down existing green belt principles, to prevent the designation being used for local political purposes as an argument that increases inequality, renders housing unaffordable, increases commuting distances and drives urban development to unacceptable densities or sensitive non green belt locations? 
In the same way as in its early years the objective of green belt designation moved away from providing open space for recreation and towards a more restrictive role, over time can it move again towards a positive role more closely aligned with other landscape, land use or nature conservation designations?
Another eighty years or so should crack it. 
Simon Ricketts, 11 November 2017
Personal views, et cetera

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Viability Assessment Is Not A Loophole, It’s A Noose

Congratulations to Shelter’s PR team. Its report, Slipping through the loophole: How viability assessments are reducing affordable housing supply in England, with a deliberately emotive reference in its accompanying 1 November 2017 press release to a ‘legal loophole exploited by developers‘ was lapped up largely uncritically by the media:
Loophole that allows developers to avoid building affordable homes leads to huge shortfall Telegraph, 31 October 2017
Majority of affordable homes lost due to legal loophole exploited by developers, show figures Independent, 1 November 2017

Revealed: The ‘Loophole’ Developers Use To Avoid Building More Affordable Homes Huffington Post, 31 October 2017
SHAMEFUL GREED Developers are using a legal loophole to build less affordable homes than required in order to protect their profit margins The Sun, 1 November 2017

Some basic truths are being conveniently forgotten. I set out some of them in my 28 May 2017 blog post, Affordable Housing Tax and won’t repeat them here, save to say that we need to pause and reflect whether public policy on affordable housing provision is in a good place at all at present. 
The aim of the Shelter report is to seek to persuade the Government to follow through with its proposed limiting of the role of viability assessment at application, as opposed to plan-making, stage. This proposal is being consulted upon in Planning for the right homes in the right places consultation paper, responses to which are due by 9 November 2017.
But the report is unbalanced. The description of the assessment process is over-simplistic. It asserts blandly that developers “can cite viability concerns to lower the amount of affordable housing they are required to provide, in order to guarantee them a 20% profit margin and inflate their bids for land”, playing down the scrutiny given by the authority’s valuers (or district valuer if the authority so chooses) and by the Planning Inspectorate on appeal (see for example my 24 June 2017 blog post that referred to the Parkhurst Road and Newcombe House decisions). The report repeatedly refers to 20% profit on a scheme as if it is a standard benchmark dreamed up by developers, when in reality a scheme by scheme approach is required. Often that figure has indeed been accepted, but on the basis that it is determined to be appropriate as a tipping point. Given the risks inherent in any major scheme (the paper wrongly states that “the developer’s profit is effectively guaranteed by the viability loophole” – not guaranteed, not a loophole) how much profit would a provider of capital require in order to invest in that project rather than in any other commercial development or investment? 20% sounds about right to me?
The report ends up laying most of the blame at paragraph 173 of the NPPF:
“…To ensure viability, the costs of any requirements likely to be applied to development, such as requirements for affordable housing, standards, infrastructure contributions or other requirements should, when taking account of the normal cost of development and mitigation, provide competitive returns to a willing land owner and willing developer to enable the development to be deliverable.”
It seeks to show the effect that this supposed change in approach has had on the delivery of affordable homes by way of section 106 agreement:

It is interesting to look at this table alongside other tables in the research work from which it is drawn, Rethinking planning obligations: balancing housing numbers and affordability (Dr Sue Brownill and Dr Youngha Cho, School of the Built Environment Oxford Brookes University, March 2017):


In my view NPPF has been far less influential than other changes such as the loss of Government funding. 

By political sleight of hand, moral and legal responsibility for funding the provision of affordable, ie subsidised, housing has over the last decade moved largely onto the owners of land being brought forward for residential development and the promoters of those schemes. What level of affordable housing do these schemes have to bear? In reality, given such high policy targets, as much as can be extracted in negotiations, often with a review mechanism in the section 106 agreement allowing for further extraction at later stages in the development, preserving only as a potential return whatever benchmark land value and developer’s profit percentage has been agreed upfront in the viability assessment. 
As I explained in my Affordable Housing Tax blog post, section 106 requirements in relation to affordable housing largely started in the 1990s and became progressively entrenched in policy through the 2000s. But, prior to reductions in government funding, first in 2005 and then in 2011, the basis for developer commitments towards affordable housing was very different. Developers would commit in their section 106 agreement to affordable housing provision on the basis of securing a minimum base price for the units, usually being obliged to market the opportunity to nominated registered providers (known as registered social landlords until 2008). The quantum of the registered provider’s bid would depend upon the level of social housing grant secured from the Housing Corporation (replaced by the Homes and Communities Agency) and/or local authority. The nature of tenure of the affordable housing, and quantum, would depend upon the base price secured and in turn, in large part, upon the availability of social housing grant. “Cascade” provisions would specify the policy priorities in terms of tenure/quantum where the minimum base price could not be achieved. The minimum base price would commonly be linked to the Housing Corporation’s Total Cost Indicator (TCI), ie its estimate, area by area, of the normal cost of providing different types of housing. Social housing grant was commonly as high as 40 to 60% of TCI. But from around 2011 , with little fanfare and no public debate, social housing grant ceased to be available for section 106 affordable housing. 
As a result of that fundamental change in approach, affordable housing requirements are now pretty much a straight tax on land value (where the developer can pass the cost to the land owner through paying less for the land) and otherwise a tax on development. Often in reality the cost cannot be passed on – land owners have existing uses for their land, other potential development options or simply a minimum aspiration below which they will not go. Equally, land may have been acquired by an irrationally exuberant purchaser, unwilling now to crystallise a loss.   
Viability assessment is a necessary evil, but don’t assume that developers relish it:
– Via review mechanisms it can end up capping the maximum return that is achievable, an unattractive option when weighed against the uncapped risks that arise through any development project.  
– The toxic nature of the public debate, placing at the developer’s door a problem not of its making.

– The increasing risk that commercially sensitive information will need to be shared publicly.  

– The slow, expensive and unpredictable nature of the process, involving various consultants, all paid for by the developer – plainly, going with the policy grain will always be an easier option.

There is of course a debate to be had as to the relative extent to which land owners, developers and the state should fund affordable housing. I hope that we are indeed about to have that debate. There are some faint but encouraging signs, for instance the announcement by the prime minister in her party conference speech of £2bn towards social housing, the promised green paper and Sajid Javid’s recent urging that the Chancellor should borrow to build homes. We await the Autumn budget on 22 November with interest. In the meantime, unless local planning authorities are going to reduce massively their affordable housing requirements (unlikely, it’s needed), there is no alternative to viability appraisal. By all means, let’s make it work better but, without it, we will have even fewer homes built. 
Inevitably, we’ve been there before. See for example an ODPM report, July 2005: The Value for Money of Delivering Affordable Housing through Section 106:
“7.1  The research confirms that s.106 plays an important role in the delivery of affordable housing. However, there are other factors besides s.106 which have a significant influence on the provision of affordable housing. Some of these factors affect the availability of land, others affect the capacity to negotiate affordable housing contributions, still others affect the financial capacity of RSLs and other stakeholders. Such factors include: 
…

– Other planning obligations – the requirement for other essential planning obligations can reduce the contribution available to affordable housing. 

– Rent restructuring – this can affect the ability of the RSL to raise loans. 

– The grant regime – the abolition of LASHG has implications for affordable housing delivery if it is not replaced by other means. The short term nature of the bidding regime for funds can delay or postpone a scheme.

See also written evidence submitted to the Communities and Local Government Committee by by Professor Tony Crook, Ms Sarah Monk, Dr Steven Rowley and Professor Christine Whitehead in 2006:
”  Our research suggests that most (nearly three quarters) of Section 106 affordable housing units have an injection of public subsidy in the form of Social Housing Grant. At first sight this is odd and does not sit easily with one of our interpretations of Section 106, ie that developer contributions replace the need for subsidy. This might suggest policy “failure” but ignores the context within which Section 106 works best. Our evidence shows that planning gain delivers affordable housing in high price areas where land is expensive. What developers’ contributions appear to have done to date is to reduce the price of this expensive land to one that RSLs can afford within Housing Corporation funding guidelines. So, despite significant developers’ contributions, mounting on average to 5% of the gross development value across Section 106 sites (both the market and non-market elements), SHG is still needed to make the homes affordable and the schemes viable. In a recent calculation we have estimated that developers’ contributions on schemes agreed in 2003-04 were valued at £1,200 million. In looking at how Section 106 provides funding, we also need to recognise that Section 106 negotiations between developers and planners are not just about affordable housing contributions, but are usually about a much wider range of contributions, both in terms of physical off-site infrastructure and wider community needs, including school buildings. Affordable housing is not necessarily the highest priority and hence there may be little by way of developers’ contributions left over once other requirements have been negotiated and agreed. Thus both the expense of the land and the competing claims on planning gain explain the need for SHG, although without a clear negotiating and “accounting” framework there may well be risks that SHG inadvertently cross-subsidises these other planning “gains”.”


Eleven years on and it seems to me that we are in a much worse position. Whilst some grants are of course still available, social housing grant is long gone and in many areas a large non-negotiable slice has taken out by CIL (supposedly to be spent by authorities on infrastructure that unlocks development but that is not how it has turned out at all).

If the 2017 answer is to rely on land owners and developers to pay for affordable housing, let that be the outcome of a proper political debate and written into policy rather than the current unsatisfactory situation, which appears to me to be intellectually dishonest. If you’re going to tax market participants, do it openly, explain why you’re doing it and be sure that the mechanism is efficient in delivering the agreed objectives – more housing and more affordable housing, of all tenures. 
Simon Ricketts, 4 November 2017
Personal views, et cetera

Housing Needs: Assessed Or Assumed?

The new draft methodology to be used by English local planning authorities for determining their level of housing need is deceptively simple. Is it indeed too simple?
The current system (difficulty level: advanced)
The NPPF currently advises that LPAs should “use their evidence base to ensure that their Local Plan meets the full, objectively assessed needs for market and affordable housing in the housing market area”. They should:
“prepare a Strategic Housing Market Assessment to assess their full housing needs, working with neighbouring authorities where housing market areas cross administrative boundaries. The Strategic Housing Market Assessment should identify the scale and mix of housing and the range of tenures that the local population is likely to need over the plan period which: 

* meets household and population projections, taking account of migration and demographic change; 


* addresses the need for all types of housing, including affordable housing and the needs of different groups in the community (such as, but not limited to, families with children, older people, people with disabilities, service families and people wishing to build their own homes); and 


* caters for housing demand and the scale of housing supply necessary to meet this demand

The PPG provides more detailed guidance but in practice the recommended approach is complex, relying on a shifting, uncertain evidence-base with subjective judgements to be made. Disputes over the calculation of “objectively assessed needs” are far too time-consuming, technocratic, uncertain and expensive. 

Local Plans Expert Group’s recommendations (difficulty level: intermediate)
Back in September 2015, the then Secretary of State, Greg Clark, and then housing and planning minister, Brandon Lewis (I know, seems like another era), appointed an independent Local Plans Expert Group “with a remit to consider how local plan making can be made more efficient and effective“. Its impressive line-up was as follows: 
Members
John Rhodes OBE – Quod, Director – Chair 

Adrian Penfold OBE – British Land, Head of Planning 

Councillor Toby Elliott – Swindon Borough Council, Cabinet Member 

Derek Stebbing – Chelmsford City Council, Planning Policy Manager 

John Howell OBE MP FSA – Member of Parliament for Henley 

Keith Holland – retired Planning Inspector 

Liz Peace CBE 

Richard Harwood OBE QC – 39 Essex Chambers 

Advisors 

Christopher Katkowski QC – Landmark Chambers 

Ian Manktelow – Wycombe District Council, Team Leader, Planning Policy 

Matthew Spry – Nathaniel Lichfield & Partners – Senior Director 

LPEG’s report was published on 16 March 2016, together with a separate volume of appendices, within which Appendix 6 sets out a simplified, standardised approach to the assessment of housing need. The methodology is summarised in this table: 


It was a detailed, thoughtful piece of work, delivered quickly. The Government then took almost as long again to publish what can best be described as a holding response on 7 February 2017, alongside publication of the housing white paper:

“The White Paper confirms that the Government will consult on options for introducing a more standardised approach to assessing housing requirements. The outcome of this consultation will be reflected in changes to the National Planning Policy Framework. We want councils to use the standardised approach and will incentivise them to do so, as this will help to speed up and reduce the cost of the plan making process for those authorities that use it. The White Paper indicates that our decision making for the £2.3bn Housing Infrastructure Fund is likely to factor in whether authorities intend to apply the new standardised approach to assessing housing requirements. 


We expect councils that decide not to use the methodology to explain why not and to justify the methodology that they have adopted. We will consult on what constitutes a reasonable justification for deviating from the standard methodology, and make this explicit in the National Planning Policy Framework.

The Government’s proposals (difficulty level: elementary)
It is interesting that politicians (again) select a group of recognised experts and then embark on a significantly different approach. Perhaps the group wasn’t brave enough in its quest for a one size fits all formula or perhaps it recognised that, if it did, the figures would not be fit for purpose. 
However, a year after the publication of LPEG’s report, the Government has published, for consultation, its proposals: Planning for the right homes in the right places: consultation proposals (14 September 2017). The consultation period expires on 9 November 2017. 
“Subject to the outcome of this consultation, and the responses received to the housing White Paper, the Government intends to publish a draft revised National Planning Policy Framework early in 2018. We intend to allow a short period of time for further consultation on the text of the Framework to make sure the wording is clear, consistent and well-understood. Our ambition is to publish a revised, updated Framework in Spring 2018.” Planning Practice Guidance will be updated at the same time.
LPEG’s recommended approach has been further simplified, reduced indeed to a formulaic approach which will have to be followed by LPAs save in “compelling circumstances” which “will need to be properly justified, and will be subject to examination.” Amongst the elements that appear to have been stripped back from the LPEG recommendations are
– Just using ONS’ projected numbers of households as the demographic baseline for each area

– No ten year migration scenario sensitivity test

– No looking at vacancy and second home rates

– No separate consideration, as part of this methodology, of the need for affordable housing although LPAs should identify the housing need for individual groups, such as those in need of affordable housing, via a streamlined process (the Government invites suggestions as to how that might work). We also wait to see what will be in the forthcoming “green paper on social housing” announced by Sajid Javid in his speech to the National Housing Federation on 19 September 2017)

The proposed formula is as follows:

A cap is proposed on the level of any increase:

“We propose to cap the level of any increase according to the current status of the local plan in each authority as follows: 

a)  for those authorities that have adopted their local plan in the last five years, we propose that their new annual local housing need figure should be capped at 40 per cent above the annual requirement figure currently set out in their local plan; or

b)  for those authorities that do not have an up-to-date local plan (i.e. adopted over five years ago), we propose that the new annual local housing need figure should be capped at 40 per cent above whichever is higher of the projected household growth for their area over the plan period (using Office for National Statistics’ household projections), or the annual housing requirement figure currently set out in their local plan.”

DCLG has applied the new methodology to every authority in England, arriving at an overall housing need figure of 266,000 a year (including 72,000 in London) broken down authority by authority on a spreadsheet (which may not open on mobile devices). The table warns that the numbers are “indicative” and “should be treated with caution” (indeed various errors have already been found) but inevitably they have been pored over by those on all sides, whether to make the case for or against additional housing in a particular area. 

There are some curious outcomes due to the way that, for example, anticipated or planned employment growth that will lead to additional housing pressure has not been factored in, save indirectly to the extent that it may have an effect on housing affordability. The affordability ratio further skews the increases towards the south with many authorities in the north and the Midlands showing decreases as a result of these factors, regardless of their actual level of ambition. The paper stresses that LPAs can plan for more homes than the number arrived at by the methodology but to what extent will the existence of the lower number encourage objectors to push back?
The transitional provisions will certainly encourage many LPAs to make sure that their plans have been submitted for examination by 31 March 2018:

This is the briefest of overviews. The paper includes further proposals to which no doubt I’ll be coming returning. In the meantime, for a full analysis of the new approach and its likely implications, I recommend Lichfields’ paper, written by LPEG adviser Matthew Spry. 

Simon Ricketts, 20.9.17
Personal views, et cetera

Class Distinctions: Planning For Older People

Housing is needed by people of all ages but there is a particular need for specialist housing for the elderly. A research report, Housing our Ageing Population: Learning from Councils meeting the Housing Need of our Ageing Population was published by the Local Government Association on 8 September 2017. From its executive summary:
“The number of people aged over 65 is forecast to rise over the next decade, from the current 11.7 million people, to 14.3 million by 2025, a 22 per cent rise. This means that one in five of the total population will be over 65 in 10 years’ time, which will become one in four by 2050. 

In the UK, the vast majority of over 65s currently live in the mainstream housing market. Only 0.6 per cent of over 65s live in housing with care, which is 10 times less than in more mature retirement housing markets such as the USA and Australia, where over 5 per cent of over 65s live in housing with care. The suitability of the housing stock is of critical importance to the health of individuals and also impacts on the demand for public spending, particularly social care and the NHS.
Making quality options available also helps with “right-sizing”, freeing up larger under-used homes back into the housing stock. 
Not only is there great need but changes to local government funding are afoot which are going to increase the pressure for supported housing for the elderly. From the LGA report:
Funding for Supported Housing: Consultation contains the key elements of the Government’s proposals for the future funding of supported housing from April 2019 including: 

“Councils will have responsibility for funding, commissioning and quality assuring all supported housing in their areas from April 2019.

“These proposals would in effect bring to an end the current housing benefit arrangements for all specialist older people’s housing at the end of March 2019“. 

We can expect policies on housing for the elderly in the forthcoming London Plan. The Mayor of London says as much in his draft Housing Strategy, published on 5 September 2017: One of his objectives is “increasing opportunities for older homeowners to move to accommodation more suitable for their needs, including benchmarks for older people’s housing requirements in the draft London Plan” (part of policy 5.2). 
I was also pleased to see a section on planning for older people in the DCLG consultation paper, Planning for the right homes in the right places (14 September 2017) even if it only amounted to two paragraphs:
“92. Section 8 of the Neighbourhood Planning Act 2017 requires the Secretary of State to provide guidance for local planning authorities as to how they should address the housing needs that result from old age or disability. Helping local planning authorities provide a simple yet robust evidence base for such groups will form part of the guidance, and will allow them to maintain the benefits of a more streamlined approach to calculating the overall housing need. 

93. When developing new planning guidance for older people, it is important that we have a shared understanding of who is included in this group. The definition of older people in Annex 2 of the National Planning Policy Framework reflects a range of people at different ages with different needs from retirement age to the very frail elderly. We are also aware of different types of housing that accommodate such a group – ranging from general market and affordable housing to specialised, purpose-built market and rental accommodation and care homes. Given the importance of planning for the need for older people as our population ages, we are reviewing whether we need to amend the definition of older people for planning purposes. We consider that the current definition is still fit-for-purpose but would welcome views.”
Not only is more housing required, there needs to be much more specificity and definition. Whilst there are more detailed supportive passages in the Planning Practice Guidance, paragraph 50 of the NPPF simply says: 
local planning authorities should: 

    * plan for a mix of housing based on current and future demographic trends, market trends and the needs of different groups in the community (such as, but not limited to, families with children, older people, people with disabilities, service families and people wishing to build their own homes)”

As the consultation paper seems to accept, the definition of “older people” in the glossary to the NPPF is extremely wide:
“People over retirement age, including the active, newly-retired through to the very frail elderly, whose housing needs can encompass accessible, adaptable general needs housing for those looking to downsize from family housing and the full range of retirement and specialised housing for those with support or care needs.”
I’m not sure on what basis the definition can be said to be fit for purpose. Housing for the elderly doesn’t fit neatly into traditional planning law, partly because it is a wide spectrum of operating models, some being a specialist version of use class C3, dwellinghouses, and some being institutional and care based in nature, falling within use class C2. 
Class C2: “Use for the provision of residential accommodation and care to people in need of. care (other than a use within a class C3 (dwelling house). Use as a hospital or nursing home.”
Class C3: “Use as a dwellinghouse (whether or not as a sole or main residence) — (a) by a single person or by people living together as a family, or. (b) by not more than 6 residents living together as a single household (including a household where care is provided for residents).”
 I wrote a blog post last year, Time To Review The “C” Use Classes?. As with other alternative or quasi residential uses, the use class distinction matters because local planning authorities have very different policy approaches in terms of whether the proposal is acceptable in that location and as to the requirements arising, for instance in relation to affordable housing. The distinction can be crucial in relation to the extent of CIL liability and indeed whether planning permission is required in the first place.

The problem is that in reality the distinctions between C2 and C3 are becoming increasingly blurred – there is a spectrum, with no clear dividing line between the two. 
At the C3 end of the spectrum, there is sheltered housing and retirement living operated by the likes of McCarthy and Stone and Churchill Retirement Living. Churchill have produced a useful guide for planning and design professionals, Retirement Living Explained (April 2017). In order to distinguish its retirement living model from general C3 use, Churchill advocates the use of model age restricted planning condition:
“Each of the apartments hereby permitted shall be occupied only by: 

* Persons aged 60 or over; or 


* A spouse/or partner (who is themselves over 55 years old) living as part of a single household with such a person 
or persons; or 


* Persons who were living in one of the apartments as part of a single household with a person or persons aged 60 
or over who has since died; or 


* Any other individual expressly agreed in writing by the Local Planning Authority. ”

Is it right that C3 retirement living should be required to deliver affordable housing when itself it meets a non-mainstream housing need? Pending any reconsideration of that policy, Churchill’s guide includes a template section 106 agreement, suggesting the making of an off-site affordable housing contribution (with early stage review if the development hasn’t started reached shell and core stage within 28 months), given that the affordable housing requirements attaching to general market housing C3 products would be inappropriate. 

At the C2 end of the spectrum, there is a variety of operating models, with a bewildering variety of descriptions, including care homes, continuing care retirement communities, assisted living, very sheltered housing and close care. 
Hardest to categorise is what the market refers to as “extra care”, which has been described as follows: 
“Extra care housing is housing with care primarily for older people where occupants have specific tenure rights to occupy self-contained dwellings and where they have agreements that cover the provision of care, support, domestic, social, community or other services. Unlike people living in residential care homes, extra care residents are not obliged as a rule to obtain their care services from a specific provider, though other services (such as some domestic services, costs for communal areas including a catering kitchen, and in some cases some meals) might be built into the charges residents pay.” (Extra Care Housing What Is It?, paper, 2015, published by Housing LIN). 

So what are the distinguishing factors between C2 and C3?
A September 2017 blog post, Update on recent Extra Care Housing Planning Appeals and CIL Success, by Tetlow King’s John Sneddon, identifies two recent appeal decisions where inspectors agreed that proposed extra care developments would fall within use class C2. (The piece is also useful on the opportunities for ensuring that C2 developments are exempted from CIL within local planning authorities’ CIL charging charging schedules.)

My Town partner Liz Christie has previously carried out an analysis of planning appeal decisions. The most important factors for determining whether the operation is properly to be regarded as C2 or C3 use are (i) the physical layout of the building; (ii) the level of care; and (iii) the nature of the operation of the proposed development. We can go into more detail on each of these aspects, with appeal references, for anyone with a specific interest in the issues but, in summary, the whole area unnecessarily complicated and uncertain. Some standardised definitions and policy expectations would be really helpful.  
I wrote this blog post as a by-product of preparing to speak at LD Events’ 26 September 2017 conference, Alternative Residential Property 2017. See some of you there. 
Simon Ricketts, 16 September 2017
Personal views, et cetera

Not In My Neighbourhood

To my mind, the problems with neighbourhood plans that I listed in my 19.2.17 blog post haven’t gone away. 

In fact, two changes to the neighbourhood plan process that were switched on from 19 July 2017 by the Neighbourhood Planning Act 2017 (Commencement No. 1) Regulations 2017 will just bring the issues to the boil at an earlier stage:

– section 1 of the 2017 Act gives decision makers a duty to have regard to neighbourhood plans as a material consideration once they have been examined, prior to their having been approved in a neighbourhood referendum or finally made (ie ‘adopted’ in local plan language). 

– section 3 of the 2017 Act requires decision makers to treat a neighbourhood plan as part of the statutory development plan once they have been approved by a referendum (unless the local authority then decides not to make it). 

In the meantime, the last few weeks have seen various rulings from the High Court and decision letters from the Secretary of State that demonstrate the complexities, uncertainties and tensions that are arising. 

Farnham Neighbourhood Plan

Bewley Homes Limited v Waverley District Council (Lang J, 18 July 2017) 

The claimants, Bewley, Wates and Catesby, were three development companies unhappy that their respective development sites were not allocated for development in the draft Farnham neighbourhood development plan. 
The case illustrates the real difficulties that arise both with grappling with detailed issues during the examination process and seeking to assert, when the report has been published, that the examiner’s reasoning is deficient. 
The claimants’ first line of attack was that the examiner was wrong to conclude that the draft plan complied with the basic condition of being in conformity with the strategic policies of the 2002 local plan. 
Lang J sets the bar very low in terms of the extent of the examiner’s duty to give reasons for the conclusions in his report: “I consider that an Examiner examining a neighbourhood plan is undertaking a function which is narrowly prescribed by statute and he is subject to a limited statutory duty to give reasons. It is distinguishable from the function of an Inspector determining a planning appeal, where the duty to give reasons is expressed in general terms.”
Secondly, she makes clear that the requirement that the neighbourhood plan must be in general conformity with strategic policies in the relevant local plan is pretty loose in practice: “The authorities establish that the phrase “in general conformity” is a flexible test which allows for some differences. The plans do not have to match precisely. It was a matter of planning judgment for the Examiner to decide whether the degree of the differences was such that he could not properly find that “the making of the [plan] was in general conformity with the strategic policies in the development plan”, as required by paragraph 8(2)(e) of Schedule 4B. For that purpose, he was required to consider the plan as a whole.”



The judge found that it was sufficient that the examiner referred to his consideration of Farnham Parish Council’s Basic Conditions Statement, from which it could be taken that he accepted Farnham’s Basic Conditions Statement as the basis for identifying the strategic policies in the Local Plan 2002.
Lang J noted that even if the reasoning had been flawed, in the light of the Court of Appeal’s ruling in DLA Delivery, “the Examiner could lawfully have adopted a different route, holding that the strategic policies restricting housing development had become time-expired in 2006 and were now redundant, and could be disregarded.”
The claimants’ other grounds of challenge arose from detailed evidence and submissions that they had made on issues relating to SANGS land and relating to a landscape study on which a key policy in the draft plan was based. It is clear that the developers had approached both issues in some forensic detail. However, the judge was satisfied with the light-touch way in which the matters had been addressed in the report:

“It was sufficient that the Examiner recorded at paragraphs 2.4, 2.7 and 2.8 that he had considered all the written material submitted to him, together with the discussions at the public hearing, all of which provided him with sufficient information to enable him to reach his conclusions. The main points raised by the Claimants were adequately addressed in the report and the Examiner’s conclusions were made sufficiently clear
.”

“The Claimants invited me to infer that the Examiner did not consider the Wates’ material because he did not refer to it. However, given the limited scope of his examination, he was not required to refer specifically to the evidence and representations presented by the Claimants, and the points raised therein. There was a large volume of evidence and these were not principal documents. It was sufficient that the Examiner recorded that he had considered the representations. He also stated at paragraphs 2.4, 2.7 and 2.8 that he had considered all the written material submitted to him, together with the discussions at the public hearing, all of which provided him with sufficient information to enable him to reach his conclusions
.”

Faringdon Neighbourhood plan

Hoare v Vale of White Horse District Council (Deputy High Court Judge John Howell QC, 7 July 2017)
Here policy 4.5B in the draft plan sought to safeguard Wicklesham Quarry for employment uses following completion of quarrying and restoration activities on the site and to support such development on it provided that there is a demonstrable need for it, no other suitable site closer to the town centre is available and certain other conditions are met.
The claimant was a local resident objecting to the allocation. 
The court took a similar approach as in Bewley to complaints as to the lack of general conformity with strategic policies in the local plan:


“The phrase “strategic policies” is, like “general conformity”, inherently imprecise, and it is not one in my judgment to which the court should seek to give a spurious degree of precision. Which policies in a development plan warrant that classification will inevitably involve a question of planning judgment that will be framed (but not necessarily exhausted) by the objectives of the particular plan and the policy’s significance in relation to their achievement and to the character, use or development of land in the area to which the plan relates which it seeks to promote or inhibit. The more central or important the policy is in relation to such matters the more likely it will be that it may be a “strategic policy” in that plan. Its identification as “strategic” or as part of the “strategic policies” in that plan may well provide a good indication of its significance. But the fact that it is not so identified does not necessarily mean that it is not a strategic policy and its identification as such does not necessarily mean that it is.”



The claimant also submitted that Policy 4.5B is about a “county matter”, which is a category of “excluded development” that cannot lawfully form part of a neighbourhood plan; and that the District Council erred in treating the quarry as “previously developed land” for the purpose of the NPPF. 
The deputy judge held that the policy was not about a county matter, given that it sought to safeguard the Quarry for employment uses following the completion of quarrying and restoration activities on the site: “The provision which is excluded from a neighbourhood plan is not any provision about any development in respect of land which is the subject of a restoration condition or an aftercare condition. It is any provision about development which “would conflict with or prejudice compliance with” such a condition. There may be operations or uses that can be carried on on such land without doing so. Moreover there is nothing to preclude a neighbourhood development plan making provision about a development that may be carried out on land subject to such conditions but only after they have been complied with. That may in fact be desirable in order to provide guidance about the future use of the land. Thus in my judgment the mere existence of such conditions applicable to an area of land does not mean that no provision about that land may be made in a neighbourhood plan.”



The deputy judge agreed that the council had indeed been wrong to categorise the site as previously developed land, given the restoration condition. However, he did not consider that the error was material to the outcome of the plan and declined to quash the plan on that basis.

 
Not easy to challenge a neighbourhood plan, is it?

Central Milton Keynes Business Neighbourhood Plan

The Secretary of State issued his decision letter on 19 July 2017, granting planning permission to Intu Milton Keynes Limited for extension of the Intu Milton Keynes shopping centre. The application was supported by Milton Keynes Council but had been called in by the previous Secretary of State Greg Clark in November 2015, who indicated that for the purposes of determining the application he wished to be informed as to “the consistency of the application with the development plan for the area including the Central Milton Keynes Business Neighbourhood Plan”.

The Central Milton Keynes Business Neighbourhood Plan was England’s first business neighbourhood plan. Central Milton Keynes Town Council objected to the application. As part of its objections it sought to portray the proposals as contrary to policies of the Neighbourhood Plan seeking to protect semi-public open space in Midsummer Place and seeking to retain Central Milton Keynes’ classic grid pattern.

However, the Secretary of State agreed with his inspector’s conclusion that the application was “in accordance with development plan policies, including those in the Neighbourhood Plan, and is in accordance with the development plan overall”.

The inspector indicated that her finding was “based on a balanced interpretation of Policy CMKAP G3. Had I taken an absolute approach to the policy, the reduction in the quantity of semi-public open space, would have resulted in a breach of the policy. Nevertheless, the proposed development would have been consistent with the development plan as a whole. In the final instance the considerable benefits of the proposal would have been material considerations sufficient to indicate that it should be determined other than in accordance with the development plan”. 



Buckingham Neighbourhood Plan

The Secretary of State declined to follow his inspector’s recommendation and, by his decision letter dated 17 July 2017, refused planning permission to Bellway Homes for a development of 130 dwellings in Buckingham. The inspector concluded that the neighbourhood plan was silent as to the proposed development of the application site. The Secretary of State disagreed:

“the larger housing sites, representing both the acceptable location and level of housing, are specifically identified and allocated in the BNDP. Both larger sites and the smaller windfall sites being confined to within the settlement boundary (HP7). The application site, being both unallocated and outside the settlement boundary, falls within neither category above and, as a consequence, the Secretary of State considers the proposals are not policy compliant. This is a policy conflict to which the Secretary of State attaches very substantial negative weight in view of the Framework policy (paragraphs 183-185) that neighbourhood plans are able to shape and direct sustainable development in their area and that where an application conflicts with a neighbourhood plan, planning permission should not normally be granted (paragraph 198).


Barnham and Eastergate Neighbourhood Plan & the Walberton Neighbourhood Development Plan

 Yet another application called in so that the Secretary of State could consider whether development proposals (for 400 dwellings as well as commercial development in Fontwell, West Sussex) were consistent with (here two) neighbourhood plans. The Secretary of State granted planning permission, by his decision letter dated 13 July 2017, finding that the proposals were indeed consistent, “subject to careful consideration at the reserved matters stage”. 
In relation to each of these applications, call in by the Secretary of State on neighbourhood plan grounds has been directly responsible for significant delays, of at least 18 months. In each of the applications there has been significant debate, argument and uncertainty as to the meaning of neighbourhood plan policies – perhaps no surprise given the light touch, difficult to challenge, nature of the neighbourhood plans examination process.
Isn’t it time for a proper review of the costs and benefits of the neighbourhood plans system as it is currently operating?
Simon Ricketts, 22 July 2017

Personal views, et cetera

Courts Interpret NPPF Paras 14, 133/134, 141 (But Couldn’t It Be Clearer In The First Place?)

The Government’s chief planner Steve Quartermain has confirmed this week that the revised NPPF will be published before the end of the year. To what extent will it reflect the proposed changes set out in the previous Government’s ‘response to consultation’ document that was published alongside the February 2017 housing white paper and to what extent will it take on board any changed political priorities since the June 2017 election or indeed various inherent uncertainties and ambiguities which have continued to occupy the courts?
Paragraph 14
I have previously blogged as to the Supreme Court’s ruling in Suffolk Coastal, which resolved (by way of a judgment of Solomon in which all parties, by operation of unexpected judicial reasoning, both won and lost) the question as to how the paragraph 14 presumption applies where there is no five year supply of housing land. 
The Court of Appeal in Barwood Strategic Land II LLP v East Staffordshire Borough Council (30 June 2017) has now resolved the question as to the presumption in favour of sustainable development applies in the mirror image position, where there is a five year supply and where the plan is not in other respects out of date. 
As in other matters, the NPPF is unclear on the meaning and application of the presumption in favour of sustainable development. Perhaps the presumption is oversold in the ministerial foreword: “Development that is sustainable should go ahead, without delay – a presumption in favour of sustainable development that is the basis for every plan, and every decision.
Paragraph 14 expresses the presumption as a “golden thread running through both plan-making and decision-taking“, before going on to set out what this means for plan making and decision making. For decision making it means:
” ◦ approving development proposals that accord with the development plan without delay; and

    * where the development plan is absent, silent or relevant policies are out-of-date, granting permission unless: 
– any adverse impacts of doing so would significantly and demonstrably outweigh the benefits, when assessed against the policies in this Framework taken as a whole; or

– specific policies in this Framework indicate development should be restricted.

The question that has exercised the courts in a series of cases is whether the presumption applies outside these specific instances, for example even where a scheme is contrary to an up to date plan. 

Lindblom LJ first sets out how judges should approach questions of policy interpretation, referring back to his first instance judgment in Bloor Homes East Midlands Ltd. v Secretary of State for Communities and Local Government (19 March 2014): 
“Planning policies are not statutory or contractual provisions and should not be construed as if they were. The proper interpretation of planning policy is ultimately a matter of law for the court. The application of relevant policy is for the decision-maker. But statements of policy are to be interpreted objectively by the court in accordance with the language used and in its proper context.”
He refers to his statement having been “underscored” by the Supreme Court in Suffolk Coastal where they set out that “the interpretation of policy will be suitable, in principle, for legal analysis – though only to a degree that depends on the context and content of the policy in question.”
Lindblom LJ followed the approach taken by Holgate J in Trustees of the Barker Mill Estates v Test Valley Borough Council (25 November 2016) in finding that is no freestanding presumption in favour of sustainable development outside para 14. 
Of course that is not to say that, as long as paragraph 14 is correctly interpreted, applicants cannot pray in aid other matters (factors where the development would accord with other policies in the NPPF) as material considerations, to overcome the presumption. It was a shame that (because in this case the judge was found to have misinterpreted paragraph 14) Lindblom LJ did not find it necessary expressly to put right some curious reasoning of the first instance judge, Green J, as to the operation of the statutory presumption in favour of the development plan set out in section 38(6) of the Planning and Compulsory Purchase Act 2004. In his judgment Green J tries to box in the exercise of a decision maker’s discretion with odd passages such as this:
Insofar therefore as paragraph [14] permits of a residual discretion it must be recognised that the outcome arrived at by the operation of paragraph [14] should carry considerable gravitational pull. It should yield only as an exception to the norm where there exists objective and substantial reasons which can be readily demonstrated to a high degree of probative value and which takes into account the particular reasons why a development has been found to collide with the Local Plan. I should add however (see paragraph [54] below) that I express no concluded view on exactly how exceptional “exceptional” actually is; this being an issue better explored in a case where that issue truly arises.”

Whilst not specifically tackling this approach, Lindblom LJ pointedly follows the Supreme Court in Suffolk Coastal and Holgate J in Barker Mill with a warning against excessive legalism in matters of policy interpretation:

“I would, however, stress the need for the court to adopt, if it can, a simple approach in cases such as this. Excessive legalism has no place in the planning system, or in proceedings before the Planning Court, or in subsequent appeals to this court. The court should always resist over-complication of concepts that are basically simple. Planning decision-making is far from being a mechanical, or quasi-mathematical activity. It is essentially a flexible process, not rigid or formulaic. It involves, largely, an exercise of planning judgment, in which the decision-maker must understand relevant national and local policy correctly and apply it lawfully to the particular facts and circumstances of the case in hand, in accordance with the requirements of the statutory scheme. The duties imposed by section 70(2) of the 1990 Act and section 38(6) of the 2004 Act leave with the decision-maker a wide discretion. The making of a planning decision is, therefore, quite different from the adjudication by a court on an issue of law (see paragraphs 8 to 14, 22 and 35 above). I would endorse, and emphasize, the observations to the same effect made by Holgate J. in paragraphs 140 to 143 of his judgment in Trustees of the Barker Mill Estates.

Paragraphs 133/134

What is the extent of the setting of a listed building for the purposes of assessment of harm?

In Steer v Secretary of State (Lang J, 22 June 2017) the main issue was treatment by an appeal inspector of the impact that proposals in Allestree, Derbyshire, for residential development and associated development would have on the landscape character of the area and heritage assets, namely Kedleston Hall (a grade 1 listed building), Kedleston Park (a grade 1 listed park), Kedleston Conservation Area, Kedleston Hotel and Quarndon Conservation Area. The Council, Historic England, the National Trust and others had opposed the appeals on the basis that whilst the proposed development was at some distance from, and would not be visible from the assets, there were historic and social/economic connections between the areas which meant that the appeal site was properly to be regarded as within the setting of the listed hall and park. 
The definition of ‘setting’ in the glossary to the NPPF is unspecific: “The surroundings in which a heritage asset is experienced. Its extent is not fixed and may change as the asset and its surroundings evolve.”
Lang J concluded that the inspector adopted an unlawfully narrow approach when determining whether the appeal site was part of the setting of Kedleston Hall and misdirected himself that a visual connection was necessary or determinative, in addition to the evidence of a historical connection.
The judge found that the inspector’s “focus was upon identifying a visual connection, and assessing the proposal’s impact upon it. The historic social and economic connections were set to one side in this exercise.”
“The evidence was that the appeal site was part of the setting of the Hall because it had formed part of the estate, managed historically as an economic and social entity, and it remained in its historic agricultural use, with hedges and mature trees characterising the field boundaries. From the Hall and the Park, the surrounding rural context was important in preserving a sense of a parkland landscape at the centre of a managed rural estate, rather than in a suburban context. The site was on the primary visitor route to the Hall and Park and so visitors would experience the historical narrative, and the concentric influence of the Hall on its landscape, as they traversed the agricultural estate, then entered the enclosed, designed park and gardens, enjoying the drama of anticipation as a great English country house was revealed to them.
In reaching her conclusion it is interesting to see the reliance that Lang J places on Historic England’s good practice guide on the setting of heritage assets. 

Paragraph 141

Hayes v City of York Council (Kerr J, 9 June 2017) concerned a planning permission granted by York Council for the construction of a visitor centre at the base of the motte at Clifford’s Tower in York and the installation of a new staircase and tower floor, with walkways, balustrading, a roof deck with a café and other restoration works. A car park next to the site is to be removed. The project includes archaeological works and disturbance to buried artefacts. 

The case concerned the meaning of paragraph 141 of the NPPF, which states that where heritage assets are lost or partly lost, local planning authorities and developers should make archaeological records publicly available, but “the ability to record evidence of our past should not be a factor in deciding whether such loss should be permitted”. 
The challenge was brought by a member of the council. One of his complaints was that the council had taken account of a legally irrelevant factor, namely the ability to record evidence of the past.
Kerr J reviewed the more detailed national heritage policies that preceded the NPPF and the way in which the precise wording changed and finally was summarised in, and replaced by, the NPPF:

The codification exercise which created the NPPF delivered commendable brevity, at the price (well worth paying) of replacing detailed exposition with general policy statements that can be Delphic, as in this instance.”

He turned to paragraph 141:
“The difficulty arises from the wording in the last sentence: “the ability to record evidence shall not be a factor in deciding …”. Those words do express, as a matter of language, what appears in conventional public law parlance to be the exclusion of a material consideration. Read literally, those words say not only that the ability to record evidence cannot be the sole justification for the harm; it cannot even contribute to the justification for the harm.”
Kerr J had real difficulty with this literal reading:
“Why should the preservation of information about an asset not be weighed in the balance along with other factors in favour of a development that harms a heritage asset? The harm is attenuated by the preservation of information and making it publicly available, which enhances and better reveals the significance of the harmed asset and hence its positive contribution to the locality and to our heritage.”

“This difficulty can only be overcome, in my judgment, once it is recognised that a non sequitur crept in when PPS 5 replaced PPS 16, and then found its way into the language of NPPF paragraph 141. In my judgment, the last sentence of that paragraph only makes good sense if interpreted so that the words “should not be a factor” are taken to bear the meaning “should not be a decisive factor”, in deciding whether the harm to the asset should be permitted.

I appreciate that, even allowing for the fact that the NPPF is a policy document and not a statutory provision, this interpretation stands uneasily with the actual words of the last sentence of the paragraph. But unless the paragraph is interpreted in that way, it would be very difficult to apply in a coherent manner.”

Kerr J rejected paragraph 141’s “literal interpretation in favour of a sensible and liberal construction of the paragraph in its proper historical context“.
Wider thoughts

So, three recent examples of the way in which the courts embark upon interpreting policy (whether national or local) and its application, consistent of course with the Supreme Court’s approach in Tesco Stores Limited v Dundee City Council (21 March 2012) that “policy statements should be interpreted objectively in accordance with the language used, read as always in its proper context. 

That is not to say that such statements should be construed as if they were statutory or contractual provisions. Although a development plan has a legal status and legal effects, it is not analogous in its nature or purpose to a statute or a contract. As has often been observed, development plans are full of broad statements of policy, many of which may be mutually irreconcilable, so that in a particular case one must give way to another. In addition, many of the provisions of development plans are framed in language whose application to a given set of facts requires the exercise of judgment. Such matters fall within the jurisdiction of planning authorities, and their exercise of their judgment can only be challenged on the ground that it is irrational or perverse (Tesco Stores Ltd v Secretary of State for the Environment [1995] 1 WLR 759, 780 per Lord Hoffmann). Nevertheless, planning authorities do not live in the world of Humpty Dumpty: they cannot make the development plan mean whatever they would like it to mean.”
Despite the reference to interpreting policies “objectively”, it will be seen that the courts will draw upon context, previous gestations of guidance and extraneous guidance documents to assist them. Sometimes, as in Hayes, the strict meaning of words will be stretched in a way that potentially leads to uncertainty. 
A broader approach to the interpretation of development consents by reference to extraneous documents than has traditionally been the case was signalled by the Supreme Court in Trump International Golf Club Scotland Limited v the Scottish Ministers (16 December 2015):
“When the court is concerned with the interpretation of words in a condition in a public document such as a section 36 consent, it asks itself what a reasonable reader would understand the words to mean when reading the condition in the context of the other conditions and of the consent as a whole. This is an objective exercise in which the court will have regard to the natural and ordinary meaning of the relevant words, the overall purpose of the consent, any other conditions which cast light on the purpose of the relevant words, and common sense. Whether the court may also look at other documents that are connected with the application for the consent or are referred to in the consent will depend on the circumstances of the case, in particular the wording of the document that it is interpreting. Other documents may be relevant if they are incorporated into the consent by reference (as in condition 7 set out in para 38 below) or there is an ambiguity in the consent, which can be resolved, for example, by considering the application for consent.”
To my mind, this all takes us into dangerous territory. Isn’t the public, or a purchaser of a development site, entitled to take words as meaning what they say. The courts are having to step in and complete the gaps left by inadequate drafting. Whilst its focus is a long way away from planning law, Lord Sumption’s speech The Supreme Court and the Interpretation of Contracts given at Keble College Oxford on 8 May 2017 is a thought-provoking read. One of the concluding passages:
“It is I think time to reassert the primacy of language in the interpretation of contracts. It is true that language is a flexible instrument. But let us not overstate its flexibility. Language, properly used, should speak for itself and it usually does. The more precise the words used and the more elaborate the drafting, the less likely it is that the surrounding circumstances will add anything useful. I do not therefore accept that the flexibility of language is a proper basis for treating the surrounding circumstances as an independent source from which to discover the parties’ objective intentions.
I agree! Let’s aspire to use words precisely, whether in the drafting of policies, permissions or indeed agreements, rather than relying on the courts as a slow, expensive and unpredictable backstop. And given their broad effect, surely policies ought to be written even more carefully than contracts?
Simon Ricketts, 8 July 2017
Personal views, et cetera
Image by Rob Cowan.

Affordable Housing Tax

In requiring the developers of private housing schemes to contribute to the provision of affordable housing, the planning system has become a tax collection system, and an inefficient, opaque one at that. 
The OECD classifies  taxes as follows:
“… compulsory, unrequited payments to general government. Taxes are unrequited in the sense that benefits provided by government to taxpayers are not normally in proportion to their payments. 

The term “tax” does not include fines unrelated to tax offences and compulsory loans paid to government. […]

General government consists of supra-national authorities, the central administration and the agencies whose operations are under its effective control, state and local governments and their administrations, social security schemes and autonomous governmental entities, excluding public enterprises.
Participants in the planning system seem to accept the political policy choice that has been made: to require developers to subsidise the provision of affordable housing, whether by requiring them to dispose of land or built units to registered affordable housing providers at less than market value (and nowadays at less than cost, given the increasing scarcity of any public sector grants or other forms of subsidy) or to make financial payments towards the provision of affordable housing elsewhere in the area. 
The provision of market housing does not in any way increase the need for affordable housing, indeed over time by increasing supply if anything it should decrease it. It may be said that mixed use communities can only be achieved by requiring the inclusion of affordable housing within market residential schemes, but that in itself does not justify the state putting the cost of the affordable housing at the door of the developer. The only reason that affordable housing section 106 planning obligations meet the requirements of regulation 122 of the Community Infrastructure Levy Regulations 2010 (necessary to make the development acceptable in planning terms; directly related to the development; and fairly and reasonably related in scale and kind to the development) is because of local policies seeking such obligations, supported by national policy. Policy could have easily required development across the board to contribute to affordable housing – or another category of development other than market housing. Why shouldn’t we use plain language and describe the extent of subsidy on each scheme as a tax? Hypothecated it may be but it still surely meets that OECD definition. For the rest of this post I will refer to it as Affordable Housing Tax, AHT. 
How to calculate AHT? Frequently, the high proportion of affordable housing that is required to be provided in connection with a private market housing development, when taken with the other costs of that development (including CIL where chargeable, a more straight-forward and transparent tax – that’s how bad AHT is!), would render the project unviable and so AHT ends up being as much as can be extracted from a development whilst allowing it to go ahead, assuming a fixed capped profit level for the developer and a fixed capped land value for the land owner (often less than its “real” value or actual acquisition cost). 
Take London. The London Plan requires boroughs to seek to maximise affordable housing provision. The current Mayor has indicated that his “long-term aim is for half of all new homes to be affordable”. In his November 2016 draft affordable housing and viability SPG (the subject of my 1.12.16 blog post  ), he introduced a ‘threshold approach’, whereby schemes meeting or exceeding 35% (by habitable room) affordable housing without public subsidy will not be required to submit viability information. There are also minimum requirements as to the proportions of different types of affordable housing that will be required (“tenure split” in the affordable housing industry jargon that we have grown up with). For schemes that cannot meet the threshold, viability appraisal is required to justify how much affordable housing the scheme can deliver.
Imagine such a concept in any other sector:
1. The market produces goods which reduce the need for the state to provide a service, or which are at least neutral. 

2. The market is taxed on those goods, with the tax applied towards provision of that service, instead of that service being paid for by the state. 

3. The level of that tax differs according to location but will often equate to all profits arising from the production of the goods, less a capped profit and capped input cost. 

I’m expressing no view as to whether this process is right or wrong. However, I do feel that the underlying reality has been conveniently forgotten. And the collateral damage from AHT is:
1. loading complexity into the planning process, with local planning authorities having to fulfil both a tax assessment and tax collection role

2. encouraging bad outcomes, with developers incentivised to expend resources on AHT mitigation (complex affordable housing negotiations, arguments over tenures, viability appraisal)

3. reducing housing delivery by rendering some projects unviable. 

How did we get here? There is an interesting 2002 study by the Joseph Rowntree Foundation, “Planning gain and affordable housing: making it count”, which starts with this brief history:

“Local authorities had been experimenting with ways of using the planning system to secure affordable housing in a number of areas in England in the 1970s, but official government endorsement first came in 1979 when the rural exceptions policy was announced. This enables rural planning authorities to grant planning consent for housing on sites that would not otherwise receive permission, provided that only affordable housing is developed on them
The approach was more widely sanctioned to enable affordable housing to be secured on all larger housing developments in 1981 and subsequently included in all Planning Policy Guidance on housing (PPG3) issued since then (DETR, 2000). Provided that local planning authorities have policies in their adopted statutory development plans that assess the need for new affordable housing in their districts, they may require private developers to contribute to meeting this need. They may also set specific targets to be achieved on sites allocated for new housing in adopted plans. When developers agree to make contributions these are made legally binding contracts, where they enter into agreements with the relevant planning authority under section 106 of the 1990 Town and Country Planning Act as part of the process of securing planning permission.”

“In 1998, the policy was amended, to reduce site thresholds above which contributions would normally be sought, and to link it more closely with the government’s policies on social inclusion, mixed communities and urban renaissance through on-site provision of affordable housing (DETR, 1998). In the 2000 version of PPG3, the government made it clear that developers’ unwillingness to make contributions to affordable housing would be an appropriate reason, of itself, to refuse planning permission (DETR, 2000). 

In the 2001 Green Paper on reform of the planning system the government proposed widening the scope of the affordable planning policy to incorporate small sites and commercial developments. It also proposed replacing negotiated contributions by standard authority- wide financial tariffs, which would still mainly be used for on-site provision. (DTLR, 2001a, 2001b).”
In my view, a significant turning point was paragraph 38 of PPG3 (1992): “A community’s need for affordable housing is a material consideration which may properly be taken into account in formulating development plan policies.”
This from an interesting 26 October 2011 paper  by Tim Mould QC:
At the time, the introduction of that policy provoked considerable controversy in planning circles. In Mitchell v Secretary of State, Roy Vandermeer QC sitting as a deputy High Court Judge held that a planning appeal decision based upon considerations of housing price and tenure was unlawful, on the ground that such considerations had nothing to do with the character and use of land. Had that view prevailed, the now conventional approach to delivering affordable housing through the planning process would have been dead in the water, considerations of price and tenure being part and parcel of the means whereby affordable housing is actually secured through the development control process. 

That view did not, however, prevail. The Court of Appeal overturned Mr Vandermeer’s decision. In Mitchell v Secretary of State [1994] 2 PLR 23, Saville LJ said (page 26G-H) : 

“On the law as it presently stands, therefore, the need for housing in a particular area is a planning purpose which relates to the character and use of land. Given that this is so, the proposition advanced on behalf of Mr Mitchell is that the need for a particular type of housing in an area is not a planning purpose which relates to the character of the use of land if that need is itself dictated or generated by considerations of cost or type of tenure. 

I cannot accept this argument. To my mind there is no sensible distinction to be drawn between a need for housing generally and a need for particular types of housing, whether or not the latter can be defined in terms of cost, tenure or otherwise. In each case the question is whether, as a matter of planning for the area under consideration, there is a need for housing which the grant or refusal of the application would affect. 

The fact that the need may be dictated by considerations of cost or type of tenure seems to me to be immaterial….
….the fallacy in the argument is that it simply confuses the need for housing (which on the authorities is a legitimate consideration) with the reasons for that need and concentrates exclusively on the latter while effectively ignoring the former. ”

Thereafter the national planning policy for the delivery of affordable housing through the planning process became encapsulated in a departmental circular devoted to that topic – DETR Circular 6/98 “Planning and Affordable Housing“. Building on the established materiality of the need for affordable housing, paragraph 1 of the circular required local planning authorities to investigate the degree of need for affordable housing in their area and, based on that evidence, to include in their local plans a policy for seeking an element of such housing on suitable sites. Such policies would then be material consideration in determining an application for planning permission.”

Tim then points to PPS3 (2005), which is even more specific as to what was required from developers: “planning authorities were required to set overall targets for affordable housing during the plan period based on (inter alia) the findings of a Strategic Housing Market Assessment; to include separate targets for social rented and intermediate housing; to specify the size and type of affordable housing likely to be needed in particular locations; to set out the range of circumstances in which affordable housing would be required; and to set out the approach to seeking developer contributions towards affordable housing provision in their area. There was further guidance on the provision of affordable housing in rural areas.”
As we then move forward to the publication in 2012 of the NPPF, the references to seeking developer contributions to affordable housing are lost. Not because the approach has changed but because by now this is just the system, isn’t it?
The NPPF simply says this about affordable housing, para 50:

“To deliver a wide choice of high quality homes, widen opportunities for home ownership and create sustainable, inclusive and mixed communities, local planning authorities should: 

    * plan for a mix of housing based on current and future demographic trends, market trends and the needs of different groups in the community (such as, but not limited to, families with children, older people, people with disabilities, service families and people wishing to build their own homes); 


    * identify the size, type, tenure and range of housing that is required in particular locations, reflecting local demand; and 


    * where they have identified that affordable housing is needed, set policies for meeting this need on site, unless off-site provision or a nancial contribution of broadly equivalent value can be robustly justified (for example to improve or make more effective use of the existing housing stock) and the agreed approach contributes to the objective of creating mixed and balanced communities. Such policies should be sufficiently exible to take account of changing market conditions over time“
 

Similarly, there is the assumption in the Government’s 2014 planning practice guidance, along with specific references later introduced into the document as to the circumstances in which affordable housing requirements should not be sought (reflecting the 28 November 2014 written ministerial statement that set out the small sites threshold and the vacant building credit). 

Throughout this period the availability of public subsidies to support the delivery of affordable housing has reduced.  
What an example of mission creep all of this is. How enticing for successive governments to restrict general taxation by progressively increasing the burden of paying for affordable housing onto private sector residential development. 
The political sleight of hand goes further: recognising the financial impact that this responsibility places on residential development, beneath the headline proportions of affordable housing that are sought, the definition of affordable housing has been adjusted to the disadvantage of those in most need of it:
– first with the introduction of affordable rent rather than social rent (see the House of Commons Library briefing paper dated 7 May 2015), affordable rent being a reduction of at least 20% on market rent as opposed to social rent’s generally lower, fixed rent, levels
– more recently with consultation on widening the definition of affordable housing to include “starter homes” and also, for build to rent development, discount market rent (see my 4.3.17 blog post). 

One advantage of calling a tax a tax would be that we could then have an honest conversation as to whether it is right that CIL always has priority over AHT. That 15% of CIL that is for neighbourhoods to apply (25% where a neighbourhood plan is in place) – can’t AHT take priority over that? Indeed, given that neighbourhood slice doesn’t even have to be spent on the provision of infrastructure (but on either “the provision, improvement, replacement, operation or maintenance of infrastructure” or “anything else that is concerned with addressing the demands that development places on an area”), why not advise that in areas of particular need of affordable housing the neighbourhood slice should automatically go toward affordable housing?
Of course the very term “affordable housing” is politician-speak. After all, all housing is affordable to some and unaffordable to others. Don’t we really mean “subsidised housing”, “low income housing” or “public housing”? I’m surprised indeed we haven’t yet seen it rebranded as “community housing”. 
But what other approach could be taken to securing it, other than the present one?
An interesting exercise would be to calculate, nationally or authority area by authority area, the annual level of AHT that is secured from developers by way of section 106 obligations (some useful national figures to begin with are within Annex A of the Government’s May 2016 starter homes consultation paper) and then to work out what that might equate to if it became an across the board (all development, not just housing) CIL-type charge. As I say, why should the cost of affordable housing solely fall on residential development? Indeed, arguably it is employment development that adds more directly to the need for homes. 
Indeed, as part of any review of CIL, doesn’t the concept of a Community Housing and Infrastructure Levy, or CHIL, have a ring to it?
Furthermore, whilst there is a much bigger role for local authorities to play in delivering affordable housing, direct and in conjunction with registered providers and the private sector (and potentially with a greater focus on neighbourhood, community, participation in delivery and management), why not turn the system on its head and boost production by making it positively in the developer’s interest to deliver affordable housing, through offering tax credits? This has been the US model, via the Low-Income Housing Tax Credit (LIHTC), ironically now under threat due to Trump’s proposed tax changes (see for example Bloomberg piece Trump Corporate Tax Shakeup Puts Housing Developers in Tailspin 26 April 2017). 

Or do we have it right with our present system? Question. 
Simon Ricketts 28.5.17
Personal views, et cetera