Suzan Yildiz, Head of Planning at Olswang LLP considers the emerging case law on the proper interpretation of key housing policies in a decision making context and concludes perverse consequences can flow from over-simplification of national planning policy…
In an uncertain planning world the NPPF certainly continues to surprise. 2013 culminated in illuminating, if foreseen, case law on the proper interpretation of the National Planning Policy Framework (NPPF’s) housing land supply policies. March 2014, brought into the public domain the curiously semantic correspondence (click the link for full version) between the Planning Minister and the Chief Executive of the Planning Inspectorate. A troubled Boles directed Inspectors to “choose their words carefully and reflect government policy very clearly” on release of Green Belt land for housing provision1. A bemused Sir Michael Pitt duly warned his Inspectors, but sought clarity about the government’s direction of travel on objectively assessed housing needs. The semantics suggest Inspectors’ should politely recommend, rather than deem it necessary to review Green Belt boundaries. A proverbial storm in a political tea-cup or, dare I say it, a dose of electioneering placing renewed emphasis on localism? Whatever the realpolitik, the need to strike a balance between meeting ‘objectively assessed housing needs2 and protection of Green Belt (or similarly constrained land) is at the heart of case law developments and the exchange of letters.
Objectively assessed housing needs and planning constraints
This article examines the approach to objectively assessed housing needs versus planning constraints, shortfalls in housing supply and the meaning of ‘persistent failure to deliver’. For ease of reference and consistency, certain terminology is deployed. The NPPF is referred to as the Framework3. For consistency with case law and to distinguish application of policies, reference to ‘development control’4 decisions is made. The term ‘planning constraint’ denotes references to Green Belt, Areas of Outstanding Natural Beauty (AONB), Metropolitan Open Land or similarly constrained situations5.
The correct approach to determining ‘objective housing needs’, and consequently adequacy of ‘housing land supply’, is of crucial importance to the soundness of development control decisions in relation to housing schemes on land or in districts with significant Green Belt (or other planning constraints). It is noted at the outset that a holistic reading of paragraphs 14 and 49 of the Framework indicates that it is conceivable the local plan may legitimately be unable to meet ‘objectively assessed needs’6. The difficulties, as will be seen, arise in the absence of an up-to-date local plan or definitive data on ‘objective needs’, but nonetheless a decision maker (whether on appeal or application) is invidiously bound to establish ‘objectively assessed housing needs’.
City and District Council of St Albans v Hunston Properties Limited and SoS, 20137
The first notable housing land supply case in the Court of Appeal, Hunston Properties Limited turns on the proper interpretation of “objectively assessed needs for market and affordable housing as far as is consistent with the policies in the Framework” (paragraph 47). Unsurprisingly, the case arises in a popular district almost entirely bounded by Metropolitan Green Belt. Hunston sought outline permission for 116 dwellings (and associated development) on a site within the Green Belt. St Albans lacked an up-to-date plan in accordance with the Framework, but refused permission for reasons associated with protection of the Green Belt. By way of reminder, in planning policy terms, housing development on green belt land remains inappropriate development unless ‘very special circumstances’ exist8. A subsequent planning appeal was likewise dismissed.
Hunston’s Section 288 challenge against the appeal decision succeeded. In determining ‘objectively assessed needs’, the Inspector had erred in relying on revoked Regional Strategy figures of 360 homes (which were deemed to reflect the considerable Green Belt constraints in the area), as opposed to need for 688 homes (being the 2008 projections for new households)9. This error led to the fatal finding of no shortfall in the 5 year housing land supply10. St Albans appealed in the Court of Appeal, but was dismissed.
Hunston offers critical lessons for decision makers determining housing schemes in light of planning constraints, where an up-to-date plan, or for that matter definitive evidence on housing needs is lacking:
- In determining ‘objectively assessed needs’11, the specific role of the qualification ‘as far as is consistent with the policies in this Framework’12 is directed at the plan making process. It does not qualify or reduce, as the Inspector wrongly assumed, the housing need itself but the extent to which the local plan might be able to meet the housing need in light of constraints. The Inspector had erred in adopting a constrained figure for housing need. She ought to have found a shortfall in the expected housing land supply below objectively assessed needs.
- A shortfall in housing land supply will not automatically demonstrate ‘very special circumstances’ justifying development in the Green Belt, but the scale of the shortfall might, depending on the degree of weight and significance afforded to it.
- Broader district wide constraints13 may mean a shortfall in housing land supply is inevitable. Therefore, of limited weight in development control decisions. Essentially, broader district wide constraints, as well as site specific considerations, could be factored into the overall planning judgement.
Therefore, Hunston confirms a local plan could legitimately fall short of meeting objectively assessed needs due to the extensive constraints in the area (not simply the site itself) without the shortfall amounting to ‘very special circumstances’. This does not obviate, but demands, an up-to-date plan. In a development control scenario, having established the correct level of objective need, the weight to be attached to the scale of any shortfalls in supply and the wider planning context are likely to be determinative of whether ‘very special circumstances’ exist.
Cotswold District Council v Secretary of State, 201314
In November 2013, the issue was revisited by the High Court in the Cotswold case in respect of 2 applications by Cotswold DC to quash decisions of the Secretary of State granting permissions on appeal for (i) an outline scheme comprising 250 residential units, and (ii) a residential scheme of 39 units, both on sites in Tetbury and within AONB. The Cotswold case adopted the approach in Hunston, namely agreeing that paragraph 47 was directed at planning making functions. Nonetheless, the question of ‘objective housing needs’ and whether there is sufficient supply to meet those needs were material considerations for the decision maker.
The decision of the Cotswold Inspector (which was exceptionally thorough) was endorsed, and suggests the following approach to determining housing schemes impacted by planning constraints and the absence of an up-to-date local plan:
- Establish ‘objectively assessed need’;
- Determine deliverable 5 year housing land supply;
- Consider if there has been ‘persistent under-delivery’ of housing;
- Conclude whether the difference between objective needs (plus a 5% or 20% buffer if persistent under-delivery) and deliverable 5 year housing supply, leads to a shortfall in housing land supply;
- Exercise overall planning judgement.
The Framework requires local planning authorities to apply a 20% buffer to meet housing requirements where there has been persistent under-delivery. This buffer influences the quantum of objective needs, housing supply shortfall, and in a development control scenario, overall planning outcomes. But what does it mean? What is the relevant period for assessing performance? Is it a continuous and demonstrable failure to deliver? These issues were considered in the Cotswold case.
Firstly, the court recognised that whilst development plan policies have legal status and effects, they are not construed as statutory or contractual provisions; instead their application requires the exercise of planning judgement based on a set of facts15. Secondly, paragraph 47 is to be interpreted and applied with regard to its overall purpose and context.
Lastly, ‘persistent under-delivery’ is a reference to ‘a state of affairs which has continued over time’, such time to be a reasonable period of time over years, not a point in time or a temporary fluctuation. There has to be ‘an assessment of previous performance’ to establish ‘a record of under-delivery’ against ‘some measure of what the housing requirements were’. In other words, a persistent policy failure to meet the appropriate housing targets over the relevant period. Interestingly, the judge concluded a decision maker could identify ‘an appropriate measure of housing needs’ separately from the relevant development plan or as a means of reinforcing the plan. The Inspector in the instant case had annualised delivery figures over a 5 year period to find persistent shortfalls in delivery against annual targets. However, the Inspector had also considered and concluded under-delivery occurred during 7 or 8 out of 10 relevant years. The performance assessment had regard to housing need projections, not the plan targets which were deemed artificially low.
There are tensions in emerging case law, perhaps reflective of policy tensions. In the Cotswold case, the judge observed (albeit not decisively) that the presumption in favour of sustainable development16 does not apply to housing applications on land with protected designations17. Yet this seems dubious in light of the trilogy of South Northamptonshire cases18 and Cotswold itself, which have disapplied ‘relevant housing supply policies’ under paragraph 49 for the purpose of triggering the presumption. The paragraph 49 exercise of disapplication feeds directly into the overall planning judgement and presumption under paragraph 14, whereby if policies are deemed “out-of-date”, permission should be granted unless constraints dictate otherwise.
The meaning of policy (although not its application) is the courts’ remit, yet the courts too are struggling with a holistic reading of the Framework. The judge in Hunston observed “unhappily, as this case demonstrates, the process of simplification has in certain instances led to a diminution in clarity”19. In essence, the simplification of the Framework on technical issues, such as housing needs and land supply, demands careful judgments policy by policy, paragraph by paragraph, line by line as to whether the relevant policy targets plan-making or decision taking. Sadly, semantics have entered the world of planning judgments and are here to stay at a time when the need for planning certainty is greatest. If not quite ‘a lawyer’s charter’, the Framework is certainly creating a window of opportunity for Counsel with an appellate practice. The purposive-interpretation led approach to the Framework potently highlights the indivisibility of law and policy: consequently, and on a practical level, the need for a collaborative approach between planners and lawyers during the planning process. On the bright side, never let it be said that the art of letters is dead. The author, for one, enjoyed the Pitt-Boles letters.
Since publication of the Framework, the author has consistently highlighted the importance of up-to-date plans and good practice for local communities, developers and the profession alike20. The lack of up-to-date plans and definitive assessments of ‘objective housing needs’ renders planning authorities vulnerable to appeals and legal challenges on housing schemes. Given the national housing crisis, it is unsurprising that house builders benefit from the Framework’s policies. The approach to assessing objective needs, housing supply and under-delivery are too technical and nuanced for day to day decision making, they properly belong to the plan-making stage. What is truly troubling, and ugly in keeping with our series’ title, is the unexpected finding that the Framework can “create perverse incentives, such as some local authorities refusing an application simply to make a decision within the statutory period.”21 Worse still, scrutiny of committee decision making may well disclose that in parts of the country some elected members could be avoiding the tough political choices, which they are elected to make, between protection of Green Belt and meeting housing demand. A select committee of MPs is due to review the unintended impacts of the Framework in terms of ‘planning for housing, town-centres and energy infrastructure’. The report will no doubt be eagerly anticipated. ■
1 The exchange occurred in response to the Inspector’s report into the Reigate and Barnstead Local Plan
2 Paragraph 47, bullet 2, Framework.
3 It is understood DCLG desire that the NPPF be known as the Framework.
4 The author’s and indeed the sector’s preference is development management for obvious reasons.
5 Reference could equally be made to policy protections. However, the term constraint is consistently used in case law. Its use in this article does not indicate a bias towards either position.
6 See footnote 9 to paragraph 14.
7  EWCA Civ 1610.
8 See paragraph 87, NPPF.
9 The 688 figure was derived from projections by the Department for Communities and Local Government (DCLG) for new households.
10 Under paragraph 47 (bullet 2).
11 Under paragraph 47(bullet 1).
12 E.g. Green Belt protection policies.
13 E.g. Green Belt or Areas of Outstanding Natural Beauty (AONB) or similar constraints.
14  EWHC 3719 (Admin).
15 These comments referenced the Supreme Court judgement in Tesco Stores Ltd v Dundee Council (Asda Stores Ltd and another), 2012 UKSC 13 relating to development plans.
16 In reference to paragraphs14 and 49 (first line).
17 See paragraphs 12 and 13 of the Cotswold DC judgement.
18 In the a trilogy of South Northamptonshire cases between December 2013 and March 2014, a number of seemingly general strategy and environment policies were deemed ‘housing supply policies’ and disapplied.
19 Paragraph 4 of Hunston judgement
20 This view is supported by recent research by Dr Gemma Burgess of Cambridge University.
21 See Dr Gemma Burgess’ research above.
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Head of Planning
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