‘Good practice on the use of s.106 mechanisms should be shared. Local Authorities will need to liaise with neighbouring authorities, affordable housing providers and the development industry and be realistic in their expectations of affordable housing delivery through s.106, recognising the danger of stifling overall housing growth through over ambitious requirements. LDD [Local Development Documents] policies should routinely require more than 35% of housing to be affordable leading to at least 10,000 affordable dwellings annually.’
‘Housing Affordability: Within the 29,623 dwellings per annum (at least) required for the region, at least 10,000 affordable homes per annum will be provided in the period to 2026. Provision will be made for at least 35% of all housing developments annually across each Local Authority area and Housing Market Area to be affordable housing. Development Plan Documents should include policies to deliver a substantial increase in the amount of affordable housing in the region and reflect the outcome of joint working including Strategic Housing Market Area Assessments. These should: - Specify targets for and proportions of affordable housing; …. - Help to secure and maintain appropriate supply of affordable housing in the wider context of maintaining an overall five year housing land supply.’
‘An element of affordable housing will be sought by negotiation on all housing sites which are of 15 units or more or are larger than 0.5ha in towns and villages of greater than 3000 population or are of 5 units or more or larger than 0.2ha in other locations [elsewhere, this is referred to as the ‘threshold’]. The provision sought will be related to evidence of local need in the District, including housing need surveys, and to the suitability of the site question. The provision of affordable housing should be on the same site but exceptionally and by agreement with the developer, a commuted sum may be sought equivalent to the appropriate affordable housing share on the site in order that the affordable housing may be provided closer to where the need for it arises.’
‘In planning at site level, Local Planning Authorities should ensure that the proposed mix of housing on large strategic sites reflects the proportions of households that require market or affordable housing and achieves a mix of households as well as a mix of tenure and price…’
‘In Local Development Documents, Local Planning Authorities should: - Set an overall (i.e. plan wide) target for the amount of affordable housing to be provided. The target should reflect the new definition of affordable housing in this PPS [set out in Annex B]. It should also reflect an assessment of the likely economic viability of land for housing within the area, taking account of risks of delivery and drawing on informed assessments of the likely levels of finance available for affordable housing, including public subsidy and the level of developer contribution that can reasonably be secured. …’
‘Drawing on information from the Strategic Housing Land Availability Assessment and or other relevant evidence, Local Planning Authorities should identify sufficient specific deliverable sites to deliver housing in the first five years. To be considered deliverable, sites should, at the point of adoption of the relevant Local Development Document: - Be available – the site is available now. - Be suitable – the site offers a suitable location for development now and would contribute to the creation of sustainable, mixed communities. - Be achievable – there is a reasonable prospect that housing will be delivered on the site within five years.’
‘(i) Whether the proportion of affordable housing proposed in response to viability considerations would result in a development which would comply with the development plan, and with PPS3 in contributing to the creation of sustainable, mixed communities. (ii) Whether the contributions proposed via the executed planning obligations would provide adequately for education and community infrastructure to serve the development.’
“214. The emerging RSS covers the period to 2026 (14). The proposed development the subject of this appeal is projected to cover a similar period – to 2024 (137). In the context of such a lengthy timespan, the downturn represented by the ‘credit crunch’, even though severe, can be regarded as a temporary and relatively short-term element. No evidence demonstrates otherwise. Though at the time of writing the RSS remains at Modifications stage, the Secretary of State has proposed no further modifications to RSS policy as a reflection of the ‘credit crunch’. RSS policy is intended to provide continuity and certainty over a lengthy period, and it is not to be expected that such policy should itself be hastily amended to reflect sudden and/or temporary changes in circumstances. 215. The requirements of PPS3 ¶29 in relation to the assessment of the likely economic viability of land for housing, and of the likely levels of finance available for affordable housing relate in particular to the formulation of Local Development Documents. The Gloucestershire and Districts Affordable Housing Site Viability Study (25) has been produced in that context. Nevertheless, site viability is a material consideration in applications for the development of specific sites. 216. Initially, in 2008 the Appellant offered 30% affordable housing on the Lydney B site (52), a proportion which reflected the specification of the emerging (pre-Modification) RSS (14). This initially offered proportion could also be seen as having reflected the view then taken of overall site viability including the detailed site development costs which the Appellant now argues are ‘abnormal’ but which were apparently not so regarded at the earlier application stage. The Council puts forward various ways in which the balance of such costs might be reduced (144-163). The Appellant helpfully acknowledges that differences between the Parties in relation to the costs of plot abnormals are not pivotal to the viability assessments (57). 217. However, in seeking to justify its revised proposed proportion of affordable housing (and its resistance to the levels of other contributions sought by the Council) the Appellant bases (59-66) its calculation of viability on data very precisely located chronologically to emphasise the effects of the ‘credit crunch’. The Appellant does so on the grounds of its witness Mr Heal’s professional view that valuation assessments are to be carried out using current known costs and values, and that the RICS Valuation Guidelines are clear that ‘market conditions prevailing’ at the date of the valuation should be used (59). The Appellant’s criticism of the Council’s evidence on site viability concentrates upon the Council’s use of forward projections, which the Appellant regards as fundamentally incorrect in principle. 218. That may be so. In the Godalming decision to which the Appellant drew attention (61), the Inspector (and the Secretary of State) accepted that the viability of the scheme should be determined on the basis of current values. However, that proposal concerned a site of only 1.6 hectares on the edge of the town centre, and on which residential development was to be concentrated in the form of 225 flats, together with commercial floorspace, car parking and a replacement police station. To phase development on so small a site in such a way that affordable housing would be triggered on a notional increase in market value depending on the timing and completion of the development (IR ¶402) would be impractical, and so it is not surprising that the Inspector considered that the wait for a time when values could possibly support the inclusion of affordable housing could be long and uncertain. That he did so was not wholly dependent upon his acceptance of the ‘current values’ basis of valuation, but encompassed wider circumstances. The Godalming site contained a former gas works and so its development involved the remediation costs of dealing with contaminated land, which represented a particular benefit to be brought by the scheme. 219. Nothing in PPS3 or elsewhere in national or regional policy guidance concerning site viability suggests that viability considerations attributable to the general economic situation (as opposed to specific characteristics of the sites themselves, as in the Goldalming case) should be used to justify significant reduction in the proportion of affordable housing to be delivered by a site above the threshold. 220. In the current case, the Appellant’s own evidence shows that the development of the Lydney B site is scheduled to take place over many years (137). The effect of omitting forward projections is therefore to exclude entirely any future benefit to the balance sheet of an upturn in the housing market and in receipts. Over such a period of time it is possible, not only that receipts would be improved by an upturn, but that the need for affordable housing might itself increase. The Appellant seeks to lengthen to 10 years (and if that is not accepted, to 5 years) the period within which application may be made for the determination of reserved matters (197). This would enable a delay to the start of development on Lydney B (whatever may occur on Lydney A) and thus would lengthen the overall period of development on this extensive site, increasing the probability that development would coincide with an upturn in the housing market. Over such a long period it is likely that viability data would change significantly in comparison with the current circumstances. 221. Development of the Lydney A site was allowed on appeal with a 20% proportion of affordable housing in recognition of its heavy infrastructure costs which contribute to the overall cost of Lydney site (Lydney A+B) (51). The residential element of the Lydney A scheme was limited by condition to no more than 320 dwellings: so at the 20% already permitted the development would yield 64 affordable dwellings. At Lydney B, 750 dwellings, more than double that number, are proposed: so that, at the 13% envisaged by the Appellant, Lydney B would yield 97 affordable dwellings, less than a third of the number sought by the Council. And there would be no further opportunity to achieve any more affordable dwellings in significant numbers through the development of sites allocated in the development plan, and certainly no opportunity to recoup elsewhere within the District, within the Plan period, the numbers of affordable units that would be forfeited on the East of Lydney sites. 222. The evidence of the SHMA is that affordable housing is needed, both as a proportion of overall dwellings and in terms of numbers, in far greater quantity than could be achieved in any event (24). In these circumstances, the degree to which the current appeal proposal falls short of the proportion sought by the Council represents a highly significant disadvantage. 223. It is clear, from the paragraph read as a whole, that PPS3 ¶9 intends it to be understood that affordable housing (which it mentions both as part of the key housing policy goal to which it refers, and in 3 of the 4 subsequent bullet-points) represents an essential element of the sustainable, inclusive, mixed communities to which it also refers under the heading of strategic housing policy objectives. It is also clear that when PPS3 ¶9 defines suitable as that the site…would contribute to the creation of sustainable, mixed communities, the term sustainable, mixed communities should be understood in the same sense in which it is used in ¶9. 224. In requiring local planning authorities, in setting targets for affordable housing in their Local Development Documents, to draw on informed assessments of the likely levels of finance available for affordable housing, including public subsidy and the level of developer contribution that can reasonably be secured, PPS3 ¶29 implicitly recognises that there may be circumstances in which, for valid reasons, developer contributions may not be capable of supporting the desired proportion of affordable housing. But in the current case, the financial considerations limiting the viability of the appeal site are essentially temporary. 225. The evidence is that the appeal site can be developed only by forfeiting a significant proportion of the affordable housing which has been justified in effect at all levels of policy and via a recent SHMA, leaving the overall need defined to a large extent unsatisfied, and with no opportunity to recoup affordable housing from another allocated site. I consider that if developed according to the current proposal the site would not contribute adequately to the creation of sustainable, inclusive mixed communities in the terms of PPS3; would not be suitable in those terms; and in those circumstances would not comply with the development plan, or with PPS3. Housing Land Availability 226. The appeal proposal is for a very substantial housing development. Taken together with the ‘Lydney A’ site, which has already received planning permission but which according to the evidence is essentially linked to the current site and will not be developed in isolation from it (81, 83), the proposal represents by far the largest housing allocation in the Local Plan (81, 108). The Appellant’s calculation of housing land availability depends upon the inclusion of an element of a Structure Plan requirement which was set at a high aspirational level. However, in the context of the housing figures set out in the emerging RSS, the requirement is substantially less. Notwithstanding the lesser requirement, it would not be possible to achieve a 5-year housing land supply without the inclusion of an element, assumed by the Council at 150, from the Lydney A site (130). The Appellant regards development of the Lydney A site as dependant upon a planning permission for the Lydney B site on the terms set out in the current appeal proposal (53, 81). To that extent, therefore, rejection for the current proposal would mean a deficiency in the housing land supply, though by a relatively small amount. On balance, the resulting deficiency in the housing land supply is not a factor of decisive weight. ”
‘- Ensuring developments achieve a good mix of housing reflecting the accommodation requirements of specific groups, in particular, families and older people… - Ensuring the proposed development is in line with planning for housing objectives…and does not undermine wider policy objectives e.g. addressing housing market renewal issues.’
‘A refusal on the grounds that [Lydney B] site should not for the time being be regarded as suitable would inevitably prevent the delivery of any houses or employment land and other benefits from the largest development site in the District.’ [my emphasis]. Paragraph 82 (which the Inspector must also have had in mind) went on, ‘Any refusal of planning permission would undoubtedly contribute to delays in achieving the regeneration objectives, both for housing and employment in the Forest of Dean District.’
‘The Secretary of State’s policy requires, amongst other factors, that planning obligations are only sought where they meet all of the following tests. The rest of the Guidance in this Circular should be read in the context of these tests, which must be met by all local planning authorities in seeking planning obligations. (i) relevant to planning; (ii) necessary to make the proposed development acceptable in planning terms; (iii) directly related to proposed development; (iv) fairly and reasonably related in scale and kind to the proposed development; and (v) reasonable in all other aspects.’
‘Can a developer turn development on a site which fails PPS3’s requirement of ‘suitability’ (see PPS3 para 54) into one which passes that test, simply by timing his application to coincide with a recession? The Claimant’s argument understandably attempts to mask that question, but it is the central and, it is submitted, only real issue.’
‘The Secretary of State took into account an irrelevant consideration, namely that he assumed that the Claimant timed its planning application to coincide with a recession in order to turn development which it is alleged failed the alleged requirement of ‘suitability’ in PPS3 para 54 into one which passed that alleged test. Alternatively, in basing his decision on the foregoing consideration, the Secretary of State acted on no evidence and/or unfairly.’