Nearly 4 months have passed since the controversial affordable homes small sites exemption policy was re-introduced into National Planning Practice Guidance (NPPG) following the Court of Appeal’s decision on 11 May.

In the aftermath of the decision, my previous article ‘Affordable Homes Small Sites Exemption and Vacant Building Credits Resurrected – A London View’ highlighted a number of uncertainties that would remain until the re-introduced policy had time to bed-in. As the summer draws to a close, are we any the wiser on how the policy is to be applied?

Battle Lines Drawn

Across London, local authorities have taken their positions on the application of the Ministerial Statement and revised NPPG, with some boroughs deciding to toe the party line while others choose to stick to their guns.

As anticipated, LB Islington and LB Richmond are of the view that the NPPG should be applied with flexibility and the development plan should take precedence, particularly in the context of their individual local housing markets.

In contrast, LB Merton and LB Enfield, informed by separate legal advice, have decided for the time being to align with the NPPG and stop seeking affordable housing contributions from small sites. They were advised that without up to date and robust evidence to justify why small sites contributions are necessary, local authorities need to give more weight to the Ministerial Statement and revised NPPG.  As a result, instances have arisen where planning applications that had previously had resolution to grant subject to affordable housing are being presented and determined again at LB Enfield’s Planning Committee, this time without any contribution.

Notably, LB Lambeth has changed camps over the course of the summer. After initially attempting to apply its own affordable housing policy, as adopted in its 2015 Local Plan, a series of appeal decisions has led to the local authority to retreat back to following the lines of the NPPG for its latest decisions.

First Blood at Appeal

We did not have to wait long for the revised NPPG to be tested at appeal, with a decision being made on 23 May 2016 for the erection for a single dwelling at 1A Chale Road in Lambeth. The decision left no ambiguity as to the relevance of the Court of Appeal judgement and revisions to the NPPG, with the Inspector taking the view that they represented “the most up to date expression of government planning policy and therefore a material consideration to…attach considerable weight”. Thus the lack of financial contribution, in this instance, was not considered to warrant dismissal.

LB Islington was another London borough to be knocked back at appeal, with the development of 10 residential dwellings at 139A Grosvenor Avenue being allowed without any affordable housing contribution. Two key outcomes from the decision were:

- In terms of the 1,000 sqm trigger threshold that is set within the NPPG, the Inspector took the view that GIA should be used instead of GEA.

- The Inspector decided that, despite aspects of Islington’s housing market such as high house prices, low income households and a prevalence of small sites, the policy expressed in the Ministerial Statement and NPPG outweighed the provisions of the local development plan.

Despite this appeal decision, however, LB Islington is still applying its local policy for small sites affordable housing contributions, having refused at least two minor residential planning applications since.

At this point, one could be forgiven for thinking it all seems clear cut and conclusive. Venturing outside of Greater London, however, reveals an appeal with an alternative outcome. On 12 August for 26 The Avenue in Elmbridge Borough, the Inspector took the view that the Ministerial Statement and NPPG should “not be applied rigidly or exclusively when material considerations may indicate an exception may be necessary”. In the case of Elmbridge Borough Council, it was considered that the exceptionally high house prices, large proportion of small scale housing developments and struggle to meet affordable housing targets were key material considerations. In the absence of any evidence to suggest that the affordable housing requirements placed an unreasonable or disproportionate burden on developers, it was decided that the Ministerial Statement and NPPG did not outweigh the local development plan

Where does this leave us?

Whilst there still may not be any absolutes at this stage, the dust is certainly starting to settle on the small site affordable housing exclusion policy.

Legal advice and recent appeal decisions point towards applying more material weight to the Ministerial Statement and revised NPPG than local adopted policy. However, exceptions can be allowed where clear, up-to-date and robust evidence is available that demonstrates how reliant a local authority is on affordable housing contributions from small sites and whether the requirement sets an unreasonable burden on small development. LB Islington, so far, has failed to demonstrate this whereas Elmbridge Borough has succeeded.