The strange case of the disappearing affordable housing

For the greenfield site known as ‘Land adjacent to 777 The Ridge’, affordable housing (AH) commitments went from 30% of what was to be built, to 40%, to zero.  How did this happen? The ‘agreed’ arrangements reported at the Hastings Borough Council (HBC) planning committee meeting in April 2021 were not formally signed up to — and later reneged on. A related case is due to be decided on 22 March 2023 with insufficient information.  Bernard McGinley looks closer at an odd business, intricate but important.

The Hastings Local Plan (Planning Strategy 2011-2028) includes 

Policy H3:  Provision of Affordable Housing

on the provision expected for new housing development. For greenfield sites and developments of more than 15 dwellings, an onsite provision of 40% affordable housing is required.  (Is a financial contribution an acceptable alternative? No. See Policy H3 b), Table 7.)

There were three main cases regarding 777 (and some others):

HS/OA/17/00645     50 units    30% AH                Outline Permission Approved

HS/FA/20/00970    67 units    40%|zero % AH    Refused, but Approved on Appeal

HS/FA/23/00016     71 units    zero % AH             Still undecided.

Regarding ‘645’, the delegated report of May 2019 explained that

The applicant has contested this requirement and a viability assessment has been provided and independently evaluated, a reduced 30% affordable housing has been accepted due to viability and delivery considerations.  . . . 

Unusually the application form is ‘Amended’ and dated January 2019. Where is the ‘Superseded’ one of 2017? 

The planning history was previously discussed by HOT here. The key event was the Planning Committee of late April 2021, deciding case ‘970‘. Planning officers recommended Grant Full Planning Permission.  The committee report and discussion had repeated references to the 40% AH.

Regarding AH, the report was clear:

The applicant has submitted a Viability Report and this has been Independently evaluated. The applicant confirms that they will contribute 40% (26.8) affordable units as required by policy.

After a long discussion the Committee decided instead to refuse it. Then they had to give reasons, which they did.  The ‘970‘ casefile has a transcript (Appellant’s Case Appendix 4) of the whole discussion.

Appeal

The applicants took this to the Planning Inspector on Appeal, who found for the applicants.  The Appeal Decision included this strange paragraph:

5.  During the course of the appeal, the main parties have reached agreement that the proposed scheme could not support an affordable housing contribution for viability reasons. As such, this matter is not in dispute. As the original viability report submitted with the application suggested no such contribution could be supported and, as the Council’s Committee Report included the provision for negotiation on development viability, I have accepted this position. 

There was an ‘original viability report’ with ‘645’ but this presumably refers to  ‘970‘ which as reported had a commitment to 40%. So where is the Section 106 Agreement (s.106, the developers’ formal undertakings as part of the granting of planning permission)? There was none until it was signed in July 2022.  Par 7 on p30 stated:

The Affordable Housing Contribution shall be zero in the event that the approved and agreed Viability Review does not show a surplus . . .

This was published on 31 October 2022. The Appeal Decision was made on 31 October 2022.  Both documents were published that same day.

Had the unfeasibility of AH been part of the Committee discussion in April 2021, the application would have been refusable for not complying with Policy H3.  

The Inspector’s mention of ‘provision for negotiation on development viability’ relates to the committee report on ‘970’, which has a shouty finale:  

8.  Recommendation 

A)  That the Planning Services Manager be authorised to issue planning permission upon completion of an agreement under S106 of the Town and Country Planning Act to secure:

[the development]

unless it has been conclusively shown that the development would not be viable and it would still be acceptable in planning terms without the identified development contributions. In the event that the Agreement is not completed or the viability issue not resolved by 30 August 2021 that permission be refused on the grounds that the application does not comply with the relevant policies (Policies H3, CI1, T3, EN3, EN6, EN1, and HN1) of the Hastings Local Plan, The Hastings Planning Strategy 2011-2028 or the Hastings Local Plan, Development Management Plan unless an extension of time has been agreed in writing by the Planning Services Manager in consultation with the Chair and Vice Chair of the Planning Committee.

As well as tangled syntax, there’s a great deal wrong with this, including:

■  upon completion of an agreement:  this indicates that there is no s.106 agreement. An s.106 should be written and signed before planning permission is granted.  Cheltenham Borough Council are clear:

If the legal agreement (S106) is not completed within the timetable for the planning application, it will be seen as a refusal to enter into an agreement and a refusal to comply with the relevant policies in the Local Plan. In this case, the application would be refused.

■  acceptable in planning terms:  to whom?  The policy is 40% AH for greenfield sites.

■  Agreement is not completed: again, why was the s.106 agreement not signed before the planning committee meeting to decide the application?

■  viability issue not resolved: as viability is crucial to permission, their separation makes no sense 

■  30 August 2021: what if the developers had worked on site for four months before the project was found to be unfeasible? How could involvements and responsibilities be untangled? How could this deadline be good practice?

■  in consultation with the Chair and Vice Chair: shouldn’t the leaders of the planning committee also be consulted about the sudden finding of zero AH, and its acceptability?

40%, what 40%?

This was a multiply defective assessment of the application for planning permission that was eventually granted. At the planning committee meeting, the case officer repeatedly referred to the 40% affordable housing, saying: 

Now in terms of affordable units, the applicants have agreed to provide a total of 26 dwellings which is 40% of what they are proposing, 16 will be social rent and 10 will be for another affordable tenure. 

The application site is a greenfield site and the Local Plan requires a 40% contribution to Affordable Housing so that 40% contribution to Affordable Housing is line with policy requirements. 

The Policy says 40% and they have committed themselves to providing the 40% Affordable Housing which is 26.8, which is 26 dwellings 

We have negotiated with them and they have offered the full 40% contribution as per Policy Requirement.

The increase to 67 dwellings from 50 was understood to be the price of achieving the affordable housing. Committee members understood that that 40% affordable housing was an integral part of the application. Now we know that it wasn’t.   ‘Agreed’ didn’t actually mean an agreement, a section 106. signed before the committee’s decision.

After the meeting but before the Appeal, HBC planning officers agreed on the proposal for zero AH and presented it to the Inspector, who accepted it as a settled matter. This meant that the failure to comply with Policy H3 (Provision of Affordable Housing) was no longer a basis for refusing the application. What is one to make of the deviations from the lengthy Aspinall Verdi report (2021) on Hastings Borough Whole Plan Viability and CIL Assessment? The conclusions were strong:

Residential 

8.2 The Council’s policies are viable on all greenfield sites and the majority of brownfield sites. 

That includes policy H3 b).  

Deferment

At committee, then-Cllr Davies mentioned deferment, but the benefit of deferment until the s.106 arrangements were agreed was not mentioned by officers. This can be seen as misleading the committee, who had ample reason to suppose that the s.106 was signed. Consideration until August 2021 (and beyond) was possible. If the s.106 was not signed before the April 2021 meeting, then deferment would have been the better option.  

Viability Assessments

For ‘970‘, the approved prime case, there were several viability reports.  In December 2020, BPC, consultants for the applicant, stated that ‘the extant scheme is unviable, even with zero affordable housing’ (BPC Report, par 2.9). In March 2021, Bruton Knowles assessed the data for HBC and concluded (p3) that the development proposal was viable (‘policy compliant’) at 40% AH. That was the position agreed to at the time of the planning committee in April 2021. (The 30 August 2021 deadline that was such a contingency feature of the committee report Recommendation was effortlessly ignored.)

For HS/FA/23/00016 Turner Morum acted for the developers, Park Lane, and found (par 2.2) 

that the scheme was unable to support the provision of any affordable housing.

In par 7.1 the proposed scheme of 71 units was found to be ‘significantly non-viable’, as was its predecessor. (Par 3.1 proposed £50k as an ‘affordable commuted sum offer’ regarding 0% AH.) A market assessment commissioned by Park Lane from consultants MCC was suitably pessimistic and fawning.  

Altair (consultants) in the ‘Viability Review Report’ of March 2023 assessed the Turner Morum findings for HBC and agreed. (Why Bruton Knowles weren’t engaged is not known.)  Par 8.3 stated: 

We . . . conclude the scheme cannot viably provide any affordable housing.

Unresolved cases  

Four other cases remain undecided, a multiplicity of variation and discharge applications, profusion sowing confusion, while it also remains unclear what main scheme is being built.

HS/FA/22/00906 (variation of conditions) is due to be heard at committee on 22 March. The committee report recommends approval and tends to downplay or misrepresent the AH adjustments since ’ 970’ and the greater than 10% changes in sizes of flats, meaning that the amendments are not ‘minor’. The committee report (in section 5 i)) seeks to blame the Inspector for its own acceptance of zero AH.  This is disingenuous, or worse.  

HS/FA/23/00016 is for 71 units, and zero % AH, and remains incompatible with ‘970’ for 67 units:  an extra 4 dwellings but none Affordable. Observation of the Lifetime Homes Standard (HBC Policy H2 d)?  No.  2% of the new development to be fully adapted for disabled people? No. The housing mix in accordance with stated policy requirements? No. Page 38 of the ‘Viability Study’ is a fearful map of the development south of the Ridge.

There’s also HS/CD/23/00178 (discharges), a new case telling an old lie, that the site can’t be seen from a public road, public footpath &c. A Park Lane company director stated that.

Case HS/FA/23/00050 (variation and minor amendments) lacks necessary documentation. The contradictions with HS/FA/22/00906 are unexplained.  Both are live but they can’t both be approved.

Principled planning?

The administrative treatment of this site has been shabby, amounting to misadministration or possibly maladministration. Planning officers did not help the committee reach an informed decision. Obligations were repeatedly evaded or misstated.  Decisionmaking was unnecessarily forced and exclusory.  67 or 71 dwellings on a greenfield site, and none affordable, is a failure of delivery. The Planning Services Manager’s public rebuking of the committee after the Appeal was lost (in November 2022) was another. The highminded declarations of HBC’s Planning Protocol and the Nolan Principles counted for nothing in this dismal business.

Similarly on 17 March in the Martineau Lane Appeal, the Inspector held that intentional unauthorised development, though a planning consideration, was acceptable. So the dismantling continues, of the planning system and the regulators’ reputations.

 

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