Another chapter about the proper interpretation of Scotland’s fourth National Planning Framework (‘NPF4’), has been written by the 3 May 2024 decision of the Inner House of the Court of Session in Miller Homes Ltd v The Scottish Ministers [2024] CSIH 11. In that instance the relevant NPF4 policy for legal scrutiny was Policy 16 (Quality Homes) and in particular its sub-para f) (‘Policy 16 f))’).
Rarely has a court decision been awaited with such anticipation by the Scottish housebuilding industry as ‘the Mossend appeal’ (see, for instance, (2023) 217 SPEL 50).
This article focuses on the generic issues arising from the decision, namely the relationship between NPF4 Policy 16 f) and any ‘exceptional release’ policy of an existing ‘old style’ Local Development Plan (‘LDP’), and its potential implications for planning permission applications for housing on unallocated sites across Scotland until new style LDPs are in place.
Background
The facts are well known. In February 2022 Miller Homes Ltd applied to West Lothian Council for planning permission in principle for a residential development with associated infrastructure etc on land near Mossend, West Calder. That ‘major development’ application, which was for the development of land in the countryside and which was not allocated for housing, was the subject of an August 2022 ‘deemed refusal’ appeal. On 26 April 2023 the Scottish Ministers (‘the Ministers’) directed that the appeal should be determined by them and not one of their reporters. The stated reason for that direction was ‘… the appeal raises national issues in terms of the application of [NPF4]’.
The terms of the Scottish Ministers’ direction was subsequently expanded upon in a January 2024 response to an environmental information request to the Scottish Government. The Mossend appeal was selected for recall by the Scottish Ministers ‘… due to an opinion of senior counsel submitted in that case which directly challenges the application of all elements of [NPF4] Policy 16 prior to the adoption of “new style [local development plans]”’ based on the 10-year ‘Minimum All Tenure Housing Land Requirements’ (‘MATHLR’) and ‘deliverable housing land pipeline’ provisions set out in NPF4.
In July 2023 the Scottish Ministers dismissed the Mossend planning permission appeal. That decision was the subject of an August 2023 statutory application under s 239 of the Town and Country Planning (Scotland) Act 1997 (‘the 1997 Act’) to the Court of Session.
A plethora of other planning permission appeals for housing which were based on similar grounds (shortfall in the five-year effective housing land supply and engagement of the so-called ‘tilted balance’) were subsequently sisted (that is put on hold) pending the outcome of the Mossend Court of Session proceedings (see, for example, (2023) 219 SPEL 107).
The case was heard by the Inner House of the Court of Session on 24 January 2024.
Outline of submissions for Miller Homes Ltd
The applicant contended that until a new-style LDP incorporating the ‘deliverable housing land pipeline’ required in terms of the first bullet point in sub paragraph (iii) of Policy 16 f), was in place in West Lothian, the exceptional circumstances in which unallocated greenfield sites might be released for mainstream housing development, could not take effect. This meant that Policy 16 f) was inoperable in practice. It followed, therefore, that the provisions of s 24 (3) of the Town and Country Planning (Scotland) Act 1997 (‘the 1997 Act’), which stipulate that where any ‘incompatibility’ arises between a provision of the National Planning Framework and a provision of a LDP, then ‘whichever of them is the later in date is to prevail’, did not apply. Accordingly, the exceptional release provisions set out in Policy HOU2 of the West Lothian Local Development Plan (‘WLLDP) had to continue to form part of the statutory development plan until a new style LDP was in place.
Outline of submissions for the Ministers
The Ministers’ position was straightforward. NPF4 Policy 16 f) was effective from the date of the publication of NPF4. Its strategic objective is to restore a plan-led system by encouraging the delivery of allocated housing and restricting the ‘exceptional’ circumstances in which unallocated sites would be released for development. This was particularly reflected in the stipulation set out in the first bullet point in sub paragraph (iii) of Policy 16 f) that such releases would only be supported in circumstances where the delivery of sites was ‘happening earlier than identified in the deliverable housing land pipeline’. The new policy on exceptional release set out in NPF4 Policy 16 f) was only engaged when the housing land audit demonstrated that houses were being delivered ahead of target. This contrasted with the pre-NPF4 position where exceptional unallocated greenfield release policies were triggered where the annual target for housing completions was not being met. The requirement in the 2014 edition of Scottish Planning Policy that a five years’ effective housing land supply had to be maintained at all times, failing which, the balancing exercise that the decision-maker is expected to apply when assessing an application for compliance with the development plan would be ‘tilted’ in favour of planning permission being granted, was now irrelevant. For these reasons the two policy positions were incompatible. By application of s 24 (3) of the 1997 Act, NPF4 Policy 16 f) superseded Policy HOU2 and the latter policy was not part of the development plan.
NPF4 Policy 16 f) was also capable of rational practical application. If there were no ‘deliverable pipeline’, as envisaged in terms of the first bullet point of Policy 16 f) (iii), the remainder of Policy 16 f) was still capable of operating in the context of pre NPF4 ‘old-style’ LDPs, including the WLLDP.
The court summarised the Ministers’ position on the point in the following terms:
‘For example, if a proposal for new homes on unallocated land were: (i) supported by an agreed timescale for build out; (ii) otherwise consistent with the plan spatial strategy and other relevant policies including, local living and 20 minute neighbourhoods and (iii) for the delivery of fewer than 50 affordable homes as part of a local authority supported affordable housing plan, then it would receive support from Policy 16 f)’.
So far as the Ministers were concerned, the issue (or ‘gap’ as the court described it) could be addressed by replacing existing ‘action programmes’ with new style ‘delivery programmes’ that contained the deliverable housing land pipeline referred to in NPF4 Policy 16 f) (see reg 5 of The Planning (Scotland) Act 2019 (Commencement No 12 and Saving and Transitional Provisions) Regulations 2023 (‘the 2023 Transition Regulations). Those regulations came into force in May 2023. The delivery programme which Aberdeen City Council had published following the adoption of its ‘old style’ LDP was held out as an example.
Alternatively, if a planning authority had still to review its action programme at the point at which an application came forward for determination, that factor in itself could potentially be regarded as a relevant material planning consideration justifying a departure from the development plan.
Decision
The court had no apparent hesitation in supporting the Ministers’ decision and refusing the appeal.
Lord Boyd of Duncansby, who delivered the court’s opinion, made several preliminary points. NPF4 now formed part of the statutory development plan. It had been endorsed by the Scottish Parliament. The requirement to maintain an effective 5-year housing land supply and the consequential focus on whether targets had been met and whether land allocated for housing was in fact capable of meeting any identified shortfall in supply, had been ‘swept away’. The operation of the ‘tilted balance’ was now ‘a thing of the past’. The overall purpose of a development plan was not, as the applicant had asserted in its grounds of appeal, ‘to stipulate that the housing need in an area is met’ but rather, as confirmed in Annex A of NPF4, ‘to manage the development and use of land in the long term public interest’ (this itself is a repetition of s 3ZA of the 1997 Act about the purpose of planning)
Having reviewed the difference in their respective approaches to the release of unallocated land for housing, the court concluded that NPF4 Policy 16 f) was the ‘antithesis’ of Policy HOU2. As such, they were incompatible. Applying s 24 (3) of the 1997 Act, it followed that Policy HOU 2 was no longer part of the development plan.
In the view of the court there was nothing in ‘statute, policy or guidance’ to indicate that the operation of NPF4 Policy 16 f) should be deemed to be postponed until such time as a ‘new style’ LDP was in place. While it was ‘true’ that the provisions of the first bullet point set out in sub paragraph (iii) of NPF4 Policy 16 f) could not operate without a deliverable housing land pipeline that did not mean that ‘Policy 16’ could not ‘operate at all’ pending a new style LDP being adopted. While the issue surrounding the practical application of NPF4 Policy 16 f) was a ‘transitional’ one, it was one, which in the view of the court, could be lawfully addressed in the interim period ahead of such adoption by either of the two ways that had been advanced by the Ministers in their submissions.
Delivery Programme
The first was through the statutory review of a planning authority’s existing ‘action programme’ and its re-publication (by application of reg 5 of the 2023 Transition Regulations and s 21(9) of the 1997 Act) in updated NPF4 form as a ‘delivery programme’. The supporting text about NPF4 Policy 16 (Quality Homes) explains that delivery programmes are ‘expected to establish a deliverable housing land pipeline for the Local Housing Land Requirement’ – a requirement which could be represented meantime by the MATHLR in Annex E of NPF4, given that it represented ‘the most up to date target for housing land within the development plan’. With a delivery programme in place following an early review of a planning authority’s existing action programme, the first bullet point in paragraph (iii) of NPF4 Policy 16 f) would become operational.
Material considerations
According to the court, the second means of addressing the transitional issue would be for the decision-maker on reliance of the provisions of s 25 of the 1997 Act, to treat the absence of a delivery programme (and, by implication, a deliverable housing land pipeline) as a material consideration that might justify the development plan position on exceptional land release not being followed.
The court concluded by finding that there was ‘no merit’ in the submission that the Ministers had failed to provide ‘proper, adequate or intelligible reasons for their decision’. So far as their Lordships were concerned, the terms of the Ministers’ reporter’s recommendations and the Ministers’ decision letter were both ‘comprehensive and well-reasoned.’
Comments
As noted above the court’s decision was issued on 3 May 2024. An application to the Inner House for permission to take an appeal against its decision to the UK Supreme Court requires to be made within 28 days beginning with the date of the decision against which the appeal is to be taken (that is by 31 May 2024) or within such longer period as the Inner House considers equitable having regard to all the circumstances.
At the time of this article being finalised there is no indication that an appeal against the decision of the Inner House of the Court of Session is to be taken.
The publication of the court’s Mossend appeal decision will now lead to the sisted planning permission appeals being revived for consideration in light of that decision.
The central issue for housebuilders and indeed the reporters and their respective legal advisers is how the Mossend judgment should be applied in practice. Procedure notices inviting comments from the parties on what they perceive to be the implications of the court’s decision on each of the sisted appeals have already been issued by the reporters. All the relevant planning authorities will doubtless now be in the process too of urgently revising their existing action programmes with a view to re-publishing them as soon as possible with a deliverable housing land pipeline in place. In terms of reg 23 of the Town and Country Planning (Development Planning) (Scotland) Regulations 2023 these ‘proposed delivery programmes’ will be subject to publication and consultation. It may be some time, therefore, before NPF4 Policy 16 f) becomes fully operational.
Meantime, given the terms of the court’s decision, it is difficult to see what options are realistically open to decision-makers when dealing with an existing planning permission application or appeal for open market housing development on an unallocated site. The clear direction from the court is that pending the issue of a new delivery programme incorporating a deliverable housing land pipeline, the first bullet point in subparagraph (iii) of NPF4 Policy 16 f) is to be effectively treated as ‘pro non script’. This means that a proposal can ‘only be supported’ if it is seen to meet the strict criteria set out in remainder of NPF4 Policy 16 f) – criteria which, as the applicant in the Mossend appeal pointed out to the court, effectively exclude mainstream housing developments from policy support. Against that background, the outcome for the previously sisted appeals, now stripped of the tilted balance, looks particularly bleak – at least from the housebuilders’ perspective.
The impact of the court’s Mossend decision on mainstream housing investment decisions in Scotland should not be underestimated. It is all very well against a backdrop where the cost of promoting a planning permission application for a major housing development can run to hundreds of thousands of pounds, for the Ministers to emphasise that ultimately the weight to be attached to the exceptional release provisions in NPF4 Policy 16 f) is a matter of planning judgment.
Readers will remember that it is not so long ago since a former First Minister (Ms Sturgeon) advised the Scottish Parliament that a planning policy of ‘no support’ constituted a de facto ban on onshore shale gas development. See, Ineos Upstream Ltd v The Lord Advocate [2018] CSOH 66 and, for instance, (2018) 188 SPEL 90).
A policy of ‘only supported’ if certain strict criteria that your type of development cannot possibly satisfy, are met, might reasonably be regarded as only one step removed from one of ‘no support’.
Following this court decision, it will be a bold strategic land director who is prepared to invest his or her company’s resources (including money) in promoting housing on an unallocated greenfield site. The clear thrust of NPF4 is now towards the development of housing on brownfield, vacant and derelict land promoted through the local development plan – a direction that will be anathema to the volume housebuilders who have been delivering most of the affordable housing across the country for the last two decades. A national housing emergency indeed.
*This article originally featured in the June issue of SPEL – Scottish Planning & Environmental Law.
