Section 106 – baffling changes will confuse

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The Government has made further changes to the approach to planning obligations in the Planning Practice Guidance on Section 106 Obligations (trailed in its March 2014 Planning Performance and Planning Contributions Consultation to tackle the ‘disproportionate burden of developer contributions on small scale developers, custom and self-builders’). The accompanying Ministerial Statement indicates that intention, is to “support small scale developers and help hard-working people get the home they want“.

Changed priorities

As of 28 November 2014, the obligations PPG states that “There are specific circumstances where contributions for affordable housing and tariff style planning obligations (section 106 planning obligations) should not be sought from small scale and self-build development“, namely:

  • Everywhere: 10-unit or less (with up to 1,000sqm ‘gross’ floorspace).
  • In ‘designated rural areas‘: local planning authorities may choose to apply a lower deskthreshold of 5-units or less.  No affordable housing or tariff-style contributions should then be sought from these developments. Post-completion cash payments should be sought in relation to 6-10 unit developments in these areas.
  • Any development consisting only of the construction of a residential annex or extension to an existing home.
  • Vacant building credit: where a vacant building is brought back into any lawful use, or is demolished to be replaced by a new building, a financial credit equivalent to the existing gross floorspace of relevant vacant buildings should be given when any affordable housing contribution in calculated. Affordable housing contributions would be required for any increase in floorspace.

Opaque intentions

The new policy has emerged without the normal range of supporting evidence and explanation.  The relationship with the NPPF is not clear.  The approach to State Aid has not been addressed.  The effect on viability appraisals will feed back into CIL-setting.  The effect on emerging Local Plans also remains to be seen – some authorities are using other, less substantive, changes to the PPG to pause or restart housing allocations.

Power to chose

It remains to be seen whther anyone will challenge the policy-making process, but authorities will need to consider very carefully how tariff and affordable housing policies should be justified and applied.  On the one hand there is a clear statement of Government policy.  On the other, possibly adopted development plan policies and sound planning reasons for continuing to seek contributions and affordable housing from small schemes.  A judgement of Solomon will need to be made.