Since its adoption in February of 2023, much of the attention surrounding NPF4 has focused on its environmental agenda. Policies relating to climate change, biodiversity enhancement, nature recovery and infrastructure-first development have represented a significant shift in planning policy and have generated considerable discussion amongst developers, planning authorities and practitioners alike.
However, NPF4’s housing policies have proved equally significant. In particular, Policy 16 (Quality Homes) has become the subject of a growing body of litigation, reflecting its importance to housing delivery, land supply and residential development proposals across Scotland.
One of the earliest and most significant authorities was Miller Homes Ltd v Scottish Ministers [2024] CSIH 11. In that case, the Inner House held that NPF4 Policy 16(f) was incompatible with a restrictive housing land release policy contained within the relevant local development plan. The Court concluded that the NPF4 policy prevailed, confirming the significant influence NPF4 could exert within the statutory development plan framework.
The recent decision in Stephen G Dalton & Son Ltd v Scottish Ministers [2026] CSIH 25 provides further guidance on the interpretation of NPF4 Policy 16 and its interaction with local development plan policy.
Background
The appeal concerned NPF4 Policy 16(c), which expressly supports homes for people undertaking further and higher education. Despite that support, the Court upheld a local development plan policy which treated purpose-built student accommodation (“PBSA”) differently from mainstream housing.
The proposed development comprised:
- 230 PBSA bedspaces;
- 46 build-to-rent flats (including 16 affordable homes); and
- associated commercial floorspace and public realm improvements.
The site was allocated within Edinburgh’s City Plan 2030 as housing site H35, with an anticipated delivery of 113 homes.
The City of Edinburgh Council refused planning permission on the basis that the proposal conflicted with the housing policies of City Plan 2030. In particular, the Council considered that the development failed to deliver the level of housing anticipated by the allocation. Less than 50% of the site was proposed for housing and the Council’s position was that PBSA did not constitute “housing” for the purposes of the development plan.
The developer appealed to the Scottish Ministers and the appeal was subsequently dismissed by a DPEA Reporter.
The Reporter concluded that the proposal failed to achieve what City Plan 2030 sought for site H35. The development would deliver 67 fewer homes than anticipated by the allocation, would not provide the Class 4 business floorspace required by the allocation’s development principles, and failed to achieve the housing mix envisaged by the plan.
The developer subsequently appealed to the Court of Session under section 239 of the Town and Country Planning (Scotland) Act 1997.
The Appellant’s Case
The central plank of the appellant’s argument was NPF4 Policy 16(c).
Policy 16 supports a variety of housing products, including affordable housing, build-to-rent developments, specialist housing and “homes for people undertaking further and higher education”.
The appellant argued that because NPF4 expressly recognises accommodation for students as a form of home, PBSA should count towards the housing allocation identified in City Plan 2030. On that basis, the appellant contended that the proposal complied with the allocation notwithstanding that a substantial proportion of the site would be occupied by student accommodation rather than mainstream residential units.
The Court’s Decision
The Inner House unanimously rejected the appeal. The Court held that City Plan 2030, read as a whole, deliberately distinguishes between mainstream housing and student accommodation. In reaching that conclusion, the Court noted that:
- housing and PBSA are addressed through separate policies in the City Plan 2030;
- City Plan 2030 treats PBSA, for various policies, alongside commercial development rather than mainstream housing;
- housing allocations are intended to address Edinburgh’s housing and affordable housing requirements.
The Court concluded that the development plan treated PBSA and mainstream housing as distinct forms of development. The fact that student accommodation may be supported under NPF4 Policy 16 did not alter the intended purpose of the housing allocation.
Accordingly, the proposal failed to deliver the level of housing which City Plan 2030 sought for site H35.
What Does Policy 16 Actually Support?
Perhaps the most significant aspect of the judgment is the Court’s treatment of Policy 16 itself. The Court rejected the proposition that because a form of development appears within Policy 16, it must automatically be treated as equivalent to mainstream housing for all planning purposes.
Instead, the Court emphasised that Policy 16 does not create a hierarchy of housing products, nor does it prescribe how local development plans must categorise or allocate different forms of housing.
Rather, Policy 16 identifies categories of homes which are capable of attracting policy support where they improve affordability, choice and address identified needs.
As the Court explained, proposals for student accommodation are simply:
“capable of deriving support” from Policy 16.
That support, however, does not automatically determine whether a proposal complies with the detailed requirements of a local development plan.
The Court therefore drew a distinction between policy support in principle under NPF4 and compliance with specific development plan allocations.
Reconciling Dalton and Miller Homes
At first sight, the outcome in Dalton may appear difficult to reconcile with Miller Homes, where the NPF4 policy prevailed despite conflict with the Local Development Plan. This was the central argument in Dalton – NPF4 Policy 16(c) expressly supported accommodation for students and that Edinburgh’s City Plan 2030 could not therefore distinguish between PBSA and mainstream housing for the purposes of a housing allocation.
The Inner House disagreed. Importantly, the Court did not depart from the approach adopted in Miller Homes but distinguished it.
In Dalton, the Court identified no inconsistency between Policy 16 and the relevant provisions of City Plan 2030. Policy 16 provided support for student accommodation as a form of housing where it improves affordability, choice and address identified gaps in provision. However, the Court considered that nothing within the policy required local development plans to treat PBSA as equivalent to mainstream housing for every planning purpose.
Accordingly, both policies could operate together. A proposal for PBSA could derive support from Policy 16 whilst the local development plan could simultaneously distinguish between student accommodation and mainstream housing when allocating land to meet housing needs and affordable housing objectives.
In that respect, Dalton is perhaps best understood not as a departure from Miller Homes, but as a refinement of it.
The decision emphasises that the existence of policy support within NPF4 does not, of itself, create a conflict with local development plan policy. In Miller, NPF4 Policy 16(f) prevailed because it was adopted later than the relevant LDP policy (under s.24(3) TCP (Scotland) Act 1997). In Dalton, the City Plan 2030 post-dated NPF4, so even if there had been incompatibility, the LDP policies would have prevailed in any event. The key question highlighted in Dalton is whether the relevant policies can be read together and applied coherently as part of the statutory development plan as a whole.
The Continuing Importance of Planning Judgment
The judgment also reinforces another recurring theme in post-NPF4 litigation: the distinction between policy interpretation and planning judgment.
The Court reiterated that interpretation of the development plan is ultimately a question of law, but that once policies have been correctly interpreted, substantial scope remains for the exercise of planning judgment by reporters and planning authorities.
That was particularly evident in relation to the proposal’s failure to achieve the preferred housing-to-PBSA balance identified within City Plan 2030. The Court accepted that the Reporter was entitled to conclude that insufficient justification had been provided for departing from that policy expectation.
As with several recent NPF4 cases, the Court showed little appetite for recasting planning merits arguments as legal errors.
