Small Scale Affordable Housing Exemption – Latest Update

Earlier this year, the Government reinstated rules exempting small sites from affordable housing obligations following the Court of Appeal decision in the case of West Berkshire District Council and Reading Borough Council v Secretary of State for Communities and Local Government.

The reintroduction of the exemption was welcome news for small scale developers, although questions were raised at the time over the weight which local authorities should attach to the restored guidance set out in national Planning Practice Guidance (PPG). Initially, most appeal decisions testing the policy ruled in favour of the exemption, which excludes housing developments of 10 units or 1,000 sqm or less from the need to provide, or contribute towards, affordable housing – with a lower threshold introduced in rural areas.  However, another Inspector has now ruled that local plan policy should take precedence over the reinstated rules.  This decision follows an appeal in South Cambridgeshire in September where the Inspector came to a similar conclusion.

The latest decision relates to the proposed change of use from a hot food takeaway to a dwelling in the London Borough of Islington. Despite only involving the provision of a single dwelling, the main issue was whether the appeal should make a financial contribution towards affordable housing provision elsewhere in the Borough, in accordance with the Council’s Core Strategy. The Inspector attached very significant weight to evidence that small sites make an important contribution to affordable housing delivery and concluded that the Government’s Written Ministerial Statement (2014) should not outweigh development plan policy on affordable housing in this particular instance. Accordingly, the appeal was dismissed.

The Government originally attempted to introduce the exemption as a means of relieving the ‘disproportionate burden of developer contributions on small scale developers’. This appeal decision further undermines the status of national policy guidance and leaves small scale developers in the uncertain position of not knowing the weight which will be afforded to local plan thresholds.

We will be keeping a close eye on appeal decisions over the coming months. If you have any queries about this decision or policies regarding the provision of affordable housing, please feel free to contact one of the Firstplan team.