The effect of the absence of a five-year housing supply is to trigger the presumption in favour of sustainable development, not just an assessment of whether a policy in a development plan is out of date.

The Supreme Court decision in the Suffolk Coastal District Council v Hopkins Homes Ltd and the Richborough Estates Partnership LLP v Cheshire East Borough Council cases was handed down on 10 May. This judgment is of huge importance in relation to housing development and the interpretation of the National Policy Planning Framework (NPPF).

Summary

Paragraph 49 NPPF policies for the supply of housing are those related to that supply, for instance site allocations, and will be out of date in the absence of a five-year housing land supply.

The Supreme Court has given paragraph 49 of the NPPF a narrow interpretation but clarified that the absence of a five-year housing land supply triggers the paragraph 14 NPPF presumption in favour of sustainable development. That has the effect that, in the planning balancing exercise, any polices that affect housing supply will, in the absence of a demonstrable five-year housing land supply, have reduced weight.

Policies that affect the supply of housing but are not policies for the supply of housing will not be out of date as far as paragraph 49 NPPF is concerned, but the weight to be given to them in the balancing exercise will be reduced, in the absence of a five-year housing land supply

Paragraph 49 of the NPPF states that 'policies for the supply of housing should not be considered up to date if the local planning authority cannot demonstrate a five-year supply of deliverable sites'.

The Court of Appeal stated that 'policies for the supply of housing' should be given a wide interpretation: policies that affect the supply of housing and not just polices that are expressly related to housing supply such as the allocation of sites.

Both Suffolk Coastal District Council and Cheshire East Borough Council appealed this decision to the Supreme Court, arguing that the proper interpretation of paragraph 49 is a narrow interpretation that concerns itself only with polices that are directly concerned with the supply of housing.

The Supreme Court has dismissed these appeals. The Supreme Court justices agreed that paragraph 49 NPPF should have a narrow meaning but that the absence of a five-year housing supply has a wider effect in the planning balancing exercise, one that goes beyond that narrow ambit.

The Court stated that the paragraph 14 NPPF presumption in favour of sustainable development is brought into play in the absence of a five-year housing land supply. This means that whether or not policies are paragraph 49 out of date policies, it is a matter of planning judgment as to the weight that these policies are to be given. That judgement should be exercised free of any overly legalistic approach to the NPPF, but subject to normal judicial oversight and, for housing developments, the overreaching need to boost the supply of housing (paragraph 47 NPPF).

The issues

The main issue at stake in these cases was the interpretation of paragraph 49 of the NPPF:

'Housing applications should be considered in the context of the presumption in favour of sustainable development. Relevant policies for the supply of housing should not be considered up-to-date if the local planning authority cannot demonstrate a five-year supply of deliverable housing sites.'

The cases were concerned with what should be construed as a relevant policy for the supply of housing.

Should paragraph 49 have a narrow construction? That the policy must in effect state that it is specifically concerned with the supply of housing (for instance site allocation policies) to be out of date in the absence of a five-year housing land supply. Or, should it have a wide construction? That any policy that has an effect on the supply of housing (for instance a generic countryside protection policy) is covered by it.

The Supreme Court judgment

While the Supreme Court justices have stated that paragraph 49 should have the narrow construction set out above, they have also stated that the effect of the absence or otherwise of a five-year housing supply goes further.

The question of whether a policy is a paragraph 49 out of date policy is not determinative of the application of the presumption in favour of sustainable development or the paragraph 47 entreaty to boost the supply of housing. It is merely one aspect of the planning balancing exercise.

In giving the Leading judgment Lord Carnworth states at paragraph 59:

'This may be regarded as adopting the 'narrow' meaning, contrary to the conclusion of the Court of Appeal. However, this should not be seen as leading, as the lower courts seem to have thought, to the need for a legalistic exercise to decide whether individual policies do or do not come within the expression. The important question is not how to define individual policies, but whether the result is a five-year supply in accordance with the objectives set by paragraph 47. If there is a failure in that respect, it matters not whether the failure is because of the inadequacies of the policies specifically concerned with housing provision, or because of the over-restrictive nature of other non-housing policies. The shortfall is enough to trigger the operation of the second part of paragraph 14. As the Court of Appeal recognised, it is that paragraph, not paragraph 49, which provides the substantive advice by reference to which the development plan policies and other material considerations relevant to the application are expected to be assessed.'

The effect of the judgment

Questions over the absence or otherwise of a five-year housing supply are still very significant but paragraph 49 is not the determinative part of the NPPF.

The absence of such a supply will mean that policies (narrow interpretation) for the supply of housing will be out of date. Other policies that have the effect of restricting the supply of housing will arguably, applying paragraph 14 of the NPPF and in the context of paragraph 47, have, in the planning balancing exercise, reduced weight depending on the extent of the five-year supply deficit and the significance of those policies.

For applications and appeals this may mean little more than a change in language. Policies that fall within paragraph 49 in the absence of a five-year housing land supply should still be referred to as being out of date and the weight to be given to them consequently diminished. Other policies that restrict the supply of housing will not be out of date but the weight to be given to them will need to be balanced against the paragraph 47 NPPF entreaty to boost the supply of housing and the presumption in favour of sustainable development in paragraph 14 NPPF.

Importantly Lord Gill makes the point that the balancing exercise applies to all policies including, for instance, green belt policies. This provides welcome clarification that the paragraph 14 presumption applies even if the land is subject to the restrictive policies mentioned in footnote 9 to paragraph 14. The reverse is often argued.

As above, the weight to be given to these policies is all part of the planning balancing exercise but, as Lord Gill states at paragraph 83, '[i]f a planning authority that was in default of the requirement of a five-years supply were to continue to apply its environmental and amenity policies with full rigour, the objective of the Framework could be frustrated'.

This is a clear entreaty to planning authorities to give serious weight to the guidance set out in the Framework over a rigorous adherence to policies, even if they are restrictive footnote 9 policies such as green belt. Such policies must be considered in the balancing exercise and potentially given less weight than is often the case now.

This does not mean that local planning authorities or inspectors hearing appeals can make arbitrary decisions on the weight to be given to policies or that the interpretation of those policies is not a matter of law, but it does move away from the legalistic approach that was being taken to whether policies fall under paragraph 49 NPPF as out of date or not and the effect of such a decision.

The decision, by putting the question over the 'class of policy' to one side in favour of a planning balancing exercise in respect of all policies that affect housing development, whether they are out of date or not, is likely to mean that there are less legal challenges. Not a bad result, even for lawyers.