Changes to the section 106 regime under the Growth and Infrastructure Act 2013, allowing affordable housing obligations to be modified on viability grounds, fell away last month, despite earlier indications that they might be retained.
Sections 106BA and 106BC came into force in April 2013, subject to a "sunset clause" killing them off after 30 April 2016.
The question remains: can an appeal be entertained once a scheme is completed?
The government's decision not to extend perhaps reflects the fact that we are no longer in recession and that, where policies are being applied properly, the stalling of some schemes is down to bad planning and not bad luck.
It may also reflect the odd outcomes that have crept into the process on appeal, including modifications that do not demonstrably enable schemes to become financially viable in the current market, and some inspectors' refusal to entertain requests to modify contributions on outline permissions.
A recent High Court ruling involving Kent's Chatham Quays development tested the scope for using the appeal mechanism on completed schemes. The multi-phased mixed scheme, approved in 2007, was later subject to section 106 variations to defer affordable housing contributions. The housing element came forward but the commercial element remained incomplete. On appeal, the inspector agreed to remove the remaining obligations, despite council claims that completion of the housing element blocked this route.
Mr Justice Gilbart's decision to uphold this decision shows that developments that are largely complete can use section 106A and 106BC to eliminate affordable housing requirements even when the time for delivery or payment has long passed. It also confirms that completion should be judged on the whole of a scheme, not just the housing element, and that the correct route for challenging decisions under these sections is by judicial review, not section 288 statutory challenge.
This point was dealt with by Mrs Justice Patterson at the permission stage of the failed Mast Pond Wharf challenge in Royal Borough of Greenwich v Secretary of State for Communities and Local Government [2014].
However, the judgment leaves open the question of whether a viability appeal can be entertained after a scheme is fully completed, noting that the Act is silent on this point. The government has said that applications submitted before 30 April can be entertained on appeal, although the legal basis for its indication that it will "generally" allow them to proceed is unclear.
Medway Council v Secretary of State for Communities and Local Government; Date: 23 March 2016; Ref: [2016] EWHC 644 (Admin)
This article was first published in Planning Magazine, 29 April 2016
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