This was an application for a Deed of Variation to Phase 10 on land at Ironstone, Lawley, Telford, Shropshire.
The Deed of Variation had been deferred at Planning Committee on 25 August 2021 to seek further information and clarification on the viability report.
Councillor J Yorke spoke on behalf of the Parish Council regarding what they considered to be incorrect procedure at the meeting on 25 August 2021 and informed the Committee of the complaint that had been submitted. Discussion on the application at this meeting would further exacerbate the situation. He raised concerns regarding the derogation of due process, committee manipulation, affordable housing profits, the Lawley SUE development, the Homes England Grant and the proposed zero per cent affordable housing in light of the decision made by Shropshire Council at the Ironbridge Development.
Mrs J Yorke a member of the public spoke against the application and raised concerns regarding what she felt was the ease that the Committee had been persuaded at the fear of appeal costs, the viability report and zero per cent affordable housing, property price increases, the reliance on the use of outside consultant and the need to fight shareholder and developer greed.
Mr I Greatrex, Viability Consultant for the Developer informed Members of the current position and that Taylor Wimpey could not provide affordable housing from the S106 Agreement due to site specifics, the retaining wall and ground conditions. The approach was entirely consistent with viability guidelines and consultants had reviewed the submission details on the costs. There were minor errors but nothing that would change the conclusion that the S106 to provide affordable housing could not be supported. Selling prices of the houses were in line with the forecast and there had been no increase in the last 12 months and the position of the viability at the present time had worsened. Viability was a material consideration. The consultant’s conclusion was accepted and it provided the best chance of affordable housing on this phase of the Lawley development.
The Development Management Service Delivery Manager addressed Members that the application before them was to vary the S106 Agreement as the site was unviable. National policies must be considered together with supporting evidence which had been independently assessed on behalf of the Council and there would be a 400k deficit on the site even with the reduction to zero per cent affordable housing. The deed of variation was considered by Members in June 2021; the amended report and recommendation requested members to recognise the issues viability, setting out the viability evidence demonstrated zero affordable housing should be provided, however there was a commitment to deliver 10% affordable housing, and the recommendation incorrectly set out this would be through the S106 agreement. However on amending the legal agreement it was recognised that the Homes England Grant funding could not be provided on this 10% and delivery can only come forward outside of the S106 requirements; Members were therefore asked to reconsider this matter in August 2021, where members raised further questions in regard to the viability and evidence was produced in relation to the sales values over the preceding twelve months. This demonstrated that there was no uplift and this was compounded by the rise of construction costs. Where there was a return below the recognised profit margins set out in nation guidance, Officers were obliged to consider the details. It was recognised that the scheme had provided £13m in the S106 Agreement as well as on the site which included £180,000 off site specialist accommodation. However as sums had been paid, and the development was well underway there was no ability to rebalance the contributions and the only remaining item that could be adjusted was the delivery of onsite affordable housing. The Developers were working with the Wrekin Housing Group in order to obtain grant funding. Across the last five years grant funding had provided some 1,600 affordable units across the borough outside of the S106 Agreements which equated to 61% of delivery rate. The return for the delivery of new build social rented accommodation was expected to be in the region of 40-55% of Open Market Value, but with grant funding the return could increase to 80% of OMV and therefore reduce the deficit. Wrekin Housing Group had given a commitment to work with the Developer to deliver the affordable housing outside of the S106 Agreement, which was evidenced to Members. Members were asked to consider the issue around the viability evidence and the request to reduce the provision on this phase of the development to zero through the Deed of Variation.
During the debate some Members felt that they were being “batted into submission” and that they couldn’t fight back and that when a site became unviable a line needed to be drawn. It was asked if it was definite that Wrekin Housing Group would supply the affordable housing and if this could be conditioned. Concerns were raised about the position Members were in and the “rubber stamping” exercise and it was asked if all Members abstained could the officers pass the application themselves.
The Development Management Service Delivery Manager said that in order to apply for grant funding affordable housing could not be assigned in the S106 Agreement or through any condition. The Wrekin Housing Group had given Board approval, subject to the zero per cent affordable housing via the S106 Agreement, to make an application to Homes England, but this could not be guaranteed.
The Chair confirmed that Members needed to make a decision. There was a lack of reasons for refusal at the last meeting and this led to the deferral.
The Legal Advisor explained that an abstention by all Members would be an odd situation and that Members were there to determine and form a view. He expressed that in respect of Councillor Yorke’s summary of the previous meeting a correct and proper decision was made as it was proposed and seconded and put to a vote and on defeating the recommendation Members moved on to decide what to do next and Members opted to defer and he was procedurally entirely comfortable that the correct procedure had taken place.
Other Members felt that they did not “rubber stamp” and that they looked at the application details and with advice from the Legal Advisor they listened to all of the information before they made a decision.
Continued apprehension regarding the zero per cent affordable housing was raised by some Members together with the viability within the NPPF and the supply of affordable housing by the Registered Social Landlord, the misinterpretation of information, the case for affordable housing reduction, validation of the viability assessment and the timeline of when this was undertaken, building costs, cost of the re-building of the retention wall, lack of a guarantee that the application for grant funding would be successful and it was wrong to allow developers to “get their cut” and for local residents not to get affordable housing.
Further points raised by other Members were that at the June 2021 meeting Members were told the provision was 10% and this was always a bonus amount. This had not changed and that Planning Committee was a quasi-judicial board and looked at legal reasons and Members were not trained in viability so were unable to go against legal reasons and that it was Members responsibility to look at the parameters and although sometimes they disagreed and it could be frustrating it was what had to be done.
At the end of the debate some Members felt that officers had done the best they could in the circumstances.
On being put to the vote it was, by a majority:-
RESOLVED – that in respect of Planning Application TWC/2010/0828 that the Deed of Variation to the Section 106 Agreement be approved.