Councillor Page asked the following question of the Chair of the Planning Applications Committee:

Loss of income and planning contributions due to prior approvals

Will the Chair update the Committee with the most recent consolidated figures in respect of:

(1)           the number of residential units that have been approved via the Prior Notification Procedure introduced in May 2013 which allows conversions from former offices to residential use?

(2)           the loss in fee income to the Borough Council as a result of this change and the estimated loss to the authority in respect of Section 106 contributions in the form of (a) affordable housing, (b) financial contributions to affordable housing off-site, (c) financial contributions to education and (d) financial contributions to leisure and open spaces.

(3)           Would she summarise the impact of all these changes and the losses to RBC in affordable housing, education and transport and other essential contributions?

(4)           Would she also comment on the implications of the DCLG announcement on 28 November 2014 preventing this, and all other planning authorities, from seeking Section 106 contributions on proposed sites of ten homes or fewer?

(5)           Lastly, would she update the Committee on the results of recent relevant planning appeals in respect of securing affordable housing contributions from sites of up to 10 dwellings?

REPLY by the Chair of the Planning Applications Committee (Councillor Lovelock):

I thank Councillor Page for his question.

This question relates to the permitted development right first introduced in May 2013 that allows conversion from offices to residential without requiring planning permission, instead relying on a prior approval process under which only a very limited number of matters can be taken into account.  The office to residential permitted development right existed up to 2021, when it was subsumed into a more wide-ranging right to convert all commercial uses under new planning use class E, which also include retail, restaurants, light industrial, health centres and indoor sport and fitness uses, to residential.

These permitted development rights are of significant concern to this Council for a wide range of reasons, including the poor quality and small size of accommodation, impacts of noise and poor air quality, loss of important employment land, the health of our high streets and the lack of contribution towards infrastructure and affordable housing.  We have strongly objected to these permitted development rights in the past, and recently contributed to the House of Commons Housing, Communities and Local Government Committee inquiry into permitted development rights, which was highly critical of their impact. In November 2021, the Council made a legal direction under Article 4 of the General Permitted Development Order to withdraw this and other associated permitted development rights in parts of Reading including the town centre, our district and local centres, the most important employment and commercial areas and the areas of poorest air quality.  This direction came into force in November 2022, after which a planning application is once more required to undertake such changes within the area of the direction.  The Secretary of State has powers to modify or cancel the direction but has not yet done so.

This question also relates to changes made to national planning policy that seek to exempt developments of up to 10 dwellings from the need to contribute towards affordable housing and local infrastructure. These changes were originally made by Ministerial Statement on 28th November 2014 and accompanying alterations to Planning Practice Guidance.  These changes have subsequently been incorporated into the National Planning Policy Framework, which is the main statement of national policy for planning.

In terms of the specific questions raised:

1.             The total number of dwellings that have been approved as conversions from office development or from the new commercial use class through the prior approval process between May 2013 and 1st February 2023 is 2,390. Of these, 1,164 had been completed at the end of March 2022 (the last monitoring exercise), 160 were underway at that point, leaving 784 with outstanding prior approval and not started (including those granted since the last monitoring exercise).  282 dwellings were subject to prior approval that has now expired.

2.             Since the office to residential permitted development rights were introduced in May 2013, the loss to the Council in terms of planning application fees is £1,689,934. The impact of the removal of the ability to seek financial or in-kind contributions by a Section 106 agreement as a result of the permitted development rights is estimated as follows:

a)      In terms of on-site affordable housing, the contribution that would have been made can be calculated based on the local policy and approach in place at the time prior approval was granted.  It is anticipated that, for those developments which had completed, were under construction or had approval and not yet commenced at 1st February 2023, the total on-site contribution would have been 655 affordable homes.

b)     For off-site financial contributions towards affordable housing, which would have been required for smaller housing developments, this can be calculated based on the average contribution that relevant developments of this size have already made per dwelling towards affordable housing.  On this basis, it is estimated that £2,218,205 would have been secured from those developments which had completed, were under construction or had approval and not yet commenced at 1st February 2023.

c)      In terms of contributions towards education it should be noted that, since the introduction of the Community Infrastructure Levy (CIL) on 1st April 2015, no Section 106 contributions would have been likely to have been made as these are now primarily covered by the CIL process, and Section 106 agreements would not therefore have been sought.  It is estimated that, had those developments permitted under PDR before the introduction of CIL and subsequently implemented been planning applications with relevant Section 106 agreements, the Council would have received £261,755 towards education infrastructure.

d)     The comments about the impact of CIL relate equally to open space and leisure. It is estimated that, had those developments permitted under PDR before CIL was introduced been planning applications with relevant Section 106 agreements, the Council would have received £1,273,100 towards open space and leisure infrastructure.

It should be noted that the figures in this answer differ somewhat from the answers given to equivalent questions in previous years.  This is because a substantial amount of evidence was compiled to form a justification for the Article 4 direction, including a more robust approach to identifying the financial contributions that would have been received.

3.             In total, the loss of contributions towards affordable housing and essential infrastructure as a result of this permitted development right is estimated to be 652 affordable homes and financial contributions of £3.753 million, as well as the loss of fee income of £1.690 million.

4.             The implications of the 2014 changes to national policy regarding sites of 10 dwellings or less are mainly of relevance to affordable housing, since contributions towards infrastructure such as open space, transport and education have been made through the Community Infrastructure Levy since 2015, and are unaffected by the national policy.

As Committee is aware, Reading Borough Council and West Berkshire Council challenged the changes through the High Court.  The case was heard in the High Court in April 2015.  The High Court judgement found in favour of the challenge by the local authorities and quashed the amendments to the National Planning Practice Guidance.  Committee will recall that an appeal by the Secretary of State was upheld by the Court of Appeal in May 2016 and the Ministerial Statement and the changes to the National Planning Practice Guidance were reinstated.

However, the Court of Appeal did emphasise that “local circumstances may justify lower (or no) thresholds as an exception to the national policy”.  It is clear therefore that an authority can seek to demonstrate that local circumstances can be used to justify an exception to national policy. At its meeting in July 2016, Strategic Environment, Planning and Transport Committee decided that the Council should continue to operate Policy DM6 seeking the provision of affordable housing for schemes of 10 or less dwellings, with some qualifications.

Subsequently, the Council prepared a new Local Plan which carried forward the requirement for all sizes of residential development from one dwelling upwards to contribute towards affordable housing.  Local plans need to generally comply with national policy.  However, during the public examination of the plan, the Council was able to demonstrate that there were exceptional circumstances justifying the local policy approach, and the Planning Inspector agreed in her report that the Local Plan policy H3 was sound.  The Local Plan, containing this policy, was adopted on 4th November 2019.  The Council’s policy approach has therefore been endorsed through the independent examination process.

The current situation is therefore that the Council continues to operate its local policies seeking provision of affordable housing on sites of one home or more, and has done so for the majority of the time since the initial ministerial statement in 2014.

5.             A number of appeals have been made against the Council’s refusal of planning permission or failure to determine planning applications for sites of less than ten dwellings.  For all appeals, the Council provides a full case explaining why local circumstances justify the requirement to provide affordable housing, bolstered since 2019 by the adoption of the Local Plan.  To date the Council has received 60 decisions relating to affordable housing provision on small sites of which 56 decisions have either been dismissed on grounds including a failure to provide for affordable housing, or have been allowed but have included a contribution to affordable housing as an exception to national policy.

The last occasion that the Council’s position regarding affordable housing on small sites was not supported by a Planning Inspector was in February 2017, which, as previously reported, resulted in an apology from the Planning Inspectorate accepting that the Inspector had not applied himself correctly to the policy framework.  In particular since the adoption of the Local Plan, appellants no longer seriously challenge the principle that sites of less than 10 dwellings should contribute to affordable housing in Reading.

Councillor Moore asked the following question of the Chair of the Planning Applications Committee:

Planning Consultation Responses

Planning application letters recently received by residents in Tilehurst regarding planning applications near them have the following piece of text: 'At this present time only consultation responses sent electronically, either by e-mail or submitted online will be accepted'.

Digital exclusion is inextricably linked to wider inequalities in society and is more likely to be faced by those on low incomes, people over 65 and disabled people. An LGA report from November 2021 called out that 'Tackling the digital divide will be crucial to addressing social and economic inequalities and levelling up every community.' Residents in Reading affected by the digital divide should be able to take part in the vital planning process.

Presuming these letters are not just sent to residents of Tilehurst but across the Borough, can I ask that given residents have received a printed letter from the Council regarding a planning application, why can they not reply via a printed or written letter?

REPLY by the Chair of the Planning Applications Committee (Councillor Lovelock):

Thank you for your question.

Officers have looked into the matter raised and it has been confirmed that it was an administrative error that the message excluding comments being sent in by post was still on consultation letters.

This message was attached to letters when officers were working away from the office during the Covid lockdown periods and access to post was not guaranteed or often delayed. It should have been deleted once officers were back at the Civic as the advice about online and emailed comments was only applicable during lockdown and is not a change to our normal practice.

I can confirm that the message was removed from consultation letters as soon as Officers were made aware of the error by your question.

Officers have apologised for not deleting the message before and have confirmed that comments on planning applications can be sent in by post, by using the online forms or by email. Whichever process is used, it is important to quote the application reference number to ensure that comments reach the correct case officer.