The recently introduced vacant building credit, and policy exemption for small developments from affordable housing contributions have been swiftly removed from national planning guidance this morning following a High Court ruling on Friday.

The policy excluded developments of 10 homes and 1,000 square meters or less, from the requirement to provide or contribute to affordable housing provision. In rural areas, a lower threshold of five homes applied.

Reading Borough Council and West Berkshire District Council had challenged the guidance on the basis it would reduce the amount of affordable housing nationwide by more than 20%. The High Court found in favour of the local authorities. They held that local planning authorities had not been properly consulted and the product of consultation that had taken place had not been properly taken into account. Significantly they held that the guidance was incompatible with the planning statutory framework. The Court also found that the impact of these changes had not been properly assessed.

The local authorities concerns that they could no longer provide the affordable housing they had assessed as being required in their local plans as a result of the blanket policy change were examined by the judge who saw the difficulties the authorities faced and by their judgment allowed the Government’s principle localism to continue to apply to small scale developments.

This case may be a blow for some developers of smaller sites but it is a real rap on the knuckles for the Department for Communities and Local Government (who as far as we know has not issued any comment as yet). The Councils were awarded their costs and the judge was critical of the way the Secretary of State had handled the case, including a statement submitted during the hearing “very late in the day indeed”. They had ignored their own department’s advice in coming to their policy decision. We will post if we hear of further developments.