West Berkshire District Council Reading Borough Council v Department for Communities And Local Government

The decision on 28 November 2014 to make alterations to national policy in respect of planning obligations for affordable housing and social infrastructure contributions by way of a Written Ministerial Statement in the House of Commons (HCWS50);

The decision on 10 February 2015 to maintain those policy changes following the completion of an Equalities Impact Assessment (“EqIA”).

The policy changes in the Ministerial Statement were accompanied by amendments to the National Planning Practice Guidance (“NPPG”). No alterations were made to the National Planning Policy Framework (“NPPF”).

Developments of 10 units or 1000 sq m or less (including annexes and extensions) would be excluded from affordable housing levies and tariff based contributions;

A lower threshold would apply in designated rural areas, National Parks and Areas of Outstanding Natural Beauty (as defined in section 157 of the Housing Act 1985), with developments of 5 units or less to be excluded from affordable housing levies and tariff based contributions. Development of between 6 and 10 units would be subject to a commuted sum payable on or after completion;

Where a vacant building is brought back into use or demolished for redevelopment, local authorities will provide a “credit”, equivalent to the floorspace of the vacant building, to be set against affordable housing contributions.

As a matter of law the new national policy is only one of the matters which has to be considered under section 70(2) of TCPA 1990 and section 38(6) of PCPA 2004 when determining planning applications or formulating local plan policies (section 19(2) of PCPA 2004), albeit it is a matter to which the Secretary of State considers “very considerable weight should be attached”;

Ministers did not pursue the option of using primary legislation to create the exemptions (See Ms. Everton Witness Statement 1, paragraph 33). Instead the changes were introduced as policy, not binding law;

In the determination of planning applications the effect of the new national policy is that although it would normally be inappropriate to require any affordable housing or social infrastructure contributions on sites below the thresholds stated, local circumstances may justify lower (or no) thresholds as an exception to the national policy. It would then be a matter for the decision-maker to decide how much weight to give to lower thresholds justified by local circumstances as compared with the new national policy;

Likewise if in future an LPA submits for examination local plan policies with thresholds below those in the national policy, the Inspector will consider whether the LPA’s evidence base and local circumstances justify the LPA’s proposed thresholds. If he concludes that they do and the local plan policy is adopted, then more weight will be given to it than to the new national policy in subsequent decisions on planning applications.

The effect of the new national policy in that case was bizarre, because the developer was willing to develop the site with a section 106 obligation compliant with the LPA’s affordable housing policy. In other words, compliance with that up to date and properly justified requirement was not impeding the bringing forward of the site. The Claimants say that that is one of the consequences of the blanket exemption conferred on small sites.

Summary of the Grounds of Challenge

The Claimants do not pursue Ground 4, which alleged a breach of Directive 2001/42/E2, the Strategic Environmental Assessment Directive.

I will consider first the challenges to the policy on affordable housing requirements before dealing with social infrastructure contributions and the vacant building credit.

In summary, the grounds now pursued in relation to the national thresholds for affordable housing contributions are as follows:-

Ground 2 – Inconsistency with the Statutory Scheme

Mr. Drabble QC rightly submits that the Secretary of State sits at the apex of the planning system in England and Wales and as such he is entitled to set national policy relevant to the determination of planning matters.

As Lord Slynn stated in R (Alconbury Developments Ltd) v Secretary of State for the Environment, Transport and the Regions [2003] 2 AC 295 (para 48) it is for Parliament and Ministers to determine the objectives of planning policy and to set out those objectives in legislation, ministerial directions and in planning policy guidelines. Decision-makers, whether local authorities, Inspectors or the Secretary of State, are all required to have regard to policy when taking particular planning decisions.

In summary, Lord Clyde held at paragraphs 139 and 140:-

In the light of the Alconbury decision, it is common ground that a challenge to the merits of a policy formulated by the Secretary of State is not a matter for judicial review.

Mr. Drabble QC submitted that in formulating and adopting a national policy, the Secretary of State exercises common law rather than statutory powers (referring to Lindblom J in Cala Homes (South) Ltd v Secretary of State for Communities and Local Government [2011] J.P.L 887 paragraph 50).

He then relied upon the distinction between a purely common law power and the exercise of a statutory discretion accepted by the Supreme Court in R (Sandiford) v Secretary of State for Foreign and Commonwealth Affairs [2014] 1 WLR 2697, in particular the judgment of Lord Sumption JSC at paragraph 83. However, the issue in that case was whether the rule against the adoption of a blanket policy fettering the exercise of a discretion (British Oxygen Co. Ltd v Board of Trade [1971] AC 610), applies also to a Minister’s use of a purely common law power. The Supreme Court held that it does not (see paragraph 62), but went on to add that the exercise of a prerogative power would be reviewable by the Courts on the grounds of irrationality or breach of other judicial review principles (paragraph 65).

However, the Claimants’ complaint in the present case does not depend upon the British Oxygen principle. The Claimants do not argue that the Secretary of State has adopted a blanket policy which simply fetters his own discretion. Instead, the challenge relates to the interaction between the Secretary of State’s policy for exempting small sites from affordable housing contributions and the statutory code for the adoption of local planning policies and the determination of planning applications.

In this case, the prerogative power to make policy upon which the Secretary of State has relied is not a freestanding power. Instead, the Defendant has exercised a common law power to promulgate a policy within the statutory framework for the planning and control of the use of land. Indeed, a major purpose of the Secretary of State’s policy is to lay down exclusions from affordable housing requirements for the determination of planning applications on smaller residential sites under the TCPA 1990 (see section 70(2)). Those applications may be determined by LPAs, planning Inspectors acting on behalf of the Secretary of State, or by the Secretary of State himself. Thus, the Secretary of State has adopted a policy for use not only by LPAs but also in the exercise of his own statutory powers to determine (i) an application which is called-in for his own decision under section 77 of the TCPA 1990 or (ii) an appeal from an LPA under section 78.

I agree with the Claimants that the decision of the Court of Appeal in Laker Airways Ltd v Department of Trade [1977] QB 643 is relevant, although not the passage cited at p 704 A-E. That part of the decision was concerned with the vires of a policy made under a statutory power. It was held that the guidance issued by the Secretary of State in that case was ultra vires the relevant statutory provisions, whereas here the policy which the Claimants seek to impugn is not made under any statutory power.

But the second part of the decision is very much in point, where the Court of Appeal held that a prerogative power cannot be exercised incompatibly with, or so as to frustrate, the relevant statutory scheme (pp 704-7, 718-722, 726-728). In that case a licence had been granted by the Civil Aviation Authority to Laker to fly a transatlantic route. The Court held that prerogative powers to withdraw the designation of Laker as an air carrier under an international treaty could not be used so as to frustrate the purpose for which the statutory licence had been granted. The Court of Appeal relied in part upon the existence of provisions in the Civil Aviation Act 1971 which could have been used to achieve the outcome desired by the Government, but which had not been used. They included the revocation of the statutory licence, subject to procedural safeguards for the licensee Laker. It was held that the effect of the statutory scheme was to prevent the prerogative being used in a manner incompatible with that scheme (see also Attorney General v De Keyser’s Royal Hotel Ltd [1920] AC 508, 526, 539-540, 554, 561, 575-6 cited by Roskill LJ at [1977] QB 719-721).

I also note that Lord Denning MR considered the scope of judicial review for controlling the use of prerogative or common law powers to be similar to that laid down in Padfield v Minister of Agriculture, Fisheries and Food [1968] AC 997. In my judgment that consequence logically flows from the conclusion in Laker that a prerogative power has to be used compatibly with a comprehensive statutory framework.

At this point it is necessary to return to the Alconbury decision. Of course, the formulation and merits of policy is a matter for government and not the courts. But a key issue in the present case is whether the policy challenged is unlawful on grounds of inconsistency with the statutory scheme, which is a matter for judicial review in the courts. In Alconbury it was held that the legislation involves an allocation of functions, including policy-making functions, as between central and local government. In the present context, the relevant function of the Secretary of State is to act as a central authority bringing some degree of coherence and consistency in the development of land, by influencing “the local development plans and policies which the planning authorities will use in resolving their own local problems”. The local development plan of each LPA lies at the heart of the system. It is the LPA which formulates locally applicable policies in its development plan. A function of the Secretary of State is to provide “guidance” for the drawing up of local plans which reflect local circumstances and issues.

Before the start of the hearing I drew attention to other cases which have considered the relationship between national and local planning policies, such as ELS Wholesale (Wolverhampton) Ltd v Secretary of State for the Environment (1988) 56 P&CR 69, 75 - 77; Surrey Heath Borough Council (1987) 53 P&CR 428, 433 - 4; and Camden LBC v Secretary of State for the Environment (1990) 59 P&CR 117, 122. As the Divisional Court emphasised in the ELS case, national policy guidance has to be applied throughout the country in widely differing circumstances. It is not to be applied in a particular case as if it had the binding force of a statute or statutory instrument. National policies provide guidance to individual decision-makers “and give an indication of the principles upon which the Secretary of State or his Inspectors will act …” when considering planning appeals. Local circumstances within a particular area can lead to a decision that national policy be given less weight and not applied, whether the decision concerns the outcome of a planning application or the formulation of local planning policies.

Mr. Drabble QC relied upon two passages in City of Edinburgh Council v Secretary of State for Scotland [1997] 1 WLR 1447 in which it was acknowledged that a change in national policy giving guidance to LPAs may render policies in local plans outdated. Lord Hope stated at page 1450 C – D that:-

“No doubt the enhanced status of the development plan will ensure that in most cases decisions about the control of development will be taken in accordance with what it has laid down. But some of its provisions may become outdated as national policies change, or circumstances may have occurred which show that they are no longer relevant. In such a case the decision where the balance lies between its provisions on the one hand and other material considerations on the other which favour the development, or which may provide more up-to-date guidance as to the tests which must be satisfied, will continue, as before, to be a matter for the planning authority.” (emphasis added)

Similar points were made by Lindblom J in Cala Homes (South) Ltd v Secretary of State for Communities and Local Government [2011] JPL 887 at paragraph 48. But it is important to note that these passages provide no support for the notion that a national policy can simply override an adopted local plan policy or create an exemption such that the local policy need not be applied. Instead they envisage the need to weigh the relative merits of national and local policy as they apply to the circumstances of an individual case. Of course, in some instances a local plan policy may become so outdated that little or no weight is attached to it, but that must always remain a matter for evaluation by the planning authority which determines a planning application (see also paragraph 124 below and Cala Homes in the Court of Appeal).

In order to resolve the issues under ground 2 the following features of the statutory scheme are particularly important:-

In my judgment it is plain from the above analysis that the Secretary of State’s common law powers to promulgate planning policies cannot be used incompatibly with the statutory code. By way of example, when the Cala Homes case reached the Court of Appeal ([2011] J.P.L 1458), Sullivan LJ stated that if, in anticipation of legislation to abolish all regional strategies, a policy issued by the Department had advised LPAs to ignore the policies in the regional strategies, or to treat them as no longer forming part of the development plan, or to determine planning applications otherwise than in accordance with those strategies (because of their proposed abolition), or if it had told decision-makers what weight they should give to the Government’s proposal, then that statement would have been unlawful (see paragraph 26 applying Laker). The legal analysis cannot be any different if a new policy from the Secretary of State is directed at local plans or at policies within local plans dealing with a particular topic.

I accept the submissions of Mr. Forsdick QC that the substance of the national policy published in November 2014 is materially different from the national policies in force between 1998 (Circular 06/98) and March 2012 (PPS3 issued in 2006). The earlier national policies simply gave “criteria” or “indicative thresholds” which LPAs were to take into account when formulating local plan policies. These policies were consistent with the statutory framework set out above and the analysis in Alconbury. They sought to give guidance to and “influence” individual LPAs when drawing up policies in their local plans for affordable housing requirements appropriate to their respective areas. The setting of thresholds was left to be dealt with at the local level by each LPA drawing up and adopting policies appropriate for their area, but having regard to the national policy on indicative thresholds. Thus, the earlier national policies properly discharged the Secretary of State’s function as a central authority bringing “some degree of coherence and consistency” to the development of land, whilst respecting the statutory role of LPAs to devise local policies appropriate to their local circumstances, subject to scrutiny by independent examination in public. The policies provided a framework within which LPAs could adopt the same thresholds or justify alternative approaches based upon local circumstances.

The new national policy does not purport to give guidance to LPAs which should be considered alongside local plan policies. Rather it gives thresholds below which affordable housing (and tariff style contributions) should not be sought when any planning application for housing development in England is determined. Those thresholds are to be applied directly, and with immediate effect, in the determination of planning applications, notwithstanding any local plan policy inconsistent therewith. To that extent the policy has been drawn up so as to displace adopted local plan policies on affordable housing requirements.

Mr. Forsdick QC also contrasted the approach taken in the Written Ministerial Statement made on 28 November 2014 with the NPPF itself. Paragraph 2 of the NPPF expressly states that the Framework should be “taken into account in the preparation of local and neighbourhood plans” (reflecting section 19(2) of the PCPA 2004) and “is a material consideration in planning decisions” (respecting both section 70(2) of TCPA 1990 and section 38(6) of PCPA 2004). Thus, in the determination of planning applications the NPPF is meant to be taken into account in addition to, or alongside, local plan policies. Moreover, it is expressly recognised that LPAs are able to formulate local plan policies which depart from the NPPF and to justify any such departure in the statutory examination of their plan. That is the clear effect of the explicit language used in paragraph 1 of the NPPF (see paragraph 5 above).

Furthermore, because it made a number of important changes to national policy, the NPPF did go on to address interaction with existing local plan policies (see paragraphs 209 to 215 of the NPPF). By paragraph 208 the policies in the NPPF came into force on the date of publication. Paragraph 209 stated that the NPPF “aims to strengthen local decision-making and reinforce the importance of up-to-date plans.” Having referred to section 38(6) of PCPA 2004, paragraph 211 explicitly stated that in determining planning applications, policies in local plans should not be considered out-of-date simply because they were adopted prior to the publication of the NPPF. Instead, the policies in the NPPF were to be treated as “material considerations” (paragraph 212) and local plans might need to be revised to take into account the NPPF (paragraph 213). Where that was the case, the NPPF stated that that should be done as quickly as possible, whether by a partial review of the plan or the preparation of a new plan. Paragraph 214 then allowed a period of 12 months from the publication of the NPPF within which decision-makers would continue to be able to give “full weight” to relevant development plan policies adopted under the PCPA 2004, notwithstanding a limited degree of conflict with the NPPF. Thus, the introduction of the NPPF allowed a period during which conflicts or tensions between the new national policy and existing local plan policies could be addressed by the revision of local plans in so far as that was considered to be appropriate.

By contrast the Written Ministerial Statement purported, with immediate effect, to create exemptions from affordable housing requirements contained in adopted local plans. It purported to do so for all small housing developments in England, without distinguishing between existing or future local plan policies. Unlike the NPPF, the Written Ministerial Statement (and the revisions to the NPPG) was not devised so as to be taken into account alongside local plan policies in development control decisions or as guidance when new local plan policies come to be formulated. The purported effect of the exemptions in the Written Ministerial Statement does not envisage that LPAs may prepare, justify and adopt local policies departing therefrom. Furthermore, the policy did not allow any transitional period within which adopted local plan policies would continue to be given full weight or primacy, or for LPAs to consider whether their local plan policies should be revised in the light of new national guidance.

Changes in national policy may impact upon local plan policies in different ways and may sometimes result in local policies being treated as outdated or as having reduced weight. For example, a new national policy may give guidance on how to approach applications for a relatively new form of development, or a new problem in the operation of the development management system, which has not been covered in the existing policies of local plans. LPAs can revise their local plan policies having regard to the new national policy and in the meantime may generally apply that policy. Similar considerations apply where a new national policy deals with a type of development of national or regional importance which has not been addressed in existing local plan policies. A local plan which had not previously addressed such matters might (depending on the circumstances) be described as “not up to date” for the purposes of weighing competing considerations.

In other situations a new national policy may deal with a subject already covered by a local plan. For example, national policy may indicate that a new objective or factor should be taken into account, or that a consideration previously referred to in national policy should be weighed differently. Such guidance will generally fall to be applied alongside existing local plan policies covering the same issue. Whether a local plan policy will be judged to be out-of date may depend upon an assessment of whether more weight should be given to the new national policy and the material upon which it has been based, or to the existing local plan policies and the local circumstances and evidence upon which the latter have been based. The outcome of that kind of process will be sensitive to the circumstances, including such matters as the relative importance of the national policy as compared with local factors and the cogency of any supporting local evidence. It is impossible to be prescriptive about such a process of evaluation. This category of case would include the indicative thresholds for affordable housing requirements set by the former PPS 3 (see paragraph 50 above).

It is plain from the evidence put before the Court that the Defendant’s policy was aimed at local affordable housing requirements, whether contained in local plans or other statutory development plans. The process by which Ministers considered policy options, obtained advice, consulted on draft policies and determined the content of the new national policy, was all on the basis that defined small-scale developments would be generally excluded or exempted from such affordable housing requirements (see paragraphs 2 and 57 to 69 above). It is also plain from Ms. Everton’s first witness statement (e.g. paragraphs 54 – 55), that Ministers’ final decision to adopt changes to national policy was made on the same basis, notwithstanding local plan policies to the contrary. Neither the Defendant’s decision nor the Written Ministerial Statement was expressed so that the new national thresholds would be subject to policies contained in adopted local plans, or even considered alongside those policies. The use by Ministers and officials of the terms “exclude” and “exemption” makes no sense unless that referred to exclusions or exemptions from requirements in local plan policies that would otherwise apply.

The changes to national policy in the present case are therefore different from the examples in paragraphs 130 to 131 above, for a combination of reasons which I summarise as follows:-

From the analysis above it can be seen that the national policy changes introduced on 28 November 2014 are inconsistent with certain core principles of the statutory scheme, in summary because:-

In these circumstances, it is not surprising that officials advised Ministers on the possible need for primary legislation in order to create the exemptions they wished to achieve (see paragraph 59 above).

For the reasons set out above, I have reached the firm conclusion that the purported effect of the new national policy on exemptions from affordable housing contributions is incompatible with the statutory framework of the TCPA 1990 and PCPA 2004 and therefore unlawful applying Laker Airways and Cala Homes.

Secondly and in the alternative, the issues raised by the Claimants should be considered by the application of the Padfield principle, as the Court of Appeal accepted in the Cala Homes case (paragraphs 15 to 17). The Court reaffirmed the elucidation of that principle by Laws LJ in R v Braintree D.C. ex parte Halls (2000) 32 HLR 770, 779. Thus, the principle is not confined to cases where the exercise of the power is “incapable of promoting the policy of the legislation”. The real question is “what was the decision-maker’s purpose in the instant case and was it calculated to promote the policy of the Act?”

Even if the new national policy were not to be construed as overriding local plan policies inconsistent therewith, nonetheless it is clear that the purpose of Ministers in consulting upon and adopting that policy was to create exemptions having that effect. Their intention was plainly to create exemptions from affordable housing requirements on smaller-scale developments, thus freeing developers and landowners from the requirements set by the planning policies of LPAs (see paragraphs 57 to 69 above). For the reasons previously given, that purpose was inconsistent with the statutory framework described in paragraphs 25 to 38, 109 to 110 and 119 to 123 above; alternatively, it was not “calculated to promote the policy of the Act” (see Padfield and R v Braintree DC ex parte Halls (2000) 32 HLR 770, 779).

The legislation presumes that planning applications will be determined in accordance with adopted local plan policies. These are policies which have been formulated by the local authority on the basis of local circumstances, having regard to (but not subject to) national policies, and have then been tested through statutory processes which include Strategic Environmental Assessment and sustainability appraisal, consultation and public participation and independent examination, and which upon adoption have “priority” in the determination of planning applications. The purpose of Ministers in their new national policy was to create exemptions from affordable house requirements by introducing blanket thresholds, irrespective of (a) whether those thresholds conflict with adopted local plan policies and (b) the weight to be attached to a specific local plan policy. To put it at its lowest, that purpose was not “calculated to promote the policy of the legislation”. Ground 2 should also be upheld on this alternative basis.

Thirdly, ground 2 may also be considered in another way. A policy may be held to be unlawful if it gives rise to an unacceptable risk of unlawful decision-making (see e.g. R (on the application of Suppiah) v Home Secretary [2011] EWHC 2 (Admin) paragraphs 137 – 140). The new national policy was intended to confer exemptions from affordable housing requirements in local plans, notwithstanding the statutory framework to which I have referred. It has been understood in that way, for example by Inspectors in the determination of planning appeals (see paragraphs 103 - 104 above). By contrast, no evidence has been provided to indicate that the policy has been understood by decision-makers working in the field to operate in the manner suggested by the Defendant for the first time during the hearing (see paragraph 99 above). Given the language used in the Written Ministerial Statement and the amendments to the NPPG, as well as the genesis of the new policy, I consider that there is an unacceptable risk of unlawful decision-making, in particular in the determination of planning applications, through treating the new exemptions as having primacy over local plan policies inconsistent therewith. However, because the authorities in this area were not addressed during the hearing, my decision under ground 2 does not rest on this third approach.

I return to the Secretary of State’s statement made through Mr. Drabble QC as to what is now said to be the effect of the new national policy (see paragraph 99 above). I do not consider that that statement overcomes the legal flaws which I have accepted under ground 2, nor should it lead the Court to exercise its discretion to withhold an appropriate remedy. I take that view for a combination of reasons, namely:-

I should emphasise, however, that the legal conclusions reached in this judgment are solely concerned with the circumstances which I have sought to summarise in paragraph 133 above. They do not affect, for example, the ability of Ministers to make policies affecting local plans, and the weight to be given to such plans, of the kind set out in Circular 06/98 and PPS 3 (see paragraphs 48 – 50 above). Moreover, different considerations may well need to be addressed in other cases, for example, subjects which are primarily a matter for national policy, such as developments of national or regional importance.

For the above reasons I conclude that ground 2 must be upheld.

Ground 3 – Whether the consultation process was unfair

The Claimants submit that the consultation process did not comply with the second and fourth requirements of the “Sedley criteria” endorsed by the Supreme Court in R (Moseley) v Haringey LBC [2014] 1 WLR 3947 (Lord Wilson JSC at para 24). In other words, it is said that the Defendant failed to give sufficient reasons for his proposal so as to allow intelligent consideration and responses to be given and also failed to take the product of consultation conscientiously into account.

The Supreme Court also endorsed a passage from the judgment of Lord Woolf MR (as he then was) in R v North and East Devon Health Authority ex parte Coughlan [2001] QB 213 in which he stated (at paragraph 112) that because consultation is not akin to litigation, the consulting authority does not have to publish every submission it receives or (absent some statutory obligation) disclose all the advice it obtains. “Its obligation is to let those who have a potential interest in the subject matter know in clear terms what the proposal is and exactly why it is under positive consideration, telling them enough (which may be a good deal) to enable them to make an intelligent response.”

Mr. Drabble QC relied upon paragraph 26 of the speech of Lord Wilson JSC in Moseley in which he stated that the degree of specificity required may be influenced by the identity of those being consulted. Thus LPAs and developers familiar with the workings of the planning system may be able to respond satisfactorily to a less detailed consultation document than consultees dealing with unfamiliar material or who are disadvantaged in some way. That, however, must depend upon the subject matter of the proposals.

But the Supreme Court also held that the demands of fairness are likely to be greater when the consulting party is contemplating withdrawing an existing benefit or advantage as compared with consultees who merely contemplate obtaining a future benefit ([2014] 1 WLR 3958 C–D). The same can be said for a proposal the effect of which is to impose disadvantage or burdens upon a party or parties. In the present case, the Department accepted that Ministers’ proposals would have a “significant impact on affordable housing numbers” and “local affordable housing contributions” (see paragraphs 67 - 68 above). The Department has not disputed the Claimants’ evidence that the shortfalls in affordable housing resulting from the new national policy will oblige LPAs to revise their adopted local plan policies, and take steps to release additional sites for housing development. This may prove to be onerous for LPAs in areas subject to environmental constraints. In my judgment, the effect of the new policy upon the ability of LPAs to fulfil their obligation to identify sufficient housing land was a factor which enhanced the requirement for sufficient information to be provided to enable consultees to make meaningful responses.

In R (London Criminal Courts Solicitors Association) v Lord Chancellor [2015] 1 Costs LR 7; [2014] EWHC 3020 (Admin) a challenge was brought to a decision on revisions to the number of Duty Provider Work contracts that would be made available under the criminal legal aid scheme. The complaint related to the consultation process and the failure of the Lord Chancellor to disclose for comment two independent expert reports, which had been used to provide assumptions for the financial modelling which had influenced the decision being challenged.

Burnett J (as he then was) set out a number of principles of which the following are relevant in the present case:-

On the facts of that case Burnett J decided that the Lord Chancellor’s failure to disclose in the consultation process the two expert reports had amounted to procedural unfairness. The consultation paper had not identified the assumptions, or even their nature, which would lead to a decision on the number of contracts available. Broad indications of the considerations which would determine the outcome were held to be insufficient to enable consultees to respond meaningfully (paragraph 50 of the judgment).

From paragraph 64 above and the consultation responses shown to the Court, I find that the following points are established:-

Paragraph 12 of the Government’s Response to Consultation published in November 2014 suggests that the Defendant did have in mind the responses from local authorities on viability issues. But that does not assist the Defendant to meet the challenge because paragraph 23 of the same document maintained that the new policy was justified by the “disproportionate burden” on small-scale developers and sites. Moreover, in paragraphs 61 and 62 of Ms. Everton’s first witness statement, as well as in oral submissions, it was made plain to the Court that the decision to adopt the new national policy was not driven by the view that “all small scale development was insufficiently viable to provide any contribution to affordable housing”. Thus, the Defendant accepts that some smaller sites can afford to make affordable housing contributions. Rather, the rationale for the policy is said to have been that disproportionate, and generally up front, charges have contributed significantly to the decline of the small scale housing industry. But I note that the new policy for rural areas adopted by the Secretary of State demonstrates that concerns about “up front” requirements can be met by allowing an affordable housing contribution to be made as a cash payment which is deferred until the development is completed (paragraph 23 above and see also consultation responses from Three Dragons and others). It follows, and indeed was accepted in oral submissions for the Secretary of State, that the real driver for the change in national policy was the view that affordable housing requirements impose a “disproportionate burden” on small sites.

In the absence of any proper explanation in the Consultation Paper as to the basis for the “disproportionate burden” concern, the focus of the responses by many LPAs on this aspect was, understandably, directed to the viability testing and flexibility towards viability issues upon which local policies are based, as Ms. Everton accepted (paragraph 61 of her first witness statement). But it now turns out from the Government’s response and the evidence it has filed in these proceedings that the notion of a “disproportionate burden” related to something else. There is nothing in the Department’s consultation paper to explain what that disproportionate burden was thought to be nor the basis for that view, including any supporting evidence. Consequently, LPAs in particular did not have an opportunity to give a meaningful, intelligent response on this key justification for the proposed policy. The rationale for the policy was not properly defined.

Paragraphs 18 to 22 of Ms. Everton’s witness statement give a limited explanation as to why the Government considered that affordable housing contributions might be inhibiting or stalling development. But the material she referred to was exiguous and some of it did not even exist at the time of the consultation. The short point remains that not even the material then in existence was disclosed as part of the consultation exercise so that consultees, in particular LPAs, could respond thereto. It is plain from the evidence filed by the Claimants in these proceedings that they would have had substantial criticisms to make of some of the material which ought to have been considered by Ministers. Furthermore, it would have been possible for LPAs to put the material relied upon by the Department into context, for example by pointing to other factors which, according to those sources, were causing development to be stalled (such as the availability of finance and funding) some of which were just as significant as the costs of planning requirements, if not more so. Finally, if LPAs had had access to the material upon which the Defendant’s concerns had been based, it would have been possible for them to consider putting forward other alternatives.

LPAs did not have the opportunity to make representations on material which was known to the Defendant and central to the formulation and adoption of his new national policy, where that policy was going to have a substantial effect on the discharge of LPA’s planning functions. The process followed by the Defendant was plainly unfair.

For the above reasons, I consider that there was a breach of the second “Sedley criterion” and consequently ground 3 must be upheld.

Furthermore, I have reached the conclusion that ground 3 also succeeds because in two respects the Defendant breached the fourth Sedley criterion, namely the requirement for the decision-maker to take the product of consultation conscientiously into account.

First, in paragraph 20 of the Response in November 2014 the Government stated that the policy they had decided upon would support self build, small scale and brownfield development “without adversely impacting on local contributions to affordable homes and infrastructure”. That statement was flatly contrary to the evidence that the policy would have a substantial impact upon affordable housing provision, as had been stated in consultation responses and confirmed in advice from officials. Nothing has been put forward on behalf of the Defendant to identify any other evidence upon which that part of the Government’s Response in November 2014 could have been based. The express statement in paragraph 20 of the Response is inconsistent with Ministers having fulfilled their obligation to take into account “conscientiously” a matter of crucial importance to their final assessment of the merits of their proposed policy.

Alternatively, even if the view were to be taken that the last part of paragraph 20 was simply a poorly drafted description of how Ministers had attempted to strike a balance between support for small-scale and brownfield development and the degree of impact upon local contributions to affordable housing and social infrastructure, there is no evidence of any consideration being given to the difference in support for the development industry which could be achieved in any event by adopting a general threshold of 3 units as compared with 10 units. Evidence has been provided by the Defendant to show that Ministers were informed in July 2014 (a) about the estimated impact upon affordable housing contributions (in monetary terms) by adopting a 10 unit threshold as compared with a 3 unit threshold and (b) that a 3 unit threshold would still achieve a significant benefit for small-scale development (see paragraphs 67 - 68 above). But there is no evidence to suggest that any attempt was made to estimate any difference in benefits for the development industry between the two alternative thresholds, so as to enable a proper judgment to be reached on whether the threshold should be set at a level which would have a substantially worse effect upon the provision of land for affordable housing. If and in so far as any balance was struck between benefits and disbenefits, it was therefore substantially incomplete. The Defendant did not grapple with an issue which, in the context of the proposed policy and the consultation exercise, was an “obviously material”, if not fundamental, consideration which he was legally obliged to take into account (Re Findlay [1985] AC 318, 334 and see paragraph 166 below).

Second, the Defendant failed to grapple with other points made by consultees (see e.g. representation by Cornwall Council and paragraphs 93 – 95 above) which were of central importance, namely that:

Grounds 3 also succeeds for these additional freestanding reasons, applying the fourth of the Sedley criteria on consultation (paragraphs 158 and 160 above) and/or the failure to take into account an “obviously material” consideration, (paragraph 159).

Ground 1- Failure to take into account “obviously material” considerations

The Claimants submit that in adopting his new policy the Secretary of State failed to take into account a number of material considerations.

Mr. Drabble QC submits that when formulating changes to national policy on affordable housing there was no obligation upon the Secretary of State to have regard to any particular considerations. This was not a case where the Defendant was exercising a statutory discretion which mandated the consideration of certain factors. Because the Secretary of State was exercising a common law power to formulate policy, he was not bound to have regard to any particular matters. To the extent that the formulation of policy is justiciable at all, “the ultimate control is the principle of rationality” (paragraph 60 of the Defendant’s skeleton).

With respect I consider that Mr. Drabble’s analysis was too narrow. Although the Secretary of State was exercising a common law power rather than one conferred by statute, nevertheless that power was relied upon in order to promulgate a policy within a statutory context and for the purposes of the relevant legislation (see paragraphs 112 to 118 above). More particularly, the Secretary of State intended that his policy be used in the determination of planning applications and in the formulation of local plan policy. Accordingly, in exercising his power to make policy the Secretary of State could only have regard to land use planning considerations.

Can it truly be said that the Secretary of State was under no obligation to have regard to any particular considerations simply because there was no statutory provision explicitly requiring him to do so when exercising his common law power to formulate policy? In my judgment the answer is no. At the very least, given that the prerogative power could only be exercised compatibly with the statutory framework (paragraphs 117 and 124 above), the Secretary of State was obliged in this instance to have regard to relevant statutory provisions relating, for example, to the formulation of local plan policy and the determination of planning applications and the implications of these provisions for the use of the policy-making power.

Indeed, in paragraph 61 of the Skeleton for the Defendant it was accepted that the principles laid down in Re Findlay ([1985] AC 318, 333-4) are applicable, at least where a common law power is relied upon in order to formulate a policy for application in a statutory context. Thus, the principle is that the party formulating a policy (the “decision-maker”) is obliged to have regard to those considerations which the legislation expressly or impliedly identifies as relevant. A consideration is “impliedly relevant” in this context if it is “so obviously material” that a failure by the decision-maker not to take it into account would not accord with the intentions of the legislation (see also R (Luton Borough Council) v Central Bedfordshire Council [2015] EWCA Civ 537 at paragraph 71). During submissions it became apparent that Mr. Forsdick QC accepted that this is the correct test to apply under ground 1 (see e.g. paragraph 33 of Claimant’s skeleton).

In my judgment, the Defendant failed to take into account certain considerations which were “obviously material”, in addition to those matters which I have already identified under ground 3 (see paragraphs 158 to 160 above). In so far as they relate to the affordable housing issue, these additional matters arise from paragraphs 88 to 90 above. In summary, there is no dispute in these proceedings that one effect of the new national policy will be to reduce the amount of land available to meet affordable housing needs, with the consequence that LPAs affected will face arguments that their local plans are out of date, the presumption in paragraph 14 of the NPPF applies and more land needs to be released in their areas, including greenfield sites.

In my judgment, the main benefits and disbenefits of the proposed exemptions from affordable housing requirements were “obviously material” to the Secretary of State’s decision to adopt the new policy. That policy could not have been adopted on a whim. That would have been arbitrary. Consequently the decision to adopt the policy had to have regard to the perceived advantages of the proposed policy. Such advantages could not properly be taken into account without also addressing any adverse consequences which were “obviously material”.

The question of what harmful consequences were “obviously material” needs to be considered in context. The Secretary of State was making changes in national policy which were intended to affect land use decisions across the country. In the submission made to Ministers in July 2014 the reduction in affordable housing contributions for the country as a whole was expressed in monetary terms in order to indicate the relative effects of setting national thresholds at 3, 5 or 10 units. But nothing has been put before the Court indicating that the scale of the reduction in the supply of land for affordable housing across the country was considered and, in particular, the implications of the action that LPAs would need to take in order to redress shortfalls, not even in broad terms.

The beneficial purpose which Ministers intended their policy to serve was to overcome the “stalling” of development on small sites, an issue relating to land supply. In my judgment adverse effects on land supply were equally and obviously relevant to a proper weighing of the benefits (or rather the net benefits) of the proposed policy. There is no evidence to suggest that that exercise was carried out before the adoption of the policy in November 2014.

According to the Statement made on behalf of the Secretary of State in this hearing (see paragraph 99 above), it is now suggested that LPAs can decide to promote and adopt local plan policies at variance from the new national thresholds (despite the plain evidence that the intention of Ministers was to create exemptions from local policy requirements). The approach in the Statement made in Court would have been similar to that taken in Circular 06/98 and PPS3 (see paragraphs 48 to 50 above). But there is no suggestion whatsoever that that alternative approach was considered by Ministers instead of the exemptions which they intended that the November 2014 policy should create. Nor is it suggested that any consideration was given to a transitional period during which LPAs could address a new national policy by revisions to their local plan policies. In the circumstances of this case, these too were “obviously material” considerations which the Defendant ought to have taken into account before adopting this policy.

On the material now before the Court, I am unable to go so far as to suggest that the Secretary of State was necessarily obliged to consider the adverse consequences of his proposed policy on land supply in quantitative terms. I have insufficient evidence on the practicality of obtaining numerical data. But, at the very least, the adverse consequences upon land supply for affordable housing had to be reflected in the final decision, even if only in a qualitative manner. For example, the creation with immediate effect of national exemptions from local plan requirements had the potential to create sudden, or even immediate, shortfalls in land supply without allowing LPAs an opportunity to address that problem beforehand through the development plan process. If instead national indicative thresholds had been set so as to influence the formulation of local plan policies, perhaps within a defined timescale, LPAs would have been able not only to set local thresholds, but also to address any consequential land supply issues, as part of a revision to a local plan. Thus, the considerations in paragraphs 170 and 171 above are interrelated.

To the extent set out above, I conclude that ground 1 must be upheld.

Ground 4 – The Public Section Equality Duty

In this case it is common ground that the public sector equality duty (“PSED”) in section 149 of the Equality Act 2010 had to be satisfied when the Defendant adopted the policies under challenge in these proceedings.

Ms. Everton explains that Islington Borough Council complained about the Defendant’s failure to comply with the PSED in a pre-action protocol letter dated 2 January 2015 (paragraph 57 of her first witness statement). The Claimants first raised the issue of whether the PSED had been breached in their Amended Statement of Facts and Grounds dated 23 January 2015 (and filed an application to amend on 2 February 2015).

A letter from the Treasury Solicitor dated 3 February 2015 indicated that the decision taken on 28 November 2014 was being reviewed in order to address the PSED.

Paragraphs 58 and 59 of Ms. Everton’s first witness statement make it plain that it had not been thought necessary to consider the PSED at the time of the 28 November 2014 decision. But, in view of Islington’s proposed challenge, officials were instructed to undertake an Equality Impact Assessment (EqIA) in respect of the changes to national policy in January. The findings and results were then recorded in a formal Equality Statement dated 5 February 2015, which was produced to the Court. Officials provided to Ministers detailed written advice (which has not been disclosed) and the Equality Statement as an Annex. It is said by Ms. Everton that having considered “the findings of the Equality Impact Assessment” and the matters required by section 149 of the 2010 Act to be taken into account, the Secretary of State was satisfied that the policy changes of 28 November 2014 were compatible with those requirements and on 10 February 2015 he decided to maintain those changes. Thus, the Secretary of State’s defence to ground 4 is critically dependant upon the Equality Statement dated 5 February 2015 in order to explain the equality impact assessment carried out after national planning policy had already been altered in November 2014. Neither the Government’s Response in November 2014 nor any of the material referred to in the witness statements of Ms. Everton suggest that the considerations forming part of the PSED were taken into account and applied before the policy was altered.

Section 149 of the 2010 Act provides as follows:-

“149 Public sector equality duty

(1)

A public authority must, in the exercise of its functions, have due regard to the need to—

(a)

eliminate discrimination, harassment, victimisation and any other conduct that is prohibited by or under this Act;

(b)

advance equality of opportunity between persons who share a relevant protected characteristic and persons who do not share it;

(c)

foster good relations between persons who share a relevant protected characteristic and persons who do not share it.

(2)

A person who is not a public authority but who exercises public functions must, in the exercise of those functions, have due regard to the matters mentioned in subsection (1).

(3)

Having due regard to the need to advance equality of opportunity between persons who share a relevant protected characteristic and persons who do not share it involves having due regard, in particular, to the need to—

(a)

remove or minimise disadvantages suffered by persons who share a relevant protected characteristic that are connected to that characteristic;

(b)

take steps to meet the needs of persons who share a relevant protected characteristic that are different from the needs of persons who do not share it;

(c)

encourage persons who share a relevant protected characteristic to participate in public life or in any other activity in which participation by such persons is disproportionately low.

(4)

The steps involved in meeting the needs of disabled persons that are different from the needs of persons who are not disabled include, in particular, steps to take account of disabled persons' disabilities.

(5)

Having due regard to the need to foster good relations between persons who share a relevant protected characteristic and persons who do not share it involves having due regard, in particular, to the need to—

(a)

tackle prejudice, and

(b)

promote understanding.

(6)

Compliance with the duties in this section may involve treating some persons more favourably than others; but that is not to be taken as permitting conduct that would otherwise be prohibited by or under this Act.

(7)

The relevant protected characteristics are—

age;
disability;
gender reassignment;
pregnancy and maternity;
race;
religion or belief;
sex;
sexual orientation.

(8)

A reference to conduct that is prohibited by or under this Act includes a reference to—

(a)

a breach of an equality clause or rule;

(b)

a breach of a non-discrimination rule.

(9)

…….”

Mr. Drabble QC submits that, “whilst equality duties must be complied with at the time that decisions which they affect are taken, the fact that a later, lawful assessment is carried out may mean that there is no basis for relief – beyond a declaration that the relevant duty was not complied with at the time of the decision in question” (paragraph 83 of skeleton with emphasis added). He relies upon a decision of Stanley Burnton J (as he was) in R (BAPIO Action Ltd) v Home Secretary [2007] EWHC 199 (Admin) at paragraphs 64-70 and the decision of Singh J in R (Cushnie) v Secretary of State for Health [2014] EWHC 3626 (Admin), [2015] PTSR 384 at paragraphs 95 to 117.

In the BAPIO case Stanley Burnton J accepted that before certain changes to the Immigration Rules had been made, there had been a failure to comply with Section 71 of the Race Relations Act 1976, which imposed a very similar obligation to the PSED. But the Court simply granted a declaration that the Secretary of State had failed to comply with the duty before deciding to alter the Rules and refused to quash those changes, for the sole reason that subsequent to that decision, an Equality Impact Assessment had been carried out the sufficiency of which had not been challenged (see paragraph 70).

The Judge had previously referred to Secretary of State for Defence v Elias [2006] EWCA Civ 1293, [2006] 1 WLR 3213 in which Arden LJ had stated that the clear purpose of section 71 is to require public bodies to whom that provision applies “to give advance consideration to issues of race discrimination before making any policy decision that may be affected by them”. She went on to describe the provision as “an integral and important part of the mechanisms for ensuring the fulfilment of the aims of anti-discrimination legislation”. In the circumstances, it is reasonable to infer that there was no suggestion in BAPIO that the failure to comply with the statutory duty at the proper time could have affected the decision to make the policy change or the nature of that change. That is not the case here. Both the effect of non-compliance with the PSED prior to the decision to alter national planning policy upon the content of those changes and the legal adequacy of the EqIA in February 2015 are very much in issue in the present case.

When BAPIO reached the Court of Appeal ([2007] EWCA Civ 1139) Sedley LJ, having noted that there was no challenge by the Appellant to either the ex post facto EqIA or the judge’s decision to grant only declaratory relief, treated the decision at first instance as an exercise of the discretion to withhold relief (paragraph 2) and then added (paragraph 3):-

“Such a finding does not in any way diminish the importance of compliance with s.71, not as rearguard action following a concluded decision but as an essential preliminary to any such decision. Inattention to it is both unlawful and bad government. It is the Home Office's good fortune that the eventual assessment did not force it to go back to the drawing board.”

In Cushnie the challenge was to regulations which entitled former asylum claimants to free NHS treatment but only if they had previously been receiving accommodation and support from the Home Office under certain statutory provisions. However, as a disabled person the Claimant’s support had been provided by a local authority instead of the Home Office and so he did not qualify for free medical treatment. Singh J held that the equality impact analysis carried out before the making of the regulations breached the PSED because it had not addressed the protected characteristic of disability (paragraph 111) and that the consideration given to this aspect after the regulations had been made had been too late to satisfy section 149 (paragraphs 112 to 116).

I entirely agree with the Judge’s conclusion (paragraph 113) that the PSED is an obligation imposed on the relevant decision-maker and therefore a failure to comply cannot be excused because consultees or other third parties did not raise issues concerning a relevant protected characteristic in their representations. In other words the matters to which a decision-maker must have “due regard” under section 149 are matters which he or she is mandated to assess and then take into account (In Re Findlay [1985] AC 318, 333-334).

At the conclusion of his judgment Singh J invited submissions as to the form of relief which should be granted in respect of the breach of the PSED (paragraph 117). I have been shown the formal order in which the Judge granted declaratory relief but not a quashing order. But I have not been provided with a copy of the submissions made to the Judge on this aspect or the reasons he gave for his decision and so I cannot treat Cushnie as an authority to support the Defendant’s submission. However, I note that during 2013 and 2014 amendments to the regulations were under consideration and the Department had indicated that the issue of whether the provision under challenge should be widened in scope, and thus potentially meet the Claimant’s concern, would be considered (paragraphs 107 - 108). Therefore, it is quite possible that that indication, which may have been reinforced in the submissions which followed the judgment, explains why only declaratory relief was granted in that particular case.

On 10 July 2015 the Treasury Solicitor sent to the Court a copy of the decision of the Divisional Court in R (on the application of Hottak and AL) v Secretaries of State for Foreign and Commonwealth Affairs and for Defence [2015] EWHC 1953 (Admin) handed down on 8 July. My attention was drawn in particular to paragraphs 61 and 62 dealing with the exercise of the Court’s discretion where a breach of the PSED had occurred, but no specific submissions were made as to how the decision might assist in the resolution of the issues in the present case.

The challenge in Hottak and AL was to the Government’s “Afghan Scheme” for the provision of protection and benefits to certain Afghan nationals who had worked for the Government. The Scheme comprised an Intimidation Policy and a Redundancy Policy. It was mainly challenged on discrimination grounds by reference to nationality, on the basis that the similar “Iraq scheme” had been more generous (paragraph 1). The Redundancy Policy under the Afghan Scheme contained financial options (which included training or education plus support) and, for certain persons who had engaged in the most dangerous tasks, the possibility of relocation to the UK (paragraph 12). The Court found that the financial benefits were in fact more generous under the Afghan Scheme than the Iraq scheme (paragraph 18). In the main part of its judgment the Court decided that the territorial reach of the discrimination provisions relied upon did not cover the claimants’ circumstances (paragraphs 26 – 49). The Court then rejected a common law discrimination argument which related to the less advantageous relocation policy under the Afghan scheme, holding that the differences between the two schemes did not involve either direct or indirect discrimination on grounds of nationality, but had been justified because of material differences in the levels of risk and the circumstances of employees in the two countries (paragraphs 50 – 56).

The PSED was very much a residual ground of challenge in Hottak and AL. The Court held that the duty did not touch on the Intimidation Policy at all. Because of the Court’s earlier conclusions, the discrimination provisions in section 149(1)(a) were not engaged, and in relation to the requirements of section 149(1)(b) and (c), only the relocation aspect of the Redundancy Policy was in issue. In that respect the Court concluded that the equality analysis carried out after the challenge had been brought would have satisfied the PSED if it had been carried out at the time when the policy was developed (paragraph 61). Although there had been a failure to comply with the PSED at the time of developing and promulgating the Afghan Scheme, the Court decided that it would be inappropriate to quash the Scheme because of the adverse impact upon those who would wish to take advantage of the Intimidation Policy or the training package with financial support. Moreover, given the Court’s conclusions on the equality analysis subsequently carried out, a quashing order was unnecessary and no practical purpose would be served by requiring a fresh analysis to be carried out limited to those aspects which should have been covered at the outset. It was for those reasons that the Court decided to grant only declaratory relief (paragraph 62). Thus, the Court’s decision on relief was highly sensitive to the facts of that case, not least the limited scope of the PSED assessment which had needed to be dealt with. In the present case it is common ground that the PSED was engaged in relation to the whole of the policy changes introduced in November 2014. For the purposes of resolving the issues in the present case, the decision in Hottak and AL adds little if anything to BAPIO and Cushnie.

Mr. Forsdick QC relied upon R (C (a minor)) v Secretary of State for Justice [2009] QB 657 which dealt with a challenge to rules made by delegated legislation as to the circumstances in which physical restraint of trainees in a secure training centre could be used. The Court of Appeal held that the Divisional Court had been wrong in refusing to quash rules which it had found to be unlawful for failure to comply with a duty similar to the PSED, notwithstanding a subsequent undertaking to carry out an EqIA following its judgment (paragraphs 48 – 49). The Court of Appeal did not doubt the good faith of officials who had carried out the subsequent assessment, but held that it was wrong in principle that an assessment which ought to have been carried out in order to inform the minds of government before taking a decision to alter the rules should only be produced subsequently in an attempt to validate a decision that had already been taken. The Court of Appeal then went on to decide that although the assessment had been produced before the appeal was heard, it should quash the rules. The Court described the breach of the duty as a procedural defect of “very great substantial, and not merely technical, importance” such that it should be marked by an appropriate order.

The Court of Appeal treated BAPIO as a case where the mistake had been realised and corrected before the matter came to court (paragraph 54). In BAPIO it does not appear that the assessment was carried out in response to a challenge raised by a potential claimant. The Home Office appears to have carried out the subsequent assessment of its own volition (see paragraphs 67 – 68). However, in the present case, the Defendant accepts that the assessment was carried out in response to the ground of challenge advanced by Islington LBC (see paragraphs 57 – 59 of Ms. Everton’s first witness statement). Furthermore, it should be recalled that in BAPIO there was no legal challenge to the EqIA subsequently carried out.

In my judgment the exercise of discretion in Hottak and AL, Cushnie, and BAPIO (at first instance) need to be seen in the context of the fundamental and well-established principle that there must be compliance with the PSED before the decision in question is taken because that process is meant to inform and influence the decision (see Elias; Kaur and Shah; BAPIO per Sedley LJ; and R (Brown) v Secretary of State for Work and Pensions [2008] EWHC 3158 (Admin) per Aikens LJ at paragraph 91). This principle has been applied to the formulation of a proposed policy and to the assessment of its merits before final adoption. The principle is all the more important where the decision involves the adoption of a national policy or delegated legislation with widespread effects. Where a decision-maker purports to carry out an assessment applying the requirements of the PSED after having taken his decision, the Court may withhold a quashing order in the exercise of its discretion. Where a subsequent assessment is unchallenged, or any legal challenge to it is rejected by the Court, it may be possible for the Court to conclude that the prior decision would inevitably, and not merely probably, have been the same if the necessary assessment had been carried out at the correct time and so refuse a quashing order of that decision (R (Smith) v North Eastern Derbyshire PCT [2006] 1 WLR 3315 paragraph 10).

Mr. Drabble QC submitted that having carried out an EqIA in January 2015 the Secretary of State was entitled to decide whether or not to maintain the policy changes he had introduced in November 2014 in the light of that assessment. He suggested that the legitimacy of the Defendant’s decision depends upon what alternatives there would have been. To suggest that he should have withdrawn his policy and then, after having carried out an EqIA, could have promulgated the same policy again would be entirely artificial. Accordingly the true question is whether the assessment and decision to maintain the policy were carried out in good faith.

I am unable to accept that merely to exclude bad faith in the Defendant’s subsequent decision to maintain his earlier adoption of a new policy goes far enough. As Mr. Drabble QC acknowledged, that approach could often be relied upon where there has been a failure to comply with the PSED before taking a decision or promulgating a new policy. I agree with Mr. Forsdick QC that the result would be to subvert Parliament’s requirement that the PSED objectives should inform the making of the original decision. Such decision-making includes the formulation and adoption of policy. There is a substantial difference between the process of reaching a decision having started with a blank sheet of paper and the validation of a decision already taken. This is the very point emphasised by the Court of Appeal in R (on the application of C) v Secretary of Justice. Furthermore, compliance with the PSED requires the decision-maker to perform the assessment with rigour and with an open mind (see Bracking below). Satisfying those requirements will often be more difficult where a decision-maker has carried out a consultation exercise and has already determined the final content of his policy after having received the responses of consultees and considered pros and cons.

There is some similarity between the present situation and one where a decision-maker who has failed to comply with a duty to give reasons for his decision subsequently seeks to supply additional reasons, typically when an omission has been raised by one of the parties. A greater degree of caution and possibly also scrutiny is likely to be required in such cases (see by analogy R (on the application of Nash) v Chelsea College of Art and Design [2001] EWHC 538 (Admin) at paragraphs 34 – 35).

I now turn to the relevant principles for determining whether there has been compliance with the PSED. Both parties accepted the summary given by McCombe LJ in Bracking v Secretary of State for Work and Pensions [2013] EWCA Civ 1345, [2014] Eq LR 60 at paragraph 26:

“(1)

As stated by Arden LJ in R (Elias) v Secretary of State for Defence [2006] 1 WLR 3213; [2006] EWCA Civ 1293 at [274], equality duties are an integral and important part of the mechanisms for ensuring the fulfilment of the aims of anti-discrimination legislation.

(2)

An important evidential element in the demonstration of the discharge of the duty is the recording of the steps taken by the decision maker in seeking to meet the statutory requirements: R (BAPIO Action Ltd) v Secretary of State for the Home Department [2007] EWHC 199 (QB) (Stanley Burnton J as he then was)).

(3)

The relevant duty is upon the Minister or other decision maker personally. What matters is what he or she took into account and what he or she knew. Thus, the Minister or decision maker cannot be taken to know what his or her officials know or what may have been in the minds of officials in proffering their advice: R (National Association of Health Stores) v Department of Health [2005] EWCA Civ 154 at [26–27] per Sedley LJ.

(4)

A Minister must assess the risk and extent of any adverse impact and the ways in which such risk may be eliminated before the adoption of a proposed policy and not merely as a ‘rearguard action’, following a concluded decision: per Moses LJ, sitting as a Judge of the Administrative Court, in Kaur & Shah v LB Ealing [2008] EWHC 2062 (Admin) at [23–24].

(5)

These and other points were reviewed by Aikens LJ, giving the judgment of the Divisional Court, in R (Brown) v Secretary of State for Work and Pensions [2008] EWHC 3158 (Admin), as follows:

i)

The public authority decision maker must be aware of the duty to have ‘due regard’ to the relevant matters;

ii)

The duty must be fulfilled before and at the time when a particular policy is being considered;

iii)

The duty must be ‘exercised in substance, with rigour, and with an open mind’. It is not a question of ‘ticking boxes’; while there is no duty to make express reference to the regard paid to the relevant duty, reference to it and to the relevant criteria reduces the scope for argument;

iv)

The duty is non-delegable; and

v)

Is a continuing one.

vi)

It is good practice for a decision maker to keep records demonstrating consideration of the duty.

(6)

‘[G]eneral regard to issues of equality is not the same as having specific regard, by way of conscious approach to the statutory criteria.’ (per Davis J (as he then was) in R (Meany) v Harlow DC [2009] EWHC 559 (Admin) at [84], approved in this court in R (Bailey) v Brent LBC [2011] EWCA Civ 1586 at [74–75].)

(7)

Officials reporting to or advising Ministers/other public authority decision makers, on matters material to the discharge of the duty, must not merely tell the Minister/decision maker what he/she wants to hear but they have to be ‘rigorous in both enquiring and reporting to them’: R (Domb) v Hammersmith & Fulham LBC [2009] EWCA Civ 941 at [79] per Sedley LJ.

(8)

Finally, and with respect, it is I think, helpful to recall passages from the judgment of my Lord, Elias LJ in R (Hurley & Moore) v Secretary of State for Business, Innovation and Skills [2012] EWHC 201 (Admin) (Divisional Court) as follows:

(i)

At paragraphs [77–78]

‘[77] Contrary to a submission advanced by Ms. Mountfield, I do not accept that this means that it is for the court to determine whether appropriate weight has been given to the duty. Provided the court is satisfied that there is a proper appreciation of the potential impact of the decision on equality objectives and the desirability of promoting them, then as Dyson LJ in Baker (para [34]) made clear it is for the decision maker to decide how much weight should be given to the various factors informing the decision.

[78] The concept of “due regard” requires the court to ensure that there has been a proper and conscientious focus on the statutory criteria, but if that is done, the court cannot interfere with the decision simply because it would have given greater weight to the equality implications of the decision than did the decision maker. In short, the decision maker must be clear precisely what the equality implications are when he puts them in the balance, and he must recognise the desirability of achieving them, but ultimately it is for him to decide what weight they should be given in the light of all relevant factors. If Ms. Mountfield's submissions on this point were correct, it would allow unelected judges to review on substantive merits grounds almost all aspects of public decision making.’

(ii)

At paragraphs [89–90]

‘[89] It is also alleged that the PSED in this case involves a duty of inquiry. The submission is that the combination of the principles in Secretary of State for Education and Science v Tameside Metropolitan Borough Council [1977] AC 1014 and the duty of due regard under the statute requires public authorities to be properly informed before taking a decision. If the relevant material is not available, there will be a duty to acquire it and this will frequently mean that some further consultation with appropriate groups is required. Ms. Mountfield referred to the following passage from the judgment of Aikens LJ in Brown (para [85]):

“… the public authority concerned will, in our view, have to have due regard to the need to take steps to gather relevant information in order that it can properly take steps to take into account disabled persons' disabilities in the context of the particular function under consideration.”

[90] I respectfully agree ……’”

The main points in the Equality Statement of 5 February 2015 (which I note was signed off by Ms. Everton) may be summarised as follows:-

In considering ground 4 it is necessary to keep in mind the principle that it is not for the Court to determine whether appropriate weight has been given to the PSED or the matters taken into account. However, in this case I have come to the conclusion that the exercise carried out in January 2015, as explained in the Equality Statement dated 5^th February 2015 (which is the only evidence before the Court about the assessment) did not comply with the requirements of section 149 of the 2010 Act because:-

I reach these conclusions for a number of reasons, both singly and in combination, which I summarise as follows:-

Mr. Drabble QC sought to meet these points firstly, by arguing that the purpose of the Government’s policy is to increase the supply of affordable housing overall and secondly, the weight to be attached to the reduction in affordable housing should be viewed in the context of a national programme for a high level of provision. There are at least three flaws with that line of argument.

For the reasons set out above, the Equality Statement of 5 February 2015 cannot be treated as satisfying the PSED and ground 4 must be upheld. The appropriate remedy is a quashing order rather than the mere grant of declaratory relief.

Ground 5 –Irrationality

At this stage in my analysis of the challenge, I do not consider that the arguments pursued under the heading of irrationality added anything of substance to the grounds which I have already accepted in relation to the new affordable housing thresholds.

Social Infrastructure contributions or Tariff-based contributions

The national policy introduced on 28 November 2014 applies the same thresholds to social infrastructure contributions (otherwise referred to as tariff-based contributions) as for affordable housing contributions. This exemption from local plan requirements was first proposed by Ministers after 24 January 2014 as a reaction to a draft consultation document prepared by officials in which it had not featured at all (see paragraphs 37 - 39 of Ms. Everton’s first witness statement). As I have noted in paragraph 63 above, there is no evidence that either Ministers or the Department obtained any information to justify the need for this additional exemption.

Paragraph 28 of the Consultation Paper published in March 2014 reveals the flawed basis upon which this further exemption was conceived. First, it was pointed out that the CIL Regulations had been amended so as to exempt self-build development, extensions and annexes and that it would be inconsistent if the same approach were not to be taken in areas which had yet to adopt CIL charging. That reasoning reinforces the point already made in relation to the new affordable housing policy, that Ministers were intending to create exemptions from local plan requirements. That is also supported by the language of Question 6, namely “Should the proposed exemption apply beyond affordable housing to other tariff style contributions based on standard formulae?”

Paragraph 28 then continued as follows:-

“Moreover, the fact that the Community Infrastructure Levy is not levied on self-build provides a strong argument for not levying any tariff-style contributions via Section 106 mechanisms either, given the desire of the Government to reduce burdens on self-builders.”

In any event, the Equality Statement produced on 5 February 2015 reveals an internal inconsistency in the stance taken by the Defendant. When dealing with the exemption from tariff-based contributions, the Statement concluded that there should not be an impact on persons with protected characteristics because LPAs would be able to substitute CIL charges for tariff-based contributions to social infrastructure. That was correct but only because small developments other than self-builds, extensions and annexes are not exempted by the legislation from CIL charges. In other words, the effect of the Defendant’s assessment in February 2015 of this change was that it produces no benefit for much, if not most, small-scale development; the effect is self-cancelling. Neither the Consultation document in March 2014 nor the Government’s Response in November 2014 showed any appreciation of this outcome, which was an “obviously material” consideration. Paragraphs 42 and 43 of Ms. Everton’s first witness statement also show that this point was not understood by Ministers or within the Department because they suggest that the exemption from tariff-style contributions was introduced in order to reduce “the burden of charges for small scale development” and not just self-build development, extensions and annexes. The failure in November 2014 to take into account the nugatory effect of this part of the national policy is a further ground upon which the challenge succeeds.

In addition, the challenge to the policy exemption from local tariff-based contributions succeeds for the reasons given under grounds 2 and 3 above.

Vacant Building Credit

This measure was suggested by Minsters, against the advice of officials, in about December 2013, just before the exemption from tariff-style contributions was suggested (see paragraph 62 above). For the reasons already given under ground 4 above, the challenge in respect of this part of the policy must succeed. I should reiterate that before the decision to adopt the vacant building measure was made, no consideration was given to the lack of information on the impact of this policy change, notwithstanding the advice given by officials that this was necessary. In addition, the challenge must succeed for the reasons given under grounds 1, 2 and 3.

Conclusions

For all the reasons set out above, both separately and cumulatively, the challenge to the national policy changes introduced in November 2014 in respect of affordable housing and social infrastructure contributions and the vacant building credit succeeds. Accordingly, I grant permission to apply for judicial review in respect of these matters.

There remains the question of what relief should be granted. I have already indicated in relation to the failure to comply with the PSED, ground 4, that the Claimant’s are entitled in principle to a quashing order, rather than merely declaratory relief. The same remedy is also justified in relation to grounds 1, 2 and 3, subject to one point.

The policy the subject of this challenge was promulgated by a Written Ministerial Statement, which was repeated and elaborated in alterations to the NPPG. In a dictum in the Cala Homes case Sullivan LJ, relying upon paragraphs 30-50 of the judgment of Stanley Burnton J (as he then was) in the Office of Government Commerce v Information Commissioner [2010] QB 98, said that a quashing order in respect of the Secretary of State’s statement to Parliament “would have been out of the question” ([2011] EWCA Civ 639, [2011] JPL 1458 paragraph 29). That referred to a statement announcing that the Government’s intention to abolish regional strategies in the Localism Bill should be treated as a material consideration in planning decisions.

The dictum by Sullivan LJ stems from Article 9 of the Bill of Rights 1689, as interpreted in decisions such as Prebble v Television New Zealand Ltd [1995] 1 AC 321, 332 and 337; Hamilton v Al Fayed [2011] 1 AC 395; R (Bradley) v Secretary of State for Work and Pensions [2009] QB 114 and R (Federation of Tour Operators) v HM Treasury [2008] STC 547. I note that this point has not been raised by the parties in the present proceedings. In any event, it would not appear, subject to submissions, that Parliamentary privilege would prevent the making of a quashing order in respect of (i) relevant parts of the NPPG, (ii) the Defendant’s decision to adopt the new policy by way of Written Ministerial Statement and (iii) the Defendant’s decision on 10 February 2015 to maintain his decision in (ii). Nor would it prevent the grant of a declaration by the Court that the policies in the Written Ministerial Statement must not be treated as a material consideration in development management and development plan procedures and decisions or in the exercise of powers and duties under the Planning Acts more generally.

As to article 9, the main issue is whether an order to quash the Written Ministerial Statement would involve any questioning of “proceedings in Parliament”. The law of Parliamentary privilege is based upon two broad principles, first, the need to avoid any risk of interference with free speech in Parliament and second, the separation of functions between the legislature, the executive and the courts (see e.g. paragraph 46 of the OGC case). But challenges have been made by judicial review to Written Ministerial Statements announcing policies, apparently without any objection based on Parliamentary privilege being raised (see e.g. Re Findlay [1985] AC 318; R v Home Secretary ex parte Pierson [1998] AC 539; R v Home Secretary ex parte Venables [1998] AC 407; R v Home Secretary ex parte Hindley [2001] 1 AC 410; R v Home Secretary ex parte Brind [1991] 1 AC 696). It has also been said that Parliamentary privilege is not intended to “ring fence” policy statements from judicial review (see e.g. paragraphs 46 to 59 of the First Report of the Joint Committee on Parliamentary Privilege - April 1999).

Accordingly, on 23 July 2015 the judgment was made available to the parties in draft form in the usual way and I invited them to agree the terms of the order to be made by the Court or, in the event of disagreement, to make submissions on what should be done.

In written submissions sent on 28 July the Claimants asked that the policy in the Written Ministerial Statement be quashed. The Defendant, however, submitted for the first time that a quashing order of the Written Ministerial Statement would be inappropriate because it would infringe Article 9 of the Bill of Rights, simply because the statement had been made in Parliament. The Defendant merely cross-referred to the case law to which I had drawn attention in paragraphs 210 to 211 above, but without any analysis or submissions to support his stance. It was not clear whether the reference I had given to the Joint Select Committee has been followed up, in order to see whether that expresses the view taken by Parliament.

I asked the parties for submissions on how the issue should be dealt with. On 29 July the Defendant suggested that the proposed quashing order of the Written Ministerial Statement raised serious issues of constitutional significance, now requiring input from lawyers in the Cabinet Office (who might wish to instruct separate Counsel to make submissions). It was also said that the Office of the Speaker of the House of Commons should be informed, in case he would wish to make submissions through Counsel. Consequently it was suggested that that aspect of the relief to be granted would need to be held over until late September at the earliest, although all other relief could be granted forthwith. In an email dated 29 September the Defendant also said that until the draft judgment was sent out it had not been “clear … that there would be any issue about the quashing the Written Ministerial Statement”. Given that it was plain in the original claim form that that was indeed the relief being sought by the Claimants, the email must have been accepting that the Defendant had not previously considered or appreciated that the relief sought gave rise to any constitutional problem. If so, that would appear to accord with a widely-held view. Plainly, if issues were to be raised about the constitutional propriety of quashing a statement of this kind, then the relevant submissions ought to have been made during the substantive hearing of the claim, and any other parties wishing to intervene ought to have been given an opportunity to do so then. It is most unfortunate that an unsubstantiated objection to the grant of this relief should have been raised in this way in response to the draft judgment. The Claimants faced the prospect of incurring more costs in dealing with the matter by way of written submissions and at a further hearing.

Fortunately, the parties have confirmed that they agree that the Court can properly grant the relief summarised in paragraph 211 above without giving rise to any issues under Article 9 of the Bill of Rights or needing to involve other parties at this late stage. The Claimants have also stated that, upon reflection, the declaration I propose to grant provides them with sufficient relief in relation to the unlawfulness of the policy promulgated by means of the Written Ministerial Statement and that they do not need to ask the Court to consider quashing the Statement itself. Therefore, the interesting issues posed by the recent objection from the Defendant will have to await another case.