Must you, and can you, count past over-supply of housing against annual requirements when calculating your five-year supply? Josef Cannon analyses a recent High Court ruling.
In January 2021 a Planning Inspector granted outline planning permission for 50 new homes at the edge of a village in Tewkesbury borough. She did so on the basis that the local authority Tewkesbury BC, could not demonstrate a five-year supply of housing land, and indeed could only manage to show 1.84 years' worth.
The Council argued that it had sufficient for 4.37 years' worth, the main difference between them being the way to approach the fact that more than a thousand more homes had been delivered since the start of the plan period than the annual average 'target' suggested needed to be delivered. The Council argued that this advance delivery – or 'oversupply' - should be 'counted' against the requirement for the following five years, recognizing that these were homes in fact delivered – and needs met – ahead of time, which had a direct impact on the needs arising in the following five years.
The Inspector discounted that advance delivery from the housing land supply calculation.
The Council appealed, its primary argument being that the NPPF, read properly, impliedly required account to be taken of those homes when calculating the housing land supply position – paragraph 73 (now 74) talked of assessing the five-year supply against 'their housing requirement set out in adopted strategic policies...', which indicated that what was required was consideration of the total requirement over the plan period, rather than the annual average figure. This would require an assessment of overall progress towards that total figure, and in turn, credit to be given for housing delivered in excess of the annual average in the early years of the plan (meaning, less was to be delivered in the remaining years in order that the total requirement was met).
In Tewkesbury Borough Council v Secretary of State for Housing Communities And Local Government  EWHC 2782 (Admin) Dove J rejected that contention, finding that the NPPF is silent on the point, leaving it to decision-makers to decide on a case-by-case basis as a matter of planning judgment, how to address past over-supply. It was not for the court to 'fill in the gaps' in national policy. Nor did the PPG address the situation: it has provisions for where there has been both an over-supply and an under-supply in previous years, permitting them to be offset one against the other, but not for the general proposition that past over-supply should always be taken into account.
Finding that the Inspector had exercised her planning judgment on that issue in a way that was not irrational, and given adequate reasons for her conclusion, Dove J dismissed the claim.
Local planning authorities who have seen significant advance delivery of housing against their planned requirements in the early years of a plan period should consider how best to persuade decision-takers, in the appropriate case, to take that record of advance delivery into account when considering five-year supply. They may take some comfort from Dove J's words at paragraph 45:
"Secondly the points raised by the Claimant in relation to the objective of the policy being to meet the strategic housing requirement across the plan period and the tilted balance being introduced by the five-year housing land supply to address circumstances where planning permissions are required to improve the prospects of meeting that requirement are contentions which would undoubtedly form part of the planning judgment to be made in each particular case as to whether or not earlier oversupply should be taken into account, and if so, how."