Agenda item

To determine the application

David Rowen presented the report to members.

Members received a presentation, in accordance with the public participation procedure, from Chris Dwan, the agent. Mr Dwan stated that he is the Planning Director for Allison Homes and made the point that in August the Committee resolved to grant planning permission. He explained that since that time it has become apparent that there are now financial implications due to rising costs of materials and also due to the delivery of the spine road, there is a difference in ground conditions across the site and more onerous foundation design requirements for much of Phase 3 and through Phase 4 to ensure that there is an acceptable stability within the road.

Mr Dwan stated that due to these issues he has had to reluctantly come back with the viability case which has been independently vetted by officers and agreed with. He stated that an agreed position has been reached on the overall position of affordable housing and an overall quantum of financial contributions from which officers can decide how that would be split. He stated that he would welcome the committee’s support to complete the overall development and stated that he is sorry that this situation has arisen, but it is only out of necessity that this route now needs to be followed. 

Members asked questions of Mr Dwan as follows:

·         Councillor Mrs Davis referred to the comment that Mr Dwan had made concerning the unforeseen issues with the land and asked him whether the land had been surveyed? Mr Dwan stated that the land was surveyed but it became apparent through the build of Phase 3 that there was an issue. He added that the original aspiration was to absorb the costs but in conjunction with the increase in build costs across the board, including materials and labour, it has become too prohibitive.

·         Councillor Sutton asked Mr Dwan to clarify that, if the committee do not agree with the proposal before them, would the build actually continue? Mr Dwan explained that there is a risk of the build not being able to continue and added that in order to get the sign off for land purchase, he needs to be able to demonstrate that there is an appropriate return and currently this cannot be proven. He stated that the set of figures which have been utilised for the viability purpose are based on current costs however build costs in the main are outstripping house price rises which means there is a degree of uncertainty which would make it very difficult to carry on. 

·         Councillor Sutton expressed the view that Allison Homes have owned the land for some time and purchased it at a reasonable price compared to land prices at the current time and he asked Mr Dwan what a like for like house would be valued at now compared to when the build was at phase 1? Mr Dwan explained that it is his understanding that the site was purchased under a delegated option which means the land was bought phase by phase and a price notice needs to be completed when you buy each individual phase and therefore the price would not be based on the land price when it was purchased a number of years ago as it would be based on the owner’s current expectation based on anticipated gross development value.

·         Councillor Connor stated that it is his understanding that in this case you buy one piece of land and then you have an option on another part of land, paying the market price. Mr Dwan stated that this is correct and then you normally include a reduction in open market value as reward for taking on the planning risk, which is the standard approach. He confirmed it is a phased purchase and Allison Homes do not own the overall site in its entirety.

·         Councillor Mrs French referred to the £1,000,000 contribution to be used for education and asked Mr Dwan whether he is likely to come back at another time and advise that this figure can no longer be afforded? Mr Dwan stated that no that would not be the case and he explained that the timeframe is sensitive as there is a continuity build and if the approval was given then the build would continue. He added that if the build had to stop then there are additional costs to be found in order to re-establish development.

·         Councillor Connor asked Mr Dwan how confident he is that the site can be built out with the new proposed viability and the £1,000,000 contribution? Mr Dwan stated that costs have been agreed by the Land Director from a planning obligation perspective and he would not have agreed the proposal if it was not achievable.

·         Councillor Marks stated that he accepts that build costs have gone up and asked, due to the oversight with regard to the issues on the spine road, what percentage would he give to the mistake, compared to that of the Covid build costs that have gone up? Mr Dwan stated that he would not be able to answer that as it is out of his area of expertise. He added that it is a cumulative thing and if it was not for the build costs then they would have done their best to absorb the other costs, but it has not been possible from a viability perspective.

·         Councillor Cornwell asked for clarity over land ownership if the development stopped now? Mr Dwan stated that it is a phased purchase, and they have the right to buy. Councillor Cornwell stated that if the proposal was not approved by the committee and the building stopped, the pressure would be put onto the landowner as they would not be able to complete the deal. Councillor Cornwell added that, in his view, the Council has more to lose than by carrying on. Mr Dwan stated that there would be a loss of 130 homes from the Councils five-year land supply and Councillor Cornwell stated that is not a guarantee as the Council does not know what would happen with another developer should that be the case. Mr Dwan stated that the costs that have been put forward are without any establishment costs and infrastructure costs and if the land went to the market now those costs would have to be added on top.

Members asked officers the following questions:

·         Councillor Mrs French stated that she has noticed on the Section 106, the £1,000,000 allocated, which is broken down for various schools. She expressed the opinion that this concerns her as over many years developers have had to pay millions of pounds to education and Cambridgeshire County Council have a statutory duty to build schools and, in her view, developers do not have the right to contribute, but she does not think that they should not contribute. Councillor Mrs French stated that she is concerned that over time, the County Council have had the money but not spent it on school placements and she asked if officers can provide her with information on how much money has been allocated to education over the past five years and how much has actually been spent. She added there is the need for a new Special Education Needs facility in the Fenland area which ,was highlighted at a recent County Council meeting she had attended, however, it would appear that there are no plans to build such facilities in the Fenland area and any additional facilities would be built in the south. Councillor Mrs French expressed the view that if Fenland are contributing towards these facilities but not getting them then, in her opinion, she feels that education should not be receiving a contribution at all. David Rowen stated that with regard to education and as part of the original consultation on the application in August, within page 53 of the agenda pack, it details the comments from the County Council and the science behind their request for contributions. He added that with regard to the request that the County Council make in terms of contributions and what they actually get due to viability are two separate things. David Rowen highlighted that in August, when the viability situation was different there was just under £1.5 million pounds for education as part of the agreed Section 106 agreement, although that figure is now reduced to £1 million.

·         Councillor Mrs French expressed the view that she has no problem with education receiving some contribution, however, she would rather see the contribution going towards affordable housing.

·         Councillor Mrs Davis referred to an earlier comment David Rowen made where he had stated that if the County Council did not use the £1,000,000 that was allocated, it could be brought back and used for affordable housing, and she asked him how often does that situation occur? David Rowen stated that the provision is that if the monies are not spent within eight years, which is not unheard of but fairly rare, and without further research on the data, he cannot provide an accurate figure to the committee.

·         Councillor Cornwell stated that it is pertinent that one funding element is affecting another element. He added that there is a large amount of development currently taking place in Whittlesey and he assumes that each of the major developments is contributing a fair amount of money towards the Section 106 contributions and in turn towards education. Councillor Cornwell asked than when arriving at those figures do officers consider the revenue intake that each of the developments are producing rather than just the capital sums that the schools may or may not require. He added that each development produces its own increased levels of Council Tax and that does not seem to be considered and he asked whether that is the case. David Rowen explained that it is not taken into account due to the fact that the Section 106 Agreement regulations can effectively only allow for capital projects and not revenue projects.

·         Councillor Mrs French asked for a report to be circulated to members on the value of contributions allocated across Fenland and how much of those contributions has actually been spent on education over the last five years.

·         Councillor Sutton asked whether it is possible for the committee to say to the developer that they do not want the £1,000,000 to go to education and would request that the monies make up the shortfall of the affordable housing. David Rowen stated that if that is what the committee request then it is possible.

·         Councillor Marks asked whether there is an equation that is used with regard to affordable housing and children which leads to more education places being needed? David Rowen stated that officers are guided by the formula that the County Council use when making their request to the Planning Officers, however, the detail of that formula is not something that he is familiar with. He added that, in his view, the affordable housing versus the market housing mix is factored into that. Councillor Marks asked whether that information can be obtained? David Rowen responded that there is a quantum of housing and regardless of the number of affordable units there is the scope for an impact on the demands placed on the nearby schools as identified by the County Council in their formula. 

·         Councillor Mrs Davis stated that the application has already been approved with the figure of £1.5 million already being agreed previously by the committee. She added that the committee cannot now refuse to give any contribution as the commitment of £1.5 million was already given. David Rowen stated that is correct and added that when the application was considered previously in August there was a policy compliant affordable housing contribution of 25% which is now reduced to 17.5%. He explained that whilst education has reduced accordingly, it is within the committee’s gift to say that they want 25% onsite affordable housing contribution as set out in the policy and a lower contribution towards education. David Rowen highlighted that if the committee were to decide that education was to receive nothing that it may be deemed unreasonable, given that six months ago there was a contribution secured towards education.

·         Councillor Connor stated that it is still within the committee’s gift to adjust the contribution towards education.

·         Councillor Mrs French stated that if there is the need for a contribution for education then she does not have an issue with it, but she does have concerns when money is contributed and used in the southern part of the County, when Fenland is in desperate need of a special needs education facility.

·         Councillors Sutton and Cornwell asked whether Mr Dwan could address the committee again to answer further queries from members. Councillor Connor denied the request.  

·         Councillor Cornwell stated that there are concerns from members over the number of contributions allocated and it is now for the committee to decide to what degree the allocations are adjusted by.

·         Councillor Mrs Davis pointed out that Mr Dwan had already advised the committee that he was not financially qualified to answer certain questions.

·         Councillor Connor advised members that the application can be deferred if that is their wish in order to obtain further detail.

·         David Rowen stated that the recommendation from officers is one that is felt to be a fair recommendation given the change of viability circumstances from what was previously agreed. He added that if members are looking to secure the policy compliant affordable housing contribution of 25% then the £1,000,000 financial contribution would be adjusted downwards accordingly.

·         The Legal Officer stated that members should consider the degree of discretion that the committee has when reviewing the allocation of planning obligation resource in order to assess how that applies not only in the specifics but also generally.

·         Councillor Marks asked the Legal Officer whether the committee should defer? The Legal Officer stated that there is a recommendation before the committee, and members are in a position to take a decision, although the committee cannot be forced to make a decision.

·         Councillor Sutton stated that it is very disappointing to be in the current position with this application. He made the point that when it was approved in August, he commented that it was refreshing to see that the social housing was at 25%, but does not see that the committee has any other choice than to accept in the whole the proposal which has been scrutinised by officers. Councillor Sutton expressed the view that the committee have the gift to say that the £1,000,000 goes to social housing or if it goes elsewhere. He added that with the social housing crisis in Fenland, it would warrant the committee to say that the money goes to social housing or if the Legal Officer advises otherwise then the application should be deferred for further negotiation.

Proposed by Councillor Sutton, seconded by Councillor Mrs French and agreed that theapplication beAPPROVED asper theofficer’s recommendation,subject tolegal advice being taken by officers in relation to re-allocating a proportion of the £1,000,000 education financialcontribution to affordable housing.

(Councillor Mrs Mayor registered, in accordance with Paragraph 14 of the Code of Conduct on Planning Matters, that she is a member of Whittlesey Town Council’s Planning Committee, and took no part in the discussion or voting thereon)

(Councillor Miscandlon registered, in accordance with Paragraph 14 of the Code of Conduct on Planning Matters, that he is Chairman of Whittlesey Town Council’s Planning Committee, and took no part in the discussion or voting thereon)

(Nick Harding, Head of Planning, stated that he was involved with Section 106 negotiations for this application and was approached in a private capacity by the applicant with regard to sites outside of the Fenland area, and left the meeting for the duration of the item)