In 2005, Lawley Village Developer Group (LVDG) won outline permission to build the 3,300-home “Lawley sustainable urban extension” in southwest Telford.
'Phase 10' of that project consists of 187 houses, and was approved in 2019 on condition 12.5 per cent was designated as affordable.
Telford and Wrekin’s Planning Committee voted to change this to 10 per cent in June, but officers ordered a re-take because of “incorrect information” in the report, and at the follow-up meeting in August told members the proposed allocation was in fact zero.
Members voted for a deferral so details of the applicant’s “viability appraisal”, which set out its case for the reduction, could be clarified. The committee will meet again on Wednesday, September 22.
Under Section 106 of the Town and Country Planning Act, developers can make contracts with councils during the planning process, promising to fund facilities, make repairs or provide affordable housing if their projects are approved.
The agreement to allocate the 23 homes on phase 10, between Station Road and the B5072, was made this way.
In a report for the committee, officers note that the LVDG is applying for a “deed of variation” to change the deal, and recommend approval.
At the June and August committee meetings, many members expressed reluctance to approve the bid.
In reports, planning officers said LVDG was requesting the reduction “as a result of the market downturn from 2008” and its effect on property value.
Committee legal advisor Ian Ross said LVDG would probably appeal if members refused the application.
As its case was backed by an “independently-appraised viability report”, the Planning Inspectorate was likely to side with it, leaving the council will “great difficulty” defending the refusal and liable for costs if it lost, he added.
Committee member Peter Scott said it felt like the committee was “being put to ransom” while colleague Nigel Dugmore said it was “just becoming a rubber-stamp committee”.
The report for next week’s meeting says members specifically asked to learn more about “whether the abnormal costs for phase 10 had been included in previous VAs [viability appraisals] for other parts of the Lawley SUE and, if they had, whether apportioning them now to phase 10 alone would amount to an exaggeration of the abnormal costs associated with phase 10”.
Officers write that the council’s own consultant studied LVDG’s appraisal and confirmed the figures in it “were fair and commensurate with those across the industry”.
They add: “Since the August committee meeting, the consultant has confirmed that the contingency has not been double-counted in the appraisal.
“There is no material cost saving to be made in this area.”
They add that the LVDG’s predicted deficit of just over £447,000 would “need to be materially improved” to warrant any change in the decision. They say assessments have revealed a potential saving of just £10,872 “which would not, in itself, represent a materially different saving to warrant reviewing the VA”.
They add that refusing the application would “leave an unsupervised and closed construction site in the SUE”, leaving a potentially hazardous eyesore, and delay the completion of the overall project.
Officers add that the LVDG is in discussion with the Wrekin Housing Group to build 19 affordable homes on the phase 10 site outside of the planning process, but can only apply for the necessary Homes England grant funding once the Section 106 obligation is removed.