UCLH had argued that the housing obligation and the penalty clause were a barrier to development at Cleveland Street and hoped to use provisions introduced in the 2013 Growth and Infrastructure Act to remove them.
The Growth and Infrastructure Act inserted a new Section 106BA, BB and BC into
the 1990 Town and Country Planning Act. These sections introduce a new
application and appeal procedure for the review of planning obligations on planning
permissions which relate to the provision of affordable housing.
But Camden’s planning officers dismissed UCLH’s arguments. In a delegated report officers commented that UCLH had provided no evidence that the obligation to provide affordable housing made the site economically unviable and the penalty clause allowing Camden to acquire the site is not a relevant consideration of the s106BA procedure.
UCLH’s application was widely opposed by community groups in Fitzrovia and Bloomsbury.
Camden’s officers concluded:
The Trust is seeking by this application to remove all obligations for affordable housing. They are also seeking to remove a further clause that currently enables the council to purchase the site for £1 if the obligations are not met. Whilst the Trust is seeking to consider how this obligation relates to the Cleveland Street site in isolation, this obligation relates to the consolidated UCLH planning agreement of 2004 and which secured the affordable housing obligations.
In seeking to remove entirely the affordable housing obligations, the s106BA procedure only enables affordable housing obligations to be modified if the obligation is unviable. The procedure also effectively creates an expectation that the trust should consider if there is any alternative that is viable and if so, to nominate that alternative. This has not happened. Also, in light of the activity of UCLH in the borough, delivering other aspects of the original permission, the council is left to assume that the scheme is viable. Therefore, pursuant to the s106BA clauses, the authority must determine that the affordable housing requirement is to continue to have effect without modification or replacement and refuse the application.
In regards to the £1 clause which gives the Council the right to purchase the site if the obligation is not delivered and which the trust is seeking to remove, this is a separate matter. The affordable housing obligation and whether or not it is viable, is the sole, relevant consideration of the s106BA procedure. The £1 clause is not. Nor are the other various comments made in the Trust’s case to remove the affordable housing obligation and which do not relate to viability.
The obligation has not prevented the Trust from building the main hospital, progressing with other health related uses on other sites and the sale of surplus sites. It has not stalled the development of the permitted scheme which the obligation relates. The result being that the Trust has received all the benefits of the permission and through the sale of sites which have not delivered any new affordable housing and failed to fulfil this key obligation.
As it stands, there is no viability issue evidenced by the Trust in their application, only the breach of the obligations they freely entered into. This is not a matter relevant to or resolvable by the s106BA procedure.
Instead, it should be noted that the current situation between the parties could be explored by informal discussion ahead of a deed of modification of the 2004 agreement. This is a different and separate process. This offer was made to the Trust before this application was received.
However, in the context of this s106BA application, in the absence of any evidence that the affordable housing is unviable, as well as the absence of an alternative put forward by the Trust that is, the authority must determine that the affordable housing requirement is to continue to have effect without modification or replacement and refuse the application.
UCLH have also made a similar application under the S106A procedure. Camden officers noted:
A further application (Ref: 2013/5062/P) has been submitted under S106A of the Town and Country Planning Act for modification and discharge of planning obligations of the s106 planning agreement signed July 2004. The proposed modification is again to delete clause 4 and related definitions of the planning agreement signed July 2004 to remove entirely the requirement for affordable housing obligations. This application is yet to be determined.
Other coverage of this story: Council refuses request from London hospital trust to remove s106 agreement — Out-Law.com