McCarthy and Stone Retirement Lifestyles Ltd & Ors, R (on the application of) v Greater London Authority

Supplementary planning guidance may explain and supplement development-plan policy, but it cannot contradict that policy or operate as an unrestricted substitute for the statutory plan-making process. Whether guidance is truly policy is a matter for the court, although the statutory framework may leave substantial room for the plan-maker’s judgment about the appropriate level of detail.

A viability-review requirement must remain within the scope of the development-plan policy it supplements. A requirement for reviews on every qualifying site, regardless of the time likely to be taken to complete development, was inconsistent with the London Plan. The absence of a separate equality impact assessment does not itself establish breach of the public sector equality duty, and due regard does not require an encyclopaedic examination of indirect effects.

The claimants, developers of specialist housing for elderly purchasers, challenged the Mayor of London’s Homes for Londoners: Affordable Housing and Viability Supplementary Guidance 2017. They argued that the guidance was unlawful because it contained policy which should have been included in the statutory London Plan, was inconsistent with that Plan, required strategic environmental assessment, and was issued without due regard to the public sector equality duty.

The claim was heard as a rolled-up judicial review hearing after permission had been refused on paper. The central issues were whether the guidance’s threshold and viability-review provisions were lawful, whether the environmental-assessment and equality duties had been complied with, and whether relief should be refused for delay.

1. Ground 1 succeeded in part. The 35 per cent threshold and associated fast-track and viability-tested routes were, at least for the time being, policies, particularly because the Mayor had included the approach in draft policy H6. However, even if the guidance was policy when issued, its production was not thereby unlawful. The statutory framework did not prohibit producing policy in advance of a plan review, absent an attempt to evade statutory scrutiny.
2. The distinction between policy and guidance is not bright-line. The court decides the legal character of the document, but must respect the plan-maker’s judgment about the level of detail appropriate for a spatial strategy and recognise the possible role of the statutory examination inspector.
3. Supplementary guidance must supplement rather than contradict the development plan. The London Plan’s reference to contingent obligations and viability re-appraisal was not confined to phased developments. It could encompass single-phase developments likely to take many years to complete or affected by delayed commencement. The guidance’s universal requirement for early and late reviews on sites below the threshold, irrespective of actual or anticipated development duration, removed that limitation and was inconsistent with policy 3.12 and its definition of contingent obligations. It was unlawful to that extent.
4. The 35 per cent threshold itself was not inconsistent with the requirement to seek the maximum reasonable amount of affordable housing. The Mayor could use an incentive to encourage substantially greater affordable-housing provision while avoiding unnecessary viability appraisals, provided the fundamental policy aim remained intact and individual development-control authorities could adopt a different approach where appropriate.
5. The strategic environmental assessment ground was unarguable. Even if the guidance could constitute a plan or programme, the evidence showed that the Mayor would have concluded that significant environmental effects were unlikely. The outcome would not have been different, engaging Senior Courts Act 1981, s31(3C) and (3D).
6. The public sector equality duty ground also failed. Due regard may be demonstrated through evidence outside a formal equality impact assessment. It did not require consideration of every indirect financing consequence, particularly where the alleged effect had not been raised and explained sufficiently. The Mayor had considered the relevant effects and was entitled to reject the factual basis advanced by the claimants.
7. Permission was granted on the inconsistent-guidance point. Permission was refused on the environmental-assessment and equality grounds. The court indicated that declaratory relief might be appropriate and invited submissions on remedy.

This was a first-instance judicial review in the Administrative Court. The judgment records that permission had been refused on paper by Supperstone J and that Holgate J directed a rolled-up hearing.