England and Wales High Court (Administrative Court) Decisions

IN THE HIGH COURT OF JUSTICE
QUEEN’S BENCH DIVISION
ADMINISTRATIVE COURT

		48/49 Chancery Lane London, WC2A 1JR
		15th July 2002

1. MR GEORGE BARTLETT QC: This is an application under section 288 of the Town and Country Planning Act 1990 to quash the decision of the Secretary of State dismissing an appeal against the deemed refusal by the second defendant, Basingstoke and Deane Borough Council of an application for planning permission by the claimants. Planning permission was sought for residential development comprising 290 dwellings, estate roads and footpaths, amenity open space, reserve site for recreation ground, railway station and allotments on a 13 ha site at Old Kempshott Lane on western edge of Basingstoke. An inspector appointed by the Secretary of State held an inquiry into the appeal and in his report he recommended that, subject to the sealing of a section 106 agreement, the appeal should be allowed and planning permission granted. The Secretary of State did not accept this recommendation.
2. In his report the inspector explained the policy context of the appeal:-

“8.1 Under Policy H2(xix) of the adopted Basingstoke and Deane Local Plan, the appeal site is allocated for housing. There is, therefore, a presumption in favour of the appeal proposal under S54A unless other material considerations indicate otherwise.

8.2 By virtue of this paragraph, it is therefore necessary to review that local plan allocation to assess whether it should proceed to development in the light of current national policy and local circumstances. A key aim of the new policy is to maximise housing provision on previously developed land in urban areas, and it requires a sequential approach to be taken to the allocation of land for housing. As a first step, this process necessitates an assessment of the amount of previously developed land available.”

3. The central issue in the appeal was the supply of housing land to meet the identified housing land requirements for Basingstoke. At paragraph 5 of the decision letter, the Secretary of State said:-

“5. The Secretary of State agrees with the Inspector that the main issues are as set out in IR paragraph 8.6 - that is the extent of the need for the additional housing land over that expected to emerge from previously developed sites and already committed greenfield developments, and whether, having regard to the sequential approach to the release of land for housing and the approach the council has taken to rank the appeal site behind other allocations in the adopted local plan, their position on the appeal proposal should be upheld.”

4. There was agreement between the claimant and the council, which the inspector and the Secretary of State accepted, that there was a residual housing land requirement for 4526 dwellings in the 5-year period 2001-2006. The adoption of that 5-year period was based on the guidance in PPG 3. The difference between the parties at the inquiry lay in their respective assessments of the housing land supply over the 5-year period. At the inquiry the assessments made by the claimant and the council of the amount of housing land that could be expected to emerge from previously developed sites and already committed greenfield developments were the subject of detailed consideration. The inspector expressed his conclusions on the differences between them. He differed from the council in respect of four of the sites that were considered. It is in relation to his conclusions on these four sites, and the way in which these conclusions are dealt with in the decision letter, that the decision of the Secretary of State is now challenged.
5. The sites considered fell into three categories – major greenfield sites with planning permission (“committed sites”), sites on previously developed land referred to in the council’s urban capacity study (“brownfield sites”) and other greenfield sites (“other sites”). The council had divided the other sites into two groups – Group 1 sites, which, they said, rounded off settlements, and Group 2 sites, which they described as uncommitted sites. Neither the claimant nor the inspector accepted that it was appropriate to classify the other sites in this way. The council had put the appeal site in Group 2, but nothing for the purposes of the present application turns on whether they were right to do so or whether their sub-division of the other sites was appropriate. Of the four sites that are relevant for present purposes, one, Park Prewett, fell in the category of committed sites. The claimant’s assessment of the contribution that this site would make over the 5-year period was 500. The council said 900. Secondly, in the category of brownfield sites, the parties differed about a site called Down West Yard. The claimants said it would produce 200 dwellings, the council said 400. The other two sites in respect of which there was a significant difference were in the category of other sites. On North Binfields the claimant’s figure was 200, the council’s 330. On the Taylor’s Farm (remainder) site, the claimant said nil, the council 100.
6. In his report, the inspector addressed himself to these differences. At paragraphs 8.9-8.10 he said:

“8.9 The only remaining difference between the parties on major greenfield sites with planning permission concerns the Park Prewett site. This difference is 500 dwellings (BSC5) not 400 as shown in BD12. The position on this large site is that the next phase to come forward will be the Core Area, which includes a neighbourhood centre. The developer and the Council have agreed terms on the necessary S106 and this is with the landowner for sealing. It thus seems that the most difficult and time-consuming aspect of the pre-construction phase is nearly complete. Marketing of the site has also started.

8.10 Even so housing completions do not seem likely in my view to emerge until next year at the earliest. The Council’s estimate of 900 dwellings represents a completion rate of some 225 units per year over the four years then remaining before 2006. However, on the basis that completions to date on the earlier phases of this site have averaged about 70 a year, I do not think that this supply estimate is realistic. While an accelerated build rate could be adopted, the past performance on this site does not give any reason to be confident that a build rate of 225 units a year is likely. I find it difficult to see more than about 125 completions per year arising. Therefore, while I think the Barratt’s final estimate of 400 dwellings from this site might be more likely, for present purposes I adopt a figure of 500 units as representing the upper limit of what appears to be practicable.”

7. Mr Christopher Katkowski QC for the claimant points out that there were two reasons for the inspector coming to the figure of 500 rather than the claimant’s 400 or the council’s 900. The first was that housing completions did not seem likely to emerge until the following year (2002) and the second was the build rate that he thought it appropriate to assume.
8. The inspector’s conclusions on the Down West Yard site were contained in the following paragraphs –

“8.11 The next area of contention concerns sites identified in the Urban Capacity Study. BD12 indicates a difference of 215 units between the parties. Barratt do not now contest a 15 dwelling contribution from the Upton Crescent site, but there remains a 200 unit difference between the sides on the Down West Yard site. The developer of this site is discussing a 460 flat scheme with the Council which he envisages completing over a period of 50 months. If he gains permission in a few months time as he envisages, then 400 units might be achievable by 2006.

8.12 However, the site is the former railway yard and there are many consultees with an involvement. Notwithstanding the Council’s accelerated procedure for negotiating and agreeing S106 agreements, there is no certainty that any obligation needed will be agreed without a hitch. I therefore doubt that as many as 400 dwellings would come forward in the timescale. I judge that around 350 is the most that is likely in practice. On the basis of these two adjustments, I settle on a range of 989-1009 units as being the number of dwellings likely to arise from the identified urban capacity sites category in BD12.”

9. Thus the inspector took the figure of 350 rather than the council’s 400 to reflect the delay in starting the development arising from the need to complete a section 106 agreement.
10. On North Binfields the inspector said:-

“8.18 The North Binfields site is expected by the Council and the County Council to generate some 312 - 330 dwellings over the five year period. The site does not yet have a planning permission, although once the Section 106 is signed this should be a formality given the Council’s resolution to grant permission subject to that agreement. Nevertheless only the first phase site is being marketed, and as yet there is no developer. Housing completions are not therefore going to start coming forward as early as expected by the County Council (CD 30 and BD9). Based on these considerations I consider the estimate that 330 dwellings will be available by 2006 is unrealistic. My view is that no more than about 250 are likely to be built over the five-year period.”

11. Thus the inspector took the figure of 250 rather than the council’s 330 because he thought that house completion would not start coming forward as early as the county council assumed.
12. On Taylor’s Farm (remainder) the inspector said:-

“8.19 The Taylor’s Farm (remainder) site is assessed by the Council to produce a 100 dwellings over the five-year period. However, the site is land locked. Given also that the developer of the surrounding land tends to develop his sites himself and does not sell parts on to other developers, it seems probable that the remainder site will be developed by the same developer. Neither is it likely that the remainder site will be opened up until the developer is well on with the major part of the Taylor’s Farm site. In BD5, the developer envisages producing 100-120 dwellings a year from mind-2002. I have no reason to doubt that this estimate is reasonable but I consider it should apply to the two sites together. Taking an average of 110 dwellings a year, I therefore adopt a figure of 440 dwellings as the likely contribution from this site over the five-year period. Attributing these to the permitted main Taylor’s Farm site, no completions should be attributed to the remainder (Group 1) site.”

13. Thus the inspector considered that no completion should be attributed to this site because development would not begin upon it until the developer was well on with the major part of the Taylor’s Farm site.
14. Overall the inspector’s calculations showed a shortfall of nearly 600 dwellings in relation to the 5-year 4526 residual requirement. He therefore concluded that at least one more greenfield site would “have to be released for development even if the baseline housing requirement for Basingstoke district set out in the Structure Plan” was to be met. Having identified this requirement, he went on to consider, taking account of PPG 3 and the sequential approach and agricultural land quality considerations, whether the appeal site should be released for development. He concluded that it should. He said at paragraph 8.28:-

“8.28 … The appeal site meets all the criteria of paragraph 31 of PPG3. There is no firm indication that it might not be needed for housing later in any event. Accordingly, if the Government’s objective of providing sufficient housing to meet structure plan derived housing requirements for the next five years is to be met, then on the evidence presented, I see no alternative to the release of the appeal site in accordance with its allocation in the adopted local plan.”

15. Both the parties and the inspector had considered the individual sites and had dealt in numerical terms with the contending assessments of completions that could be expected from them in the 5-year period. By contrast, in addressing himself to the inspector’s conclusions on these matters, the Secretary of State dealt with the question of land supply in more general terms. The relevant parts of his decision letter are these:-

“8. The Inspector has concluded that a shortfall in housing land supply exists (IR8.20) but not to the extent of the applicants case. In respect of the Council’s estimate he considers that they have assumed unrealistic delivery rates on a number of greenfield sites including the Park Prewett site (IR 8.10). He considers that the past completion rates in the district demonstrate that development of this site will not achieve the number of dwellings which have been estimated by the Council. For this reason, and because of other adjustments made by the Inspector to the Council’s calculations, he concludes that the shortfall against the residual requirement indicates that at least one more greenfield site than planned by the Council will have to be released (IR8.20)

9. The Secretary of State does not disagree, after taking into account the Council’s urban capacity study, greenfield sites which already have permission and other potential sites, that there appears to be a shortfall of housing land against the structure plan baseline requirement. But he is concerned about the methods of prediction which have been employed by the parties and the Inspector, which, in his view do not reflect his policy in PPG3 Housing. The Secretary of State considers that the calculations and predictions adopted by the parties and the Inspector have relied too heavily on past completion rates to determine whether the release of further greenfield land is justified.

10. Planning Policy Guidance Note PPG3 indicates that it is an essential feature of the plan, monitor and manage approach that housing requirements and the ways in which they are to be met should be kept under regular review. Effective monitoring is essential to the strategy of maintaining an adequate supply of land for housing and to enable its planned release. In the Secretary of State’s view, while past rates of completion may be an indicator of how land may eventually be taken up it does not provide sufficient certainty now that the supply will not reach its full potential. Such predictions are no substitute for monitoring land take up as it actually occurs in order to establish whether additional land needs to be released. It is only by monitoring completions from housing sites, and ensuring, where they actually fall below assumed rates, the release of further sites, that land releases can be effectively managed and can be justified in the light of PPG3 policies to plan, monitor and manage housing land and supply. In the Secretary of State’s view it is too early at present to establish with certainty that the sites the Council has identified to meet the district’s housing requirement will not deliver their potential. He considers that monitoring housing supply as advocated in his policies in PPG3 will prevent the premature release of greenfield sites and not inhibit further previously developed land from coming forward.

11. As indicated above, the Secretary of State accepts that a shortfall of housing land appears to exist, albeit not to the extent promoted by the appellant nor that concluded by the Inspector, and he considers that some greenfield development will be required. For the reasons outlined above, he accepts the broad level of the Council’s projected supply figures and he agrees with the Council that, at the present time, housing development on greenfield sites of the amount identified by them as Group 1 will be needed to meet the housing requirement.”

16. The challenge to the decision that Mr Katkowski advances on behalf of the claimant is that the decision letter fails adequately to explain the Secretary of State’s reasons for differing from the inspector’s assessment of the housing land supply and that the claimant was prejudiced since this was the crucial issue in the case. He says that the only reason given by the Secretary of State for differing from the inspector was that the inspector had relied too heavily on past completion rates. In paragraph 8 the Secretary of State had referred to the Park Prewett site and what he described as “a number of greenfield sites”. He characterised the difference between the inspector and the council in respect of Park Prewett and these greenfield sites as being that the inspector had concluded that the council had assumed “unrealistic delivery rates”. In paragraph 9 of the decision letter, the Secretary of State (whilst accepting that there would be a shortfall between the housing requirement and what could be achieved through committed sites and brownfield sites) disagreed with the method of predicting housing completions adopted by the claimant, the council and the inspector. The Secretary of State considered that the Inspector had “relied too heavily on past completion rates to determine whether the release of further greenfield land is justified”. In paragraph 10 of the decision letter, the Secretary of State addressed why he considered that past completion rates should not be relied upon as a reliable indicator of the extent to which sites would come forward. In paragraph 11 of the decision letter, the Secretary of State recorded that a shortfall of housing land appeared to exist and that some greenfield development (ie other sites) would be required. However, he stated that the extent of that shortfall was not as great as had been concluded by the inspector and that “for the reasons outlined above, he accepts the broad level of the Council’s projected supply figures.” The reasons referred to said Mr Katkowski, could only properly be understood to refer to the Secretary of State’s view as to the inadequacy of predicting completions in reliance on past completion rates, as expressed in paragraphs 9 and 10 of the decision letter.
17. Mr Katkowski says that it was self-evidently wrong for the Secretary of State to treat as the sole difference between the inspector and the council past completion rates. The inspector’s reasoning in respect of three of the sites, Down West Yard, North Binfield and Taylor’s Farm (remainder) had nothing to do with past completion rates; while, as far as Park Prewett was concerned, it constituted only one of two reasons, the other being the date on which development could be expected to start. Thus, said Mr Katkowski, the informed reader was not able to understand whether the Secretary of State concluded that 900 dwellings could be achieved from Park Prewett during the 5-year period, or whether he had in mind some other figure, and, if so, how he derived it; nor could he understand why the inspector’s conclusions on the number of houses to be supplied by the other three sites was rejected. Furthermore the inspector had given no reason, or no comprehensible reason, for accepting “the broad level of the council’s projected supply figures”, as the decision letter put it at paragraph 11, and thus his agreement with the council on the Group 1 sites (625 houses, as compared with the inspector’s finding of 450) was unexplained. Indeed, since he had said in paragraph 9 that the parties, including therefore the council, had relied too heavily on past completion rates in making their assessments, it was perverse of him then to accept the council’s assessments as the basis of his decision.
18. For the Secretary of State, Mr Timothy Corner QC says that the reasoning in the decision letter is clear and that the Secretary of State did not misunderstand the inspector’s reasoning. In paragraph 8 he recognised that the inspector had not simply relied on past completion rates in differing from the council: included were the words “and because of other adjustments made by the inspector to the council’s calculations.” It was clear from paragraph 8.10 of the inspector’s report that past completion rates accounted for by far the majority of the inspector’s disagreement with the council on the Park Prewett site. It was reasonable, therefore, that the Secretary of State should refer to this. In referring again to past completions in paragraphs 9 and 10, he was not suggesting that that constituted the whole of the inspector’s reasoning. He was entitled to take the view that the calculations and predictions adopted by the parties and the inspector had relied too heavily on past completions.
19. The essential reason for the Secretary of State’s approach was made clear, Mr Corner said, in paragraph 10, where he expressed the view that the correct approach, having regard to PPG 3, was “plan, monitor and manage”. In the present case the Secretary of State considered that that approach meant that it was too early to say that the sites identified by the council to meet the district’s housing requirement would not deliver their potential. The right approach was to monitor to see whether those sites did, in fact, meet the potential, and if they did not, to release further sites. In those circumstances the Secretary of State concluded that he accepted the “broad level” of the council’s projected supply. Mr Corner submitted that his reasoning was adequate.
20. Both counsel referred to PPG 3, which underlay the assessments of housing land supply that the parties and the inspector had made and was expressly referred to in paragraph 10 of the decision letter. Mr Katkowski pointed to particular features of this new guidance. It required a sequential approach to the release of housing land, and it required councils to “plan, monitor and manage”. None of this, however, meant that the requirement to identify at least a five year supply of housing land was anywhere qualified. Paragraph 34 made clear the requirement:

“34. Sufficient sites should be shown on the plan’s proposals map to accommodate at least the first five years (or the first two phases) of housing development proposed in the plan. Site allocations should be reviewed and updated as the plan is reviewed and rolled forward at least every five years. Local planning authorities should monitor closely the uptake of both previously-developed and greenfield sites and should be prepared to alter or revise their plan policies in the light of that monitoring. However, it is essential that the operation of the development process is not prejudiced by unreal expectations of the developability of particular sites nor by planning authorities seeking to prioritise development sites in an arbitrary manner.”

21. Thus, Mr Katkowski said, the process of plan, monitor and manage was to be fitted in to the local plan process. It did not imply that the process could be by-passed. Moreover paragraph 34 warned against unreal expectations of developability.
22. Mr Corner emphasised that the importance of PPG 3 in the present case was that it explained why the Secretary of State approached the matter as he did. “Plan, monitor and manage” meant that housing requirements were to be kept under regular review, and there was nothing to suggest that it was tied to the quinquennial review of local plans. The requirement that there should be “sufficient” land must be read with this in mind. It did not require that sites were identified which would come forward beyond peradventure. What the Secretary of State was saying was that the council’s figures should be taken but that “plan, monitor and manage” should be operated during the relevant period to ensure that sufficient land was released for development.
23. I agree that the Secretary of State’s reasons should be read in the light of his own policy guidance in PPG 3. There is reference to monitoring, and to “plan, monitor and manage” in paragraph 34, which I have quoted, and in paragraphs 8, 76 and 77. Paragraph 8 states

“8. It is an essential feature of the plan, monitor and manage approach that housing requirements and the ways in which they are to be met, should be kept under regular review. The planned level of housing provision and its distribution should be based on a clear set of policy objectives, linked to measurable indicators of change. These indicators should be monitored and reported in the RPBs’ annual monitoring report. Such monitoring should be the basis on which the RPB periodically reviews and rolls forward its housing strategy. Reviews should occur at least every five years and sooner, if there are signs of either under or over-provision of housing land. Advice on the indicators which can be used for monitoring is set out in paragraph 77 and in PPG11.”

24. Paragraph 76 says:

“76. Effective monitoring is essential to the strategy of maintaining an adequate supply of land and buildings for housing and to enable its managed release. Further advice on monitoring is contained in good practice guidance referenced at Annex D.”

Annex D identifies as the guidance referred to Monitoring the Delivery of Housing through the Planning System: A Good Practice Guide (2000).

25. Paragraph 77 sets out the indicators that monitoring should include - the numbers and types of dwellings provided, the type of land used, etc. It then says:

“Information obtained from monitoring these indicators should be used to track progress in respect of local planning authorities’ own policies and to contribute to the RPB’s annual monitoring report.”

26. Underlying the sequential approach to the identification and release of housing land is the concern that greenfield sites should not be developed unless and until it is necessary to do so. Paragraph 30 of PPG 3, to which Mr Corner draws attention, says:

“30. In identifying sites to be allocated for housing in local plans and UDPs, local planning authorities should follow a search sequence, starting with the re-use of previously-developed land and buildings within urban areas identified by the urban housing capacity study, then urban extensions, and finally new development around nodes in good public transport corridors. They should seek only to identify sufficient land to meet the housing requirement set as a result of the RPG and strategic planning processes. In doing so they do not need to consider all the land in their area: they should not extend the search further than required to provide sufficient capacity to meet the agreed housing requirement.”

27. The foundation of Mr Katkowski’s challenge is that the Secretary of State wrongly treated the shortfall identified by the inspector as attributable solely to annual rates of completion. It does not seem to me, however, that, on a proper reading of the decision letter, this is what the Secretary of State did. In paragraph 8 he refers to the inspector’s views on unrealistic “delivery rates” assumed by the council, but this expression can, in my view, reasonably be read as referring to completions assumed for the 5-year period rather than to annual completions. Indeed he refers in that paragraph to “other adjustments made by the inspector to the council’s calculations”, which shows that he is alive to the fact that it is not only annual completion rates that give rise to the differences between the council and the inspector. When he says that the inspector “considers that the past completion rates in the district demonstrate that development of this site will not achieve the number of dwellings which have been estimated by the Council”, his only error, in my view, lies in the words “in the district”. It was not on district completion rates but on the average completion rates on the earlier phases of Park Prewett that the inspector based himself. But the rest of the statement is correct. It was because of past completion rates that the inspector rejected the annual rate of 225 dwellings that the council’s total of 900 (over a 4-year period) would imply.
28. In paragraph 9 the Secretary of State expresses concern about “the methods of prediction which have been employed by the parties” and says that “the calculation and predictions adopted by the parties and the inspector have relied too heavily on past completion rates.” These comments, clearly, are not intended to apply only to the particular sites on which there were differences between the inspector and the council. They are of general application. That past rates of completion were relied on by the parties and the inspector in assessing land supply, certainly in relation to brownfield sites, is clear from paragraphs 8.13 and 8.14 of the inspector’s report. The opening words of paragraph 9 of the decision letter show that the Secretary of State was addressing himself in that paragraph to all sites - those covered by the urban capacity study, greenfield sites with permission, and other potential sites. Mr Katkowski did not suggest that it was wrong to say that past completion rates had been relied on by the council in making the estimates of land supply. The conclusion of paragraph 9 – that the appearance of a shortfall of housing land might be due to over-reliance on part completion rates, so that it was insufficient to justify the release of further greenfield land - was one that related to the totality of the land supply assumed, and not that of the four particular sites.
29. Paragraph 10 is, in my judgment, the crucial paragraph in the Secretary of State’s reasoning. He is saying that the approach of “plan, monitor and manage” put forward by PPG 3 is the means by which an adequate supply of housing land can be maintained while ensuring that there is no premature release of greenfield sites. The concern is that such premature release would inhibit the development of brownfield land. He says that, because there is insufficient certainty that the supply will not reach its full potential, monitoring is to be relied on to show if completions are falling below those assumed and to justify the release of further sites. Based as it is on the conclusion of paragraph 9, which, as I have said, relates to the totality of the land supply assumed, the reasoning is, in my view, clear.
30. In paragraph 11 the Secretary of State says that for “the reasons outlined above” he accepts the broad level of the council’s projected supply figures and that the development on greenfield sites of the amount identified by them as Group 1 will be needed. I cannot accept Mr Katkowski’s contention that, despite the reference to “the reasons outlined above” the Secretary of State in fact gave no reason for accepting the council’s figures. His reasons are those contained in paragraphs 9 and 10. He has concluded in paragraph 10 that “it is too early at present to establish with certainty” that the council’s identified sites “will not deliver their potential”. Putting it in this way, he is clearly adopting a different approach from the inspector, who was concerned to be satisfied that completions would, or would be likely to, take place in the numbers advanced by the council. In effect the onus of proof, or, to put it perhaps more correctly, the underlying presumption, is reversed. Thus in paragraph 8.10 the inspector concluded that housing completions at Park Prewett “do not seem likely in my view to emerge until next year at the earliest” and that part performance “does not give any reason to be confident that a build rate of 225 units a year is likely”. In paragraph 8.12 he said that there was “no certainty” that any section 106 obligation on Down West Yard would be agreed without a hitch. In paragraph 8.18 he said that completion at North Binfield “are not going to start coming forward as early as expected by the County Council”. On Taylor’s Farm (remainder) (paragraph 8.19) he thought it “probable” that the site would be developed by the same developer as the main site; that it was not likely that the site would be opened up until the developer was well on with the main site; and that an average of the developer’s reasonable build-rate estimate should be taken. It does not seem to me, in view of the different approach that the Secretary of State was taking that he needed to deal specifically with these conclusions of the inspector in order to make clear the reasons for his decision. The inspector was asking himself whether there would be, or would be likely to be, completions during the 5-year period in the numbers assumed by the council. The Secretary of State wanted to establish that the sites would not produce the number of dwellings assumed before deciding to release additional land. Monitoring – particularly in relation to those sites where the doubt was whether completions would start at the time assumed by the council or a year than they assumed – would clearly assist in achieving the greater degree of assurance that the Secretary of State sought.
31. I should add that there was no contention on Mr Katkowski’s part that in adopting the approach that he did, in seeking sufficient certainty that the sites would not deliver their potential, the Secretary of State was acting contrary to his own guidance in PPG 3. He did suggest, however, that PPG 3 only required “plan, monitor and manage” for the purpose of the quinquennial review of the local plan. That, clearly, was not the view taken by the Secretary of State, who evidently regarded it as a continuing process whose objective was not so confined. It seems to me, in the light in particular of paragraphs 8 and 77, that the Secretary of State was entitled to treat it as a continuing process that could inform a decision on whether a particular greenfield site should be released for development.
32. The element in the decision letter that I have found rather less clear is the the Secretary of State’s acceptance, in paragraph 11, of the “broad level of the Council’s projected supply figures” despite his conclusion, in paragraph 9, that the parties (including, therefore, the council) had relied too heavily on past completion rates in making their assessments. It is this that forms the basis of Mr Katkowski’s perversity challenge, and, simply put side by side, these two passages do appear to be inconsistent. When read in the context of the totality of paragraphs 8 to 11, however, the Secretary of State’s thinking is, in my view, sufficiently explained. His concern, as I have said, is that over-reliance on past completion rates may have caused the identification of a shortfall that may not, in the event, occur. Hence he looks to monitoring to determine whether particular releases of land are justified. His view, clearly, is that over-reliance on past completion rates may have caused the supply to be under-estimated. He accepts “the broad level” of the council’s figures, but only the broad level because there may be an element of under-estimation. Given the role that he sees for monitoring, such an approach is understandable. In any event it is necessarily the case that, had he rejected the council’s assessment because of its over-reliance on past completion rates, he would done so on the basis that it under-estimated the supply. There would thus be no justification for releasing the appeal site for development.
33. In my judgment, the Secretary of State’s decision letter, taken as a whole and read in the light of PPG 3, gives adequate reasons to explain where he differed from the inspector and why. He was, as I have said, in error in saying that the inspector based his views on the completions that could be expected on the Park Prewett site on past completion rates in the district. But this error does not seem to me to affect the basis of his disagreement with the inspector, and indeed Mr Katkowski did not place any reliance upon it. Both the reasons challenge to the decision and the perversity challenge accordingly fail and the application is refused.
34. The costs order that I should make is agreed. The claimant must pay the first defendant’s costs of the application on the standard basis, such costs, if not agreed, to be the subject of a detailed assessment.
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THE DEPUTY JUDGE: For the reasons set out in the judgment which I now hand down, the application is refused.

MR WHELIN: My Lord, this is entirely upon the costs.

THE DEPUTY JUDGE: Yes, I have included in the judgment a note of the order as to costs that I should make, there is no dispute about that is there?

MR WHELIN: I would just invite my learned friend to confirm the total, my Lord. The total I have is £5,539.25.

THE DEPUTY JUDGE: Very well, yes, I see.

MR KOLINSKY: My Lord, may it please your Lordship, on the question of costs it may be needed simply to record the agreement between the parties for an order of costs in the sum £5,539.25, your Lordship.

THE DEPUTY JUDGE: Very well, I make an order in that sum.

MR KOLINSKY: I am grateful. Your Lordship I make an application for permission to appeal your Lordship. I do so primarily on the ground that in Part 54 r. 3 that an appeal would have a real prospect of success. In doing so I respectfully remind your Lordship that the explanation of this test of Lord Woolf, MR, (as he then of was) in Swaine v Hillman is that there should be a realistic as opposed to a fanciful prospect of success and I respectfully submit that there is. Your Lordship, will appreciate that this is essentially a short point and a point of law in my submission as to the standard of reasoning and also rationality of the Secretary of State's decision.

Without re-arguing the merits of the case, your Lordship, I make four brief submissions in support of my application. Firstly, that your Lordship has himself acknowledged in two places in your judgment that your Lordship was troubled by an element of the reasoning of the Secretary of State. Those two references are, firstly, in paragraph 23 of your Lordship's judgment, referring to paragraph 8 of the decision letter, where there was a reference in respect of part cruet ^^ to past completions rate for the district as opposed to site specific past completion rates. Secondly, in paragraph 28 of your Lordship's judgment paragraph 11 of the Secretary of State's decision letter, your Lordship acknowledged an apparent inconsistency between the Secretary of State's acceptance of the broad level of Council's figures for housing supply having just criticised the approach adopted. That is my first submission, that your Lordship does acknowledge, if I put it like this, glitches in the reasoning of the Secretary of State in those two respects.

Secondly, I say that there is a real prospect of success because the Secretary of State does not grapple with the Inspector's conclusions in respect of the other adjustments or provide any reasons for departing from them and your Lordship will recall Mr Kafcosy's ^^ reply in which he quantified the extent of the other adjustments as compared with the issue of past completion rates and this is, of course, in relation to part of the Inspector's reasoning and part cruat ^^ also that Down West yard site, the North Tinfill site and Tate lager's ^^ site and as simply remind your Lordship that when one quantifies those differences it is greater than the issue of past completion rates.

Thirdly, your Lordship, I submit that an informed reader has no idea how much housing supply the Secretary of State is considering may come forwards under the wait and see approach which he adopts. There is no indication in the decision letter as to what the realistic delivery rates are and no indication in respect of the other adjustments, which I just addressed under my second ground, or over what period the Secretary of State proposes to wait and see of what he assumes to be realistic in relation to those periods. I say that is an element which is at least arguable, an argument which has real prospect of success that is legally deficient.

My Lord, fourthly, I say that clearer justification is required as a matter law to part so fundamentally from the Inspector's approach to housing supply which follows a detailed inquiry, measured against that standard the Secretary of State's letter it is arguable that such an argument has a real prospect of success but the reasoning in this letter is insufficient. Your Lordship, unless I can assist further, that is the basis upon which I seek permission to appeal.

THE DEPUTY JUDGE: Thank you very much, Mr Kolinsky. Permission is refused. I am not satisfied that any of those four grounds would stand a realistic prospect of success.