Breaking News: The End of the Road for the Strategic Transport Fund

The Supreme Court has this morning found that the Strategic Transport Fund which was put in place by Aberdeen City and Shire Strategic Development Planning Authority is unlawful (read the judgment here). This decision upholds the judgment of the Court of Session issued last year.

Our client, Elsick Development Company (EDC), the promoter of 4000 new homes at Chapelton, south of Aberdeen, had challenged the supplementary guidance on STF adopted by the SDPA.  This required developers to pay contributions on a roof tax basis into a central pot to be used towards strategic transport measures across a wide area.  EDC’s challenge was that payments should not be required where there was no link between the transport measures and the impact of individual developments.

Last year, the Court of Session upheld EDC’s challenge and quashed the guidance, but the SDPA was given leave by the Supreme Court to appeal against the decision on the basis that it raised an important question of planning law - can a planning authority adopt a policy in its development plan which requires developers to pay into a pooled fund to be spent on infrastructure, including interventions at places where a particular development has only a minimal impact?

The Supreme Court judgment makes it clear that imposing on a developer, as a pre-condition of development commencing, a requirement to make a financial contribution towards infrastructure which is unconnected to the development of their site is unlawful as it falls outwith the scope of section 75 of the Town and Country Planning (Scotland) Act 1997 which governs planning obligations. Section 75 contains an implicit limitation that the restriction must serve a purpose related to the particular development or site.

The Supreme Court held that for a planning obligation to be a material consideration in a decision to grant planning permission, the obligation must have more than a de minimis or trivial connection with the proposed development. In the absence of that link, the inclusion of a policy in a development plan which seeks to impose an obligation which is unrelated to a development will not make the obligation lawful.

Pooled infrastructure contributions are not unique to the north east of Scotland. Today’s judgment will have planning authorities and developers across Scotland reviewing existing and proposed planning obligations and development plan policies to ascertain whether they meet the Supreme Court’s requirements.

Our planning team regularly advises on all aspects of planning obligations, including variation and discharges of section 75 agreements and section 75A appeals. For more information please contact me.

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