Shortfall in housing land supply is a matter of planning judgement


West Lothian Council (the “Council”) appealed against a decision of a reporter appointed by the Scottish Ministers (the “Reporter”) granting an application for planning permission to construct homes on a greenfield site.

The Inner House of the Court of Session held that the Reporter had applied the correct national and local planning policies for the release of greenfield land for housing. The Reporter had found that there was a significant shortfall in the effective housing land supply available and on this basis the exceptional release policies were engaged.


The Council refused an application for planning permission by Ogilvie Homes to construct around 104 houses at Hen’s Nest Road, a greenfield site in East Whitburn. On appeal to the Scottish Ministers, Ogilvie Homes were successful in obtaining planning permission by the appointed Reporter. The Council appealed this decision on the grounds that the Reporter had failed to apply the correct national and local planning policies for the release of greenfield land for housing.

The relevant development plans for the Whitburn area are the Strategic Development Plan for Edinburgh (“SDP”), the South East Scotland 2013 (the “SESplan”) and the West Lothian Local Development Plan 2018 (the “LDP”).

Policy 7 of the SESplan provides that planning permission on greenfield sites can be granted where there is a shortfall in the 5-year effective housing supply provided the following three criteria are met:

  1. The development will be in keeping with the character of the settlement and local area;
  2. The development will not undermine green belt objectives; and
  3. Any additional infrastructure will be funded by the developer.

Policy HOU 2 of the LDP sets out four criteria: the same two criteria as (i) and (iii) of Policy 7 plus an additional two criteria requiring the development to contribute to sustainable development and requiring the development to deliver new housing within 5 years.

Additionally, it was noted that the Scottish Planning Policy 2014 (“SPP”) was a material consideration which sets out a presumption in favour of sustainable development. In circumstances where a development plan contains no relevant policies, or they are out of date, the presumption becomes a significant material consideration. It will be overcome only where adverse impacts demonstrably outweigh the benefits (para 33). This is known as the "tilted balance". SPP contains a section entitled "Enabling Delivery of New Homes". It provides that the planning system should "identify a generous supply of land … to support the achievement of the housing land requirement … maintaining at least a 5-year supply of effective housing" (para 110). Local development plans must set out the housing supply target, based on need and demand (para 115). The housing supply target is the number of houses which should be delivered over the plan period (para 115). This figure is increased by between 10 and 20% (the generosity margin) to establish the housing land requirement. Housing policies are deemed to be out of date if there is a shortfall in the required five-year effective housing land supply (para 125).

Reporter’s Decision

The issue before the Reporter was whether there was a shortfall in the 5-year Housing Land Supply.

The Council and Ogilvie Homes had taken different approaches in calculating the housing supply. The Council argued that the average method should be used to calculate whether there was a shortfall. This involves dividing the housing land requirement by the number of years in the plan and then multiplying the result by five. Conversely, Ogilvie argued that the correct method of calculation was the residual approach which involves the annual housing land requirement to be multiplied by 5 and any under delivery of completions ought to be added to that figure.

Taking a pragmatic approach, the Reporter calculated the shortfall via a different method from both the Council and Ogilvie Homes by taking the number of houses which should, according to the development plans, be built during the plan period up until 2024 and subtracted the figure for the houses that were predicted to be built during this period, as set out by the housing land audit. A shortfall of 4,000 houses by 2024 resulted. The Council argued that the Reporter had erred in law in determining that there was a shortfall and challenged the Reporter’s method of calculation.

Inner House Decision

In making their decision, the Court considered the following points:

  1. Whether the Reporter’s decision was intelligible and succinct: Referring to the case of NLEI v Scottish Minister [2022] CSIH 39, the Lord President highlighted that ‘reporters are not lawyers’. The desirability is for them to set out their decisions and reasoning ‘in an intelligible yet succinct manner’. In this case, the court concluded that the Reporter met both criteria and had considered the correct key issue: whether there was a shortfall in the 5-years’ effective housing land supply. The Reporter had made clear his awareness of among other things, the different approaches to calculation, the recent history in this area, the developments in Government policy and successful court challenges in respect of these policy changes.
  2. Whether error of law in the Reporter’s approach: In this context, the court determined that there was no fault in the Reporter’s decision. Legally, the Reporter was required to follow existing planning policy, regardless of how satisfactory the current policies were. The court reiterated that the question of whether there is a housing shortfall is a matter of planning judgement and the court would only step in where the Reporter had made an error in law and there was no material which supported the Reporter’s decision. In this case ‘it was apparent that there was such material’. The court found that it was clear the Council was not on track to meet its housing land requirements and the court could see no error in the way the reporter had reached his decision. Concluding, the court determined the Reporter’s approach in his calculation had been ‘realistic and accorded with common sense… [and] consistent with the recommended broad assessment approach’ (Gladman Developments v Scottish Ministers 2020 SLT 898) and had also included a ‘useful cross-check with the Mossend decision’ (Gladman Developments v Scottish Ministers [2019] CSIH 34.) – a recent Council decision which had arrived at the same conclusion.

The Court refused the appeal.


The Court made clear that whether there is a shortfall in the effective housing land supply in any local development plan area is a matter of planning judgement.

Interestingly in this decision, the Reporter rejected both the average and residual methods put forward by the Council and Ogilvie Homes to compare the housing land supply against the housing land requirement.

The Reporter cut through the customary methodological debate by taking the number of houses, which ought, according to the development plans, to have been built during the plan period and subtracting the figure for the houses, which the housing land audit predicted would be built during that period. His conclusion was not that the existence of this difference in numbers in itself triggered the exceptional release provisions, but that it demonstrated the existence of a significant shortfall in the effective housing land supply presently available. An adequate land supply should be available at all times. The figures before the Reporter were more than sufficient to support his conclusion that the current supply was inadequate and that accordingly the trigger contained in the relevant policies was activated.

Article co-authored by Emily McDonald, Trainee Solicitor at CMS.