Agenda item

In accordance with Regulation 10(1)(a) of the Local Authorities (Executive Arrangements) (Meetings and Access to Information) (England) Regulations 2012, the proper officer has informed Councillor Stephen Button, Chair of the Communities and Wellbeing Overview and Scrutiny Committee, that it is intended that the following key decision will be made by Cabinet on 18^th March 2026, under the General Exception provisions, on the grounds that the decision is urgent and cannot reasonably be deferred.

 

Report attached.

 

In accordance with Regulation 10(1)(a) of the Local Authorities (Executive Arrangements) (Meetings and Access to Information) (England) Regulations 2012, the proper officer had informed Councillor Stephen Button, Chair of the Communities and Wellbeing Overview and Scrutiny Committee, that it was intended that the following key decision would be made by Cabinet on 18^th March 2026, under the General Exception provisions, on the grounds that the decision was urgent and could not reasonably be deferred.

 

The Cabinet considered a report of Councillor Munif Dad BEM  JP, Leader of the Council, setting out the evidence for an Article 4 Direction made under the Town and Country Planning General Permitted Development Order 2015 (as amended) covering smaller houses in multiple occupation (HMOs) in the wards of Altham, Baxenden, Huncoat, Immanuel, Milnshaw, Overton and St Oswalds.

 

Councillor Dad provided a brief introduction to the report, noting that, at the present time, change of use from dwellinghouses (use class C3) to smaller HMOs (properties occupied by 3 to 6 unrelated individuals) within the relevant wards did not require planning permission.  He outlined the extent of the existing Article 4 arrangements and what was now proposed, including the reasons why and the possible risks of the preferred timescale for implementation.

 

Councillor Pritchard and Brerton spoke in favour of the proposals and commented that it was a brave decision to implement the Article 4 Direction across the whole Borough.  Councillor Zak Khan supported the proposals and enquired if the Council had sufficient resource to monitor the impact on the local communityof any planning approvals given.  Councillor Pritchard reminded members that the new regime had only just come into force, but any planning conditions would fall under the remit of the planning enforcement team.

 

The Leader added that the original evidence had only supported introducing these measures for 9 wards but that in taking that decision a commitment had been given to review the evidence for all other wards in the Borough.  The whole of Hyndburn would now be covered.

 

Approval of the report was deemed a key decision.

 

Reasons for Decision

 

The Council had resolved in December 2024 to make a non-immediate Article 4 Direction removing the automatic right to change from Class C3 (dwellinghouse) to Class C4 (small HMO), as otherwise permitted under Schedule 2, Part 3, Class L of the Town and Country Planning (General Permitted Development) (England) Order 2015.  Evidence prepared to support the Article 4 Direction had identified that some areas of the Borough had higher concentrations of HMOs, lower property values, and greater levels of deprivation.  It had therefore been recommended that permitted development rights be withdrawn within the nine most affected wards: Barnfield, Central, Church, Clayton-le-Moors, Peel, Netherton, Rishton, Spring Hill, and St Andrew’s.

 

The Council had confirmed the March 2026 Article 4 Direction on 17 November 2025.  The Direction would take effect on 15^th March 2026.

 

A further exercise had now been undertaken to establish whether evidence existed to support a further Article 4 Direction in the remaining seven wards: Altham, Baxenden, Huncoat, Immanuel, Milnshaw, Overton and St Oswalds.

 

Paragraph 54 of the National Planning Policy Framework (NPPF) stated that the use of Article 4 directions to remove national permitted development rights should be limited to situations where an Article 4 direction was necessary to protect local amenity or the well-being of the area and in all cases, be based on robust evidence, and apply to the smallest geographical area possible.

 

Where permitted development rights were removed, the effect was that developers were required to submit a planning application for such proposals (in this case a change from Class C3 (dwellinghouse) to Class C4 (small HMO).  This would allow the effects of a proposed HMO on an area's amenity and the local community to be taken into consideration as part of the planning application process.

 

One of the shared aims of the Corporate Strategy (2023-2028), the adopted Hyndburn Core Strategy and the emerging Hyndburn Local Plan was to provide for a greater choice and quality of housing in the Borough.  To help deliver this objective the Core Strategy set out a number of key priorities:

 

• To provide sufficient housing of the right size and type to meet local needs, including those in need of affordable and supported housing or requiring larger family homes, higher value homes and homes to cater for an aging population.  This would provide a more balanced housing supply with a choice of property types and tenure. 
• To ensure that all new property would be built to high standards, in sustainable locations, making the best use of brownfield land and to designs which would minimise carbon emissions and relate well to local character. 
• To ensure that areas of low demand housing were regenerated with a wider range of improved and new housing and supporting facilities, including local health centres and public open spaces. 

 

The Core Strategy recognised that access to good quality affordable housing was an essential human need and was vital to the creation of sustainable, mixed communities.  The provision of a balanced housing market within Hyndburn was a key priority and the Core Strategy sought to achieve this primarily though the development of larger family homes in sustainable locations. 

 

The Hyndburn 2040 Local Plan (Strategic Policies and Site Allocations) was now at Main Modifications stage in plan-making.  The policies in the plan should now be considered to carry substantial weight.  Policy SP11 (Suitable Range of Housing) particularly related to the development of new apartments and Houses in Multiple Occupation (HMOs) in Hyndburn.  It stated that the Council would seek to ensure that an appropriate range of housing was delivered in the plan period.  New apartment developments (including Houses of Multiple Occupation) would only be supported where they would maintain the prevailing character and setting of the local area and were either:

 

a)    within town centres or within walking distance (250m or closer) of town centres;

b)    part of high-quality development in canal-side locations where the regeneration benefits of this type of development can be demonstrated;

c)    part of strategy housing development where there was a need to provide a wider range of housing types;

d)    in locations that were well served by public transport and the development would secure the efficient use of land; or

e)    part of a scheme that would involve the reuse of adaptation of a historic mill building in an appropriate location.

 

The explanatory text in paragraph 6.31 of the report also noted that, “New apartment developments and Houses in Multiple Occupation (HMO) in Hyndburn will only be supported in the appropriate locations set out in Policy SP11 where they are well designed in terms of their appearance, size and setting.  The Nationally Described Space Standards (NDSS), which set out minimum space standards and room sizes have been adopted by the Council for all new housing developments (where viable), which includes the new build of (and conversion of existing buildings to) flats/apartments or HMOs”.

 

The Inspector at the examination of the Local Plan had not made any main modifications to Policy SP11 in the emerging plan and it was therefore considered to carry substantial weight in decision making.

 

This policy framework had been established in response to the housing problems that had historically been witnessed in Hyndburn.  At its worse, the Borough had suffered housing market failure due to the high concentrations of poor-quality terraced houses coupled with low demand, contributing to high levels of deprivation in central areas of Hyndburn.  Whilst much had been done to help address these issues, the 2025 Indices of Deprivation showed that large areas of the Borough still suffered from high levels of deprivation.  These areas were characterised by having:

 

• High density of terraced and low value housing;
• High numbers of rented properties;
• Higher than average health issues;
• Low average wages;
• Higher than average number of people on allowances;
• Higher rates of crime and disorder; and
• Poor quality environment.

 

At a time when corporate policies were seeking to improve the quality of housing across Hyndburn, there was a concern that the uncontrolled development of HMOs in these areas would serve to lower the quality of housing and only serve to increase the social problems experienced in these areas.  Higher than average concentrations of rented properties and houses in multiple occupation might have an unacceptable adverse impact on the socio-economic profile of these areas and as a consequence might result in families moving out and contributing to a spiral of decline at a time when the Council was working to improve these areas. 

 

The main driver for the increase in HMOs appeared to be the low property prices in the Borough coupled with a lower wage economy, which generated higher numbers of residents seeking lower affordable rents.  In many cases this was the only way some residents could access the housing market.  This type of property provided a higher yield to owners for a lower initial input.  Hyndburn continued to be one of the lowest places in the country for property prices, even though HMOs would often sell, once converted, for a higher price.

 

It was important to acknowledge that HMOs had widened the housing choice within the Borough, particularly providing affordable accommodation for young professionals, alongside low-income households who might be economically inactive or working in low paid jobs, and it was believed it had assisted in tackling the issues of a large number of vacant dwellings within the Borough.  HMOs operated by government partnerships also provided essential temporary accommodations for asylum seekers, homeless people, ex-offenders, etc.

 

Under current planning rules, planning permission was required for the use of a property as a house in multiple occupation if it was to be occupied by more than 6 people.  Since the majority of houses in Hyndburn’s inner areas and many of the other wards within the Borough were smaller Victorian terraces, the use of these properties as smaller HMO’s did not require planning permission.

 

In 2012, the Government had introduced permitted development rights that meant that HMOs occupied by 6 or less occupants did not require planning permission.  From this point on it had been very difficult to monitor the numbers of properties being converted into HMOs.  It would also appear that around 2021 to 2023 there had been an uplift in properties being purchased for conversion.  HMOs with 5 persons or more, or that comprised two or more households, required a licence from the Council, so these properties could still be monitored. 

 

As of February 2026, it was estimated that there were approximately 502 HMOs in the Borough.  Since the decision in 2024 to make a limited Article 4 Direction in 9 wards in the Borough, work had been ongoing to try and identify HMOs.  Though there was a concentration of smaller HMOs within the central urban areas, there were smaller HMOs in all wards in the Borough.

 

The report provided further detailed information about the following:

 

• The need for an Article 4 Direction;
• Options for Introducing a New Article 4 Direction; and
• Consultations.

 

Alternative Options considered and Reasons for Rejection

 

There were alternative options open to Cabinet - firstly where the Article 4 Direction should apply and secondly, what type of Article 4 Direction should apply:

 

Do not take forward the HMO Article 4 Direction within the remaining 7 Wards of the Borough

 

One option would be to not introduce an Article 4 Direction, in which case conversions to small HMOs would remain permitted development across the remaining 7 Wards within the Borough.  The position could be monitored for a set period with a further report to Cabinet being mandated.  This option carried a risk that smaller HMOs would be difficult to identify and monitor, and also that they would proliferate in those wards, possibly as a result of some displacement of HMO’s from the parts of the Borough covered by the existing March 2026 Article 4 Direction.  Therefore, this option was not one recommended to take forward.

 

Whether to make an Immediate or non-Immediate effect Article 4 Direction

 

A Direction with immediate effect could withdraw permitted development rights straight away; however, it would have to be confirmed by the local planning authority within six months of coming into effect in order to remain in force.  Confirmation could only occur after the local planning authority had undertaken local consultation in accordance with Sections 107 and 108 of the Town and Country Planning Act 1990 and the provisions of the Town and Country Planning (Compensation) (England) Regulations 2015 (as amended).

 

As set out above, compensation provisions applied to Directions that had taken immediate effect.  By contrast, a non-immediate Direction might be made giving at least 12 months’ notice before it came into force, thereby removing the potential for compensation claims once the Direction was in effect.

 

While the evidence set out in the report indicated that there was a strong planning basis for intervention, the level of financial risk associated with making an immediate Article 4 Direction was difficult to quantify.  Given the evidence of relatively high numbers of HMOs within the Borough, and the factors identified which contributed to the demand for the conversion of properties to HMOs, there was the potential for compensation claims to arise if an immediate Direction was pursued.  The Council did not have complete information on the location of all such properties and there might be additional properties not currently identified.  Furthermore, the possibility of speculative planning applications being submitted for the purpose of establishing a basis for compensation claims could not be discounted.

 

Having regard to the above considerations, members were invited to determine whether they would prefer to make a non-immediate Direction, which would remove the financial risks to the Council whilst still addressing the planning concerns, although at a slower pace.

 

Resolved                                 (1)   That Cabinet, having considered the evidence base attached as Appendix 1 to the report and being satisfied that there are grounds for an immediate Article 4 Direction as set out in section 3 of this report, approves the introduction of an immediate Article 4 Direction to remove the permitted development right that currently allows a property to change from Use Class C3 (dwellinghouse) to Use Class C4 (small House in Multiple Occupation) without planning permission, as set out in Schedule 2, Part 3, Class L of the Town and Country Planning (General Permitted Development) (England) Order 2015, and such Article 4 Direction to apply within the wards of Altham, Baxenden, Huncoat, Immanuel, Milnshaw, Overton and St Oswalds.

 

(2)   That Cabinet also agrees to:

 

(i)        Delegate authority to the Head of Planning and Transportation, in consultation with the relevant Portfolio Holder, to make any necessary minor amendments to the Evidence Base documents and to prepare the final draft of the Article 4 Direction and the associated notice.

 

(ii)       Carry out a public consultation on the proposed immediate Article 4 Direction in respect of the proposed confirmation of the same pursuant to sections 107 and 108 of the Town and Country Planning Act 1990 and the Town and Country Planning (Compensation) (England) Regulations 2015 (as amended).

 

(iii)      Delegate authority to the Head of Planning and Transportation, in consultation with the Portfolio Holder, to review the consultation responses and determine whether the Article 4 Direction should subsequently be confirmed, noting that the Direction will not continue to apply unless the same is confirmed by the Council within 6 months of being made.