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Hi John and Faye,
Thank you for your query on weight of neighbourhood plan policies in areas where a 5 year housing land supply cannot be demonstrated.
It is true that where a neighbourhood plan has been made for an area with an out of date 5 year housing supply, the relevant policies in the neighbourhood plan may carry less weight than for neighbourhood plans in areas where there is an up to date 5 year housing supply. However, this does not mean that these policies carry no weight at all and it very much depends on a case by case basis- the decision maker may give such a policy weight if he determines it is reasonable to do so.
For example, Mr Justice Lindblom in Crane v SSCLG  EWHC 425 was presented with a challenge to a decision made by the Secretary of State for a proposal for 111 residential dwellings in Broughton Astley in Leicestershire in an area which was not allocated for housing in the neighbourhood plan. The Secretary of State had refused planning permission on the basis that the development was in conflict with the neighbourhood plan, even though the local authority did not have a 5 year land supply and both the local plan and neighbourhood plan were out of date under the NPPF. In this case Mr Justice upheld the decision of the Secretary of State to refuse the planning permission.
Mr Justice Lindblom noted that in relation to the NPPF paragraph 14 and weighting, it is not a matter of law but of planning judgment. Mr Justice also noted that neither paragraph 49 nor paragraph 14 of the NPPF advises that policies for the supply of housing should be given no weight or minimal weight or any specific amount of weight. Instead the critical consideration for him in this case was whether the harm associated with the proposed development “significantly and demonstrably” outweighed any benefit, or that there are specific policies in the NPPF which indicate that development should be restricted. Mr Justice stated that the Secretary of State had not made a mistake in determining that the proposed development was in conflict with the neighbourhood plan even though the core strategy’s policies were out-of-date.
This example illustrates that neighbourhood plans can still have weight, even if there is no up to date 5 year supply of deliverable housing sites, as how much weight should be given to a plan with housing policies that are out of date is a matter of planning judgement, not law. Therefore, even if policies are not considered up to date, they can still have weight and therefore prevent developers from building where they want. So the fact that a local authority does not have a demonstrable 5 year housing land supply, does not mean it undermines the neighbourhood plan.
Through our extensive work with neighbourhood planning groups, this is our understanding of the situation, however it is not formal advice/guidance; and is not a substitute for your own professional/legal advice.
I hope you find this helpful.