Following a legal challenge from Southwark Council, Secretary of State for Communities and Local Government Sajid Javid has lifted his block of the proposed compulsory purchase order ("CPO") of the remaining properties in the first phase of the Aylesbury Estate regeneration in Southwark.
Mr Javid has previously prevented the CPO on human rights grounds. In his decision letter issued in 2016, he stated that many of the remaining leaseholders on the estate would be unable to afford the options of either a shared ownership or shared equity property as part of the regenerated scheme and, as a consequence of the CPO, would be forced to move out of the area.
At the time, his decision was hailed as a victory by campaigners. However, increasingly reliant on the use of CPO powers to drive inner city regeneration, local authorities and developers were naturally concerned that the decision marked a step-change in CPO policy that would jeopardise the delivery of new homes. Accordingly, the Council moved to judicial review.
Following the CPO Inquiry, the Council announced a change in its approach to CPO compensation, which would take into account the increases in values in the local property market and the availability of additional local properties which were considered to be affordable and suitable for residents' needs (i.e. it would go beyond an assessment of the open market value of the affected properties). Mr Javid's decision not to contest the legal challenge was on the very narrow basis that he had not given sufficient reasons to explain his view on the Council's change in approach. His decision to concede does not touch on the more fundamental concerns raised by his initial decision, for example, whether the Council had taken 'reasonable steps' to acquire the land through agreement.
It remains to be seen whether Mr Javid's u-turn will mean business as usual for the use of CPO powers. Or, whether the conduct of an acquiring authority and the approach to land valuation will come under closer scrutiny as local planning authorities and developers seek to deliver the regeneration agenda.
A new CPO inquiry will now take place and whoever is Secretary of State for Communities and Local Government after 8 June 2017, will be required to consider the issues afresh.
Cllr Peter John, Leader of Southwark Council, said: “We are really pleased that the Secretary of State has quashed his previous decision, and will now allow us to hold a new CPO inquiry. We remain committed to regenerating the Aylesbury Estate for the benefit of local residents.”