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You are here: BAILII >> Databases >> England and Wales High Court (Administrative Court) Decisions >> Bain v Secretary of State for Transport [2024] EWHC 2216 (Admin) (27 August 2024) URL: https://www.bailii.org/ew/cases/EWHC/Admin/2024/2216.html Cite as: [2024] EWHC 2216 (Admin) |
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KING'S BENCH DIVISION
ADMINISTRATIVE COURT
BIRMINGHAM DISTRICT REGISTRY
Priory Courts, 33 Bull Street, Birmingham, B4 6DS |
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B e f o r e :
____________________
MAIR BAIN |
Claimant |
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- and – |
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SECRETARY OF STATE FOR TRANSPORT |
Defendant |
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- and – |
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NATIONAL HIGHWAYS LIMITED |
Interested Party |
____________________
MR JAMES STRACHAN KC and MS ROSE GROGAN (instructed by Government Legal Department) for the Defendant
MR REUBEN TAYLOR KC (instructed by National Highways Ltd) for the Interested Party
Hearing date: 14 May 2024
____________________
Crown Copyright ©
MR JUSTICE MOULD :
Introduction
(a) misinterpreted paragraph 4.5 of the National Policy Statement for National Networks (December 2014) ['the NPSNN'].
(b) failed to reach a reasoned conclusion on the significant effects of the Proposed Development on the environment, contrary to regulation 21(1)(b) and (2) of the Infrastructure Planning (Environmental Impact Assessment) Regulations 2017 ['the 2017 Regulations'].
(c) failed to discharge his Tameside duty of reasonable enquiry (Secretary of State for Education and Science v Tameside MBC [1977] AC 1014, 1065).
Statutory background
"…
(2) In deciding the application the Secretary of State must have regard to –
(a) any national policy statement which has effect in relation to development of the description to which the application relates (a "relevant national policy statement"),
…
(3) The Secretary of State must decide the application in accordance with any relevant national policy statement, except to the extent that one or more of subsections (4) to (8) applies.
…
(7) This subsection applies if the Secretary of State is satisfied that the adverse impact of the proposed development would outweigh its benefits.
…".
"(1) When deciding whether to make an order granting development consent for EIA development the Secretary of State must –
(a) examine the environmental information;
(b) reach a reasoned conclusion on the significant effects of the proposed development on the environment, taking into account the examination referred to in sub-paragraph (a) and, where appropriate, any supplementary examination considered necessary;
(c) integrate that conclusion into the decision as to whether an order is to be granted; and
(d) if an order is to be made, consider whether it is appropriate to impose monitoring measures.
(2) The reasoned conclusion referred to in paragraph (1)(b) must be up to date at the time that the decision as to whether the order is to be granted is taken, and that conclusion shall be taken to be up to date if in the opinion of the Secretary of State it addresses the significant effects of the proposed development on the environment that are likely to arise as a result of the development described in the application".
"environmental information" means the environmental statement (or in the case of a subsequent application, the updated environmental statement), including any further information and any other information, any representations made by any body required by these Regulations to be invited to make representations and any representations duly made by any other person about the environmental effects of the development and of any associated development.
…
"further information" means additional information which, in the view of the Examining authority, the Secretary of State or the relevant authority, is directly relevant to reaching a reasoned conclusion on the significant effects of the development on the environment and which it is necessary to include in an environmental statement or updated environmental statement in order for it to satisfy the requirements of regulation 14(2).
…
"any other information" means any other substantive information provided by the applicant in relation to the environmental statement or updated environmental statement.
…
"updated environmental statement" means the environmental statement submitted as part of an application for an order granting development consent, updated to include any further information.
Factual background
The NPSNN
"4.2 Subject to the detailed policies and protections in this NPS, and the legal constraints set out in the Planning Act, there is a presumption in favour of granting development consent for national networks NSIPs that fall within the need for infrastructure established in this NPS. The statutory framework for deciding NSIP applications where there is a relevant designated NPS is set out in Section 104 of the Planning Act.
4.3 In considering any proposed development, and in particular, when weighing its adverse impacts against its benefits, the Examining Authority and the Secretary of State should take into account:
... its potential benefits, including the facilitation of economic development, including job creation, housing and environmental improvement, and any long-term or wider benefits;
... its potential adverse impacts, including any longer-term and cumulative adverse impacts, as well as any measures to avoid, reduce or compensate for any adverse impacts".
"4.5 Applications for road and rail projects … will normally be supported by a business case prepared in accordance with Treasury Green Book principles. This business case provides the basis for investment decisions on road and rail projects. The business case will normally be developed based on the Department's Transport Business Case guidance and WebTAG guidance. The economic case prepared for a transport business case will assess the economic, environmental and social impacts of a development. The information provided will be proportionate to the development. This information will be important for the Examining Authority and the Secretary of State's consideration of the adverse impacts and benefits of a proposed development. It is expected that NSIP schemes brought forward through the development consent order process by virtue of Section 35 of the Planning Act 2008, should also meet this requirement".
"4.7 The Department's WebTAG guidance is updated regularly. This is to allow the evidence used to inform decision-making to be up to date. Where updates are made during the course of preparing analytical work, the updated guidance is only expected to be used where it would be material to the investment decision and in proportion to the scale of the investment and its impacts".
"1.3.1 While sound planning of business case development, assisted by the Orderly Release Process, can minimise the cost, resource, and time needed to ensure a business case remains in step with latest evidence, it is nonetheless reasonable for project sponsors to decide what updates to business cases it is proportionate to make when TAG, or other guidance/evidence changes.
1.3.2 The Department expects that such decisions should be made on a scheme by scheme basis and be based on balancing the need to ensure decisions are based on up-to-date evidence with the need to support decision makers in delivering their programme. This should involve reasonably balancing (a) the greater time, cost, and/or resource needed to deliver programmes, with (b) the quality of the analysis submitted to assist the decision required, including its robustness against potential challenge from all sources".
Under the heading "When to update", paragraph 1.3.7 advises –
"1.3.7 Updates to analytical models and appraisals, where they are deemed to be material, should be programmed to coincide with forthcoming decision-points within a project. The Department would not expect work to be undertaken to update analysis as a general necessity where it will not be used. Promoters should therefore plan when changes should be implemented for their work programme, considering the balance of factors described above".
The Interested Party's planning statement
"4.1.4 The total value of the economic, environmental and social monetised benefits and disbenefits are calculated to obtain a ratio. This ratio is referred to as the benefit cost ratio (BCR) and provides an indication of whether the Scheme presents a sufficient level of benefits to be considered as good value for money".
"4.2.1 Various impacts emanating from the Scheme have been monetised in order to calculate a BCR, which indicates whether the Scheme would provide overall value for money. As the Scheme would be operational for several decades, the economic assessment for the Scheme is based over a 60-year period. As a result, monetised benefits and disbenefits are attached to a set year. In this case, the costs are based on 2010 market prices discounted to a 2010 present value year.
4.2.2 Overall, the Net Present Value of Benefits (PVB) i.e. the total value of Benefits for the Scheme is £419 million, while the Net Present Value of Costs (PVC) is a £163.1 million deficit. The BCR is calculated as the ratio of costs (PVC) compared to the benefits of the Scheme (NPV), which derives a BCR of 2.6.
4.2.3 The DfT BCR benchmark is a ratio of 2, which is considered high value for money. The BCR for this Scheme is 2.6 and can therefore be considered to constitute a high value for money scheme".
The Examining Authority's Report
"4.5.11 The Proposed Development has been the subject of an economic assessment which considered its economic, environmental and social benefits and disbenefits. The Applicant advised that the assessment followed the DfT's WebTAG guidance and HM Treasury's Green Book. It was based on the assignment of a forecast core growth scenario, with sensitivity tests using low growth and high growth assumptions for the volume of traffic using the Proposed Development. Benefits and disbenefits were monetized to provide a benefit cost ratio (BCR). The DfT benchmarks a BCR of 2 as high value for money. In comparison, the BCR for the Proposed Development was calculated to be 2.6 [REP1-005 REP7-007 REP10-009]. We are satisfied that the approach taken to the economic assessment is consistent with the advice at paragraph 4.5 of the NPSNN".
"We are, therefore, satisfied that the Proposed Development would be likely to result in significant reductions to delays and congestion at the three junctions and would improve highway safety. As such it would also help to release constraints on housing and economic development to the west ofDerby.
We are also content that the costs and benefits of the proposal have been assessed appropriately. Overall, therefore, we conclude that the need for the Proposed Development has been established in accordance with the requirements of the NPSNN and that the presumption in favour of development is engaged".
"126. The ExA noted that the Applicant advised the scheme had been subject to economic assessment which followed the DfT's WebTAG guidance and HM Treasury's Green Book and the benefits and disbenefits monetised to provide a benefit to cost ratio (BCR). It was necessary for the ExA (and SoS) to satisfy themselves that the approach taken to the economic assessment was consistent with the advice at paragraph 4.5 of the NPSNN [ExA Report, 4.5.11] which provides that this information is important for the Examining Authority and the Secretary of State's consideration of the adverse impacts and benefits of the proposed development.
127. In order therefore to satisfy the requirement of NPSNN paragraph 4.5 and in order that the SoS can provide an up to date reasoned conclusion on the benefits of the Scheme, the Applicant must undertake an assessment of the Scheme against the most recent Government policy and guidance and recalculate the BCR which, in light of the above, is likely to have changed.
128. The recalculation of the BCR will also be relevant to the SoS' assessment of the "straightforward" balancing exercise required under section 104(7) of the Planning Act between the Scheme's "adverse impact" and "benefits"."
"129. Overall the adequacy of the environmental information produced in support of the application for Development is, in light of the length of time since the examination closed, inadequate and, as per the paragraphs above, further information is now required to provide the SoS with an up to date picture".
"Before main construction work can commence the project will need to have a full business case in place and gain approval from National Highways' Investment Committee, with this incorporating an assessment of Economic Value for Money for the scheme.
The BCR is re-calculated at each key stage (end of preliminary design ahead of the DCO application and at the end of detailed design ahead of construction starting). The BCR (and Value for Money) will be re-estimated before a final decision is made to commit construction funds".
"26. The Statement of Matters asked for further representations on any change in whether the Development would be consistent with the requirements and provisions of relevant local or national policies, given the length of time since the examination closed. Our client highlighted several guidance documents and policies that had been updated since the end of the examination, including:
(i) HM Treasury Green Book
(ii) Valuation of greenhouse gas emissions
(iii) DfT's WebTAG guidance
(iv) DMRB Volume 11, Section 3, Part 1, HA 207/07 – This was withdrawn in November 2019
(v) Highways England Carbon Reporting Tool.
27. The Applicant's response here focusses on the impact that these documents have on BCR and value for money of the scheme and says that those will be recalculated later, but does not address whether, and the extent to which, the scheme is consistent with the requirements and provisions of those guidance and policy documents. The SoS will need to consider the extent to which the Development would be consistent with policy and so the Applicant should assist by providing further detail regarding the scheme's compliance with these documents".
"17. … The case made for the scheme in the DCO application is affected by changes to the BCR and economic case for the scheme. The applicant appears to have ignored this new policy guidance from the Government.
18. …ES chapter 2 "The Scheme" states at 2.2.2 that a Scheme-specific objective for theA38
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Derby
scheme is:
"To be affordable and represent High Value for Money according to Department for Transport (DfT) appraisal criteria."
The new carbon price data has changed the application of the DfT's WebTAG guidance and required a re-issuing of TAG Data Book now at v1.17 released in November 2021 with the new carbon price data. In order to demonstrate value for money, and to meet the scheme objective in the ES, the revised DfT criteria should be tested with new calculations of the BCR as described in a later section. The SoS cannot consider the case for the scheme to be legitimate for determining the DCO, or consistent with its own objectives, until this has been done".
"It can be seen that the new carbon prices are significantly greater than the previous ones. For example, for the predominant non-traded sector, the 2020 carbon price in the new policy data is c.£240/tCO2e compared to of c.£60/tCO2e on the previous data (i.e. 4 times greater)".
Dr Boswell produced a policy paper published by the Department for Business, Energy and Industrial Strategy in September 2021, which showed that these changes had been made in the light of changes in international and national climate change targets, including the UK 2050 net zero target. Dr Boswell also argued for a re-assessment of the BCR for the Proposed Development to take account of updates to the traffic model including a new version of the Emissions Factor Toolkit.
The decision
"The Secretary of State therefore agrees with the ExA that section 104(3) of the PA2008 has effect in this case and that he must decide the application in accordance with the NPSNN designated in December 2014, except to the extent that one or more of section 104(4) to (8) of the PA2008 apply…".
"The Secretary of State has taken account that the Proposed Development has been the subject of an economic assessment and the ExA considers that the approach taken, which considered its economic, environmental, and social benefits and disbenefits, is consistent with paragraph 4.5 of the NPSNN [ER 4.5.11]. The Secretary of State has noted that Mair Bain, in a response of 26 October 2021 to the statement of matters, said that the Department for Transport's WebTAG guidance and HM Treasury's Green Book have been updated since the assessment and contended that the benefit-cost ratio ("BCR") should be recalculated. The Applicant, in its response of 2 February 2022 to the Secretary of State's consultation of 7 January 2022, stated that the BCR will be re-estimated before a final decision is made to commit construction funds. The Secretary of State, like the ExA, is satisfied that the economic assessment has been undertaken in a way consistent with paragraph 4.5 of the NPSNN. Paragraph 4.5 identifies that the business case provides the basis for investment decisions on road projects and it will normally be based on the Department's Transport Business Case guidance and WebTAG guidance and will assess the economic, environmental and social impacts of a development where the information is proportionate to the development and where such information will be important for the Secretary of State's consideration of the adverse impacts and benefits of a proposed development. Given the economic assessment that has already been undertaken (and its assessment of effects), along with all of the information now available on the economic, environmental and social impacts of the Proposed Development and the way in which the BCR is used to inform investment decisions, the Secretary of State is satisfied that the information already provided is proportionate. Accordingly, the Secretary of State is content that the assessment was appropriately carried out at the time of application and does not consider that it is necessary to recalculate the BCR now in light of the updates that have occurred as the Applicant has confirmed that the BCR will be reassessed before any final decision is made to commit construction funds and that reassessment will take account of those updates. The Secretary of State has taken into account that the ExA is satisfied that the Proposed Development would be likely to result in significant reductions to delays and congestion at the three junctions, improve highway safety and also help to release constraints on housing and economic development to the west ofDerby [ER 4.5.13]. The Secretary of State has not been provided with any evidence that persuades him that the economic, environmental and social impacts of the Proposed Development have changed significantly since the examination closed".
"The Secretary of State notes that the options appraisal considered alternative layouts for each of the junctions and assessed them against economic, environmental, social and value for money criteria [ER 4.5.27] and notes the description of options appraisal at ER 2.4. The Secretary of State has further considered that these options were subject to several consultation exercises before the preferred route was finalised [ER 4.5.27]. Therefore, the Secretary of State is satisfied that the need for the Proposed Development has been established in accordance with the NPSNN and that the alternatives have been assessed in line with paragraphs 4.26 and 4.27 of the NPSNN. Moreover, the Secretary of State agrees with the ExA that the options appraisal for the Proposed Development was properly undertaken and that due consideration has been given to the alternatives to the Proposed Development [ER 4.5.28] and that the proposals meet the requirements for good design and development [ER 4.5.39]".
"148. …While as set out above the Secretary of State considers that the Proposed Development will not significantly impact government's ability to meet carbon targets and therefore Net Zero and the Paris Agreement 2015 and that cumulative emissions have been adequately considered, given that the Proposed Development will increase carbon emissions, it is given negative weight in the planning balance. However, due to the likelihood of the Government's legally binding targets decreasing carbon emissions over the lifetime of the Proposed Development, limited weight is attached to this. …".
"155. There is strong Government policy support for schemes that seek to deliver a well-functioning SRN. In providing junction improvements and new slip roads to the SRN to address congestion and improve performance, the Secretary of State considers that the Proposed Development would help to deliver this policy in accordance with paragraphs 2.23-2.27 of the NPSNN. The Secretary of State agrees with the matters considered by the ExA to weigh significantly in favour of the Proposed Development [ER 6.5.7]. The Secretary of State agrees with the ExA that the critical need to improve the SRN to deliver a national network that meets the country's long term needs and supports a prosperous and competitive economy (together with the matters set out at ER 6.5.8) weigh very heavily in favour of the DCO being made [ER 6.5.11].
156. The Secretary of State agrees with the ExA's conclusion of the matters that weigh significantly against the DCO being made [ER 6.5.9] but as set out above, also gives limited weight to the temporary deterioration in air quality for some receptors during construction and limited weight to the increase in carbon emissions. Overall, the Secretary of State agrees with the ExA that the adverse effects would be relatively limited in magnitude, duration and/or the number of receptors affected [ER 6.5.12] and that the national need for, and considerable public benefits of, the Proposed Development clearly outweigh all of the adverse effects [ER 6.5.15]. The Secretary of State therefore agrees with the ExA that the case for making the DCO for the Proposed Development has been made [ER 6.5.18]".
Pre-action and other correspondence
"In determining the application for the DCO there was no duty to have an up-to-date business case. The business case is used as the basis of an investment decision – it is not determinative of an application for a DCO which requires a more holistic approach to the weighing the planning merits for and against a proposed development.
It is normal for the Full Business Case (with an up-to-date BCR and Value for Money Statement) to only be available shortly before the construction investment decision which it informs. That investment decision can be several months after any planning decision, and as it represents by far the largest investment decision, it is important that it takes into account the latest cost estimates/quotes, and schedule, before start of works.
The Investment Decision is made in accordance with the appropriate governance and assurance framework for the scale of the investment. Whilst there are regular updates to the Outline Business Case and BCR/VfM throughout the lifecycle of a scheme up to construction, they don't necessarily align with any planning decision, as the construction investment decision is kept separate".
"The Ground of Claim on which your client has obtained permission is to the effect that the Defendant was under a legal duty to take into account a BCR that reflected the advice set out in HM Treasury Green Book – Valuation of Energy Use and Greenhouse Gas: Supplementary guidance to the HM Treasury Green Book on Appraisal and Evaluation in Central Government which published in October 2021 (with further updates in January and April 2023).
It is not part of the Defendant's case nor that of National Highways (NH) that the Defendant had before him a BCR that reflected that update Green Book advice. Both parties accept as a matter of fact that he did not".
Ground 1
Relevant principles of judicial review
"19. The court's general approach to the interpretation of planning policy is well established and clear (see the decision of the Supreme Court in Tesco Stores Ltd. v Dundee City Council [2012] UKSC 13, in particular the judgment of Lord Reed at paragraphs 17 to 19). The same approach applies both to development plan policy and statements of government policy (see the judgment of Lord Carnwath in Suffolk Coastal District Council v Hopkins Homes Ltd. and Richborough Estates Partnership LLP v Cheshire East Borough Council [2017] UKSC 37, at paragraphs 22 to 26). Statements of policy are to be interpreted objectively in accordance with the language used, read in its proper context (see paragraph 18 of Lord Reed's judgment in Tesco Stores v Dundee City Council). The author of a planning policy is not free to interpret the policy so as to give it whatever meaning he might choose in a particular case. The interpretation of planning policy is, in the end, a matter for the court (see paragraph 18 of Lord Reed's judgment in Tesco v Dundee City Council). But the role of the court should not be overstated. Even when dispute arises over the interpretation of policy, it may not be decisive in the outcome of the proceedings. It is always important to distinguish issues of the interpretation of policy, which are appropriate for judicial analysis, from issues of planning judgment in the application of that policy, which are for the decision-maker, whose exercise of planning judgment is subject only to review on public law grounds (see paragraphs 24 to 26 of Lord Carnwath's judgment in Suffolk Coastal District Council). It is not suggested that those basic principles are inapplicable to the NPS – notwithstanding the particular statutory framework within which it was prepared and is to be used in decision-making.
Ground 1(a) – misinterpretation of paragraph 4.5 of the NPSNN
Submissions
Discussion
"Given the economic assessment that has already been undertaken (and its assessment of effects), along with all of the information now available on the economic, environmental and social impacts of the Proposed Development and the way in which the BCR is used to inform investment decisions, the Secretary of State is satisfied that the information already provided is proportionate".
Ground 1(b) – regulation 21 of the 2017 Regulations.
Discussion
"it addresses the significant effects of the proposed development on the environment that are likely to arise as a result of the development described in the application".
"…regulation 26(2) is dealing with whether the competent authority is satisfied that its "reasoned conclusion" under regulation 26(1)(b) on the significant environmental effects of the proposal is up to date. The legislation, in particular regulation 3, does not make the validity of the development consent depend upon a formal conclusion by the authority that all the environmental information is up to date. The deeming provision in the second half of regulation 26(2) does not indicate otherwise. A "reasoned conclusion" of the authority is taken to be up to date if the authority judges that its conclusion addresses the likely significant environmental effects. Here the Council judged that the surveys relating to breeding birds were sufficiently reliable for present purposes. The object of regulation 26(2) is straightforward, namely to prevent a planning permission being granted if there has been a delay since the time when the authority's "reasoned conclusion" was reached without the authority being satisfied that it may still be relied upon. This deals with the risk of a material change of circumstances occurring between an authority reaching its "reasoned conclusion" and the grant of planning permission".
"(d) a description of the reasonable alternatives studied by the applicant, which are relevant to the proposed development and its specific characteristics, and an indication of the main reasons for the option chosen, taking into account the effects of the development on the environment...".
"For national road and rail schemes, proportionate option consideration of alternatives will have been undertaken as part of the investment decision making process. It is not necessary for the Examining Authority and the decision maker to reconsider this process, but they should be satisfied that this assessment has been undertaken".
Ground 1(c) – breach of Tameside duty
Conclusion on ground 1
Application to admit Professor Goodwin's report
Disposal