The Council had given planning consent for a superstore, not appreciating the proposed size, which would contravene national planning policy. In the face of the council’s objections, the Secretary of State revoked the permission. The substantial compensation would fall on the Council. The inspector described the decision as ‘grossly wrong’ and ‘seriously perverse’, and likely to cause ‘significant harm to Alnwick’s vitality and viability as a shopping centre’. He indicated that he regarded the issue of compensation as irrelevant. The Secretary of State adopted that reasoning.
The council sought to to quash that order, arguing that liability for compensation of this order would put the council in severe financial difficulties, and in particular risk a planned development of leisure facilities elsewhere. This argument was only developed fullay at Court. The Secretary of State submitted that compensation was irrelevant as a matter of law, but also that, even if it had been relevant, relief should be refused as a matter of discretion, because on the material before the Secretary of State there was no likelihood of it having led to a different decision.
Held: Richards J accepted the Secretary’s submissions.
On the first, Richards J said: ‘A decision maker will often be entitled, if not required, to take into account as a relevant or material consideration the financial consequences of his decision. Consideration of the effects of a decision on others is a normal aspect of the decision-making function and there is no difference of principle between financial effects and other effects. The observations of Nicholls LJ, in Vasiliou v Secretary of State for Transport  2 All ER 77 as to the relevance of the adverse effects of a ministerial order were directed to the specific context of an order extinguishing or expropriating an individual’s rights but are in my view capable of more general application. Nor is the point limited to the effects of a decision on others. It also applies to the financial consequences for the decision maker himself. Where decisions involve the expenditure of public funds, the decision maker will normally be entitled or required to take into account matters such as the availability of funds and competing demands on those funds.
All that, however, is at a level of generality. Whether a particular consideration is one that a decision maker is entitled or required to take into account in the exercise of a statutory power depends ultimately on the statute conferring that power. A statute may restrict the range of permissible considerations either expressly or by implication. Whether it does so is to be determined by reference to its provisions and to the statutory purpose.
In the exercise of their functions under sections 97 and 100 of the 1990 Act with regard to the revocation and modification of planning permissions, local planning authorities and the Secretary of State are required to have regard to ‘material considerations’ (see section 97(2)). What is capable of amounting to a material consideration for this purpose must in my view be the same as in relation to the initial determination of planning applications, i.e. the ‘material considerations’ referred to in sections 70(2) and 54A. Although the courts have adopted a flexible approach towards the concept, a consideration must in broad terms be a ‘planning’ consideration in order to be material for that purpose. Any consideration which relates to the use and development of land is capable of being a planning consideration (see Stringer v Minister of Housing and Local Government  1 WLR 1281, 1294).
It follows that financial consequences are capable of amounting to a material consideration in so far as they relate to the use and development of land. R v Westminster City Council, Ex p Monahan  1 QB 87 is an example. The need for a connection with the use and development of land was helpfully spelled out in the application of that decision in Northumberland County Council v Secretary of State for the Environment (1989) 59 P and CR 468.
It also follows, however, that in so far as financial consequences do not relate to the use and development of land, they are not capable of amounting to material considerations. In my view that is fatal to the general proposition for which [leading counsel on behalf of the council] contends, that the cost to the local authority may be taken into account irrespective of land-use consequences. I see no warrant for treating cost as a permissible consideration even where it is not a ‘material consideration’ within the meaning of the legislation. It is wholly consonant with the statutory purpose that decisions under sections 97 and 100 should be guided only by planning considerations. It cannot have been the legislative intention, in introducing provision for the payment of compensation, that the impact of such payment upon a local planning authority’s financial position should condition the exercise of the powers to revoke or modify planning permissions. Payment of compensation enters into the picture only after a decision to revoke or modify has been taken. Its purpose is simply to ensure that persons interested in the land are compensated for any loss they suffer by reason of the revocation or modification of the permission.’
Richards J also accepted as a general proposition that, where a decision involves the expenditure of public funds, the decision maker will normally be ‘entitled or required’ to take into account ‘matters such as the availability of funds and competing demands on those funds’.
 EWHC Admin 782, (2000) 79 PandCR 130
Cited – Vasiliou v Secretary of State for Transport CA 1991
When considering the revocation or modification of a planning consent, any impact on an interested party is a relevant consideration. A planning permission should not have been granted closing a public road without considering its adverse effect on . .
Cited – Northumberland County Council v Secretary of State for the Environment 1989
Applied – Health and Safety Executive v Wolverhampton City Council and Another Admn 5-Nov-2009
The claimant sought to have development stopped on a site which it said was too near a site for the storage of liquid petroleum gas.
Held: Collins J allowed the claim and granted declaratory relief that Wolverhampton had failed to: (i) notify . .
Cited – The Health and Safety Executive v Wolverhampton City Council and Victoria Hall Ltd CA 30-Jul-2010
The Council had granted planning pemission for four blocks of student accomodation. The Executive objected that it had not dealt properly with the issue the proximity of a liquified petroleum gas storage depot.
Held: Though there had been some . .
Cited – The Health and Safety Executive v Wolverhampton City Council SC 18-Jul-2012
The Council had granted planning permission for four student housing units. The Executive complained that they were too near to a liquified gas storage depot. The Court was now asked whether the impact of any compensation which might be payable on . .
Lists of cited by and citing cases may be incomplete.
Updated: 28 May 2022; Ref: scu.140046