Rutland County Council agrees £4.8m settlement on Oakham North site from Larkfleet Homes

The Oakham North development, a joint project between Larkfleet Homes, Bellway and Persimmon Homes. View from Melton Road. EMN-150915-172032001

The Oakham North development, a joint project between Larkfleet Homes, Bellway and Persimmon Homes. View from Melton Road. EMN-150915-172032001

  • Mistake by planning department meant Section 106 agreement was not valid
  • Developer Larkfleet Homes agreed to pay settlement of £4.8m
  • Rutland County Council would originally have received more than £6m
  • Mistake was “competency issue”, not disciplinary
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UPDATED: Rutland county councillors have voted to accept the loss of £1.88m of developer contributions for the Oakham North estate after a “serious administrative error” by the planning department.

Eighteen of the 20 members present for the discussion at last night’s full council meeting (September 14) voted to receive a £4.8m settlement from Bourne-based Larkfleet, in place of the £6.68m originally agreed in the Section 106 agreement for the 988-home development between Oakham and Barleythorpe, set when planning permission was approved in July 2011.

Background:‘Serious’ planning error means Rutland County Council could lose out on £1.8m from Larkfleet Homes.

The mistake, which came to light in April this year, was made when Larkfleet applied to amend a planning condition covering flood risk assessments in November 2011. The condition was changed in January 2012, but the acting development and control officer at the time failed to realise that a new Section 106 agreement was required. A Section 106 ensures developers pay to improve infrastructure and community facilities.

As a result, Larkfleet no longer has to adhere to the original agreement, so is not legally obliged to make any financial contributions for the Oakham North development apart from the £340,667 which was paid for the first phase.

Once the mistake was highlighted the council and Larkfleet, also acting for Persimmon Homes and Bellway Homes, began negotiations about a settlement and agreed on a £4.8m sum. Councillors approved that settlement, which will not be ring-fenced, at Monday’s meeting.

Explaining the situation, chief executive Helen Briggs told councillors: “While the settlement proposed is less than the anticipated figure, it remains a significant contribution that will allow the council to protect the interests of local residents, taxpayers and specifically the residents of the Oakham North development.

Coun Richard Gale (Independent) voted against the settlement while Coun Ben Callaghan (The Independent Group) abstained. Coun Gale suggested the mistake would not have happened had Rutland been part of a larger authority. He said: “Although we have got some good officers we don’t have the broad variety of expertise that a local authority needs.”

The council said it would not name the officer responsible for the mistake as doing so would breach the duty of care it has towards its staff. No-one has lost their job as a result. Mrs Briggs said the planning department had undergone training to ensure similar mistake would not be made in future.

Coun Edward Baines (Con) told the meeting it was not a question of disciplining those involved and suggested the whole council should take responsibility for the error.

And deputy leader Coun Terry King (Con) advised councillors to accept the settlement, adding: “In this case the developers have been honourable in reaching an agreement which enables us to have the opportunity to mitigate for the pressures that this development brings forward.

“One or two services might end up as silver services rather than gold services.”

Coun Alan Walters, leader of the opposition Independent Group, declared an interest in the matter so did not take part in the discussion. But after the meeting he said: “Looking back to that time I am not necessarily convinced that all councillors had been made fully aware of the lack of resilience in that department.

“Yes we knew that planning decisions were not being made within target timescales etc, but I do not recall being told of any serious concerns regarding staffing levels or the appropriateness of service provided.”

The money will be paid in four instalments: £2.26m as soon as the agreement is signed, then four future payments of £551,000 on the four consecutive anniversaries of the first payment. Unlike a Section 106 agreement, which specifies where the money must be spent, the council will now have full flexibility.

The full report to councillors can be read on the Rutland County Council website.