Merton to fight Council in £1 million High Court battle

Merton has launched a High Court legal challenge to Oxford City Council’s social housing charge. Under a new policy, permission for student accommodation will only be granted if a financial contribution is secured towards social housing elsewhere in Oxford. These rules apply to buildings of 20 or more bedrooms.

Merton College is leading a group of several colleges, and student housing developer McLaren Property, in alleging that  the charge is a “an unauthorised housing tax”. According to UK law, councils can levy charges but not taxes on the construction of property.

Merton planned to build accommodation for 298 students at Manor Place in central Oxford, but says the scheme is now unviable due to the charge. Merton cites an increase in cost of £140 per square metre, plus a five per cent administration charge, as reasons for halting building plans. The charge has been estimated to add £1m to the cost of the scheme.

Oxford Brookes University also criticised the policy, saying that for the 313- bed Dorset House development on London Road, the council’s changes would have meant forcibly giving £1.37m towards affordable housing.

A statement from Merton and McLaren said, “This legal process is now the only possible method of challenge available to us of a policy which will have the effect of making the development at Manor Place unviable. The impact of the policy does not solely affect Manor Place, but will have a wider implication across other potential development sites in the city.”

Stuart Black, Development Manager of McLaren, said, “The plan would stop dead student accommodation in Oxford that is done on a commercial basis.”

A City Council spokesman defended the policies, telling The Oxford Mail that, “We will continue to defend the adoption of these policies as fair and appropriate.”

Colin Cook, a council board member specialising in city development, said he wanted to prioritise new homes over student accomodation. He claimed that the policy removes a loophole that allows developers to recieve permission for student flats that are later used as private homes.

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Although Oxford University is not participating in the legal challenge, a spokesperson stated, “Through developing student accommodation, the University and colleges alleviate the pressure on the private rental market in the city, and meet obligations laid down by the City Council. These things are of benefit to the local community. Yet under these changes, we will be penalised for doing so.

“Oxford students benefit from greater provision of University and college owned accommodation than those at almost any other university. This offers protection from the private rental market, allowing undergraduates in particular to pay rent only in term time, making a cost saving.

“Oxford students will continue to be well provided with accommodation, even under these changes.”

A Merton student commented, “On the one hand, Merton has a load of money. But no one likes spending a million pounds.”