Community Infrastructure Levy (CIL) has arrived at last!
After 10 years or so of talk and not much action, the first few local authority CIL plans have been adopted and before long the payment of levies on commencement of development will become a familiar part of the planning process.
Local Planning Authorities can collect the levy, in £££’s per square metre, from all schemes of 100 square metres (net) and all new market dwellings (even if smaller than 100 square metres). The trigger for payment is commencement of development, although some councils may allow payment in instalments.
Changes of use, charity landowners and affordable housing are exempt. Levy receipts can be used for improvements to transport, flood defences, schools, hospitals, health facilities, parks and leisure centres. There is no longer a requirement to link the contribution to the development. So monies can be spent wherever the council sees fit. The first few CIL plans are as follows:
· The London Borough of Redbridge has set a blanket £70 per square metre levy applying to all types of development over 100 metres (net).
· Newark and Sherwood Council requires up to £125 per square metre for residential and retail development only.
· Shropshire County Council expects between £40 and £80 per square metre for residential development only.
· Mayor of London - £20 per square metre in the poorest Boroughs, £35 per square metre in the medium Boroughs and £50 per square metre in the richest Boroughs. Expected to raise £300 million towards cost of Crossrail.
These early examples show a range of different interpretations of the CIL regulations. Less well off Boroughs who wish to encourage development may only charge CIL for certain types of development (eg Newark and Sherwood), while wealthier Boroughs may decide to charge more on a blanket basis in order to discourage development (eg Redbridge).
Worryingly, Stewart Murray, the Chief Planner at Redbridge, interviewed in Planning Magazine (10 February 2012) calculates that CIL in his Borough will raise £2.5 to £5 million per year, compared to just £1.5 million from section 106 agreements.
No doubt a lot more local authority CIL plans will be adopted in the coming months. It will be interesting to see how different regimes treat the Levy, as an enabling device or as a tax on development to raise much needed funds for local government, which is being hard pressed by Government cutbacks.
The viability of many schemes is bound to be threatened, if council’s do not adopt a flexible and reasonable approach.
Judicial review in Scotland (and maybe England) should hopefully soon not empty your pockets.
Third party rights of appeal have never quite gone away in Scotland with the Government always conscious that although many of the changes have helped third party involvement in the planning process, there are still situations where decisions warrant challenging and in the past the cost of judicial review has been prohibitive thus acting as a check to those who would wish to take matters further. The Government is, therefore, considering introducing new rules of court for the making of Protective Expenses Orders, which will have the effect of capping the amount of legal costs that a challenger would have to pay the other side, if they lose, at £5,000. Proposals also include the introduction of a similar cap of £30,000 on the defending party's liability to pay the challenger's costs. The consultation closes on April 3, 2012.
This issue was recently discussed at the Scottish Property Federation, where the Chief Planner made it clear that this is coming directly from EU pressure and is also likely to be brought forward for England. Some sort of change seems inevitable although efforts will be made by the industry to set timescales and boundaries for its implementation.
