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.
Guildford Property Seminar
Alliance Planning joined forced with TFT (Tuffin Feraby Taylor) and Redwood Finance Group to update property developers and allied professionals on recent and upcoming changes to the property sector, including energy efficiency, funding and planning policy. The event was well attended by circa 100 professionals from the property world in the South East.
Jacqui Allen of TFT presented on changes in legislation that those with a property portfolio need to be aware of, including changes to the energy efficiency requirements for properties that landlords are aiming to let out. Jacqui also discussed the Energy Act requirements and R22 Refridgerant issues and changes in statue that are driven by the UK’s commitment to reduce carbon emissions by 80% by 2050. Jacqui gave examples of how these requirements are being met in practical terms on current projects.
Nigel Robinson of Redwood Finance Group provided an overview of the banking sector, property development and investment finance at the current time. He outlined some of the reasons why developers are struggling to obtain finance for their developments as banks continue to prioritise their own recapitalisation over lending to businesses. Nigel set out examples of projects that had been struggling to secure finance, until the Redwood Finance Group had been successful in obtaining funding on their behalf.
Alliance Planning's Andy Stallan summarised the changes to the planning system including the Planning for Growth Agenda and publication of the draft National Planning Policy Framework, which the Government wishes to use to speed up development. This states that the default answer to development should be ‘yes’ wherever possible. The most important findings of the recent report by the CLG Select Committee in response to the draft NPPF were outlined. Andy also set out the main provisions of the Localism Act that now apply or will apply in the near future. Some notable changes to the planning system include greater freedom for Councillors to express views on a planning proposal before it reaches the planning committee and the introduction of provisions for local communities to establish Neighbourhood Plans. In addition, the implications of CIL were discussed. The full impact of the Localism Act will take a while to work through, but the implications for the planning system will be significant. Andy's presentation is attached below.
The event was followed by a lively Question and Answer session and a chance to network over a glass of wine.
120126 Planning for the Future (ACS) (2) [Read-Only].pdf
