Community Infrastructure Levy will slow development
and should prioritise the fundamental elements of infrastructure that will have the biggest contribution to a development’s integration into the local community.
The government has stated that the CIL can cover local facilities such as schools, parks, health centres, transport and flood defences. However, it believes that the levy should not be used for general local authority expenditure or to remedy pre-existing deficiencies in infrastructure provision.
Participating authorities will have to determine what infrastructure projects will be needed both in their area and sub-regionally, cost them and work out the contribution each development should make. This assessment needs to be robust yet flexible, but it is still unclear what documents and processes will be used to calculate this.
In the seminar, which was attended by 75 of the region’s property professionals, planning partner Mat Jones considered the tariff approach that has been taken by some authorities to date and the context of S106 negotiations. He came to the conclusion that the system seems to be working as is, thus questioning the need for a new and additional system of ‘tax’.
As well as this line of reasoning, there are practical differences in setting CIL if it is implemented as currently drafted – removing the link to land value does not remove all the difficulties surrounding setting the charge.
To date, the Bill has little detail, and whilst government has assured that draft regulations will be published, there is still much to be clarified, raising a number of questions in terms of application. Local authorities will face complex processes in setting the levy, and there are questions around its application, for example how it might affect mixed use or high density schemes and whether local authority land disposals will create any additional benefit. Coming from a development perspective, I can’t help but think that CIL would be difficult to implement and could slow the (already lengthy) system down. On a wider note it could be used by central government as an excuse to scale down funding infrastructure in the longer term, and the fact there is no reference to market conditions could also pose a problem.
Given the current downturn we have seen throughout the property market, CIL would be detrimental for development activity, acting as another unwelcome barrier to regional and specifically regenerational development. However, we have to recognise that spreading the burden of infrastructure cost beyond the current main payers of the residential and retail sectors, and across a wider percentage of schemes, makes sense. As far as I’m concerned, the simpler and clearer the better.
Infrastructure is fundamentally important for future growth and making places we can all live and work in, so some kind of contribution is obviously needed. The better it is planned on a regional level, the easier it will be for developers to understand it, accept it and simply get on with ‘business as usual’.
