Halman on ... a reversal of levy fortunes

Planning, 5 September 2008

Charging local rates on empty property, as introduced in April, is one such example. This was intended as a revenue raiser for the government. Instead, owners are resorting to demolition, leaving scars across towns and cities, and speculative schemes are becoming less likely as empty rates are added to holding costs.

There is a danger that this unfortunate timing will be repeated with the community infrastructure levy (CIL). At its heart, CIL is also a revenue-raising tool, designed to lever in funding from schemes not currently caught under section 106 obligations.

A further cost to development could not come at a worse time. Private sector housing starts are down and commercial developers are having a similarly torrid time. Local authorities, which have discretion on when and whether to introduce CIL, would do well to proceed with the utmost caution.

One immediate and predictable consequence will be to make some schemes less viable and so deter the restart that the industry so urgently needs. In marginal areas it is less likely that redevelopment value will outstrip existing use values, with the result that brownfield sites will not be released.

We should take heed of the Scottish Government's recent decision to postpone its review of developer contributions to avoid further burdens on development. CIL must be right in every detail, with a clear understanding of the potential consequences for each area before taking the plunge. Act in haste, as they say, repent at leisure.

- Gary Halman is a partner at commercial planning adviser HOW Planning LLP and a past chairman of the RICS planning and development faculty. The views expressed are his own.