Government moots 'non-negotiable' nationally-set developer contributions

The government may in the future consider setting developer contributions nationally and making them 'non-negotiable', a consultation on proposals for changes to the developer contributions system has revealed.

Infrastructure: details on developer contribution changes published
Infrastructure: details on developer contribution changes published

Alongside its review of the National Planning Policy Framework (NPPF), the government today published a consultation on its proposals for changes to developer contributions. 

These changes were first announced in last year’s Budget following recommendations made by the government’s Community Infrastructure Levy (CIL) review panel, which was tasked with reviewing the workings of the levy.

The Budget said that the government would consult to ensure that where an authority has adopted CIL, section 106 pooling restrictions could be removed "in certain circumstances such as where the authority is in a low viability area or where significant development is planned on several large strategic sites".

It also proposed to allow authorities to "set rates which better reflect the uplift in land values between a proposed and existing use".

Other measures to be consulted on would include "speeding up the process of setting and revising CIL to make it easier to respond to changes in the market".

CIL indexation rules could also be changed so that rates are pegged to house price inflation rather than build costs, the Budget document said.

The Budget also said that combined authorities and planning joint committees with statutory plan-making functions could be given the option to levy a "strategic infrastructure tariff", in the same way that the London mayoral CIL is providing funding towards Crossrail.

All of these proposals are included in today’s consultation document. The consultation says that the government wants to "allow CIL charging schedules to be set based on the existing use of land".

"This will allow local authorities to better capture an amount which better represents the infrastructure needs and the value generated through planning permissions", it says.

On the removal of section 106 pooling restrictions, the consultation says that these will be removed in areas that have adopted CIL; where authorities "fall under a threshold based on the tenth percentile of average new build house prices, meaning CIL cannot feasibly charged"; or where development is planned on several strategic sites.

The document says that CIL indexation rates for could be pegged to the Consumer Price Index (CPI) for non-residential development and house price inflation for residential development.

The consultation says that the proposed changes "could provide a springboard for going further". It says the government will continue to explore options to create a clearer and more robust developer contribution system that really delivers for prospective homeowners and communities accommodating new development".

It says that "one option could be for developer contributions to be set nationally and made non-negotiable".

"We recognise that we will need to engage and consult more widely on any new developer contribution system and provide appropriate transitions. This would allow developers to take account of reforms and reflect the contributions as they secure sites for development.

"The proposals in this consultation are an important first step in this conversation and towards ensuring that developers are clear about their commitments, local authorities are empowered to hold them to account and communities feel confident that their needs will be met." the document says.

The consultation is open from 5 March to 10 May 2018.

Alongside the developer contributions consultation, the government has published the findings of research into the extent and value of agreed planning obligations levied in England in 2016 to 2017.


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