Last month the government responded to its consultation on developer contributions. In a step that will be welcomed by Local Authorities, in response to the CIL Review Panel, the government has agreed to lift the ban currently in place which restricts councils from combining five or more Section 106 payments to pay for infrastructure.
The lifting of the restriction will mean that councils will be able to deliver key infrastructure projects more quickly on strategic sites. Often on particularly large schemes, the restriction has meant that the threshold is met before all elements of the site have been able to contribute, so this move is to be welcomed.
Whilst Section 106 payments are site specific payments for the mitigation of construction related impacts, CIL payments are pooled by Local Authorities for use on infrastructure anywhere in the borough. This is where I think the system doesn’t quite work. Developers rightly place emphasis on the amount of CIL contributions they make for applications. However, this money is rarely spent on infrastructure in the area immediate to the site for which the contribution was obtained.
When talking to residents about development in their local area, we often hear frustration at the fact that communities do not directly benefit from the CIL levy that developers are asked to pay. What they want to see is some of that money being spent specifically in the immediate area of a development, to ensure that those residents most impacted by construction reap some of the benefits.
Whilst the CIL Review Panel has started to make changes to the way in which levies on developers work, there still seems to be some way to go before a system is introduced that makes tangible improvements at a hyper-local level.