Pincher: Replacement Of Section 106 To Put ‘More Ammunition In The Hands’ Of Councils

Speaking to the House of Lords Built Environment Committee, which has been undertaking an inquiry into meeting the UK’s housing demand, Christopher Pincher said the “new system that we develop should provide at least as much affordable housing as the present one”. The government’s proposed planning reforms include replacing Section 106 and the Community Infrastructure Levy with a single new levy in a bid to ensure that affordable housing and infrastructure agreed by a developer is delivered “as expected” and on time. Read more on Inside Housing.

https://www.insidehousing.co.uk/news/news/pincher-replacement-of-section-106-to-put-more-ammunition-in-the-hands-of-councils-73170 

HCLG Committee ‘Unpersuaded’ That Planning Reforms Will Make System Quicker

The Housing, Communities and Local Government Committee has published its first report on the future of the planning system in England. The report expressed concern over “the lack of detail” in the government’s vision for a new zonal planning system in England, which included proposals to split the planning system into three categories of development zones (growth, renewal and protected) and replacing Section 106 agreements and the Community Infrastructure Levy (CIL) with a single Infrastructure Levy. Read more on the Rural Services Network website.

https://www.rsnonline.org.uk/hclg-committee-unpersuaded-that-government-planning-reforms-will-make-system-quicker 

Affordable Housing: Construction – Parliamentary Written Answer

Lord Jones of Cheltenham: To ask Her Majesty's Government what plans they have to maintain the use of section 106 agreements to deliver affordable housing.

Lord Greenhalgh: The Government’s White Paper, Planning for the Future proposes that a new ‘Infrastructure Levy’ will replace section 106 planning obligations and the Community Infrastructure Levy and be set in a way which delivers at least as much - if not more - onsite affordable housing than at present. It also proposes that the Levy will be payable on the completion of development. To better support the timely delivery of infrastructure, local authorities would be allowed to borrow against Infrastructure Levy revenues so that they could forward fund infrastructure.

http://www.parliament.uk/business/publications/written-questions-answers-statements/written-question/Lords/2020-12-07/HL11139

Development Company Offers To Pay £43m CIL Charge

The development company owned by Richard Desmond has offered to pay a £43m Community Infrastructure Levy (CIL) charge on the proposed Westferry Printworks development, after his initial application controversially escaped the levy. The High Court quashed the planning application for the development in May, after housing secretary Robert Jenrick admitted the decision to approve it one day before Tower Hamlets’ CIL charge was introduced in January showed “apparent bias”. Westferry Developments has refused to increase the quantum of affordable housing – a major point of contention in the initial application. Read more on Inside Housing.

https://www.insidehousing.co.uk/news/richard-desmonds-development-company-offers-to-pay-43m-cil-charge-for-westferry-site-67720?utm_source=Housing60&utm_medium=email&utm_content=article_link&utm_campaign=H60

Tories Received £12k Donation After ‘Unlawful’ Housing Development Approval

Richard Desmond, the developer who wanted to build 1,500 homes in London, donated £12,000 to the Conservatives after the Housing Secretary gave him planning permission for the project. Housing Secretary Robert Jenrick approved the project against the advice of government planning inspectors on 14 January, just one day before changes to Tower Hamlets’ Community Infrastructure Levy (CIL) were introduced.  This meant Desmond’s firm Northern and Shell avoided paying a levy of up to £50m for the project. Read more on the Mortgage Solutions website.

https://www.mortgagesolutions.co.uk/news/2020/06/10/tories-received-12k-donation-after-unlawful-housing-development-approval/

Former Tory Donor's Housing Project 'Unlawfully Approved To Avoid £40m Hit'

The housing secretary knew that a billionaire former media tycoon had only 24 hours to have an east London property development approved before community charges were imposed that would have cost him over £40m. Robert Jenrick’s accepted that his approval of one-time Conservative-supporting billionaire Richard Desmond’s project at the Isle of Dogs was unlawful. Documents related to the consent order for the development show that the minister was aware that a council-imposed community infrastructure levy (CIL) would have been introduced on 15 January this year. Against the advice of his own planning inspector, the minister gave the go-ahead for the construction of more than 1,500 apartments. Read more on the Guardian website.

https://www.theguardian.com/politics/2020/may/27/richard-desmond-housing-project-unlawfully-approved-robert-jenrick-isle-dogs-london-avoid-40m-hit

Housing: Construction – Parliamentary Written Answer

Marco Longhi: To ask the Secretary of State for Housing, Communities and Local Government, what plans the Government has to strengthen the rights of local communities on section 106 agreements. 

Christopher Pincher: The Government has introduced a requirement for all local authorities that receive developer contributions, including from section 106 agreements, to publish an annual Infrastructure Funding Statement. The statements, which must first be published by 31 December 2020 should identify income and spend on infrastructure and affordable housing and the choices local authorities have made about how future contributions will be used. This transparency will help local people to understand what contributions are being collected towards infrastructure. The neighbourhood allocation of the Community Infrastructure Levy also enables communities to have a say in how funds should be used to help support their local area.

http://www.parliament.uk/business/publications/written-questions-answers-statements/written-question/Commons/2020-03-16/30036

Communities Get Clear Sight Of How Councils Spend Developer Cash

Councils will be required to report on the total amount of funding received from housing developers and how it was spent. A reformed Community Infrastructure Levy (CIL) accounts for every pound of property developers’ cash, levied on new buildings. Builders already have to pay up for roads, schools, GP surgeries, and parkland needed when local communities expand. In 2016/17 alone they paid £6bn toward local infrastructure. Read more on 24housing.

https://www.24housing.co.uk/news/communities-get-clear-sight-of-how-councils-spend-developer-cash/

Developer Contributions To Be Made Simpler, Says Malthouse,

Housing minister Kit Malthouse has announced changes to developer contributions to make the system simpler and accelerate the pace of homebuilding. Builders pay through developer contributions (section 106 and Community Infrastructure Levy [CIL]) for the roads, schools, GP surgeries and parkland needed to help areas to cope with new residents. But Malthouse said these measures are “confusing and unnecessarily over-complicated”. The new rules mean that communities would know exactly how much developers are paying for infrastructure in their area, he explained. Councils will be required to report the deals done with developers and set how the money will be spent, so residents can see every step taken to make sure that their area is ready for new housing. Read more on the Planning Portal.

https://www.planningportal.co.uk/news/article/640/planning_news_-_13_june_2019?utm_source=PPQ+Newsletter&utm_campaign=3034f4b39f-Newsletter_18042019_HTML_COPY_01&utm_medium=email&utm_term=0_734e0b63a9-3034f4b39f-7266185#one

Council Leader Calls For Affordable Housing Tariff

The Government should give local authorities the power to impose tariffs on developers to provide cash for more affordable housing, according to the leader of Westminster City Council. Cllr Nickie Aiken urged Whitehall to allow councils to institute ‘a locally-set charge paid on net increases in floor space’. This would allow the council to charge developers to help ease the burden they place on local infrastructure, he said. It would also help raise funds for affordable housing. Cllr Aiken compared the scheme to the Community Infrastructure Levy (CIL) and section 106 planning obligations which contribute towards the creation of sustainable communities and mitigate the negative aspects of developments. Read more on the LocalGov website.

Housing White Paper To Include Review Of Section 106 Deals

Crest Nicholson chief executive Stephen Stone has revealed the government plans to review section 106 and the community infrastructure levy in the forthcoming housing white paper. The white paper is due to be published in January, with measures included which the government hopes will help it hit its target of building one million homes by 2020. Stone revealed he had dinner last week with communities secretary Sajid Javid and said he believes the Tories are planning to “re-open” section 106 and the community infrastructure levy (CIL). But he criticised the planned measure and said: “It will create chaos again when you want to get planning and want to get building.” Read more on the Building website.

Financial Relief for Social Landlords

Housing Minister Brandon Lewis has proposed new rules that would enable a wider range of affordable housing providers to claim relief from the Community Infrastructure Levy (CIL). Currently, only a limited number of housing associations and local authorities can qualify for this housing relief. Subject to parliamentary approval, the proposed new rules would enable a wider range of social landlords to potentially benefit from the CIL. To qualify, new homes would need to be let at no more than 80% of market rent to people whose needs are not met by the commercial housing market. Read more on 24dash.

Section 106 Replacement Delayed By a Year

Plans to introduce a planning levy are likely to be pushed back a year to give councils more time to put their charging schedules in place.  A consultation published by the CLG proposes that the full implementation of the community infrastructure levy be delayed until April 2015, rather than April next year, to allow councils to continue to pool contributions from developers from different planning obligations.  The levy was intended to replace section 106 agreements, which are negotiable arrangements made between councils and developers to fund roads, affordable housing and community facilities on top of the cost of development. But developers expressed concerns that CIL levels, which are non-negotiable charges made by square metre on development, were being set unaffordably high.  Download a copy of the consultation from the Gov UK website or see the Live Consultations page in this blog.

Cash Incentive for Communities That Accept New Housing

Communities that accept the building of new homes in their areas will be rewarded will cash, the planning minister, Nick Boles, has announced. Neighbourhoods that create housing development plans and get the backing of local people in a referendum will be given 25% of the revenues from the Community Infrastructure Levy that arises from the development they choose to accept.  The cash incentive will be paid directly to parish and town councils who will be free to spend it on community projects. Read more on the CLG website.

Warning over Development Community Levy Threat

Councils’ levies on new developments are being set too high to make the building of affordable housing viable, developers have warned.  Local authorities across the country are in the process of setting their community infrastructure levy (CIL) charges after the publication of the new planning system in the national planning policy framework last month. But developers have said that after CIL is paid, there won’t be enough money left for affordable housing.  CIL is paid by developers to councils to be spent on the community local to the development, on projects such as infrastructure or schools. Affordable homes are still developed through section 106 agreements in most cases.  Stephen Teagle, managing director of affordable housing and regeneration at Galliford Try, said the company had done work earlier this year comparing the historic cost of providing 35 per cent affordable housing on a development with the cost of providing it on top on CIL payments. ‘We found there’s a significant gap between the historic cost and new CIL payments councils are asking for. Something has to give, and what will give is the delivery of affordable housing,’ he said.  Read more on Inside Housing.

Homes to Be Proud Of – Speech by Eric Pickles

This Government came to office with a wholly new approach to housing. We didn't want to tweak existing policies. Nor to do a bit of tinkering here and there. We want to get Britain building again. We want the new homes a growing country needs. The homes that growing families, older people, and young mobile professionals need. We'll do it by working with the market. Not against it. Localism means a whole new approach to incentives and investment. Giving communities genuine choice to shape and influence growth - not forcing development upon them. Supporting communities to deal with the impacts of growth - not leaving them high and dry. The New Homes Bonus and the amended Community Infrastructure Levy gives growing neighbourhoods cash to invest locally. We want to communities to have good reasons to say "yes" to growth. If we look at the experience in Netherlands and Germany, I think it's very plain that localism and growth are two sides of the same coin.” Read the full text of the speech on the CLG website.

Councils to Get More Cash from Development

New reforms will give more of the benefits of development to communities while providing more certainty for industry, according to decentralisation minister Greg Clark. He promised more control for councils over how new infrastructure in towns and cities is funded, and more money to benefit the neighbourhoods where new developments are built. Mr Clark confirmed the Community Infrastructure Levy, introduced by the previous Government, would be continued, but reformed to ensure neighbourhoods share the advantages of development. The levy will give councils the option to raise funds from developers building new projects in their area, and provide a more certain and flexible system for housebuilders, cutting the costs of lengthy legal negotiations. These funds will be passed directly to the local neighbourhood so community groups can spend the money locally on the facilities they want, either by contributing to larger projects funded by the council, or funding smaller local projects. ‘Alongside the New Homes Bonus, this is another way to make sure communities benefit from development in their area. It will help change the debate about development from opposition to optimism’, he said.
Read more on Inside Housing.