10 Feb 2017
CIL + s106 → LIT + SIT + s106 = fairer, faster, more certain and transparent?
No, I’m not revisiting my maths A-level (fortunately), but we planners love an acronym or two and the above summarises what the Government’s ‘CIL Review’ Group considers will best deliver the original objectives for CIL the community infrastructure levy.
This week’s publication of the Housing White Paper has quite rightly grabbed the headlines, with housing delivery, or the lack of, being the pre-eminent planning issue of the day. However, a number of other related publications were released on Tuesday, including ‘A New Approach to Developer Contributions: A Report by the CIL Review Group’, originally submitted to the Government in October last year.
The Group, led by Liz Peace, has produced a well-structured and readable report, a welcome relief from the much-amended CIL Regulations themselves… Ahead of its publication, we previously considered what might be within the review - below are five headlines from the Report itself:
The ‘new approach’ referred to in the document’s title is the recommended replacement of the current CIL and s106 regime with: a standardised ‘Local Infrastructure Tariff’ (LIT) for all development; a ‘Strategic Infrastructure Tariff’ (SIT) for combined authorities; and s106 for larger/strategic developments
The potential methodology for the LIT rate is a charge of between 1.75 and 2.5% of the sale price for a standardised 100sqm three bedroom family home, divided by 100 to reach a square metre rate. This would be applied to all residential development, with other uses charged at a percentage of up to, but not above, the residential figure. The report notes that “this methodology is fairly crude but what it lacks in sophistication it makes up for in simplicity and the avoidance of bureaucracy”
The mandatory LIT would be charged on the gross area of new development with no reliefs and exemptions, so out would go the offsets for existing buildings and affordable housing under the current CIL Regulations. Changes of use and development using permitted development rights would also pay
Small developments (e.g. residential schemes under 10 units) would only pay the LIT and larger/strategic development would be able to negotiate s106 obligations to better relate infrastructure delivery to development. Current s106 pooling restrictions would also be removed. Importantly, it is recommended that local authorities would be given flexibility to offset the LIT against s106 obligations
The SIT would be similar to the current Mayoral CIL, pooling money for a small number of identified infrastructure projects
So let’s see how much of this is taken forward by the Government (we have to wait for the Autumn Budget to hear its response and find out what actions, if any, are to be taken to change the CIL and s106 regimes). In the meantime, I will have to return to that maths A-level after all, to continue to navigate my way through the existing CIL Regulation 40.