Concern at new charge

Levies on new developments being planned by Sheffield and other local authorities could stifle regeneration, according to top planning lawyer Oliver Martin.

By Bob Rae
Wednesday, 9th January 2013, 8:43 am

Mr Martin, who is head of planning at Sheffield-based law firm Irwin Mitchell, says there is widespread concern about the impact of the new Community Infrastructure Levy – or CIL.

The levy allows local authorities to raise funds to pay for local and sub-regional infrastructure projects, including roads, schools and hospitals in an effort to boost the area’s growth.

Mr Martin says Sheffield City Council have indicated that office and industrial buildings would exempt, while car showrooms and out-of-town leisure developments could have to pay £60 a square metre, new student housing, £50, hotels £45 and housebuilders between £20 and £100, depending on the neighbourhood

“The introduction of CIL may stifle development and regeneration as, once adopted in an area the CIL regime is not sufficiently flexible to deal with viability issues on difficult brownfield sites,” says Mr Martin. “Interestingly, Wolverhampton City Council has chosen not to implement CIL in its area due to concerns over viability of schemes.

Oliver Martin argues that measures, known as Section 106 Agreements or planning obligations, offer more flexibility for local authorities to take account of overall costs in order to ensure that schemes are viable and can proceed.

Using powers under Section 106 of the Town and Country Planning Act, local authorities negotiate a deal which requires a developer to make a contribution to offset the negative impacts caused by a project as part of a condition for planning permission.

Mr Martin adds that infrastructure to be paid for by a CIL will not necessarily be provided in parallel with the development, especially in the early stage when receipts held by local authorities may not be sufficient for them to provide the required infrastructure.