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Community Infrastructure Levy

Comment 27th July 2010

I am a recently retired planning officer with some experience of the operation of this scheme in my previous local authority.  In theory the scheme has merits, but in practise there are a number of drawbacks.

For a start the calculation should be fair and easy to understand.  The scheme I am familiar with was introduced in haste and was not a fair system as it did not cover every category of land use or development.  Consequently some quite small developments could command a disproportionately large fee, which could not be satisfactorily explained to the developer.  Some payments were so large that the developer was deterred from making the application and investing in the Borough unless they were reduced.  In addition the Borough Solicitor was constantly changing the format of the legal Deed because of doubts over its enforcability.

Small developers of, say 1 house, found the system particularly difficult to understand.  They were required to do an online calculation which produced a legal document, which had to be signed, witnessed and returned with the planning application.  Many small developers failed to understand that they had signed a legal document and didn't complete the Deed correctly.  It was also necessary to carry out a Land Registry check to make sure that the landownwer's details were correct.  This all created additional work for planning officers and delayed  the decision making process.

The levy was payable once building work had comenced.  For a small developer this was a heavy additional outlay at the start of the development when finances were often already tight.  Non-payment meant instigating the debt recovery process – again all  additional work for staff.  I would question whether the amount of income from small development against the cost of administration made it a worthwhile operation.

Why does this matter?

The Government is considering introducing CIL across the board for all development.  I can see merit in such a scheme for major development, but have concerns if it is applied to small developments.  If the Government is committed to reducing red tape and stimulating the economy it should look closely at CIL and see whether the costs outweigh the benefits.

In particular there should be one scheme covering the country.  Councils should be free to charge what they want, but the basic calculation for the levy should be the same.  The system also needs to be rigorously tested before introduction so that it is easy to understand and to administer.

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