In April 2010 the Community Infrastructure Levy (CIL) was introduced as the Government’s preferred method of collecting developer contributions towards infrastructure. It was intended to provide a more transparent, faster and proportionate system for collecting financial contributions than the S106 route. Less than 6 years after its introduction, many LPAs have steered clear of CIL and the Government commissioned a CIL Review Team in October 2016 to assess its effectiveness and to recommend changes necessary to realign the system with its housing and growth objectives.

The CIL Review Team has completed its report to Government and this was published alongside the White Paper on Tuesday. It identifies four possible options for change;

1. Do nothing;
2. Complete abolition;
3. Minor reform to get rid of the worst problems of the system; or
4. More radical change to see whether it could achieve some or all of the purposes for which CIL was originally established.

The Review recommends the 4^th option - a “twin track” system of low level tariffs for all developments, with Section 106 agreements for larger sites. This system would seek to allow Local Authorities to take advantage of the best elements of the existing CIL and Section 106 regimes.

Low-level Local Infrastructure Tariff (LIT)

Under the proposed “twin track” system, all developments would be subjected to a streamlined low-level Local Infrastructure Tariff (LIT), which would make a contribution to wider cumulative infrastructure provision in an area.

It is suggested that the LIT would be set at a low level and would be applied to all development, almost without exception, and that this will avoid difficulties or a widespread call for exemptions or reliefs, a key issue of the existing CIL, apparently.

S106

Under the same “twin track” system, larger developments, which require direct mitigation to make them acceptable in planning terms, or very specific major infrastructure on or close to the proposed development, would be subject to an additional Section 106 Agreement. The review considers that the Section 106 regime still has an important role to play but that further clarity and streamlining is required to understand where and how it should be best applied.

THE CIL of Approval?

The review believes that the proposed approach is likely to raise more money for infrastructure in aggregate by optimising LIT and Section 106 contributions. The White Paper advises that  the Government will examine the options for reforming the system and ensuring direct benefit for communities, and it will respond to the independent review and make an announcement in the 2017 Autumn Budget.  Accordingly, it’s looking like Q2/Q3 2018 at the earliest before any new system could be introduced.

CIL was introduced to bring certainty to an area of the planning system shrouded in uncertainty and risk. Six years on and the system is back in a state of flux and set to be batted around Government, and then Parliament, for an extended period with no immediate end to the uncertainty. I’ll endeavour to keep everyone updated as and when the Government reaches a decision on the new skeleton and begins putting meat on the bones of it.