The British Property Federation (BPF) has urged the government to abandon plans to introduce a new infrastructure levy and change how the community infrastructure levy (CIL) and section 106 system works instead.
The Department for Levelling Up, Housing and Communities is currently consulting on the proposals and the BPF urged the government to reform existing planning contributions rather than introduce a new levy.
The federation said it was concerned that a new levy would create a “more complex system that slows the development process and undermines the timely delivery of associated infrastructure, resulting in increased uncertainty throughout the planning system”.
The BPF added that a new levy would have a negative impact on affordable housing provision, would present multiple challenges to under-resourced local authority planning departments and the idea of using GDV as the primary measure of calculating a developers’ levy liability would cause “uncertainty for developers, funders and local authorities due to changes between valuations and affect scheme viability, especially for commercial and mixed-use projects”.
Ian Fletcher, director of policy at the BPF, said, “The idea of bringing in a new infrastructure levy is to remove the complexities experienced under the current system of contributions, but the new levy has fundamental structural challenges and will do little to reduce complexity. We are incredibly concerned about the impact the new levy would have on the timely provision of new infrastructure, the delivery of new affordable homes, and the uncertainty it would create in the market.
“It will take time for a new levy to be introduced and during that period local authorities and developers will have to continue to rely on s106 and CIL, which will not be reformed under the current proposals. We urge the government to reform the current contribution systems, rather than press ahead with an unnecessary overhaul of the entire system. It is undeniable that CIL and s106 can be improved, but we would like to work with government to share our expertise and work towards a scenario where the existing system is enhanced and simplified.”
