Treasury pledge over community infrastructure levy

17 December 2007

The Government has pledged that the Treasury will not top-slice funds raised by the community infrastructure levy, the replacement for its abandoned planning gain supplement.

Local government minister, John Healey, confirmed that monies raised by the tariff-based levy would not, as Opposition MPs feared this week, be ‘nationalised’, and then re-distributed at a later date.

The levy is designed to mitigate the cumulative impacts of infill development on roads and other infrastructure. But Healey stressed that the levy ‘is not a blank cheque, but specifically to meet the costs of infrastructure identified [in] the development plan’.

This might fall outside a local planning authority’s boundary, he acknowledged. Any spending on projects not falling inside a council’s area, however, would be ‘passed from the council to other bodies’ rather than being taken away by Whitehall and then shared out. Negotiated Section 106 payments would continue, to cover affordable housing on specific sites.

Opposition MPs were critical at the Planning Bill’s second reading in the Commons about the lack of detail about the levy, and how the new system for approving major infrastructure projects would work. Conservative MP John Gummer, former environment secretary, criticised ‘the most autocratic Government since Cromwell’, given the lack of information on the proposals. ‘We cannot debate it properly because the details on which these debates should take place are not known,’ he complained.

Labour’s former planning minister, Nick Raynsford, said that, given the scheme was only developed in the past couple of months. That has not allowed much time for the details to be explored as fully as they need to be’. The Government, however, claimed that developers supported the new levy, which was more transparent than the abandoned planning gain supplement proposal. The Home Builders Federation, speaking to Surveyor, said it, and the British Property Federation and other developers, were behind the proposals.

John Slaughter, director of external affairs at the Home Builders Federation, said: ‘It provides a clear mechanism for paying for necessary infrastructure.’ Crucial details were still to be worked out, however, said Slaughter, including the level it would be set at, and how the list of infrastructure projects to be supported was arrived at. ‘What level of contribution is it reasonable for land values to sustain? We’re talking to the Government about this.’

Healey, announcing the local authority financial grant last week, said he ‘wants councils to use revenue-raising powers, rather than simply relying on the Government and local taxpayers’.

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Treasury pledge over community infrastructure levy

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