Stephen Teagle, managing director of Galliford Try, said: “Something has to give and what will give is the delivery of affordable housing.”


In most cases, affordable housing is still paid for via Section 106 agreements and developers can currently choose this as an alternative if it increases the viability of a scheme. However this will no longer be an option after April 2014, as the government plans to encourage take-up of CIL among authorities by limiting the use of Section 106 agreements for affordable housing. This will throw the situation into sharp focus if councils do not ensure their levy is set at a rate that allows the figures to stack up in develop- ers’ favour.


CIL anomalies


Another problem that has emerged since the introduction of the CIL is that section 73 variations to projects that already have planning permission will immediately trigger a payment. Also, according to a recent article in Building (8 June 2012), “any section 73 variations made during the process of building out new applications...can lead to the developer being charged twice”.


The government promises that these anomalies will be ironed out by October 2012, but in the meantime, develop-


ments may be put on hold while the rules are changed.


Making it happen


So what can local authorities do to en- sure that their area remains attractive to developers, that they will gain from the CIL in terms of creating new infrastruc- ture for their communities and that they will be able to meet their commitment to provide affordable housing for local people? 3 important aspects to be con- sidered by charging authorities are:


ll Ensure CIL is set at a realistic level and is not out of kilter with neigh- bouring authorities;


ll Consider carefully which types of development should be levy-free; and


ll Ensure that affordable housing is still affordable.


The majority of authorities in England and Wales have yet to finalise their charging structure under CIL. The authorities acting as ‘front runners’ have compiled these tips for other local au- thorities when setting their charges:


ll Engage and secure corporate and political buy in at the start of your


CIL project;


ll Understand in detail the viability in your local area; read the report;


ll Take account of all the policy costs such as affordable housing, s106 when doing CIL assessment as they are interlinked;


ll Have a project plan in place and understand the risks at the outset;


ll Start CIL implementation early; it is more work than the charging schedule; and


ll Read and understand the regula- tions


(Source: The Planning Advisory Service)


In today’s challenging economic climate, the key to making the new regime work effectively for both authorities and developers will be to keep charges at a level that ensures that investors can balance their books and still turn a profit. It will also be vital to ensure that planning authorities keep permissions flowing through the system without get- ting wrapped up in red tape and make sure that schemes remain equally viable across the country, facilitating rather than blocking new development.


The Terrier


The Terrier is published quarterly by ACES. The inclusion of any individual article in the Terrier should not be tak- en as any indication that ACES approves of or agrees with the contents of the article.


ACES 24


ACES Secretary: Tim Foster MRICS 23 Athol Road, BRAMHALL Cheshire, SK7 1BR 01 614 - 399 589 secretary@aces.org.uk


ACES Editor: Betty Albon editor@aces.org.uk


THE TERRIER - Summer 2012


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