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Tories to review infrastructure levy

The Tories have indicated they would not go ahead with current Government plans for a new Community Infrastructure Levy if they are successful at next year’s election.

The proposed CIL would be a levy on all new housing and commercial schemes based on local infrastructure costs, and would create a pool of cash for infrastructure in an area.

But while the idea of a levy has been supported in principle by many in the property industry, the details of the proposal have not met with general approval.

At a briefing on Tory plans for construction and property last week, organised by Construction News in conjunction with the British Property Federation and law firm Linklaters, shadow local government secretary Bob Neill revealed the Tories shared the industry’s concerns about the plans.

“We would not proceed with the current CIL regulations. I note the very strong points that are made,” he said. The BPF has been critical of the new CIL, saying it believed the current proposals were “misguided and will deter rather than encourage development”.

In particular it believed the regulations, which have been discussed for the past two years, did not properly define what infrastructure development was or provide commitments about infrastructure plans.

The CIL is intended as a way of scaling back section 106 agreements, in which developers agree to fund new infrastructure as part of planning submissions for new developments.

Some argue that Section 106 agreements are no better than bribes to local authorities to allow major developments.

Mr Neill’s comments are thought to be the first time the Tories have made their position clear on the CIL.

At the briefing Mr Neill outlined the Tory policy of “localism” – the return of many planning powers to a local level rather than operating “spatial strategies” through regional authority.

He also reiterated plans to downgrade the Infrastructure Planning Commission as a body that reported to the secretary of state.

But former Tory mayoral candidate Steven Norris, speaking at the briefing, warned against taking too much power away from the IPC.

He said he thought the IPC was “one of the greatest creations of this Labour government”.

He also said the Tories were facing a critical question on construction spending: what was “good spending” and what was “bad spending”.

Mr Norris said: “My concern is that in the past it has proved very easy to cut infrastructure plans. It is politically painless.”

Labour budgets are politically difficult to cut back by comparison, he added.