A coalition of 30 organisations has urged housing secretary Michael Gove not to proceed with the Infrastructure Levy because it could reduce the number of affordable homes delivered, and mean less money for vital infrastructure.
The proposed Infrastructure Levy is just one of the Department for Levelling Up, Housing and Communities' planning reforms to make sure that developers pay a "fairer share" for affordable housing and local infrastructure.
The Levy, a measure set out in the Levelling Up and Regeneration Bill, would replace Section 106 contributions for most developments, as well as the Community Infrastructure Levy (CIL). These charges currently raise around £7 billion a year.
The 30 organisations, ranging from public sector and third sector groups, to built environmental professionals, include the:
In a letter, they call on Gove to work with them to reform the current developer contributions system, warning him that the levy could make it "harder, not easier, for local leaders and communities to secure the benefits of new development".
This would result in councils and housing providers delivering fewer homes for affordable and social rent, and less critical infrastructure, such as roads, health centres and schools, being built alongside development.
To the coalition, it is unclear how the proposed levy's rates and thresholds would protect the delivery of affordable homes. It warns that: "we cannot support reforms that are likely to leave communities with fewer new social and affordable homes, mixed and balanced developments and less of the infrastructure they need".
The letter warns that under the proposals not only would less money be raised for affordable and social rent homes, but there would also be less of a legal obligation for this tenure of housing to be included by developers. They highlight that in 2022, Section 106 was responsible for delivering 47% of all affordable homes built.
In addition, councils are concerned that the proposed levy could reduce the amount of money available for infrastructure to go alongside development that would ease the pressure on existing services and communities.
There are further concerns that while the infrastructure levy may work on greenfield sites, it would make many brownfield sites "unviable, perpetuating regional inequalities, creating another barrier to delivery and deepening our already acute housing crisis".
Also, the length of time it would take to roll out and the complexity of the system would create prolonged uncertainty across the planning system.
Roger Gough, housing and planning spokesperson for the CCN, said: "Considering local authorities already experience challenges in delivering sufficient affordable homes and infrastructure needed to mitigate the impacts of development, attempts to reform the present system are laudable".
"But the proposed Infrastructure Levy could end up being the worst of both worlds: resulting in less funding being made available for vital infrastructure, less affordable homes being delivered than before, and impacting on the viability of development".
"At a time when it is crucial that we ensure that there is enough infrastructure to ease local pressures and create sustainable communities as well as building as many homes as possible, the upheaval of introducing a new system will create even more uncertainty to a system which is already not firing on all cylinders and instead the government should seek to strengthen the present s106 and CIL mechanisms".
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