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Councils delay developer CIL payments

Local authorities are exploring delaying community infrastructure levy payments to support struggling developers during the pandemic.

Wakefield Council is allowing developers more time to make payments and extending debt recovery cases to six months.

The levy is a charge on new development, set by local authorities per square metre and is used to fund local infrastructure projects.

The council said it is adopting a flexible approach to assist the industry and help aid its recovery, which it said will benefit the local economy in the long-term.

Wakefield Council’s cabinet member for economic growth and regeneration, Darren Byford, said: “In light of current circumstances, we feel it is important to support the development industry in any way we can.

“The CIL money will still be generated, just over a longer period of time, and will still be spent on some wonderful projects across our district.”

The London Legacy Development Corporation said it is dealing with CIL and section 106 payments individually, following the approach by government and the mayor of London. The LLDC said it would “reasonably consider any requests to defer or delay payments on a case-by-case basis”.

A spokesman for the Old Oak Park Royal Development Corporation said: “OPDC recognises the huge challenges and difficulties facing the construction industry as a result of Covid-19, and will be sympathetic to any requests to delay CIL/section 106 payments by developers facing financial difficulties.”

Birmingham City Council said it is looking at all cases on an individual basis “giving consideration to the circumstances and justification for deferring payments”.

A spokesman for Greenwich Council said: “Royal Greenwich is aware that developers are experiencing cashflow issues as a result of COVID-19 and we are currently considering options to support them during the crisis. Allowing Section 106 and CIL payments to be delayed, in line with advice from Transport for London and the Mayor, is one option being considered.”

In 2017/18, CIL raised £457m across England and Wales. Revenue has been steadily rising since CIL was introduced, with over 160 local authorities charging CIL by May 2019 and, according to one December 2019 estimate, another 40 authorities or so preparing to introduce the charge.

To send feedback, e-mail emma.rosser@egi.co.uk or tweet @EmmaARosser or @estatesgazette

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