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ICE warns against diversion of CIL funds

The ICE today warned that infrastructure investment could suffer if a widening of Community Infrastructure Levy (CIL) use goes ahead through the Localism Bill.

The ICE has today made a plea for government to protect the CIL, which it says is “a vital source of infrastructure funding”, in the Localism Bill.

ICE vice president and Localism Panel chair Geoff French said: “ICE strongly believes this important funding stream must be protected for its original purpose, the provision of vital infrastructure.

“We fear, however, that there is a danger of it becoming simply a tax on development.

“Local authorities are already facing reduced budgets; if the CIL is weakened in this way it is likely to end up being used to plug funding gaps in other areas, and our nation’s infrastructure will suffer as a result.”

Amendments proposed to the Bill in the House of Lords this week would allow the CIL, introduced in the Planning Act 2008 specifically to provide for vital new and upgraded infrastructure, to be opened up further for use by local authorities for other purposes.

In a letter to communities and local government secretary Eric Pickles, the ICE expressed extreme concern that the government, represented by Earl Atlee, suggested that it was inclined to favour those amendments.

It said that this “could direct much-needed funding away from the provision of the essential infrastructure that underpins economic growth, both locally and nationally”.

The Department of Communities and Local Government (DCLG) has previously estimated that by 2016 CIL could be worth £1bn per year.

With government also estimating that £200bn needs to be invested in the UK’s infrastructure in next decade, the ICE says the CIL will become an increasingly important funding stream.

Together with other industry organisations, the ICE has now sought to persuade the government to protect use of the CIL.

Former environment secretary Lord Jenkin has tabled two amendments on behalf of ICE and supported by the Local Government Technical Advisers Group (TAG), the Chartered Institution of Highways & Transportation (CIHT) and Association of Directors of Environment, Economy, Planning and Transportation (ADEPT), seeking to clarify that the CIL would:

  1. only be used for maintenance and development of new infrastructure, not revenue funding of existing infrastructure
  2. be prevented from being used for purposes other than infrastructure needs if passed onto neighborhoods affected by the development as proposed

Speaking in the Lords debate, Jenkin said: “The question is: can it be extended to something that is not infrastructure? I contend that the original intention of the Act was perfectly clear and that the answer to that has to be no.”

The ICE expects that the purpose of the CIL will be given further consideration at the Report stage in the Autumn.

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