The conundrum from August's Future Perfect? e-bulletin reads as follows...let us have your thoughts.
One of the most interesting points in the recent CIL consultation paper is the Government's proposal to amend section 106, in order to ensure that section 106 agreements can only be taken into account as a reason for granting permission for CIL development if the obligations they secure satisfy the requirements of Circular 5/05. The CIL consultation paper highlights the fact that LPAs can and do currently seek section 106 obligations that are not essential to allow permission to be granted. It may not be a coincidence that this point comes forward in the consultation paper only a few months after the Secretary of State's decision, in March 2009, at Knockhall Road, Kent. In that decision, the application, by the LPA, of a standard tariff was regarded as inappropriate in the absence of clear evidence that the relevant obligation was necessary. (See our April Future Perfect? for more on this decision.)
It is clear from the consultation paper that, for a number of reasons, the Government now frowns on the use of section 106 to secure "standard charges". This will encourage LPAs to look more seriously at CIL rather than lose the benefit of recovering charges in this "across the board" way. Where LPAs already use section 106 to secure standard charges, the proposal is that the ability to continue with this will be phased out in two years - the idea being that this gives the LPA time to bring in CIL.
So the conundrum for LPAs now is - do we carry on bringing forward emerging standard charge policies or do we immediately work towards CIL so as to make sure we have it in place within two years? And of course, particularly in light of the Knockhall Road decision, this consultation paper and its clear direction in terms of the use of section 106 in the context of pooled contributions, the opportunity is there for developers who are negotiating section 106s to seek to reduce their burden relying on the circular. The conundrum for them is - should I appeal to make the point?
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