---

Localism Bill

My Lords, in speaking to Amendment 204GA, I shall also speak to government Amendments 204GB to 204GD, 204HA to 204HB, 204JA to 204JC, and refer to Amendment 204H and 204J. We set out our commitment to consider whether the existing restrictions on the use of the CIL—community infrastructure levy—receipts are drawn in precisely the right way to best support and enable new development and growth. We have considered this alongside our changes at Clause 103, through which we will place control over a meaningful proportion of levy receipts with the neighbourhoods and communities that accept new development and growth. We are consulting on our proposals to use the powers to require local authorities to pass on a proportion of levy receipts raised from development in an area where there is a parish or community council for that area. Where no parish or community council exists, we will use existing guidance to require local authorities to apply an equivalent amount to addressing the demands of hosting new development in the area and to engage with the community in determining how that proportion of the funds will be spent. Amendments 204HB and 204JC extend the permitted uses of this proportion of the funds to allow it to be used to support development by providing infrastructure or addressing any other demands that development places on the area. First, any body to which funds are passed under new Section 216A will benefit from these wider spending powers. Secondly, where a charging authority does not have to pass funds under Section 216A, we will have the power to specify that they can use a proportion of the CIL funds in this way. It is our intention to specify the same proportion for this purpose as we will for Section 216A, providing a consistent approach in both parished and unparished areas. The remainder of the funds will be retained by the local authority and must be used to support development of the wider area by funding the provision, improvement, replacement, operation or maintenance of infrastructure. Our amendments will allow receipts raised from new development to be applied to the range of costs that it creates. They strike the right balance between enabling funds to be directed to the localised demands that development places on the areas that host it and the cumulative burdens that development creates across the local authority and wider area. The levy is to support new development. While the provision of infrastructure is essential to physically unlock new development, it is not the only matter that needs to be addressed to make development acceptable and sustainable to the communities that are asked to host it. At the neighbourhood level, the impacts of development are more localised, direct and diverse. The impacts will, for the most part, be concerned with local infrastructure, but communities often identify other unfunded pressures on local services as the reason why new development is not acceptable. If communities are to accept and welcome growth, they must be satisfied that they will not suffer as a result of doing so. By placing a meaningful proportion of the contribution that new development makes under the control of the community that hosts it, and by giving that community the flexibility to spend those funds on the matters that it identifies need to be addressed, we will ensure that communities share in the benefits of growth rather than suffer as a result of it. When residents see and understand that development is making a fair contribution towards meeting the demands that it places on their communities, they will be more likely to accept and, indeed, welcome it. Our amendments will enable the levy to support new development more effectively. The levy will mean that more development can go ahead by providing a valuable contribution towards delivering the infrastructure needed to unlock and enable it, and by ensuring that communities have reasons to say yes to growth. In making our changes we have taken the opportunity to make economic viability an explicit component of the purpose of the instrument. This will mean that local authorities must ensure that charges are reasonable and do not prejudice the delivery of their local plans, including matters such as affordable housing. My noble friend Lord Jenkin has tabled Amendments 204H and 204J, which are concerned with restricting spending of the levy to matters publicly identified by the local authority that charges it. It may be helpful to the House if I use his amendments as a peg to provide further reassurance. I fully understand my noble friend’s concern to ensure that use of the levy should be transparent; indeed, it must be if developers and communities are to see and understand how the contributions are being used to support development and manage its impacts. That is why we are strengthening, through the levy and the town and country planning regulations, the requirement for local authorities to report openly and regularly on levy income and expenditure. Our experience from the front runners scheme, which is supporting more than 33 local authorities to implement the levy, is that local authorities are in any case choosing to publish a list of their spending intentions. This demonstrates that a flexible approach to infrastructure lists is working and that a more prescriptive approach is not needed at this time. The legislation already allows for regulations to require them to do so, should we wish to in the future. I appreciate my noble friend’s concerns, but I hope that he will be reassured by the steps that we are taking to improve transparency and accountability of levy income and expenditure, agrees that our changes are the right means to achieve that, and will be willing not to pursue his amendments. I beg to move.