Community Infrastructure LevyAgricultural, forestry and small scale rural developments are all set to be hit by the proposed introduction of the Community Infrastructure Levy and could make many schemes unviable, the CLA is warning.
The levy, (CIL), proposed under draft planning regulations* would pull in areas such as agriculture which, largely, have been exempt from a planning charge. Worse, the charge would be levied at the onset of any development, or in the case of change of use of a building, as soon as the new use begins. And the sum could be considerable.
"Although the levy is still out for consultation, we have at least one instance of a local planning authority which has already introduced a form of standard charge under existing policy," says Tim Isaac, CLA eastern region deputy director. "This is in our region where a charge of £60,000 has been proposed on one of our farmer members who plans to turn a disused poultry house to general storage. As no development work is entailed the charge would be levied immediately, making the whole scheme unviable."
CIL is being offered as an alternative to the present Section 106 system of planning obligations which are imposed when permission is given for some developments to help provide the necessary infrastructure. The difference is that CIL will be a standard charge set and collected locally and used directly or indirectly for the development in question. And the levy will be non-negotiable. It will also capture a much wider range of development – which includes agriculture and forestry.
"This is where rural diversification – and in turn the rural economy – will be hit," explains Mr Isaac, "as we can see in the case of the poultry house. Deterred by the up-front cost, applicants are unlikely to go ahead with their projects, valuable income is likely to be lost – and certainly in some cases, jobs. Farm and forestry buildings will also be pulled in.
"Agricultural development and farm diversifications are not like a large housing scheme where a school or community facility or improved roads have to be provided. It does seem unfair that such low-key and low-impact developments should incur a levy – and a large one at that. We are particularly concerned over farm shops and the effect this could have on entrepreneurs looking to add value to their produce."
The only buildings exempted from CIL will be those up to 100 square metres gross floor area – hardly larger than a double garage. Moreover for those over the minimal size the entire development will be CIL liable. "Our understanding is that even when development involves demolition of an existing building, the charge will be made on the whole, not solely the new-build element."
The CLA has been lobbying vigorously for over two years to try to achieve the necessary protection for rural businesses. In particular it is arguing that farming and forestry buildings should qualify for a particular exemption being accorded to premises into which people do not normally go such as electricity sub-stations. "Obviously employees go into electricity sub-stations from time to time, so if those can be exempt why not, say, a farm building too?" says Tim Isaac.
"We are also dismayed to see that some authorities, anticipating CIL, are levying a form of it even before the present consultation period completes on October 23."
Local authorities will be able to set their own charges, so the CLA is already working on a strategy to deal with CIL at the charging authority level. "We are writing our own CLA CIL paper in which we will set out and argue the economic viability issues surrounding agricultural and forestry development and other small-scale rural development and why all should be exempt from CIL," explains Mr Isaac.
"We are also asking our members – and any others in the rural areas who may be affected – to alert us to any infrastructure plan consultations and/or charging schedule being developed by their local authority. Contact me, Tim Isaac on 01284 789201 or firstname.lastname@example.org."
For further information
Tim Isaac, deputy director Eastern region CLA 01284 789201 or 07702 928860
Sally Smith, CLA PR 01553 764422 OR 07729 448046
Notes to Editors:
*Detailed Proposals and Draft Regulations for the Introduction of the Community Infrastructure Levy. For the full paper go to: http://www.communities.gov.uk/documents/planningandbuilding/pdf/communitylevyconsultation.pdf
As a membership organisation, the CLA supports landowners and rural businesses and communities, assessing and commenting upon national and regional policy and lobbying government on their behalf. There is a team of experts in London and a regional structure able to give local support. The CLA has been looking after the interests of its members, as well as promoting the positive aspects of land ownership and land management, for over 100 years.
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Tim has a degree in agriculture and is a qualified Rural Surveyor, specialising in farm and estate management. He lives on his family's farm in Essex. Tim advises and represents members on business management and lobbies all levels of government on key rural issues.
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