Shropshire Council decides to accept provision of infrastructure by developers liable to pay CIL

Since April 2010, local planning authorities (LPAs) have been able to elect to charge CIL on new developments to support the delivery of infrastructure in their areas. The 2010 CIL Regulations gave LPAs the discretion to accept land as all or part of a CIL payment. The Regulations were amended in 2014 to enable payment to be made through the provision of one or more items of infrastructure, at the relevant council's discretion.

Shropshire Council adopted a CIL charging schedule in 2012, requiring payments of £40 per square metre or £80 per square metre for residential development in the council's administrative area. At a meeting on 8 June, the council's cabinet agreed a policy statement allowing for the payment in-kind of CIL through the provision of infrastructure.

A report (4-page / 123 KB PDF) prepared for the cabinet meeting said such 'infrastructure payments' would only be accepted where the infrastructure provided was included on a list to be produced by the Council annually following community engagement.

The report said there was a risk that developers would "regularly seek this form of contribution rather than making a financial payment". It said the financial implications of the new policy statement included potential difficulty meeting the council's duty to pass on a proportion of CIL receipts to town or parish councils. However, the report noted that discretion on whether to accept an individual infrastructure payment would remain with the council and concluded that "the benefits of offering such a policy approach … outweigh the risks".

The cabinet resolved to agree the policy statement and that it should come into effect on 13 June.

Planning expert Sarah Chapman of Pinsent Masons, the law firm behind Out-Law.com, said: "The ability of local authorities to deliver CIL funded infrastructure has long been a concern for developers. The CIL regime relies on the delivery of development to raise funds, but many developments cannot be implemented without the necessary infrastructure being put into place. For local authorities, CIL does not meet the full cost of delivering infrastructure and they must secure alternative funding, making local authority-led delivery ahead of development challenging."

"Whilst the council still retains discretion as to whether an infrastructure payment in lieu of CIL is acceptable, this positive policy approach from Shropshire Council will allow developers to work collaboratively and proactively with the Council to unlock development opportunities which rely on infrastructure being in place. It remains to be seen how often the council will put this policy into practice or whether other local authorities will follow Shropshire’s lead," Chapman said.