Planning Bill

I rise to express sympathy for the amendments tabled by the noble Baroness, Lady Valentine. There is a real danger, not only in the Bill but in the consultation documents, of not merely implying but saying that CIL is, effectively, a charge or a tax—or whatever it will be called—on development gain. The amendment proposed by the noble Baroness is an ingenious solution. If the Minister were able to respond positively to the idea behind the amendment, reassurance would be provided that, in discussions, that part of the consultation document would disappear. In expressing sympathy for that, I add that the debate on clause stand part is the only time when we can talk about the principle as opposed to how what is proposed is brought about. I continue to express to the Minister what she knows are my deepest reservations about the line that the Government are taking. I forecast that enormous tangles will result from this. The idea that it will provide certainty will turn out to be a myth. There will be enormous variations across local government areas and they will tend to emerge, not de minimis, but at modest levels because of the fear, on which I shall comment in a moment, of stopping some developments. In my view, it will be set at modest levels. It is very wise to keep Section 106 because, in my view, local authorities will still want to get additional revenue from developments which are large and which will produce substantial gains. I can see that that is what will happen. If that were not to be done, as a matter of logic and straightforward economics, once you apply a charge, a tax—call it what you want—to all developments, at the margin some developments will become unviable. This is the point in the Bill when it is worth putting on the record our very grave reservations. In due course, if it came to a vote, I would not vote against the Government, but I simply give a warning that they are opening up a pitfall. As the current recession and depression in development and in property prices—housing, commercial and industrial—show, working out what kind of rates to charge, what you are going to bring in, and when, is a very tricky business indeed. Values have fallen by between 20 and 50 per cent. As the recession takes hold, you will probably find that property values and development values fall even more sharply which will make a mockery of this system if it is in operation. However, this concept would regularise much better the framework in which local authorities set out their infrastructure needs and would provide a basis on which comprehensive discussions could take place with anyone who wants to undertake development. That is warmly welcomed. However, I am not at all convinced that that framework, which is a big step forward, needs to be supported by this kind of funding, in part or in whole.