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  6. Move to use levy to help fund Crossrail

Move to use levy to help fund Crossrail

London Mayor Boris Johnson has started consultation on proposals to use the Community Infrastructure Levy (CIL) to help fund Crossrail

Under these proposals most new developments in the capital would be required to contribute towards the costs of the transport project. The requirement is scheduled to come into force in 2012 and is designed to raise £300m.

New powers given to the Mayor under the 2008 Planning Act allow him to use the planning system to raise money for infrastructure improvements via a CIL.

This new charge will be collected by the boroughs and will be set at £ 50, £35 or £20 per square metre of new development depending on the location of the borough. CIL will be charged on all development with a gross internal floor space of 100 square metres or more or which involves the creation of one dwelling even where this is below 100 sq m.

Schools, colleges, medical and health establishments and buildings which house machinery or equipment but are not used regularly by people will be exempt. Developments by charities for their own purposes, and affordable housing are excluded by law.

In 2010 alterations to the London Plan introduced new policies to use planning obligations (Section 106 agreements) to secure financial contributions towards Crossrail to raise a further £300m towards London’s share of the funding package. Office, shop and hotel developments in central London, the north of the Isle of Dogs and areas near new Crossrail stations outside central London pay these contributions.

Section 106 contributions will continue to be sought once the CIL is set, but the Mayor will not double charge - CIL payments will be deducted from the amount to be paid under s106.

Read more about the Mayoral Community Infrastructure Levy - Preliminary Draft Charging Schedule

 

Roger Milne

21 January 2011