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Watts Bulletin (Issue 143)

Welcome to the final technical bulletin of 2013 and at last there are positive signs of recovery in the construction market. After six years of pain, the industry deserves some good news and reports of green shoots are not only welcome but are also boosting confidence in the market. According to the latest construction figures from RICS, every part of the country is reporting increased numbers of private housing starts and during the three months to September 2013, construction workload as a whole rose at its strongest rate since 2004.  However, despite the positive figures – for example, construction output up by 3.6% in the last six months – there is no doubt that a sustained recovery is likely to bring its own problems. According to Building (22 November issue) the number of people employed in construction is now at its lowest level since 2002 with a fifth of all jobs in the industry now cut. During the coming months if the upturn we have all been waiting for is sustained – the resurgence of pay demands and skills shortages cannot be far behind.

Watts Bulletin (Issue 143)

CIL reforms announced

Following a consultation earlier this year, the Government has announced a number of reforms to the Community Infrastructure Levy in response to fears that the tax may not provide the benefits to local communities that were promised and be unworkable in practice.

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Changes that have been introduced include:

  • a requirement for local authorities to weigh up CIL infrastructure funding against its potential effects on the viability of new developments;
  • different levels of tax to be set by local authorities depending on the extensiveness of the development;
  • an exemption for residential extensions and annexes;
  • a broader spectrum of buildings to be covered by the vacancy test;
  • an exemption for particular highway agreements from proposals to restrict their use;

The date from which the pooling restrictions on Section 106 apply nationally has also been changed to April 2015.

The British Property Federation (BPF) which had called for reforms to the CIL, is supporting the changes, originally outlined in a consultation that ran from April to May 2013.

Chief executive Liz Peace commented that the BPF was pleased the government has agreed to amend a policy that the organisation feared could have held back development and put a brake on economic growth. “We look forward to seeing the revised regulations and guidance when they are published,” she said. However, despite the proposed changes there are still concerns in the property industry that some charging schedules are being set too high.”Local authorities should provide a proper evidence base and assess whether or not their CIL will stifle rather than support growth,” added Peace.

To read the government response to the CIL consultation in full go to www.gov.uk
For further information about CIL reforms, please contact Allen Gilham Associate in Watts’ London office, on 020 7280 8000.

Do you believe the CIL reforms put in place by the government will result in long term improvements? Would you like to see any further measures incorporated into the changes? Let us know your thoughts on Watts’ Twitter page or join the Watts Bulletin group on LinkedIn.

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The Watts Bulletin is the technical companion to the Watts Pocket Handbook, the essential guide to property and construction, as used by professionals since 1983.

Watts Bulletin editor: Trevor Rushton.

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